HC Deb 22 June 1938 vol 337 cc1212-29

Motion made, and Question proposed, "That—

  1. (1) as from the twentieth day of August, nineteen hundred and thirty-eight, Section three of the Finance Act, 1925 (which imposes duties of customs on motor cars, musical instruments, clocks, films, etc.), and any other enactment which amends or expressly relates to that Section, shall cease to have effect;
  2. (2) the Treasury shall by order direct that, as from the said date, there shall be charged under Section three of the Import Duties Act, 1932, on all goods which immediately before the said date were chargeable with a duty of customs under Section three of the Finance Act, 2925, 1213 an additional duty of such an amount as will, with the general ad valorem duty, amount to the rate of duty so chargeable thereon immediately before that date;
  3. (3) any such order shall be deemed to have been made under the Import Duties Act, 1932, but for the purposes of Section nineteen of that Act shall be deemed not to be an order imposing a duty of customs;
  4. (4) Section five of the Import Duties Act, 1932, and Section two of the Ottawa Agreements Act, 1932 (which relate to Imperial preference), shall not apply to any such goods as aforesaid, but all such goods which, but for this provision, would be exempt from the general ad valorem duty and any additional duty shall, as from the said date, be charged with those duties at the preferential rate of two-thirds of the full rate."—[Mr. Oliver Stanley.]

10.12 p.m.

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

I do not think it is necessary for me to take up more than a short time in making plain the general effect of these proposals. Hon. Members will, of course, realise that this Motion is only the first stage, and that, if it is passed, upon it will have to be introduced a new Clause which will contain the full details. A statement on those details will be made more appropriately at that point. However, I think I can, quite broadly, make plain the general effect of this Motion. I do not think I need recall to hon. Gentlemen the long and chequered history of what are known as the McKenna Duties. They were imposed by a former Chancellor of the Exchequer, Mr. McKenna, during the War, and their purpose at that time was supposed to be to prevent the tonnage urgently required for war purposes being used for what were largely luxury imports. The classes of goods affected were motor cars, musical instruments, clocks, films, and accessories or parts of those categories.

Afterwards, during the first Chancellorship of Lord Snowden, the McKenna Duties were removed only to be reimposed by the right hon. Gentleman the Member for Epping (Mr. Churchill) under the euphonious title of revenue duties. As revenue duties they existed down to the time when, in 1932, the first definite step was taken towards introducing a protective tariff in this country. When the Import Duties Act was introduced in 1932, it had the effect of placing upon all goods, with certain exceptions, a general ad valorem duty of 10 per cent. and, secondly, of allowing the industries concerned to make application to the Import Duties Advisory Committee for an addition to that ad valorem duty. When that Act was passed, these McKenna Duties were omitted from its operation. The effect of this Resolution, if passed, and of the Clause which will be founded upon it, will be to bring that part of our protective system which is now filled by the McKenna Duties into line with the rest of the protective system, and to give to the industries which deal in these commodities the same right that is enjoyed by all other industries in the country of making application to the Import Duties Advisory Committee, the Import Duties Advisory Committee submitting a report to the Government, and the Government, if necessary, submitting an Order to the House.

It is difficult to think of any convincing argument against such a course. It is now a pure anachronism that these four types of commodities, for a purely historical reason, should be placed on a different footing from other commodities of a very similar character. There is no reason why motor car manufacturers should not be able to apply for an increased duty equally with iron and steel or engineering manufacturers. One can quite see the reason for the exclusion of the McKenna Duties from the Act of 1932. At that time the whole device of the Import Duties Advisory Committee, and the whole machinery of protective duties, was a new, untried and intricate piece of machinery, and where a number of industries were already enjoying, under the existing practice, a protective duty, one can understand why at that time they were left aside on the ground that they had already been dealt with. But that no longer applies, and for some time consideration has been given to the question of assimilating the two procedures, the McKenna Duty procedure, where a duty can only be varied by legislation, and the Import Duties Act procedure, where it can be varied, after investigation by the Import Duties Advisory Committee, by the passage of an Order through the House of Commons.

It is true that until recently this distinction has been rather of an academic character. There has been no real dissatisfaction in any quarter with the general height of these duties, nor any suggestion that, if the alteration were made, there would in fact be any application to the Import Duties Advisory Com- mittee. But one cannot close ones eyes to the fact that during the last few months this question, which was an academic question, has become one of considerable public importance. Frankly, there has been a great deal of criticism by way of questions in the House, and a great deal of comment in the Press, as to the increased importation of one in particular of the commodities covered by the McKenna Duties. I am not now going to argue the merits, but there is no doubt that there is a question to be resolved. Whether that industry or any others, under this proposal to give them power to go to the Import Duties Advisory Committee, would be able to convince the Committee that there was a case for an increased duty, is clearly beside the point. What my right hon. Friend feels is that the time has come when, if it is thought that there is a question to be determined, these industries should be given the same opportunity of having it determined as is enjoyed by all the other industries of the country.

Perhaps I might quite shortly explain the actual provisions of the Resolution. Hon. Members will see that it has four Sub-sections. The effect of the first Subsection is to do away entirely with the original Section of the Finance Act of 1925 which re-created these McKenna Duties, and a number of small amendments to that Section which have been made in subsequent Finance Acts in reference to this subject. That alteration will, for a reason which I will explain later, come into force on 10th August of this year. The general effect of the second Sub-section is that, since the duties under the old McKenna procedure are being swept away, duties of exactly the same level will be re-imposed by Treasury Order. There will be, therefore, no immediate practical effect, no immediate change of the incidence of duty. The only result will be, as I explained, to enable these industries to operate under the Import Duties Act, 1932. Sub-section (3) deals with a very small point. Unless some provision such as that was made, under Section 19 of the Import Duties Act, when the Treasury came to lay this Order, to which I have already referred, re-imposing these duties on the same level, it could be done only after an affirmative Resolution of the House. As the House will already have discussed it, both on this occasion and during the passage of the Clause, and as the form of the Order which the Treasury has to lay will have been prescribed in the Clause, we feel it will be a waste of Parliamentary time to demand that there should be an affirmative Resolution.

Sub-section (4) is a little complicated, because it deals with Imperial Preference. The history of Imperial Preference is as follows: Originally it was laid down that the duty on goods coming in from the Empire should be charged at two-thirds of the rate of the full McKenna Duties. In 1926, I think it was the preferential difference in favour of the Dominions was stabilised for a period of 10 years, which has been since extended by subsequent provision, and will expire on 19th August this year. As a matter of fact, during the period considerable alterations have been made in the McKenna Duties. In many instances they are now below the original 33⅓ per cent., but, under this guarantee, over the 10 years the Dominions were still entitled to a preference based on one-third of the 33⅓ per cent.—a preference, therefore, which, in some cases, when the duty was reduced became of a higher ratio than that of one-third.

When this guarantee expires, automatically the preferences to the Dominions will all go back to this level of one-third of the old rate. It is proposed, under Sub-section (4) of this Resolution, to lay that down, so that in future the rate charged upon Empire imports will be normally two-thirds of the rate charged on imports from abroad. That, I hope, makes clear the objects and the actual provisions of this Resolution, and I hope the Committee will be prepared to allow the Resolution to pass, in order that on it we may found a new Clause for inclusion in this Finance Bill.

10.26 p.m.

Mr. Pethick-Lawrence

The Resolution which is before the Committee, as the President of the Board of Trade has explained, does not of itself make any difference in the import duties in the way of their being imposed on these specific articles. The proposition is a change of procedure. Whereas the duties have been of a certain order under a certain method of procedure, the proposal of the Government is that in future they shall come under a different Act and be liable to change by a different method from what is the case at the present time. We on these benches have on many previous occasions explained our opposition to the method of the Import Duties Advisory Committee. We have taken exception to it on the ground that the House was deprived of an opportunity of adequate debate, and that the duties were imposed [...]n advance of the decision of the House, and further, that, in many cases, the House was not supplied with any information which was at all adequate to enable it to make up its mind on the matters brought under review. I cannot feel that the situation in this respect has changed to-day from what it was when this procedure was originally proposed by the Government in the early days of the previous Parliament.

We recognise, however, that the procedure the Government adopt with regard to the great mass of the articles which it is sought to protect is one which is, in fact, being invoked, and I do not know that there is any special ground for singling out individual articles for differential treatment. Moreover, there are very special reasons why this procedure is being proposed at the present time. The President of the Board of Trade made some reference to the matter, and it is in the common knowledge of the Committee that the real question is the importation n large numbers of a certain class of motor car to the detriment of the trade in this country. This large importation is being made possible at the present time by a peculiar form of financial assistance. I deliberately refrain from using the word "subsidy," but there is no doubt that considerable financial assistance is being given to enable these cars to compete in our market. What the precise character of that financial assistance is, it will be for someone to unravel and discuss. On the doctrines of pure Free Trade it has always been recognised that where an article enters into competition and is enabled to succeed in that competition by a definite subsidy given to it by the exporting country, the doctrines of pure Free Trade do not necessarily deter the importing country from placing the duty in those individual cases. Therefore, the proposed duty is in accordance with full Free Trade principles. This is a special case, and we on these benches recognise that if we were to oppose the proposal of the Government we should not be merely voting indirectly against a duty on these cars, but we should be voting for postponing the question and not enabling it to be discussed at an early date. In these circumstances, having taken all the matters into consideration, we have decided not to oppose the Government's proposal.

10.32 p.m.

Sir Percy Harris

I am surprised at the speech of my right hon. Friend. The very last thing that I wish to do is to generate heat, but I am surprised at the position put before the Committee. The proposition is moved not by the Chancellor of the Exchequer, who is responsible for the change in the method of taxation, but the President of the Board of Trade. I am particularly surprised at my right hon. Friend the Member for East Edinburgh (Mr. Pethick-Lawrence) for not taking exception to the changeover in procedure. The old duty dates back to 1915. It has, therefore, been in existence 22 years. If there is an urgent problem—the questions that have been asked suggest that it is an urgent problem—the right and proper thing for the Chancellor of the Exchequer to do is to come here with a new Clause in the Finance Bill and to impose an additional duty. If this matter is so urgent that people are being ruined, then let the right hon. Gentleman follow the procedure of the Finance Bill on an ordinary Budget Resolution, rather than the procedure of the Import Duties Act. If there is an inquiry necessary, the right hon. Gentleman is capable of finding a gentleman capable of doing it, or even of referring this matter—

Mr. Charles Brown

If the Chancellor of the Exchequer adopted the policy suggested by the hon. Baronet, could we have a guarantee that we should have his support and that of his party for the proposition?

Sir P. Harris

Certainly not, but I want to have a Clause that we can examine. We do not want merely to have to record the decrees of the Treasury, late at night, or in the early hours of the morning, without any power to amend the proposal. That proposition has been put forward in the last five or six years from the Front Bench opposite. What has converted them I do not know; it may be the new dispensation, or perhaps the new co-operation. All that happens is that we have an Import Duties Order presented to us late at night, although I give credit to the Parliamentary Secretary to the Treasury who has done his best to meet us in that respect by bringing forward this Resolution before 11 o'clock, but certainly at a comparatively late hour, all we can do is meekly to confirm or reject. If there is to be a change in the scale of duties, the right procedure is to go through the procedure of the Finance Bill, so that we can alter or amend the Clause as we think fit.

These particular duties date back for 22 years. This is no struggling infant industry coming into being and calling especially for immediate attention in order to save its existence, nor is it one of the poorest industries. I can understand a strong case for special treatment for the textile or cotton industry which has had to face great difficulties during the last half dozen years, but this is the wealthiest industry in the country. It has had the advantage, except for two years when the Labour party dropped the duty, of this protection for 22 years. It has not only had the advantage of the 33⅓ per cent. duty, but it has had the artificial protection which is given by the horse-power tax, originally framed to keep out American cars which were of high horse power and which gave English motor manufacturers special advantages in the British market. There have been immense profits made out of the industry during the last 10 years. The Morris Company, the Austin Company and the Rolls Company have immense reserves which they may well utilise to assist the industry to meet this new competition.

I say that if it can be proved that there is dumping—and curiously enough the Board of Trade was rather inclined to resist that suggestion at Question Time—or a conspiracy by a foreign government to ruin an industry, as far as I am concerned I should take no exception to special treatment or a special duty to meet the occasion. But if the Government are convinced that it is necessary to change the scale of duty let them follow the order of procedure of the Finance Act, bring in a new Clause which we can examine on its merits and amend as we think fit. This unsatisfactory and autocratic procedure of import orders is thoroughly undesirable, and ought to be opposed on every possible occasion. I say that the motor industry, which has enjoyed protection now for close on 20 years, which has had exceptional advantages, and which is a wealthy industry having large reserves, certainly should not be given this special privilege of being taken out of the Finance Bill and dealt with under the Import Duties Orders procedure. I think that the Committee which, after all, is the guardian of the public purse, should be jealous of handing over to a committee of three the ancient privilege of imposing taxation, which has been won after years of labour. This is one more case of a new method of taxation which is most undesirable, and to which I object.

10.41 p.m.

Mr. H. G. Williams

I know that I speak on behalf of a large number of hon. Members on this side when I tender thanks to the Chancellor of the Exchequer and the President of the Board of Trade for having proposed this procedure which, after all, does not finally commit the Committee or the Government to any subsequent action. It is merely by the chance of the method adopted in 1932 that the protective duties commonly known as the McKenna Duties, after the well known Liberal Chancellor of the Exchequer of that name, were not brought within the purview of the Import Duties Advisory Committee, which was set up to stop that system of logrolling which everybody recognises has sometimes been an undesirable feature of protective tariffs abroad. That system was devised very largely to meet the kind of objection which was from time to time made by the hon. Baronet the Member for South West Bethnal Green (Sir P. Harris). To-night, we all rejoice that at last Bethnal Green, I will not say has crossed the Rubicon, but put a foot tentatively in the Rubicon.

I wish to thank the Chancellor of the Exchequer. I think this is a method which should be satisfactory to everybody. I should like also to pay a tribute to one or two Members of the Opposition. The hon. Member for Stoke (Mr. Ellis Smith) was, I think, the first hon. Member to draw attention to the recent events. He was supported by the hon. Member for Llanelly (Mr. J. Griffiths), and in a recent Debate, speaking from the Front Bench opposite, the hon. Member for Gower (Mr. Grenfell) pleaded in terms that were clear and unmistakable that what was happening should be stopped or that steps should be taken so that we could stop it. On this occasion, I think the great majority of hon. Members agree that we are facing a situation of a very undesirable character, and that His Majesty's Government should not be unarmed in dealing with this sort of menace. There is one question I wish to put to the President of the Board of Trade. It is a little difficult to understand the significance of all the words in the Resolution, but in the first paragraph there is a reference to any other enactment which amends or expressly relates to that section"— that is to say, the section of the Finance Act, 1925. Does that reference cover motor tyres? Hon. Members may have forgotten that under the original McKenna Duties, when a car came into this country, the whole car was dutiable, and motor car parts were dutiable, except the tyres. For reasons which I understand had a significance during the Great War, the tyres were expressly exempted, not on economic but on political grounds. In 1928, the right hon. Gentleman the Member for Epping (Mr. Churchill1), who was then Chancellor of the Exchequer, decided to round off the duties by making the tyres a part of the motor car for the purpose of the McKenna Duties. I should like to ask the President of the Board of Trade whether this scheme will cover motor tyres separately, as well as every other part of a motor car.

10.44 p.m.

Captain W. T. Shaw

I wish to congratulate my right hon. Friend the President of the Board of Trade on the action which he has taken for the purpose of dealing with these Opel cars. The difficulty which has arisen in this matter is recent, but in my constituency there is a hardship which is far greater and which has more severely disturbed the people in that district than imports of Opel cars from Germany. I refer to the jute industry. I hope that the Government will take steps to find some way of dealing with that difficulty, so that the jute industry will get some reasonable protection.

10.45 p.m.

Mr. Acland

The party above the Gangway has surprised me twice to-day. This afternoon they did not not oppose the guaranteeing of a large sum of public money to a private monopoly, and now they have just told the Committee that here we have something which they hate, and which they have always hated, and yet, when the Government ask for more of it, they do not oppose it. I am particularly sorry because I had special reasons for hoping that the increased duty on motor cars—and that is really what we are considering—would have been brought forward in a different form from those Orders which are usually presented to us after 11 o'clock. I had hoped to move an Amendment to the proposed duty on cars which would have been, I believe, useful as a matter of principle, namely, an Amendment designed to associate some system of genuine public accounting with any industry which claimed the privilege of the duty. That seems a vitally important principle. Since I have been in this House there has never been an Import Duties Order presented to us in a form which enabled an Amendment of that kind to be moved, or which allowed us to attach any conditions as to wages, costings and conditions of labour in the industry, or to make any change at all in the form of the Order. When we began to hear this talk about Opel cars coming in I thought that a proposal for a duty would arise which would give an opportunity of moving such an Amendment and discussing the principle of attaching such conditions to industries which obtained the privileges of a duty.

I think there is reason to wonder—I will not use the word "suspect"—whether this great motor industry of ours could not make a rather better show as regards its costs if it were really put to it. Very large sums have been given out by the motor industry, but perhaps not quite so large as the public outside has been led to believe, because I understand that every time £2,000,000 is given to some university or other, spread as it always is over seven years, so as to avoid Income Tax and Super-tax, the donor parts with £625,000 of his money, and by parting with that he is able to compel the Chancellor of the Exchequer to part with £1,375,000 of our money. In other words, these people who have been selling these cars and making very large profits are able, at their own sweet will, provided they put up £600,000 of their own money, to direct—at this time when every penny is required for armaments—very large sums of public money into whatever directions they may choose. I believe that in this way the owner of one of our large motor manufacturing industries has directed to objectives which seem good to him sums of money which amounted to the total of the increase in the Tea Duty. I had hoped that when the question of increasing the preferences and tariffs and other privileges of this industry came up we would have been able to discuss and thrash out a proposal for attaching conditions as to costings, and so forth, to those privileges. Of course the Government would have outvoted us, but I had hoped that there would have been an opportunity of raising these matters. Now the Government have come along with this proposal. I do not know whether they read my thoughts, and wanted to avoid any trouble of that sort, but our chance has now been cut away; the party above the Gangway apparently is going to let us down and we shall walk into the Lobby alone against this proposal.

10.50 p.m.

Mr. E. Smith

The hon. Baronet the Member for South-West Bethnal Green (Sir P. Harris) and the hon. Member for Barnstaple (Mr. Acland) have chided our party for the attitude we have taken up. On this issue we are concerned about the people whom we represent and the working classes in general, and we are not letting them down. Many of my hon. Friends will be disturbed because the hon. Member for South Croydon (Mr. H. G. Williams) finds himself in agreement with us. I want to state the position as it affects us. We are living in a capitalist democratic State and we who are relatively young have the privilege of speaking here on behalf of the working class because of the sacrifices made by our ancestors during the past 100 years. Great struggles have taken place and great sacrifices have been made by those to whom we belong for the right of free speech, to establish the principle of collective bargaining and of the right to speak in this House and to build up our party. Owing to the development of monopoly capitalism in certain parts of Europe, and to the fact that they have forged a new political instrument, they are now resorting to practices which have for their object the undermining of established practices in this country. We see staring us in the face a menace to all that we stand for, and to the social services which have been wrung from the Tory party. We look upon this new form of political activity on the Continent as a menace to our lives. Therefore, we are forced to take up this attitude.

May I remind hon. Members of the position in this country? It is true that the motor industry has been making exorbitant profits, and even within the framework of capitalist democracy we claim that a bigger proportion of those profits should have found their way into the pockets of the employés. Therefore, we say that, if it is right for us on this occasion to take a stand against the menace that is growing on the Continent, we are also right in making a stand for a bigger proportion of the profits of the trades that are receiving protection to come to the workpeople. Because we are acquiescing in this proposal it must not be taken that we are acquiescing in a wholesale policy of Protection. We see the menace in Europe, and what we are hoping is that this House will adopt a more scientific method of dealing with these matters.

10.55 p.m.

Mr. Stanley

I rise to answer briefly some of the points that have been made in the Debate. In reply to my hon. Friend the Member for East Croydon—[HON. MEMBERS: "South Croydon!"]—I mean South Croydon; I can never orientate him correctly—I would say that motor tyres were included by a subsequent Act in the category of McKenna Duties, and they will be included in the new Clause.

Mr. H. G. Williams

Thank you.

Mr. Stanley

I do not want to interfere in the private fight that has been going on between the United Front on the Opposition. I only want to say to the hon. Member for South-West Bethnal Green (Sir P. Harris) that although he has announced that he was surprised at the speech of the right hon. Gentleman opposite, I was not in the least surprised at the speech that he made. It was exactly what I had expected to hear. To the hon. Member for Barnstaple (Mr. Acland), I feel that my right hon. Friend and I rather owe an apology. I confess that we never realised, when we decided on this procedure, that one of its effects would be to deprive him of the opportunity of making a speech, but the part of it which we have heard this evening has been of very great interest, and now that we know that that would be one of the consequences, when we weigh that against the possible effects on these big industries of giving them the opportunity of presenting their case, we still feel that the advantages of the policy that we have advocated must outweigh the disadvantages to which the hon. Member has drawn our attention, and we must still, therefore, ask the Committee to agree to our proposal.

10.57 p.m.

Mr. Bellenger

rose—

Hon. Members

Divide!

Mr. Bellenger

The right hon. Gentleman had far better have left unsaid what he has just said, and then it might have been possible for some of us to have kept silent. May I say to him and to other hon. Members that I for one am not at all satisfied with the method that the Government are taking in order to combat the menace which my hon. Friend the Member for Stoke (Mr. Ellis Smith) has explained? I am a Free Trader, or at any rate a freer trader, and I am not in favour of indiscriminate tariffs. I realise the special circumstances of this case, and I realise that if methods are to be adopted by foreign Governments such as are being adopted by Germany, we must take special measures to combat them, but I give the right hon. Gentleman warning that he must not expect that this party, or some of us, will support him in every action that he takes such as he is taking to-night.

There is another side to this question, which my hon. Friend the Member for Stoke has touched upon, as well as the hon. Member for Barnstaple (Mr. Acland), with whom I am in very great sympathy on the point that he has put as to the conditions in these industries that we are protecting. I believe the time will come when the Import Duties Act will itself have to be revised, and very considerably revised, so that we shall not only get a greater measure of protection for the manufacturers and the employers engaged in these different industries, but so that we shall also get more fairness for the

workers who are engaged in them. May I state my position if it comes to a Division to-night? I shall not support the Government, although many of my hon. Friends may do so. There have been occasions when I have not voted against the Government, for my own reasons, because I have thought that, although I could not support them, I could not vote against them, but to-night, although I realise that they are taking a cumbrous method of combating a very insidious form of competition directed from a totalitarian State, nevertheless I cannot support them in the Division Lobby to-night.

11.0 p.m.

Mr. Ede

I desire to associate myself with my hon. Friend the Member for Bassetlaw (Mr. Bellenger). It was a great pity that the right hon. Gentleman the President of the Board of Trade, in answering the hon. Member for Barnstaple (Mr. Acland), should have made it so emphatically clear that we could not avoid seeing that this procedure is adopted so as to avoid discussion on the great vital interests of industry which we regard as fundamental to any consideration of this problem. This is an industry which has to meet a peculiar and novel form of competition from abroad. There are grave doubts, which the right hon. Gentleman himself has voiced from that Box at Question Time and in part of his first speech this evening, as to the exact way in which this dumping is assisted in Germany. It is, therefore, very desirable that this House, in considering the problem, should have as free a hand as possible in dealing with it and in discussing it in a constructive manner. It is clear from the right hon. Gentleman's speech that he is delighted to have achieved the method whereby this can go through on the take-it-or-leave-it method which is associated with the Import Duties Advisory Committee's recommendations. Because of his attitude on this matter I also find myself unable to support the Government.

Question put.

The Committee divided: Ayes, 274; Noes, 16.

Division No. 245.] AYES. [11.3 p.m.
Agnew, Lieut.-Comdr. P. G. Allen, Lt.-Col. Sir W. J. (Armagh) Astor, Han. W. W. (Fulham, E.)
Albery, Sir Irving Anstruther-Gray, W. J. Attlee, Rt. Hon. C. R.
Allen, Col. J. Sandeman (B'knhead) Asks, Sir R. W. Baldwin-Webb, Col. J.
Banfield, J. W. Grant-Ferris, R. Petherick, M.
Barr, J. Greenwood, Rt. Hon. A. Pethick-Lawrence, Rt. Hon. F. W.
Batey, J. Grenfell, D. R. Pickthorn, K. W. M.
Beamish, Rear-Admiral T. P H. Gridley, Sir A. B. Plugge, Capt. L. F.
Beaumont, Hon. R. E. B. (Porism'h) Griffiths, J. (Llanolly) Ponsonby, Col. C. E.
Beechman, N. A. Grimston, R. V. Pownall, Lt.-Col. Sir Assheton
Bernays, R. H. Groves, T. E. Price, M. P.
Birchall, Sir J. D. Guest, Lieut.-Colonel H. (Drake) Procter, Major H. A.
Bird, Sir R. B. Guest, Dr. L. H. (Islington, N.) Radford, E. A.
Blair, Sir R. Hall, G. H. (Aberdare) Raikes, H. V. A. M.
Boulton, W. W. Hambro, A. V. Ramsay, Captain A. H. M.
Bower, Comdr. R. T. Hannah, I. C. Rankin, Sir R.
Boyee, H. Leslie Harbord, A. Rathbone, J. R. (Bodmin)
Briscoe, Capt. R. G. Haslam, Henry (Horncastle) Rayner, Major R. H.
Broad, F. A. Haslam, Sir J. (Bolton) Reed, A. C. (Exeter)
Bromfield, W. Hayday, A. Reid, Sir D. D. (Down)
Brown, C. (Mansfield) Heilgers, Captain F. F. A. Reid, W. Allan (Derby)
Brown, Col. D. C. (Hexham) Hely-Hutchinson, M. R. Ramer, J. R.
Brown, Brig.-Gen. H. C. (Newbury) Henderson, J. (Ardwick) Rickards, G. W. (Skipton)
Browne, A. C. (Belfast, W.) Heneage, Lieut.-Colonel A. P. Ridley, G.
Buchanan, G. Hepburn, P. G. T. Buchan. Ritson, J.
Bull, B. B. Herbert, Major J. A. (Monmouth) Roberts, Rt. Hon. F. O. (W. Brom.)
Burke, W. A. Hicks, E. G. Robinson, J. R. (Blackpool)
Campbell, Sir E. T. Higgs, W. F. Robinson, W. A. (St. Helens)
Carver, Major W. H. Holmes, J. S. Ropner, Colonel L.
Cary, R. A. Hopkinson, A. Ross, Major Sir R. D. (Londonderry)
Cassells, T. Horsbrugh, Florence Ross Taylor, W. (Woodbridge)
cazalet, Thelma (Islington, E.) Hudson, Capt. A. U. M. (Hack., N.) Rowlands, G.
Chapman, A. (Rutherglen) Hunloke, H. P. Royds, Admiral Sir P. M. R.
Christie, J. A. Hunter, T. Ruggles-Brise, Colonel Sir E. A.
Clarke, Colonel R. S. (E. Grinstead) Hutchinson, G. C. Russell, Sir Alexander
Clarry, Sir Reginald Inskip, Rt. Hon. Sir T. W. H. Russell, S. H. M. (Darwen)
Cluse, W. S. Jagger, J. Salmon, Sir I.
Cobb, Captain E. C. (Preston.) Jenkins, A. (Pontypool) Salt, E. W.
Colville, Rt. Hon. John Joel, D. J. B. Samuel, M. R. A.
Conant, Captain R. J. E. John, W. Sanderson, Sir F. B.
Cooke, J. D. (Hammersmith, S.) Jones, Sir G. W. H. (S'k N'w'gen) Sandys, E. D.
Cooper, Rt. Hn. T. M. (E'nburgh, W.) Jones, L. (Swansea W.) Scott, Lord William
Courthope, Col. Rt. Hon. Sir G. L. Jones, Morgan (Caerphilly) Selley, H. R.
Craven-Ellis, W. Kirby, B. V. Shakespeare, G. H.
Croft, Brig.-Gen. Sir H. Page Lamb, Sir J Q. Shaw, Captain W. T. (Forfar)
Crooke, Sir J. S. Latham, Sir P. Shepperson, Sir E. W.
Crookshank, Capt. H. F. C. Law, R. K. (Hull, S.W.) Shute, Colonel Sir J. J.
Groom-Johnson, R. P. Lee, F. Silverman, S. S.
Cross, R. H. Leech, Sir J. W. Simon, Rt. Hon. Sir J. A
Cruddas, Col. B. Lees-Jones, J. Simpson, F. B.
Culverwell, C. T. Leighton, Major B. E. P. Smiles, Lieut.-Colonel Sir W. D.
Daggar, G. Lennox-Boyd, A. T. L. Smith, E. (Stoke)
Dalton, H. Lindsay, K. M. Smith, Sir Louis (Hallam)
Davies, Major Sir G. F. (Yeovil) Lipson, D. L. Smith, Sir R. W. (Aberdeen)
Davies, S. O. (Merthyr) Little, Sir E. Graham- Smith, T. (Normanton)
Denville, Alfred Llewellin, Lieut.-Col. J. J. Somervell, Rt. Hon. Sir Donald
Despencer-Robertson, Major J. A. F Locker-Lampson, Comdr. O. S. Sorensen, R. W.
Dobbie, W. Loftus, P. C. Spears, Brigadier-General E. L.
Doland, G. F. Lyons, A. M. Spens, W. P.
Dorman-Smith, Major Sir R. H. Mabane, W. (Huddersfield) Stanley, Rt. Hon. Oliver (W'm'ld)
Drewe, C. M'Connell, Sir J. Stephen, C.
Duckworth, Arthur (Shrewsbury) McCorquodale, M. S. Stourton, Major Hon. J. J.
Dugdale, Captain T. L. Macdonald, Capt. P. (Isle of Wight) Stuart, Hon. J. (Moray and Nairn)
Duncan, J. A. L. McEntee, V. La T. Sueter, Rear-Admiral Sir M. F.
Eastwood, J. F. McGovern, J. Tasker, Sir R. I.
Eckersley, P. T. Maonamara, Capt. J. R. J. Taylor, C. S. (Eastbourne)
Edmondson, Major Sir J. Maitland, A. Taylor, Vice-Adm. E. A. (Padd., S.)
Edwards, Sir C. (Bedwellty) Margesson, Capt. Rt. Hon. H. D. R. Thomas, J. P. L.
Elliot, Rt. Hon. W. E. Markham, S. F. Thomson, Sir J. D. W.
Ellis, Sir G. Mothers, G. Tinker, J. J.
Elliston, Capt. G. S. Maxton, J. Tufnell, Lieut.-Commander R. L.
Emery, J. F. Maxwell, Hon. S. A. Turton, R. H.
Emmott, C. E. G. C. Mayhew, Lt.-Col. J. Viant, S. P.
Emrys-Evans, P. V. Metter, Sir R. J. (Mitcham) Wakefield, W. W.
Entwistle, Sir C. F. Mellor, Sir J. S. P. (Tamworth) Walkden, A. G.
Errington, E. Mills, Major J. D. (New Forest) Walker-Smith, Sir J.
Erskine-Hill, A. G. Morrison, Rt. Hon. H. (Hackney, S.) Wallace, Capt. Rt. Hon. Euan
Fleming, E. L. Morrison, Rt. Hon. W. S. (Cirencester) Ward, Lieut.-Col. Sir A. L. (Hull)
Frankel, D. Munro, P. Ward, Irene M. B. (Wallsend)
Fremantle, Sir F. E. Nall, Sir J. Warrender, Sir V.
Furness, S. N. Neven-Spence, Major B. H. H. Waterhouse, Captain C.
Fyfe, D. P. M. O'Connor, Sir Terence J. Watkins, F. C.
Gardner, B. W. Oliver, G. H. Watson, W. McL.
Gibson, Sir C. G. (Pudsey and Otley) O'Neill, Rt. Hon. Sir Hugh Watt, Major G. S. Harvie
Gibson, R. (Greenock) Parker, J. Wayland, Sir W. A.
Gledhill, G. Parkinson, J. A. Wedderburn, H. J. S.
Gluokstein, L. H. Patrick, C. M. Wells, Sir Sydney
Goldie, N. B. Peaks, O. Whiteley, Major J. P. (Buckingham)
Gower, Sir R. V. Perkins, W. R. D. Wickham, Lt.-Col. E. T. R.
Williams, E. J. (Ogmore) Womersley, Sir W. J.
Williams, H. G. (Croydon, S.) Wragg, H. TELLERS FOR THE AYES.—
Windsor-Clive, Lieut.-Colonel G. Wright, Wing-Commander J. A.C. Captain Hope and Lieut.-Colonel
Winterton, Rt. Hon. Earl Young, A. S. L. (Partick) Kerr.
Wise, A. R. Young, Sir R. (Newton)
NOES>
Acland, R. T. D. (Barnstaple) Jones, Sir H. Haydn (Merioneth) Sinclair, Rt. Hon. Sir A. (C'thn's)
Evans, D. O. (Cardigan) Leach, W. White, H. Graham
Foot, D.M. Owen, Major G.
George, Major G. Lloyd (Pembroke) Roberts, W. (Cumberland, N.) TELLERS FOR THE NOES.—
George, Megan Lloyd (Anglesey) Rothschild, J.A.de Sir Hugh Seely and Sir Percy
Griffith, F. Kingsley (M'ddl'sbre, W.) Salter, Dr. A. (Bermondsey) Harris.
Harvey, T.E. (Eng. Univ's.) Silkin, L.

Question put, and agreed to.

Resolution to be reported To-morrow; Committee to sit again To-morrow.