ARMAMENTS (COSTINGS). (Hansard, 21 February 1939)

§ Mr. Garro Jones
As it has been well said, everything comes to him who waits, and as hon. Members opposite took advantage of the shortness of time before the conclusion of the main Debate to prevent me from refuting certain statements made by the Prime Minister, I take such advantage as the clock offers to me to deal with this point now. Whenever charges have been made, and they have been made during the past eight years from this side of the House, that there has been gross profiteering in armaments, they have either been ignored by Ministers, or, in the last year or two, the Prime Minister has taken occasion to read extracts from a report of the Select Committee on Estimates. I very 349 much regretto say that the Prime Minister, in giving those extracts, has read garbled extracts, taken out of their context, omitting from the centre of the quotation important words which would have affected its real meaning. I propose to read extracts from the report of the Select Committee on Estimates to indicate what the true opinion of that body was, and the evidence which was placed before it. The Prime Minister read this extract: Your Committee thought it advisable to examine the subsequent experience of the Defence Departments and of the Treasury …. Nothing that has since transpired suggests to them that it is necessary now to add to the recommendations in that report. At that point there appeared in the Official Report a considerable number of dots, which indicated that the Prime Minister omitted some parts of the report of the Select Committee on Estimates. That is a debating manoeuvre which may perhaps be occasionally permissible in the heat of debate on the back benches, but for the Prime Minister tostoop to that method of conducting controversy does not reflect particular credit upon his office. If the Prime Minister and other Ministers wish to convey to the House and to the Committee when the House is in Committee the true opinion of the Select Committee on Estimates, these are some of the extracts he ought to have quoted. The first one is as follows: Your Committee are informed that a review of the procedure and its results by a small1 committee is under consideration. That was the first indication in the report that they were not satisfied with the questions they had put to civil servants. The next one the Prime Minister omitted was as follows: If it, in fact, should prove as regards any substantial field that a satisfactory price, and the essential data for ascertaining that it is satisfactory cannot be obtained by the existing methods, some alternative course will have to be considered for dealing with the problem. The main part of the problem in the last 12 months has been the investigation of sub-contract prices. Sub-contracting processes have assumed a very large proportion of the total cost of armaments. This is what the Chairman's draft of the report said, and I should like to call particular attention——

Sir Joseph Nail
The hon. Member stated that some dots showed that words had been left out. Are the words which 350 were left out the words since quoted by the hon. Member?

§ Mr. Garro Jones
The words are: It will be appreciated that such evidence is necessarily of a general character. In the summary of the report of the Select Committee on Estimates it was plain that there was no profiteering in sub-contracts. I think the hon. Member will be interested in this. The Chairman of the Select Committee asked one of the civil servants the question: Arising out of the observations that you have made, Mr. Self, do I understand, Mr. Meadowcroft, that the costs of a large percentage of your contract work or work that you permit to be sub-contracted are in fact checked by your Department?

§ Sir J. Nall
Does this alter the Prime Minister's quotation?

§ Mr. Garro Jones
Yes; it alters it substantially.

§ Sir J. Nall
This is on another page altogether.

§ Mr. Garro Jones
The Prime Minister tried to convey to the House a view of the Select Committee on Estimates, and he conveyed a false representation. I am quoting from the report. Let me quote further from the report. The Chairman asked: Then it would be correct to say that you only worry about the sub-contracts in non-competitive contracts?—Yes. that is all. So that we find that this vast yield of subcontracts, which accounts for hundreds of millions of pounds, is entirely unchecked in respect of supervision by civil servants.
Then as regards competitive tenders this question was put by the Chairman to Mr. Meadowcroft: Do you experience many cases where the price of particular commodities appear to be fixed by a ring? Mr. Meadowcroft replied: Yes. There are a number of these. I think probably it applies more to sub-contracts 351 than to main contracts, although we have had it on main contracts also. Thus, again, you have a vast field of the supply of armaments which are admittedly under the control of a ring.
What is meant by a ring? A short time ago the London County Council put out tenders for the supply of steel. Ten firms quoted £47,811 14s. 9d., and one firm quoted £1 less, and that tender was accepted because it was £1 less, on the pretence that it was a competitive tender. The London County Council have no powers to deal with these rings, but the Government have power to deal with them, and the Government, despite the evidence which is contained from cover to cover of this report, have the effrontery, on every occasion on which the question is raised, to quote short and garbled extracts in general terms from the report.
I advise those hon. Members who have done me the honour to stay and listen to me to get this document. Every Member of the House is a busy man, and I was only able to read it from cover to cover during the 14 hours journey from Aberdeen to London, but hon. Members 352 will get sufficiently good results if they spend one or two hours in reading the document. Any hon. Member who spends one or two hours in reading the report will be convinced that profiteering in the supply of armaments at the present time is a scandal and a moral affront to the people who are paying for the armaments. My hon. Friend the Member for Stoke (Mr. E. Smith) reminds me that there is also the question of machine tools. The Government take advice about the prices of machine tools from the very people who supply machine tools. It is not only a question of loss of money, although when we are spending £3,000,000,000 in five years—which is the lowest sum that can now be spent—even the loss of money is a sufficiently serious matter for the social services and for posterity. But there is another aspect of the matter. It is that part of the moral front which is so easily vulnerable on this question. I say that if that front is weakened, no amount of armaments will serve to fulfil the objects which they seek to fulfil.