HC Deb 21 September 1939 vol 351 cc1081-92

Motion made, and Question proposed,

"That this House do now adjourn."—[Captain Margesson. ]

4.3 p.m.

The Minister of Supply (Mr. Burgin)

My right hon. Friend the Prime Minister, in his statement yesterday, said that the effort of this country will be the utmost of which it is capable, and therefore, of course, in no whit inferior to that made even in the most strenuous days of the Great War, although the developments in modem warfare must necessarily affect the distribution and the employment of our various resources. Every Member of the House will realise that the organisation of supply must, even in peace-time, be an immense undertaking, but once war has broken out the problem becomes bigger still and one which literally knows no limit. My opportunity to-day is to enable the House and the country to have some conception of the manner in which the problem of supply is being taken. My desire is to give to the House as much information as I possibly can to enable the picture properly to be understood, at the same time bearing in mind that we are debating in public, that enemy ears are listening, and that it would be most unwise in anything we say to-day in this House to disclose the location, the area or the output of munition factories.

One of the chief responsibilities of the Ministry of Supply, and it is one that will affect supply for all the Services, for all Government Departments, and for the whole economic life of the country, is responsibility with regard to raw materials. Under the Act setting up the Ministry and the order subsequently made, the duties regarding stocks of various essential commodities were transferred to me, and in addition extensive powers were given under the defence regulations, and I have already made great use of them. The essential purpose of my duties with regard to raw materials is to see that such supplies of the materials as are available are used to the best purpose, having regard to the essential needs of the country, to see that when supplies are not being replenished by the normal processes of trade some other steps are taken to replenish them, and to see that supplies are available at reasonable prices. The extent and the nature of the action required vary accord- ing to the circumstances of each trade. I have already found it necessary to set up a number of control organisations, covering iron and steel, timber, copper, lead, zinc, aluminium, wool, paper, leather and a number of other things. I will circulate details, with names and addresses, in the OFFICIAL REPORT, for the convenience of the House.

Following are the details:

The addresses of the various controls of raw materials set up by the Minister of Supply are as follow (in some cases the addresses are temporary):—

Control and Address.

Aluminium:

Hemp and Flax:

Scotland:

Northern Ireland:

Iron and Steel:

Jute:

Leather:

Molasses and Industrial Alcohol:

Non-ferrous Metals (lead, zinc, tin and copper):

Paper:

Silk and Rayon:

Sulphuric Acid, Sulphate of Ammonia, other Fertilisers:

Timber:

Wool:

The action that has been taken has varied in each case, but the principles are the same, namely, first, to see whether any shortage or difficulty is to be expected, and then to see that what is available is used to the best advantage. The element of control has in general been applied lightly in the first place, with every effort to prevent any disturbance of useful work and to prevent disturbance of the ordinary commercial channels. It may well be necessary gradually to increase the measure of control as demands increase and as more information becomes available as to what supplies will be obtainable and what substitutes can be used. In some cases it must be understood that as time goes on normal supplies will be available only for the most essential purposes, and for that purpose "essential purposes" will have to be very strictly defined. Control of this kind must affect fundamentally every part of the industry covered by it, not only that part engaged on work for Government Departments, but also the part of the industry still working for civilian needs, and adaptation of many industries to war conditions will no doubt be necessary. I have, in conjunction with the President of the Board of Trade, appointed a board to consider what adaptations are desirable in the cotton industry, to take one outstanding example.

As I have said, one of the functions of these control organisations will be to supplement, and indeed to replace, the ordinary means of maintaining supplies of materials, while utilising to the full the men in the industry who have made a lifetime study of these particular commodities. If there is any doubt whether supplies that could be obtained will still come by the normal processes of trade, it will be necessary to step in to see whether some other stimulus to importation is required. In a number of cases this has already been done.

Not the least important element in the control of materials relates to prices. Everyone is opposed to profiteering— every public-minded individual, every healthy-minded individual. For a great many materials maximum prices have already been fixed at about the price ruling at the time war broke out. I do not expect that we shall be able always to maintain all these prices. Some, no doubt, will have to be increased. That will depend on a number of factors, including the general level of world prices and the terms and conditions under which we are able to obtain further supplies; but the general principle will remain un-altered, that is to see that supplies are available for essential needs at reasonable prices.

There are large and important supply organisations, dealing with the Navy and the Air Force, which are outside the scope of the survey I am making, but apart from raw materials, which cover all supplies, I will deal later with machine tools and with priorities, both things which affect all branches.

Perhaps with regard to Army supply the problem can be summed up in these words: The growth of the air menace made the first priority the defence of the country against air attack, and the whole of the programme for the air defence of Great Britain, as I think all hon. Members will agree, quite rightly has had first place—everything connected with anti-aircraft guns, searchlights, detectors, ammunition, instruments and transport, everything required for the air defence of Great Britain has first priority. I ask hon. Members to recollect that fact in connection with the gun production programme.

I think, apart from the anti-aircraft programme, I should put the order of the tasks which I have to perform in connection with Army supply, something like this. My first task is to equip the Fighting Services of the nation with everything requisite for the conduct of military operations and the maintenance of those operations on a war scale. The House will be aware of the favourable comment already made on the excellence of the equipment and material accompanying the Expeditionary Force. In spite of the great demands made by the doubling of the Territorial Army, and the calling up of the Militia and the Reserves, and quite apart from the outbreak of the war, the Army clothing requirements are being met.

I regard as my second task the organisation of the power to produce everything which foresight, and the lessons learned from the last War and from experience, indicate as being the probable requirements of those Fighting Forces at any time during the war. My third task is the provision of sufficient reserve equipment of every kind for the maintenance and expansion of those military Forces as the needs of the war, casualties and wastage may require. It is increasingly difficult in these days to convey to the average mind ideas of size or number, but let me take shell production as an instance. There are at present engaged on the machining and production of shell 68 firms other than those normally employed in making munitions, while, if you take components as well as the whole shell, there are 700 firms, and the number is being added to every day.

My fourth task is the extraction from the sources of production within the country, both actual and capable of being created, of every ounce of endeavour and every ton of output likely to be of service to ourselves or our Allies, present or future. Then there is the organisation of the provision of raw materials, semi-manufactured and manufactured goods, required not only for armaments but for maintaining the life of the nation and for carrying on our export trade; and the earning and winning of foreign exchange with which to purchase goods and equipment from outside our own sources of supply.

These, I think, briefly, are the tasks in the realm of Army supply to which a Ministry of Supply has to devote itself and 1 say at once that everybody who has a contribution to make, whether executive or operative, whether civil servant, industrialist or workman, whether skilled, semi-skilled or unskilled, whether man or woman, has a part to play. The value of their services is recognised and their desire to serve is appreciated and the organisation of the opportunity for them to serve to the best of the nation's interests is one of the major needs of the moment. To put it briefly, this task is cue for the whole of industry and the man power of the nation and the measure of the success that is capable of being achieved, depends primarily on the extent to which the services of all can be enrolled and their co-operation secured.

Let me now tell the House how this problem has been tackled. On 20th April I was appointed Minister of Supply Designate. We were quickly able to start an embryo organisation and to investigate the size of the problem. It was on 1st August, seven weeks ago, that the Ministry of Supply came into being. I cannot give the House too clear an understanding of the value of that preparatory period of organisation since 20th April. We had, of course, the inestimable advantage of being able to study in detail the official history of the Ministry of Munitions in the last war. We were able to start this time, where we left off last time, besides having the whole of the work of the Supply Board at our disposal.

In peace time the Ministry of Supply was the normal departmental machine, working with the manufacturer, who received the orders from the fighting services and in accordance with those orders, Treasury approval having been obtained, set to work to provide and cater for the supply. Under present conditions, war having been declared, the task is immensely wider because there are certain limiting time factors in munitions supply, just as there are in other forms of manufacturing effort. You cannot instantaneously produce from an empty field or an empty building, munitions of war. Machinery has to be collected, machine tools arranged in their right order, jigs and tools prepared. It is only then that the first raw material can commence its passage through the shops and that there is a chance for the process of production even to begin. In some cases the lag between authority to begin and actual output, even in war time, cannot be reduced below 12 months. I want the House to take it as a solemn statement of industrial fact that, in certain classes of production, there are these limiting factors. There is gun production for instance and there are certain kinds of explosives which cannot be produced within 12 months from the order to begin. If it is possible to do it more quickly of course we shall do so but that is the advice which is tendered to us.

Let me say what has been done in order to ensure that productive opportunity is being harnessed to this national task and that every willing worker is being allowed to translate willingness into contribution. First, the organisation itself has been extended. It has been expanded on the lines of the lessons learned from the war of 1914–1918. We have set up at the Ministry of Supply an immensely greater organisation, with a proper Munitions Council consisting of directors with executive power. The House will probably like to hear as much as I can tell them now of the main features of that organisation and I hope before long to be able to circulate in the OFFICIAL REPORT information on the layout as a whole. When it became apparent that the responsibility for Army supply would be immensely increased, my first task was to see that the burden which was being borne personally by the Director-General of Munitions Production was reduced. Everyone who knows anything of the work of Rear-Admiral Sir Harold Brown, will realise that if any man could bear this burden alone, either at the time of preparation or in the circumstances of war itself, he would be that man and I cannot speak too highly of the work which he has done and is still doing. But it seemed to me too much for one man and one of my first acts as Minister was to appoint a Director of Stores who, under the advice of Lord Woolton took over responsibility for clothing, equipment and storage. Lord Woolton, I should say, was formerly Sir Frederick Marquis. That was while we were at peace. On the outbreak of war it became clear that the whole national effort must be organised for production on a scale and at a tempo, limited only by the maximum extent of our national resources.

In the circumstances which I have just mentioned, I have adopted a course which is only practicable to a limited extent in peace but which, as the experience of the last war shows, is available to the Government in war. I have summoned to assist us in the task before us leaders of the civilian world of industry, commerce and finance. Following the precedent of the Ministry of Munitions, it has been decided to have a Supply Council of which I shall be Chairman, and the Secretary of the Ministry of Supply, Sir Arthur Robinson, the Deputy-Chairman. The members of the Council and their responsibilities will be these. Sir Harold Brown will be Director-General of Munitions Production and will continue to be responsible for gun and shell production, for instrument production and machine-tools and for the Ordnance Factories. The area organisation will also be under his management.

There will be a Director-General of Explosives who will take over from Sir Harold Brown responsibility for explosives production and chemicals. For this post, I am glad to say that I have been able to secure the distinguished services of Lord Weir whose unrivalled experience of organisation and production will be of inestimable value. The House will wish to pay a tribute to the patriotism and spirit of service which have led Lord Weir, once more, to take up a task of the first importance at the hour of need. He is one of the greatest engineering forces in the world.

The production of tanks, mechanical transport, railway material, and engineering and signal stores will be under a third Director-General of Tanks and Transport. For that post Mr. Peter Bennett, President of the Federation of British Industries, who has already rendered valuable services as a member of the Prime Minister's Industrial Panel, and who has already helped me in an honorary advisory capacity, has been selected.

As Director-General of Equipment and Stores, I am able to announce the appointment of Lord Woolton, whose business experience is unrivalled and who is clearly marked out for the post by the great work he has already done in organising, in circumstances of extreme pressure, the clothing supplies of the Army.

I have referred to the work of the Ministry represented by the control of raw materials, and that side of the work will be represented on the Council by Sir Andrew Duncan, the steel controller who will be Chairman of the Committee of Controllers.

With regard to finance, the importance of finance, as the House will agree, cannot be overstated, and those responsible for the finance of a Ministry such as the Ministry of Supply will have a difficult task. They will have to work under great pressure and to secure that no obstacle is placed in the way of production, but remembering that every penny wasted is a contribution to the war chest of the enemy. Therefore, we shall be constantly on the watch to avoid extravagance. I am happy to say that Mr. Patrick Ashley Cooper, a Director of the Bank of England and of many important companies, has agreed to place his experience and judgment at our disposal as Director-General of Finance.

Lieut.-General Sir Maurice Taylor, the Senior Military Adviser, and my hon. and gallant Friend the Parliamentary Secretary complete the Council. Lieut.-General Sir Maurice Taylor will be chiefly responsible for liaison with the War Office and will be generally responsible for the military staff at the Department and its establishments. My hon. and gallant Friend is the head of the priority organisation. To recapitulate, the Council will consist of myself and the Permanent Secretary, four Directors-General of Production, the Director-General of Finance, the Chairman of the Committee of Controllers, the Senior Military Adviser, and the Parliamentary Secretary, and the House will feel, I hope, that the organisation is a good one and that the posts are filled in a way to ensure the maximum efficiency in working and to deserve the confidence of the House. The House would, I think, like to know that Lord Weir, Lord Woolton, Sir Andrew Duncan, Mr. Peter Bennett, and Mr. Ashley Cooper have all asked to be allowed to serve without remuneration.

Now I pass to priorities. Anyone familiar with munition production will realise the immense importance of all questions relating to priorities, priorities not only of Service requirements over civilian needs, but priorities as between the Services themselves. The House will like to know that a comprehensive priority machine is beginning to function under the chairmanship of my hon. and gallant Friend the Parliamentary Secretary. All Departments of State are represented, the members meet daily, and a vast volume of urgent work is continuously handled with despatch and, I think I may fairly claim, to the satisfaction of industry. Naturally, in the complications arising from the outbreak of war, there have been instances where raw materials have not been forthcoming for every manufacturer exactly as could be wished, but these inequalities are being overcome, the Department is continuously expanding, and steps are being taken to recruit the necessary additional expert staff for the different sections involved. I must tell the House that at the outbreak of war the headquarters staff was 900; the headquarters staff is now 2,200, and further additions are being made from day to day as the work requires.

Having dealt with raw materials and to some extent with machine tools and with priorities, I want to look a little closer at equipment, and the next topic that I take if. artillery. Guns take a long time to make, and they are the main determining factor in military operations as to the extent to which the Forces themselves can be protected from onslaught by the enemy forces. The Expeditionary Force requires heavy artillery, medium and field artillery, and ammunition supplies sufficient on modern war scales, on the basis calculated by the General Staff. Besides heavy and medium and field artillery modern forces require a great many other weapons—tanks, anti-tank guns, tank rifles, anti-aircraft guns, trench weapons, machine-guns, Bren guns, and a vast armoury of fighting material, and all of this material, being of greater precision, more rapid rate of fire, and higher velocity, tends under modern conditions to have a shorter life, to wear out quicker, to require more early replacement, and, consequently, to be supplied in ever growing numbers; and all of these weapons require ammunition, cartridge cases, fuses, filling, propellants, on a vast scale. Moreover, with the tendency to mechanisation, units require all this material to be capable of being brought up to them in their fighting positions by carriers, mechanised transport, track vehicles, and a host of other similar gear.

To produce originally the whole material for a force of the requisite size determined, to maintain that force in the field, to fill up gaps, to maintain drafts, to equip reserves, fresh units and fresh formations means that the basis of planning must be bold, must be created with vision and with due regard to the unexpected in war, to the possibility of mishap, and to the possibility of enemy interference, and with the note always before our eyes of the essential necessity of there being enough of everything at the only time when it matters. The rearmament programme of the nation began years ago, it progressed month by month towards its fulfilment, and progress was made on many different branches of production within the limits laid down from time to time. The outbreak of war has meant that the problem, vast as it always was, of equipping and maintaining in the field the Army of the size then contemplated has to be enlarged to a far greater horizon by the needs of inevitable further effort, military and civil, British and Allied, and by the necessity of supplying countries hard pressed in the early stages of the war with a thousand and one necessities of which they may find themselves short, and, above all, by the long-term organisation for manufacture on an almost illimitable scale.

I should like to turn from that broad description closer to detail, and to give the House a greater understanding and a better conception than appears to be prevalent in some quarters as to such matters as an industrial census, the use of smaller firms, and the measures which we are taking to increase ammunition supply. Let me take those three topics in that order and, first, the industrial census. The Deputy-Leader of the Opposition and the right hon. Member for Caithness (Sir A. Sinclair) both in recent speeches referred to the census of capacity that was taken during the last war, and seemed rather to suggest that nothing of this kind has been done this time. That is not the case. There has been the Supply Board organisation for all Services and a Directorate of Industrial Planning, which, starting in the War Office and now transferred to the Ministry of Supply, has systematically been combing the productive potential of the country for munition supplies and listing the firms, the managerial capacity, the actual tool floor space, and other essentials; and particulars are at the disposal of the supply organisation of 9,000 firms, most of whose plant has been critically surveyed and who have provisionally, wherever possible, been allocated either for immediate production of war material or for conversion and swing-over to war material at an early date. It may interest the House to know that there are at present directly working for the Ministry of Supply some 6,500 contractors and that, broadly speaking, those contractors and their sub-contractors are flung country-wide and are not limited to aggregations in one or other particular area. The system of extensive sub-contracting and of the manufacture of component parts in a large number of firms for eventual assembly in bigger firms has been adopted on a very wide scale.

There is, in effect, a system of national factories. The direct national factories are, of course, the Royal Ordnance factories. There were four available at the beginning of the defence programme. Eighteen have been put in hand since then, and six have been put in hand since the outbreak of war, making a total of 28 ordnance factories. There are, in addition, a very large number of factories which, though managed by the firms, are in substance national factories since the plant has been provided by the Government and remains the property of the Government. The reason why a larger number of additional national factories are not being put in hand is that the time factor is against it. It is quicker and preferable from many points of view to utilise the facilities, technical staff and labour, of existing industrial firms, besides which there is a greater capacity for expansion quickly than would be the case if the efforts were confined to fewer but larger units; and labour difficulties are to some extent avoided by utilising as far as possible existing industrial plant.

Major Milner

How many of the 28 national factories are functioning?

Mr. Burgin

I should like to look into that question.

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