HC Deb 16 June 1938 vol 337 cc516-39

8.37 P.m.

Sir W. Smithers

I beg to move, in page 2, line 34, to leave out Sub-section (2).

I have put down this Amendment only in order to raise one point, but it is a point of importance. I think that by Sub-section (1) the Government have taken all the powers which they require to achieve the objects of their policy of accumulating reserves of essential commodities in this country, and that Subsection (2) is not necessary and is, further, wrong in principle. I will take as an example the transactions up to date. It is very difficult indeed for a private individual who is not connected with the business in any way to find out the exact details, but I am informed—I speak subject to correction—that the Government bought about £8,000,000 worth of wheat during their recent transactions, and that within a few days there was a serious loss on those transactions at the current market price of the day.

I am also told that they bought about 100,000 tons of whale oil, at £13 5s. or £13 10s. a ton, and I am informed by responsible people who are not disgruntled in any way—I want the President to believe that I mention these facts only in the interests of the taxpayers—that they paid from £1 to 30s. per ton too much for that whale oil. It is true that there is a selling pool for whale oil, and I understand that the Government employed a broker, in whom they had every confidence, to purchase this amount of whale oil. The mere fact of an individual who was not an ordinary dealer in whale oil coming into the market at once aroused suspicion, aroused interest. Without accusing anybody of being dishonest or working against the Government in any way I say the mere fact that this individual came in at once set everybody, not only in the British market but all over the world, including America, saying, "The British Government are buying whale oil." I can only tell the President that the market think it was a most stupid procedure to adopt.

It is true that there is a selling pool. It is no good trying to keep it secret, because everybody knows. The selling pool are Unilever and the Southern Oil and, I think, one other associated interest. They are reputable, patriotic people, and I want to ask the President why they were not trusted in the same way as the people who purchased the wheat for the Government were trusted. Dealing in whale oil is a very technical business. The amount available each year is well known—it varies between 450,000 and 550,000 tons—and the demand is well known, and if the Government had given the order to or asked the co-operation of one of these big dealers no suspicion would have been aroused and the purchase would have been made, I honestly believe, at a much cheaper price than the Government paid. I want to ask why the men, the companies, who deal in whale oil were not consulted and were not asked to co-operate, which they would have done willingly and loyally, with the Government, instead of an outside firm being employed.

I want to ask the President whether he will not use to the full the powers for which he is asking under Sub-section (1). The policy of the Government is evidently to increase food storage in this country, and if they would make up their minds whether they want a three months' supply or a six months' supply, and would ask the trade—the dealers, the millers, the importers—to co-operate with them, I do not believe there would be any necessity to put into force Sub-section (2), which I am proposing should be left out of the Clause. I would point out that to increase storage in this country is a very expensive business. It will increase the cost of living very considerably. Storing, bargeing and port dues are very heavy items.

If it is the policy of the Government to store whatever they consider necessary, whether three months' or six months' or nine months' supply, we have, of course, to bear the cost, because for the safety of the country we must store the food, but I do ask that the Government should not go into the markets themselves. Let them use the powers under Subsection (1). If they say to traders, "We want you to help us to increase the food supplies stored in the country," it may be necessary to give them say, 3 per cent. on the money that is lying idle—[Interruption]—well, that is the market price—while the food is stored. I understand that the storage capacity for wheat in this country in public warehouses is about 1,000,000 tons, and in private stores about 750,000 tons. The consumption of wheat in this country is about 6,750,000 tons a year, the home production is about 1,750,000 tons—I am giving round figures—and the imports just over 5,000,000 tons. Therefore, from those figures, we have a storage capacity for about three months' supplies.

I know nothing about this matter technically, of course, but I am told that the storage capacity is far greater than for a three months' supply if it were properly organised, and if storage were available at an economic rent. It is important in the national interest and in a crisis that the Government should know what is the storage capacity of this country, and I would ask them whether they possess that information.

The Deputy-Chairman

That point does not arise.

Sir W. Smithers

I have made one or two destructive criticisms; may I make a constructive criticism? It is that instead of going into the market and buying essential commodities themselves the Government might avoid taking any market risk and avoid any market loss to the taxpayers. They may know that in the next six months or so x amount of foodstuffs will come to this country; would it not be possible for them to say to the exporters from other countries: "Send the stuff here now, and we will advance you 75 per cent. of the value of it"? That would be a perfectly good business transaction. I believe that if the Government indicated their policy on the lines of Subsection (1) and if the traders were given sufficient encouragement, there would be no need for the Government to take business risks. Let them give the traders the help and encouragement they want and the Government will have all the food supplies, for six months, nine months or whatever they require in this country. It would be a much less risk than losing on 100,000 tons of whale oil or the market risk on buying a large amount of wheat.

8.48 p.m.

Sir Arthur Salter

I hope that this Amendment will not be accepted by the Committee. I do not want to argue the matter at length, but I am sure that no adequate and satisfactory system of food storage can be arranged unless the Government have power under both Subsection (1) and Sub-section (2). The plan cannot be satisfactorily and thoroughly carried out under Sub-section (1) alone, because some use will have to be made of Sub-section (2). I would add even to have the best chance of making use of Sub-section (1) it is good for the Government to have the power proposed in Subsection (2).

8.49 p.m.

Mr. Turton

My hon. Friend who moved the Amendment assumed that every essential commodity governed by Sub-section (2) was an imported one. I should like the President of the Board of Trade to tell us how he intends to use his powers under Sub-section (2) and whether he intends to acquire and store essential commodities that are produced at home as well as those that are imported from overseas. It would be a grave mistake if the Government were to use their powers under Sub-section (2) merely for imported commodities. The effect would be very harsh on home producers, because more foodstuffs would be coming in from abroad at a time when home producers are not in a very easy position.

I would take a concrete case. I do not expect that the Minister will tell us whether the Government intend to acquire and store eggs, but if they intend to do so, would they consider using the National Mark system and acquiring and storing home-produced eggs instead of imported eggs? At the present time imports of eggs have increased by 20 per cent. over the last year, and it would be very dangerous for the Government to embark upon any plan for acquiring and storing foreign eggs. If they were to acquire and store home-produced eggs the effect would be beneficial upon the English poultry and egg market, as well as having a great value in a time of emergency. I would ask the President of the Board of Trade to give the assurance, when replying on the Amendment, that home-produced essential commodities will not be forgotten by the Government.

8.50 p.m.

Mr. Stanley

The Amendment would have the result, of course, of depriving the Government of any power to acquire these foodstuffs on their own account. I need not take very much time in explaining why it would be most undesirable to deprive the Government of that power. In the first place, my hon. Friend clearly had in mind only one aspect of the food storage problem. When I was explaining the Bill on Second Reading I divided the problem into two. One was the storage which he has described already of essential foodstuffs coming in from abroad or produced at home, the reserves of which were increased. The other was the storage in different parts of the country of immediately consumable goods to meet dislocation in each locality. It may not be possible for special stores such as might be required for dealing with the evacuation of some city to be arranged for under the provisions of Sub-section (1). The second point is that I agree that wherever possible and practicable it is better that this should be done through the traders because it causes the least dislocation of the industry.

But what position are the Government in, if the trades—some trades—know that the Government are creating this reserve for the national safety and that they have no power of doing so for themselves but must fall in with the demands of the trade whatever those demands happen to be? I cannot think that my hon. Friend would like the Government to be in that position. I regard this Amendment as rather a peg on which my hon. Friend wanted to hang some interesting and legitimate criticisms of transactions which have already taken place. I would make this observation, because the matter will no doubt be raised very often when we have to debate this subject again. It is not fair, and never will be fair, to accuse the Government of having lost the taxpayers' money because after they bought a commodity the price of it has gone down. The point of the Bill is to get a reserve of the foodstuffs that we want as quickly as we can. It might well be that the Government would take the view that if they waited six months they could get a commodity more cheaply, but we cannot afford to wait six months because we have to get it now. Because of that we must buy in a fluctuating market whatever it may be. As to the criticism of the purchase of whale oil, I can tell my hon. Friend that the price of whale oil to-day is higher than the Government have paid.

With regard to the methods we have adopted in a particular instance I can say that in the circumstances of the moment we adopted the best method and one least likely to cause disturbance in an extremely sensitive market.

I fully share my hon. Friend's view as to the desirability of using the powers of Sub-section (1) as much as possible, and I fully share his desire that somehow or other arrangements should be made with traders by which they bear all the market risks in connection with these increased reserves, while the Government is free from such risks. I have to confess, however, that we have not yet found a commodity in regard to which it would be possible to make such a favourable arrangement. If we do see a chance of making an arrangement of that kind, I assure my hon. Friend that we shall be only too anxious to take advantage of it. Finally, in reply to my hon. Friend the Member for Thirsk and Malton (Mr. Turton), I should like to emphasise the fact that, while it is quite true that the particular commodities we have bought hitherto have been, and indeed, from the nature of at any rate two of them, must be, imported, I should not like anyone to assume that this is a Bill which deals only with the purchase of imported commodities. We shall buy commodities either from abroad or from this country, whichever is the better from the point of view of increasing the reserves of the commodity in question to meet an emergency.

8.57 p.m.

Sir W. Smithers

While thanking the President of the Board of Trade for his reply, I should like to say, if I may, with respect, that I think I have won a great victory in having got him to say that he will use the powers of Sub-section (1) as far as possible. [HON. MEMBERS: "Oh!"] I have made certain criticisms from the business point of view, having no connection whatsoever with the trade in either whale oil or wheat, but merely trying to represent certain views in carrying out my duty, and I do not think it is for hon. Members opposite to interrupt. In view of the fact that my right hon. Friend has stated that the policy of the Government will be to use Subsection (I) as far as possible, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Sir W. Smithers

I beg to move, in page 2, line 37, after "including," to insert: the acquisition by purchase or hire, of storage accommodation. This really follows what I have been trying to indicate. I do not want the Government to go into business, but I want them to have full powers of control over all storage.

8.59 p.m.

Mr. Stanley

I understand the object of this Amendment to be to give the Board of Trade power both to purchase and to hire storage accommodation. I can assure my hon. Friend that that power is already in existence. The Board of Trade has the power to purchase, and it is intended that any transaction of this kind, whether of purchase or of hire, shall be done by the Office of Works.

Amendment negatived.

9.0p.m.

Mr. Moreing

I beg to move, in page 2, line 38, after "buildings," to insert "on lands belonging to them."

I move this Amendment for the purpose of seeking information from the President of the Board of Trade on a question which affects dock and harbour authorities in this country. If my right hon. Friend looks a little surprised that I should be moving it, I should like to remind him and the Committee that Preston, which I have the honour to represent, is a port. I will not say it is so important as London or Liverpool, or even Bristol, but it is a port, and I have been asked to put this matter forward on behalf of the dock authorities of the country. Two points arise under Sub-section (2) as drafted. One is that the Clause as drafted gives the Board of Trade the power to do all such things (including the execution of works and the erection of buildings) as may appear to them necessary for the storage, preservation and transport of such stocks. We should like to know whether that will give the Board of Trade power to enter on to land belonging to a statutory dock undertaking and compulsorily acquire such land and erect warehouses on it. That seems to us to be important, because it gives a very wide power to the Board of Trade to interfere with the property of statutory undertakings which they have developed and are using in accordance with long determined plans, and the consequences of such interference may affect them adversely in the future.

There is another point on which we should like an assurance. If the Clause as it stands is carried, the Board of Trade will have authority to erect warehouses and provide increased warehouse accommodation in places removed from the present dock undertakings, and naturally, if they do this, it will be on sites which they regard as the least vulnerable to attack compatible with reasonable facilities for distribution. The position we foresee is that, after the crisis has passed—we all hope that it will not arise, and that these things will not be necessary—the Government will have on their hands considerable numbers of warehouses, and will be faced with the problem of what is to be done with them; and we are afraid that they might put them up through a disposal board and that they might be taken over by new under-takings—

The Deputy-Chairman

How does the Amendment affect that?

Mr. Moreing

The principle of the Amendment is that the Board of Trade would only put the warehouses and buildings on lands which are already Government property—

The Deputy-Chairman

That is not the hon. Member's Amendment.

Mr. Moreing

The Amendment leads up to that.

The Deputy-Chairman

I must point out to the hon. Member that, if they acquired the land, it would belong to the Board of Trade, and that is not in the Amendment.

Mr. Moreing

I bow to your Ruling, and will not pursue the point further, but will only say that we should like to have an assurance that in dealing with a crisis action will not be taken precipitately which may have a very serious effect on these bodies, which have invested very large capital sums and which are compelled, in carrying on their undertakings, to make charges to the consumers using their property which would make it difficult for them to compete against combinations of new warehouses erected under more favourable terms. It is only for the purpose of getting assurances from the Government on these points that I have moved the Amendment.

9.5 P.m.

Mr. Logan

It would appear to me that this would be patriotism running mad. One would imagine that in an emergency, which I hope will never occur, we would be anxious to make the best of it. In the last War we were in a bad position as regards storage, and had to depend on supplies obtained in a very haphazard fashion. Now the Government are taking time by the forelock and preparing for what may occur, and we find that, with the most patriotic ideas, we are having Amendments brought forward that are going to make it very difficult for the Government to get the best sites. In a great city it is most important that these warehouses, which might be called the granaries of the city, should be near the people. In a great city like Liverpool, in a time of national emergency, not only would we talk about entry on to the estate of the Mersey Dock and Harbour Board, but we would take the lot if we wanted it. If the nation finds itself in a dilemma everybody must at some stage make a sacrifice. Therefore, the Government are perfectly entitled to say, "We want these powers and we are going to exercise them; it is for us to take the sites for the benefit of the nation."

9.7 P.m.

Mr. Stanley

The only effect of the Amendment, if it were carried, would be to prevent the Board of Trade, in a case where they thought fit to erect a warehouse, doing so on land which they leased. The hon. Gentleman appreciates that they would only have to buy the land to be able to erect a warehouse on it. There are many parts of the country where it might be impossible to get the appropriate sites—in Scotland especially. Scottish Members will realise that the feu system is very widespread, and it might be extremely difficult to buy land in Scotland. In any case, I do not see any reason for depriving the Board of Trade of this power. The Bill gives no power of compulsory acquisition, and it is not anticipated that we shall have to spend millions putting up warehouses all over the country which will be afterwards standing in competition with other warehouses. I do not think that the Port of Preston—and I do not need to be told that Preston is a port, for I have known it longer than my hon. Friend—need fear any unfair competition.

9.9 P.m.

Mr. Moreing

I will not deal with my right hon. Friend's knowledge of the Port of Preston. We know that his name is so well associated with Lancashire, and particularly with that part of Lancashire. In view of the fact that the Clause as drafted does not give compulsory powers for the acquisition of dock properties, I will, with permission, withdraw the Amendment.

Amendment, by leave, withdrawn.

9.10 p.m.

Mr. Turton

I beg to move, in page 2, line 41, to leave out Sub-section (3).

In the Second Reading Debate the only part of this Bill that aroused any criticism was this particular Sub-section. It may be argued against my Amendment that I am attempting to leave out this Sub-section and not putting anything in its place. I plead guilty to that, but if the Committee did agree to leave out the Sub-section it would be for the President of the Board of Trade to devise the particular wording that he wishes to have in order to fulfil the intention of the Committee. The Committee will remember that under this Bill, while the power to purchase essential commodities is to be exercised by the board in secret, the disposal of the commodities must be preceded by an Act of Parliament. A number of us thought it was a great mistake that there should be this publicity before the disposal of commodities. We remember the loss that the country suffered at the end of the last War, when the Government disposed of the War stock. In the Second Reading discussion there was a little difficulty in my mind as to what this Sub-section actually means. The President of the Board of Trade, when he moved the Second Reading, declared that this Sub-section meant that any liquidation—I mean complete liquidation of stocks accumulated under the powers of this Bill—cannot take effect without another Act of Parliament defining the manner in which it is to be carried out."—[OFFICIAL REPORT, 2nd June, 1938; col. 2287, Vol. 336.] My right hon. Friend the Minister for the Co-ordination of Defence, in summing up, said that this course had been taken so that traders shall not have hanging over them indefinitely the possibility of disturbances of the market by the continual dribble of Government-owned stock on to the market, with the possibility of depressing prices."—[OFFICIAL REPORT, 2nd June, 1938; col. 2358, Vol. 336.] I think, at the outset, we ought to have quite clear in our minds what is meant by Sub-section (3). Does it mean that no disposal at all of essential commodities can be permitted except by Act of Parliament, with the two exceptions, of course, that the Government can dispose when they need to replace the stocks by new stocks, owing to deterioration of commodities, or where the consuming power is altered, under the second proviso of Sub-section (3)? If so, this is unduly hampering the Government. It may happen that the President of the Board of Trade, in his discretion, might want to get rid of a certain amount of commodities for a certain period of the year, and if he was not permitted to dispose of the stock except by Act of Parliament it could not be carried out properly. Therefore, I would ask the Government to reconsider the Sub-section, and, either now or at a later stage, to give themselves the power both to purchase and to dispose of commodities when and how they think fit.

I am quite certain the present President of the Board of Trade would not exercise his powers in such a manner that there would be any disadvantage to the traders of this country. He would be careful, when he disposed of commodities, to do it with the same care that he must exercise when he purchases commodities. It is inconceivable that any successor of his from any side of the House would fail to exercise that discretion in carrying out his functions. I can see no advantage at all in having it made obligatory for an Act of Parliament to be passed before any of this disposal could take place. The hon. Gentleman the Junior Member for the Cambridge University (Mr. Pickthorn), I think it was, said in his speech on the Second Reading that it did not matter at all if this Sub-section went. After all, the Government had bought these commodities by Parliamentary powers, and clearly they could drive a coach-and-four through the Subsection, and then come down to the House again. That might be a witty and just comment upon it, but if there is any likelihood of that happening it would be far wiser for us to eliminate this hampering power in Sub-section (3) and to give the Government full power in their discretion to purchase or dispose of stocks.

9.17 p.m.

Mr. Stanley

I think it will be for the convenience of the Committee if I rise at once to deal with this Amendment, because it raises, as my hon. Friend quite rightly says, the most difficult point that we encounter in the Bill. I frankly tell the Committee that this is a case where the Government have had—and I think the Committee will have to do so—to weigh two sets of disadvantages. I do not in the least deny—although I think we could very easily modify the disadvantages which my hon. Friend said would attach to the Bill—the fact that a new Bill is to be introduced is a warning that, at some time or other in the near future, liquidation is going to take place and may therefore have a depressing effect upon the market before the Government stocks can be disposed of. Provided that the Government stocks are not too great in size or too varied in character, and, as in most instances will be the case, that we are in the closest consultation with certain sections of the industry on the matter, I do not believe that it will be so difficult when the time comes to liquidate these stocks in an orderly manner.

I admit that it would be much simpler for the Government if, when the time came and the Cabinet decided that the emergency was over and we need no longer hold these stocks, we could start to get rid of them and keep the matter secret without anybody knowing it. But hon. Members must look at the other side of the picture. We are assured from all sides, on this we made the most careful inquiry among the traders, that unless there is some guarantee—and this is the only form of guarantee which we could give—that these stocks are not to be thrown upon the market secretly and suddenly so much anxiety will be caused among traders that they will be frightened to carry large stocks because of this possible disturbance, and the result may well be that anything that we gain by an increase of stocks by action taken under this Bill, will be lost or more than lost by a decrease in the normal stocks held by the traders owing to the fear of Government liquidation.

If we have to choose between two sets of disadvantages, one which will operate during the period of the emergency and one which will operate only when the emergency has passed, above all we must avoid those disadvantages which operate during the emergency and which may by themselves destroy the whole effect of the Bill which we are now passing. I agree with a great deal of what my hon. Friend has said. I wish it were possible—and I have devoted a great deal of attention to this—to have some other kind of statutory guarantee which we could give to the traders in these particular commodities, a guarantee which would give them the feeling of security which they must have if they are not to reduce their normal stocks, but I have been unable to think of any measure except this one, which does at any rate assure us that the liquidation will not take place until notice is given in the form of a Bill. If we do not have that we shall have continual rumours running around any little fall in prices. People will say, "Oh, that is the Government selling," and it may create such an atmosphere of fear and uncertainly in those markets as to disorganise them. That, quite frankly, is the dilemma in which we find ourselves, and it is the dilemma which I put to the Committee.

Mr. Logan

I am at a loss to understand whether you intend to keep these stocks, but as a business arrangement I should think that there would be no difficulty in dealing with the question of stocks and making an arrangement with the legitimate trade, so as not to handicap them in their business. I wonder whether from time to time, in regard to the warehousing of these goods for national use in a time of emergency, it will not be possible to realise them when renewals come in?

Mr. Stanley

That, as I have explained, is already allowed for in the Clause. It is the regular turnover.

Mr. Logan

With regard to warehousing and storage?

Mr. Stanley

Yes. We are dealing with the stage in which you begin to sell and not replace. That is the dilemma, and I believe that in choosing the way which does not have disadvantages during the period of emergency, we are choosing the correct course.

9.23 p.m.

Sir Stafford Cripps

I think that the right hon. Gentleman is being unduly apprehensive and also perhaps unduly tender. Is it to be said that everybody who may or may not suffer as the result of emergency is to be given a statutory guarantee that the circumstances of the emergency and the possible events that happen after it, are to be such that he or she will not suffer as a result of the emergency?

Mr. Stanley

I am sorry if I did not make myself clear. It is not a question of giving somebody a guarantee that they will not suffer. I am anxious not to create such an atmosphere of suspicion that they themselves, rather than incur losses, will reduce their stocks and thereby deprive us of normal stocks.

Sir S. Cripps

That is exactly what the right hon. Gentleman did say. He said that the only form of statutory guarantee of which he had been able to think was this one.

Mr. Stanley

Yes.

Sir S. Cripps

What is the guarantee? It is the guarantee that nothing will be done by the Government which is likely to cause apprehension in the minds of people who are storing commodities. Their position is to be guaranteed that they are not to suffer in any way, by reason of the liquidation of Government stocks, without notice from Parliament and a new Act being passed and protection being given under the Act and on various other matters. Is it proposed, in respect of this emergency, which we all hope will not arise, that everybody is to have their apprehensions removed of what may happen to them—for instance, wage earners in factories and other places—by giving them a statutory guarantee of some sort of Order being the best that can be devised by the House of Commons? Or is this to be limited merely to people who are traders or people who are storing goods, because if everyone is going to be asked in time of emergency to submerge his individual interest in the interests of the State, surely it is unnecessary to put in statutory guarantees as regards what the Government may find they have to do at the end of the emergency in order that they, representing the country, may come out of it as well as possible.

Surely the primary consideration here is not the question of apprehension. The primary consideration is how can the Government best and most favourably liquidate these stocks when the time for liquidation comes? It may be some opportunity abroad or something else in such circumstances may occur after the emergency when it is essential, if the Government wish to liquidate at all favourably, to liquidate immediately and not have to wait for an Act of Parliament to be passed before it can start. So far as the apprehension of persons already in the trade is concerned, if that apprehension is going to cause them to sabotage the desire of the Government in an emergency to get bigger storage, the obvious remedy is for the Government to do it themselves. It is idle for the Government to say, "We must rely upon the psychological condition of the rest of the country to permit the private trader to store so much extra, and those two amounts together will be sufficient." Surely, if there is any danger whatever of apprehension or any other reason coming in and causing the private trader not to store, if the Government are going to see that there is a sufficient quantity, they must have the whole of it under their control so that they can, if necessary, say, "You must fill that warehouse. You have not got it full. It may be because you are apprehensive or because you have not enough money. It may be for all sorts of reasons, but that warehouse is not full."

If the Government are counting on that warehouse as an essential part of the supply, they really cannot legislate on the basis that we must remove apprehension so that the warehouse shall be full. It is not only apprehension that may cause them to be anxious. There are thousands of reasons. The owner may not have enough money, or he may not desire to do it for business reasons. If the warehouse is considered an essential part of the storage, the Government must somehow or other see that it is used for storage and not merely leave it to the chance of what a private holder may or may not do in an emergency of that kind. Therefore, as far as the right hon. Gentleman puts this guarantee forward as a protection to ensure that private storage is used to whatever the Government have calculated its capacity to be, it is not really any protection at all, and it is not going to attain the objective that the right hon. Gentleman hopes it will attain. Therefore, there is really nothing to weigh in the scale against what he admits is the obvious advantage of giving the Government complete control as regards the time of liquidation, without having to have a fresh Act of Parliament, because what he is doing is not going to secure for certain what is essential in a matter of this importance, that private storage will be used to the capacity which the Government have calculated it may be used. The only way in which that can be done is to keep a continual check on what there is in private storage and, if that is falling too low, the Government must take steps, by taking it over or by some other means, to see that it is used to the capacity that they desire. Short of that there is no security of any kind. There being nothing really to be said against the point, the Government should consider very seriously taking the extended powers that have been suggested in accordance with this Amendment.

9.31 p.m.

Mr. Kingsley Griffith

As far as I understand the right hon. Gentleman's point, it is that when you come to liquidation—that is a post-crisis operation; you are not likely to have to liquidate in the middle of a crisis—you cannot do it more or less at your leisure and consider the interests and threats to various people which in a moment of crisis you would have no hesitation in ignoring. That is a sound point. As I understand the argument of the hon. and learned Gentleman the Member for East Bristol (Sir S. Cripps), it would tend to this, that you should have no private storage at all. The whole of your operations should depend entirely on Government activities. But that is obviously not the purpose of the Bill. The Bill contemplates that there should be the simultaneous operation of private storage, private traders being encouraged to accumulate stocks, the Government at the same time supplementing their efforts by doing what they think necessary. If that is the object, I think it is reasonable that the Minister should do his best to assure private traders that they are not going to be confronted with an unnecessary difficulty at the end of the whole process.

It may be that the hon. Member for Cambridge University (Mr. Pickthorn) was right when he suggested that the Government could drive a coach-and-four through the Act at the end, but I do not see that we need contemplate that they will do anything of the kind. If we are contemplating the simultaneous process of public and private stores, it is reasonoble for the Government to do everything they can within the four corners of the Bill to reassure those who are to co-operate with them that they are not going to be confronted with unusual difficulties at the end of the process when the crisis is all over. Undoubtedly the accumulation of a large pool of material by the Government or anyone else is a disturbing factor in the normal course of trade and, if the Government can do anything in the course of this Bill to prevent that disturbing factor from having an adverse effect, it is reasonable that they should do so, and I hope they will resist the Amendment.

9.33 P.m.

Mr. Aneurin Bevan

Everyone will agree on the necessity of not depleting private stores as a consequence of the action proposed by the Government, but I doubt very much whether the Minister's proposal will have that effect. I should have thought that private traders would be satisfied that the interest of the Government in preserving the public well being is that in no circumstances should prices be broken by the sudden unloading of stocks, and that no assurance at all can be adequate for the trading community in addition to the mutual self-interest which binds both parties together. There were circumstances following the late War when Government stocks were held off the market for a very long time in order not to break prices, and eventually were sold at ruinous prices because the Government had not taken advantage of the higher prices that existed from the end of the War till 1920 or 1921.

The Government are, obviously, always interested in not breaking prices, but what does the right hon. Gentleman propose? He says to the trading community, "We are going to accumulate stocks. We will hold those stocks and we will not disperse them until we have the permission of the House." I cannot imagine anything more likely to disturb the trading community than the proposal that would be made by the Government at that time, after a Debate in the House of Commons, informing the trading community that powers are to be taken to unload on the market the stocks which had been accumulated by the Government. I assume that the right hon. Gentleman will say that having acquired those powers the Government would exercise them with discretion. If that be so, they do not want these additional powers. They will unload the stocks slowly on to the market so that the market can take the goods without any sudden slump. Therefore, I should say that the right hon. Gentleman is doing the worst possible thing for the psychology of business at that time in proposing to advertise in the most public fashion the acquirement of powers which did not formerly exist. I should have thought that the trading community has already all the guarantees that they can reasonably expect. If the Government unloaded these stocks suddenly on the market in such a way as to depress the price, the Government would lose trade and employment would lose.

Mr. Stanley

indicated dissent.

Mr. Bevan

The right hon. Gentleman shakes his head. Surely, that is so, otherwise why is there apprehension? The apprehension is that the Government stocks would be unloaded in such a way as to take the place of privately sold goods, and so break the price. The Government have an interest in seeing that that is not done, and I should have thought that if there are apprehensions—and there always must be apprehensions when the Government accumulate stocks of this kind—those apprehensions would be much more likely to be exacerbated than mitigated by the proposal which the right hon. Gentleman makes. I should imagine, therefore, that in these circumstances he should not give guarantees which would be more alarming than reassuring.

9.38 p.m.

Mr. S. O. Davies

This Sub-section is amazing when one realises that it has been fathered by this Government. Let us try to visualise what would very likely be the situation at the time when the Government would feel that it was opportune, in order to prevent deterioration of any stocks which they might have on hand, to bring a Bill before the House. Does not the right hon. Gentleman anticipate that in all probability there would immediately be extremely powerful opposition to the passing of any Bill of that kind? That opposition would come from supporters of the Government. The excuse would be that the unloading on the market of a great deal of stocks would immediately depress prices. There is no doubt about that, because it is a habit of mind of the bigger capitalists in this country that if anything is placed on the market which is not directly their own, they are in opposition to it, and that opposition immediately finds its echo on the Government benches.

It is no use the right hon. Gentleman telling the House now, and it would be no use telling the House when the situation arose, that if we did not dispose of these stocks they would deteriorate and be wasted. That argument would not in the least affect his supporters on that side of the House. The Government have had unlimited experience in identifying themselves not merely with the destruction of stocks but with the destruction of industries. We have seen it going on in this House. We have had Acts of Parliament passed, taking chunks of basic industries and deliberately and wantonly destroying them by Acts of Parliament for which the present Government have been responsible. I am amazed at the indiscretion of the right hon. Gentleman, knowing the kind of supporters that he has and knowing that everything has to be opposed unless it: is exploitation by industrialists and capitalists in this country. Without any shadow of doubt the moment that Act of Parliament was mooted the benches opposite would be packed with Government supporters who would not be the supporters of the Government in a case of that kind. Rather than allowing these stocks to be unloaded to depress prices, so that the poorest might participate in such unloading, I can well imagine solid opposition on the part of the Government supporters against anything being done to make it possible for a greater number of people to participate in some of the stocks mentioned in the Schedule of the Bill. It is a most indiscreet step on the part of the right hon. Gentleman to have embodied such a Sub-section in the Bill, because he knows that the habit of thought of those who call themselves Government supporters would cause them to oppose the Government. Therefore, this Sub-section is asking for their opposition along the traditional lines on which such opposition is expressed by the alleged supporters of the Government.

9.43 p.m.

Mr. Ede

I do not share the pessimism of my hon. Friend as to who will be in control of these stocks if ever the time comes. I have no doubt that if the present Government remain in office very much longer we shall drift into the crisis. They were founded on crisis, they have drifted from crisis to crisis, and when crises no longer exist they will have no excuse for their existence. I am sure that any genuine crisis, as opposed to the artificial crises which they have created one after another ever since 1931, will effectively sweep them away, and I have no doubt that people far more in tune with the greater part of the Bill—

Mr. Stanley

Is this a repetition of the speech which the hon. Member made at Stafford?

Mr. Ede

I was not asked to go there. If the right hon. Gentleman will examine the record of by-elections at which I have spoken he will realise that I have been called off in order not to create too much dismay in the hearts of the Government. The proposition before us is almost unprecedented. I can only think of one previous example in history to which we can refer, and that was in very ancient times when Joseph laid up during the seven fat years a store for the seven lean years. The Minister for the Co-ordination of Defence will, I am sure, be quite willing to assist the right hon. Gentleman, should I err from orthodoxy. I do not read that the corn trade of Egypt approached Pharaoh and suggested that the action of Joseph ought to be safeguarded by some similar Clause to that which we are now discussing. It is true, of course, that Joseph was forewarned of the exact length of the time of preparation and the duration of the crisis, and as they were apparently to be equal he was able to balance matters out. The right hon. Gentleman is not in that happy position.

Mr. Stephen

The hon. Member will recollect that there was a stern Jewish persecution which followed the end of that period of 14 years.

Mr. Ede

My hon. Friend should recollect that no parallel should be carried too far. I suggest that the difficulty of the Government is due to the fact that they are trying to graft a Socialist provision into a non-Socialist state of society. That is the fundamental difficulty which confronts them. For the purpose of an emergency they realise that nothing but Socialism can save the country, but at the same time they are concerned to see whether they can save private enterprise. I suggest that the disposal of these stocks is far too remote for us to bind ourselves in the matter to-night. Clearly, they cannot be disposed of pre-crisis, because that would be a notification by the Government, which exists on crises, that all danger was past, and an intimation to the dictators of the world that we regarded the position as secure. They will be disposed of in the ordinary way of business during the crisis, and, I imagine, will be continually replenished during the crisis.

Who can say if we get into another war what will be the condition of affairs at the end? I do not think anyone imagines that the words in this Bill will affect the position if the Government thought it advisable to ignore them. Let us recollect the Corn Production Act, under which the farmers were promised that there should be no variation of a certain guarantee with less than four years' notice. I believe it took less than four minutes for that guarantee to be destroyed by the same Parliament, when it suited their purpose. I suggest that the Sub-section gives no real protection to anybody and it might seriously hamper the Government and the public interest in the final event. It would be as well if it were not included in the Bill.

Mr. Turton

I appreciate the difficulty of the President of the Board of Trade. One effect of the Amendment, if it was carried, would be that it would accomplish exactly what hon. Members opposite have been hoping would not happen. If the Amendment was carried the Government would have no power at all to dispose of stocks.

Sir S. Cripps

The hon. Member really cannot say that, because the Government would put in the appropriate power to meet exactly the assumption he made.

Mr. Turton

It is not for the hon. and learned Member for East Bristol (Sir S. Cripps) to say that he trusts the Government to bring in legislation, but it is permitted for me to say so because I am a loyal supporter of the Government. I hardly think it the right attitude for the hon. and learned Member to say that he dislikes the Sub-section in the Bill but that he has confidence that the Government will bring in exactly what he wants. I would ask the President of the Board of Trade whether he can give an assurance that between now and the later stages of the Bill he will devise a method to get the Government out of the dilemma they are in? If so, then I think it might be more convenient to raise this matter on the Report stage and put in a better devised Amendment than my own.

9.53p.m

Mr. Stanley

I do not think I can do more than repeat what I have already said, but I should not like to leave the Committee under any misapprehension or under any sense of subsequent grievance. I said that we have endeavoured to think of some alternative form which would prevent, in spite of the amusing and propagandist speeches from hon. Members opposite, the very serious danger of the depletion of the normal stocks at a period of emergency and at the same time do away with the difficulties which I frankly admit, although I think they have been exaggerated, arise from this provision. I will certainly give a promise to the hon. Member for Thirsk and Malton (Mr. Turton) that between now and another stage of the Bill I will continue my inquiries and think over the matter again, and if by any chance we can devise an alternative superior method I will bring it before the House. If we cannot I should not like the Committee to be under any misapprehension. We have to choose between the provision in the Bill and leaving it out altogether, and on balance the advantages are certainly on the Bill as it is.

Mr. Turton

On that understanding I ask leave to withdraw the Amendment.

Hon. Members

No!

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

The Committee divided: Ayes, 182; Noes, 99.

Division No. 235.] AYES [9.53 p.m.
Adams, S. V. T. (Leeds, W.) Colfox, Major W. P. Dunglass, Lord
Albery, Sir Irving Colman, N. C. D. Eastwood, J.F.
Aske, Sir R. W. Colville, Rt. Hon. John Eckersley, P.T.
Assheton, R. Conant, Captain R. J. E. Elliot, Rt. Hon. W.E.
Astor, Major Hon. J. J. (Dover) Cooke, J. D. (Hammersmith. S.) Ellis, Sir G.
Balfour, Capt. H. H. (Isle of Thanet) Cooper, Rt. Hn. T. M. (E'nburgh, W.) Elliston, Capt. D.S.
Balniel, Lord Courthope, Col. Rt. Hon. Sir G. L. Emery J.F.
Barrie, Sir C. C. Cox, H. B. Trevor Emmott, C.E.G.C.
Baxter, A. Beverley Crooke, Sir J. S. Emery-Evans P. V.
Beamish, Rear-Admiral T. P. H. Crookshank, Capt. H. F. C. Entwistle, Sir C.F.
Beaumont, Hon. R. E. B. (Portsm'h) Croom-Johnson, R. P. Evans, D.O.(Cardigan)
Beechman, N. A. Cross, R. H. Everard, W.L.
Birchall, Sir J. D. Crowder, J. F. E. Fleming, E.L.
Boothby, R. J. G. Cruddas, Col. B. Fyfe, D.P.M.
Boyce, H. Leslie Davies, C. (Montgomery) George, Major G. Lloyd (Pembroke)
Brass, Sir W. Davies, Major Sir G. F. (Yeovil) George, Megan Lloyd (Anglesey)
Broadbridge, Sir G. T. Denman, Hon. R. D Gluckstein, L.H.
Brown, Brig.-Gen. H. C. (Newbury) Dodd, J. S. Grant-Ferris, R.
Browne, A. C. (Belfast, W.) Doland, G. F. Gretton, Col. Rt. Hon. J.
Bull, B. B. Donner, P. W. Gridley, Sir A.B.
Butcher, H. W. Dorman-Smith, Major Sir R. H. Griffith, F. Kingsley (M'ddl'sbro, W.)
Campbell, Sir E. T. Dugdale, Captain T. L. Grimston, R.V
Carver, Major W. H. Duggan, H. J. Guest, Lieut.-Colonel H.(Drake)
Chapman, A. (Rutherglen) Dunsan, J. A. L. Guest, Hon. I. (Brecon and Radnor)
Gunston, Capt. Sir D. W. Mitchell, H. (Brantford and Chiswick) Sinclair, Rt. Hon. Sir A. (C'thn's)
Harbord, A. Morris-Jones, Sir Henry Smith, Bracewell (Dulwich)
Harris, Sir P. A. Morrison, G. A. (Scottish Univ's.) Smith, Sir Louis (Hallam)
Haslam, Henry (Horncastle) Morrison, Rt. Hon. W. S. (Cirencester) Smith, Sir R. W. (Aberdeen)
Hely-Hutchinson, M. R. Munro, P. Smithers, Sir W.
Herbert, A. P. (Oxford U.) Nall, Sir J. Somervell, Rt. Hon. Sir Donald
Herbert, Major J. A. (Monmouth) Nicholson, G. (Farnham) Somerville, A. A. (Windsor)
Higgs, W. F. Nicolson, Hon. H. G. Southby, Commander Sir A. R. J.
Hoare, Rt. Hon. Sir S. O'Connor, Sir Terence J. Spens. W. P.
Holmes, J. S. O'Neill, Rt. Hon. Sir Hugh Stanley, Rt. Hon. Lord (Fylde)
Hope, Captain Hon. A. O. J. Peake, O. Stanley, Rt. Hon. Oliver (W'm'ld)
Hopkinson, A. Perkins, W. R. D. Stewart, J. Henderson (Fife, E.)
Hulbert, N. J. Petherick, M. Stourton, Major Hon. J. J.
Hume, Sir G. H. Ponsonby, Col. C. E. Sueter, Rear-Admiral Sir M. F.
Hunloke, H. P. Radford, E. A. Tasker, Sir R. I.
Inskip, Rt. Hon. Sir T. W. H. Raikes, H. V. A. M. Thomson, Sir J. D. W.
Jones, Sir G. W. H. (S'k N'w'gt'n) Ramsay, Captain A. H. M. Tufnell, Lieut.-Commander R. L.
Kerr, Colonel C. I. (Montrose) Ramsbotham, H. Turton, R. H.
Kerr, J. Graham (Scottish Univs.) Rathbone, J. R. (Bodmin) Wakefield, W. W.
Keyes, Admiral of the Fleet Sir R. Rayner, Major R. H. Walker-Smith, Sir J.
Law, R. K. (Hull, S.W.) Reed, Sir H. S. (Aylesbury) Wallace, Capt. Rt. Hon. Euan
Leech, Sir J. W. Reid, W. Allan (Derby) Ward, Lieut.-Col. Sir A. L. (Hull)
Lees-Jones,.J. Ramer, J. R. Ward, Irene M. B. (Wallsend)
Lewis, O. Rickards, G. W. (Skipton) Waterhouse, Captain C.
Lipson, D. L. Roberts, W. (Cumberland, N.) Watt, Major G. S. Harvie
Llewellin, Colonel J. J. Robinson, J. R. (Blackpool) Wedderburn, H. J. S.
Locker-Lampson, Comdr. O S. Ropnar, Colonel L. Wickham, Lt.-Col. E. T. R.
Loftus, P. C. Ross, Major Sir R. D. (Londonderry) Wilson, Lt.-Col. Sir A. T. (Hitchin)
Lyons, A. M. Ross Taylor, W. (Woodbridge) Windsor-Clive, Lieut.-Colonel G.
McCorquodale, M. S. Rowlands, G. Wise, A. R.
Macdonald, Capt. P. (Isle of Wight) Royds, Admiral Sir P. M. R. Womersley, Sir W. J.
McKie, J. H. Ruggles-Brise, Colonel Sir E. A. Wood, Rt. Hon. Sir Kingsley
Macquisten, F. A. Russell, Sir Alexander Wright, Wing-Commander J. A. C.
Magnay, T. Salt, E. W. Young, A. S. L. (Partick)
Manningham-Buller, Sir M. Sanderson, Sir F. B.
Margesson, Capt. Rt. Hon. H. D. R. Sandys, E. D. TELLERS FOR THE AYES.—
Markham, S. F. Shaw, Captain W. T. (Forfar) Mr. Furness and Major Sir
Mayhew, Lt.-Col. J. Simon, Rt. Hon. Sir J. A. James Edmondson.
NOES.
Adams, D. M. (Poplar, S.) Griffiths, J. (Llanelly) Oliver, G. H.
Alexander, Rt. Hon. A. V. (H'lsbr.) Groves, T. E. Paling, W.
Ammon, C. G. Hall, G. H. (Aberdare) Parkinson, J. A.
Attlee, Rt. Hon. C. R. Hardie, Agnes Pearson, A.
Barnes, A. J. Hayday, A. Pethick-Lawrence, Rt. Hon. F. W.
Barr, J. Henderson, A. (Kingswinford) Price, M. P.
Benson G. Henderson, J. (Ardwick) Quibell, D. J. K.
Bevan, A. Henderson, T. (Tradeston) Richards, R. (Wrexham)
Broad, F. A. Hills, A. (Pontefract) Ridley, G.
Brown, C. (Mansfield) Jagger, J. Ritson, J.
Buchanan, G. Jenkins, A. (Pontypool) Robinson, W. A. (St. Helens)
Burke, W. A. Jenkins, Sir W. (Neath) Salter, Dr. A. (Bermondsey)
Cape, T. John, W. Sexton, T. M.
Charleton, H. C. Johnston, Rt. Hon. T. Shinwell, E.
Cluse, W. S. Jones, A. C. (Shipley) Smith, E. (Stoke)
Cocks, F. S. Jones, Morgan (Caerphilly) Smith, Rt. Hon. H. B. Lees- (K'ly)
Cove, W. G. Kelly, W. T. Stephen, C.
Cripps, Hon. Sir Stafford Kennedy, Rt. Hon. T. Stewart, W. J. (H'ght'n-le-Sp'ng)
Daggar, G. Kirby, B. V. Summerskill, Dr. Edith
Dalton, H. Lansbury, Rt. Hon. G. Taylor, R. J. (Morpeth)
Davidson, J. J. (Maryhill) Lathan, G. Thurtle, E.
Davies, R. J. (Westhoughton) Lawson, J. J. Tinker, J. J.
Davies, S. O. (Merthyr) Leach, W. Viant, S. P.
Dobbie, W. Lee, F. Walkden, A. G.
Dunn, E. (Rather Valley) Leonard, W. Welsh, J. C.
Ede, J. C. Logan, D. G. Westwood, J.
Edwards, Sir G. (Bedwellty) Macdonald, G. (Ince) Whiteley, W. (Blaydon)
Fletcher, Lt.-Comdr. R. T. H. McEntee, V. La T. Williams, E. J. (Ogmore)
Gardner, B. W. Maclean, N. Wilson, C. H. (Attercliffe)
Gibson, R. (Greenook) Messer, F. Windsor, W. (Hull, C.)
Graham, D. M. (Hamilton) Milner, Major J. Woods, G. S. (Finsbury)
Green, W. H. (Deptford) Morrison. Rt. Hon. H. (Hackney, S.)
Grenfell, D. R. Naylor, T. E. TELLERS FOR THE NOES.—
Griffiths, G. A. (Hemsworth) Noel-Baker, P. J. Mr. Mathers and Mr. Adamson.

Clause ordered to stand part of the Bill.