NEW CLAUSE.—(Duty to give information.) (Hansard, 29 June 1939)

§ Mr. Burgin
I beg to move, "That the Clause be read a Second time."
The Clause requires a contractor to give notice to the Minister when his receipts from armament contract business in an accounting period reach the amount which brings them within the charge. Hon. Members asked earlier whether there were to be returns, or whether forms were to be issued to everybody. This Clause puts the obligation on the contractor to notify the Minister when the £200,000 period has arrived and it puts on the contractor a duty to notify sub-contractors 759 whenever he places armament contracts With them. He has the further duty, on receipt of notice from the Minister, to give particulars of what armament contracts have been carried out by him. The requirements to give information set out in the Clause are considered sufficient to enable the Minister to carry out this function. He has in addition, under Clause 9 of the Ministry of Supply Bill, power to examine all books and to procure information on the cost of those contracts which fall within the range of the wider definition of "articles required for the public service." The provisions in Sub-section (3) of this new Clause are devised to make the administration of this scheme easier both for the Minister and the contractors.

§ Mr. Pethick-Lawrence
I make only one comment upon this Clause. The right hon. Gentleman has rightly imposed this duty on the contractors, but he finds it utterly impossible to impose upon contractors, at the same time, the duty, of stating what money they receive for armament contracts given by local authorities.

§ Mr. Garro Jones
Last night I ventured to make a suggestion to the effect that armament contracts should be marked at their origin in the Service Departments. I was not favoured with any reply to that suggestion, but I still think it was a good one, and my belief is confirmed by this Clause. I ask the Minister how the recipient of a contract is to know whether it is an armament contract or not. Last night I read an extract from a journal which is supposed to be well informed about these matters to the effect that an armament contractor, or any other contractor, would find it difficult to know whether any given contract came within this definition or not. Therefore, I repeat my suggestion and ask the Minister to examine its practicability.

§ Mr. Burgin
I am sorry the hon. Member did not receive an acknowledgment of his suggestion, but I did endeavour, by a nod of the head, to convey to him that his suggestion ran on parallel lines with the scheme which we have been working out. I think it is desirable, when con tracts are placed by any of the contract departments of the three fighting Services, or by any other Government Department coming within this operation that the con tract itself should clearly denote that it is an armament contract from the moment it leaves the Government office.

§ Mr. Garro Jones
Will the Minister go a step further in the interest of efficiency and say that a main armament contractor who receives such a contract shall be obliged to re-mark it if he is giving it to a sub-contractor?

§ Mr. Burgin
That is all included in the scheme put forward last night and tallies exactly with the arrangements which are being made in the Departments for the purpose of operating this tax.

§ Sir P. Harris
I recognise the sweet reasonableness of the right hon. Gentleman and congratulate him on his desire to meet suggestions in order to secure co-operation in making this Clause a success. It occurs to me, however, that it is a little dangerous to have promises of this kind made in the Committee, which might suggest that if a contract is not marked as an armament contract, it would be immune from any liability under this Clause. That would be a very serious thing in the light of our discussion this afternoon about border-line cases.

§ Mr. Burgin
The only way in which I can make it clear is this. I have said that in connection with the administration of this Armament Profits Duty it is proposed that the Ministry of Supply, as soon as the Royal Assent has been given to the Bill, shall issue to contractors and those likely to be concerned an explanatory memorandum on the way in which it is proposed to administer the duty. The hon. Member seemed to suggest the possibility that by a clerical error, say by a stamp not having hit the corner of a contract, somebody might be rendered immune. For the purpose of rendering it more noticeable to the contractor that the contract is an armament contract, it is intended that that fact shall be noted on the contract, and no doubt by accompanying letters and in other ways the notification can be brought home to all concerned. Certainly, it will not be a defence that the contract was not so marked. These provisions are for the purpose of assisting and not hindering the administration of the tax.

§ Sir Geoffrey Ellis
Surely whether the contract is marked or not, it is, in the long run, a question of interpreting the Act whatever the Department may do and it would be always open to a contractor, if there was a dispute, to appeal.

§ Mr. Ede
I wish to reinforce the point made by my right hon. Friend the Member for East Edinburgh (Mr. Pethick-Lawrence) in view of the right hon. Gentleman's explanation to my hon. Friend the Member for North Aberdeen (Mr. Garro Jones). I cannot follow why a local authority could not be instructed, when placing a contract, to intimate by a notice on the contract itself that it was a contract on which grants would be payable under the Air-Raid Precaution or Civil Defence Measures and that therefore any profits on it must be included in the return to the Minister. I suggest that the right hon. Gentleman is steadily building up our case so completely that at last he will convince himself.