HC Deb 31 January 1940 vol 356 cc1206-26

Motion made, and Question proposed, "That this House do now Adjourn."—[Major Sir James Edmondson.]

Mr. Deputy-Speaker (Colonel Clifton Brown)

Mr. Thurtle—

Mr. Silverman

I think with great respect to my hon. Friend, I have priority to-day on the Motion for the Adjournment.

Mr. Deputy-Speaker

That depends on whether the hon. Member catches my eye. As a matter of fact, he has not caught my eye.

6.21 p.m.

Mr. Thurtle

I desire to give publicity to the case of which I am going to give details as a matter of public duty. The facts must speak for themselves. It is quite possible that there may be nothing more in this case than a certain amount of negligence and irresponsibility on the part of a few public servants, but I think the House will agree, after they have heard the facts, that it is very desirable that the case should be thoroughly examined. It will be common agreement, especially in these days when we are spending such huge sums of public money, that the contracts departments of the Ministry of Supply and any other public Department should be, like Caesar's wife, above suspicion. The facts to which I want to draw the attention of the House are these. There is an old-established firm in the Midlands area which for a considerable time has been supplying water bottles and cooking stoves for the Army. About May of last year the output of these water bottles and stoves was unsatisfactory and the representative of the Ministry of Supply went down to the firm to investigate the reason. He found that the firm was in financial difficulties. It lacked the necessary working capital, and, as it was essential from the War Office point of view that these things should be coming in in a steady stream, the Ministry of Supply went so far as to write to the bank to ask the bank whether it would give the firm additional credit.

I think it will be desirable, in order to avoid confusion, although I regret the necessity for it, to introduce certain names into my narrative, and I therefore propose to do so. The officer of the Ministry of Supply who wrote to the bank asking for this further credit for the firm was Colonel Howell Jones. The fact that he wrote in this way makes it clear that the Ministry was anxious that these things should be forthcoming. The bank declined to advance further credit. The next stage of development is this. Colonel Howell Jones and a Mr. or Major Macgillivray of the Ministry of Supply happened to meet Colonel Hayley, an officer working at the War Office. In some way or other the difficulties of this firm came up in the course of luncheon. The War Office colonel, Colonel Hayley, when he heard of these difficulties said at once that he knew a man who was an agent for a group which had a large amount of money to invest in such a concern. The agent in question turned out to be a person who is now passing under the name of Charles Kingsley Scott. This was the person who was suggested to the Ministry of Supply by the colonel of the War Office as a man who might find money for this firm which was supplying Government contracts.

The House will be interested in hearing the record of this reliable financial agent, Mr. Charles Kingsley Scott. He was in prison for two years for fraudulent conversion and he had five petitions of bankruptcy against him—two in 1929, one in 1934, one in 1938 and another in 1939. Once, when he was adjudged bankrupt, he paid 2¾d. in the£. After this luncheon, it is clear that the colonel in the War Office reported what he heard to this Mr. Scott. As a result, a meeting was arranged between Colonel Howell Jones, of the Ministry of Supply, and Mr. Scott. Later, Colonel Howell Jones took Scott to the War Office contracts department, where they saw the Assistant Director of Contracts. There is no need for me to mention his name; he can easily be identified. The latter gave assurances that in the event of the company being put upon a sound financial footing the War Office would continue to place contracts with it. The next step was that Colonel Howell Jones, of the Ministry of Supply, instructed its Midlands representative, Major Macgillivray, to introduce this Mr. Scott to the chairman of the firm which required the finance. This, I think, is important and vital. Major Macgillivray, the representative of the Ministry of Supply, saw the chairman of this firm and informed him he had been instructed to do so and to vouch for this Mr. Scott—the man with this record —and told the chairman of the company that he could safely negotiate with him. That is a very strong recommendation in respect of a convicted criminal.

The gravamen of my case against the Ministry of Supply and the point I want the Minister to deal with is this: That they took upon themselves the responsibility of introducing to this firm, which was supplying necessary articles of war to the Service Departments, which wanted finance, as a reliable financial agent a man with a record like this. If they knew nothing at all about him I suggest that it indicates that there was great negligence and ii responsibility on the part of the responsible officials of the Ministry of Supply, and I should like to know what the answer is to that.

Arising out of this introduction by the Ministry, negotiations took place with various people who had finance, but they all proved abortive, and apparently they all proved abortive for the reason that in each case this Mr. Scott wanted to extort from the financiers or from the firm, it does not matter which, an enormous proportion of such profits as might accrue as a result of Government contracts, even going so far on one or two occasions—it may be he had no justification for this—as to stress the fact that he wanted that large proportion of the spoils because there were certain legitimate interests of the Ministry which he had to satisfy. [An HON. MEMBER: "How much?"] Something like 5o per cent. of the profits of the firm. It is not clear from the record whether the Ministry in question was the Ministry of Supply or the War Office, but I understand that the Assistant Director of Contracts, who was at one time under the War Office, was, about last September, under the control of the Ministry of Supply, and that at the time these statements were made about certain legitimate interests of the Ministry he must have been dealing with the Ministry of Supply and not with the War Office. That is really the whole of my story, at least so far as the Ministry of Supply is concerned.

The War Office is not represented tonight. I did speak to a Minister of the War Office this afternoon telling him that I should say something which might involve the War Office, and perhaps you will permit me to make one comment which does concern the War Office. I think the House is entitled to ask for a further examination into the fact that a colonel employed by the War Office took upon himself the responsibility of introducing to the Ministry of Supply as a reliable financial agent a man who had the record of which I have spoken. I do not know whether he had been in the Army. He has been referred to variously as "Mr. Scott," "Captain Scott" and "Major Scott." I understand that the Ministry representative for the Midlands, in introducing him to the chairman of the firm, referred to him as Major Scott, but I am not certain what his rank may be. I think it is desirable that there should be an investigation into the relationship between this officer of the War Office and this man for this reason: It does not appear that the relationship was just a casual one, because there is the fact that about the time when these negotiations were going on this colonel of the War Office actually gave away the bride of this Mr. Scott at his wedding. That indicates that there was a certain amount of close relationship existing between the two, because I cannot imagine that a colonel in the War Office would give away the bride of a complete stranger.

These are my facts. I shall be very glad, as I am sure the House will be, if there can be a satisfactory and a reassuring reply forthcoming. It may be, as I said to begin with, that the only thing that has happened is that there has been negligence and a certain degree of irresponsibility, and that there is nothing worse behind it; but certainly the House and the country, which is providing these vast sums of money, is entitled to be assured that there is nothing in the slightest degree irregular going on in connection with Government contracts.

6.35 p.m.

Sir William Jowitt

I, too, desire to say something on this matter, because I think it was I who first had some sort of cognisance of it. It arose in this way. The firm of contractors in question came to consult me as upon a legal matter. On these facts coming out I suggested to them that there really was not a legal matter at all, but that it was their plain duty, as there seemed to be a grave case, to allow me to put these facts before the Minister of Supply. They readily consented, and I therefore caused a statement to be prepared which I at once sent in, not showing it to anyone else at all. I sent it to the Minister of Supply. He, I may say at once, received me with the greatest courtesy, and assured me that the fullest investigation would be made, and in due course, those investigations having been made, it is right that the House should know that the Minister thereupon asked me myself to look at the files. He made me completely free of these highly confidential and secret documents, and therefore in anything I say I am most anxious to avoid saying anything which I should not say. I shall watch the Minister closely, and if I see a slight shake of the head I shall at once move off from the topic which I am discussing.

I may say that I am perfectly certain that the right hon. Gentleman, like every other Member of this House, is most anxious to strike at any form of corruption. There is no question about that. If, therefore, we have a case which looks as though there might be corruption, I suggest it is a very proper thing that in some form or other that case should be investigated—investigated ruthlessly—in order that we may be quite certain that nothing has gone wrong. I will take the responsibility, and I think the right hon. Gentleman will pay some regard to my impression, of saying that having seen these documents I feel that there is a grave case for inquiry. I would rather not particularise further than that. I think that, so far as the officers of the right hon. Gentleman and his Department are concerned, there was no corruption. I think there was grave carelessness. I think, too, that for officers of the Ministry to take upon themselves to introduce somebody as a responsible financial agent without knowing anything about him is a grave matter. But it is fair to remember that this man was introduced to them in, I think, a more or less casual conversation at a club, as my hon. Friend the Member for Shoreditch (Mr. Thurtle) has said, by an official of the War Office, an officer serving at the War Office. That being so, I can readily understand that they would be rather put off their guard. They would not unnaturally think, or might think, that a person introduced under those auspices would at least be an honest man.

With regard to the officer at the War Office I must say this: There has been no such investigation, so far as I know, as was taken in hand by the right hon. Gentleman or under his direction. I do think it a very serious thing—I am saying no more than this, though there is much more I could say—that an officer serving at the War Office should at a club luncheon introduce to officers of the Ministry of Supply a friend of his as a person who has a large amount of money to invest, and that thereupon the officers of the Ministry of Supply should take upon themselves to go down to the Midlands and introduce this gentleman who was, as has been said, a man with a bad criminal record. I say with a clue sense of responsibility that that matter has not received the investigation it requires. I apprehend that the function of the Director of Public Prosecutions—a gentleman whom I know well, who used to work under my jurisdiction in the old days—is not to conduct himself as though he were an inquiry agent. You must put before him definite facts, make at least a strong prima facie case. I do not for the moment say more than this, that an officer serving at the War Office introduced as a responsible financier a man with a criminal record. Shortly after that we find the officer of the War Office giving the bride away at the wedding of this criminal gentleman. In my view those facts merit the closest investigation and all sides of the House—there will be no difference of party on this—will, I think, desire that they should be investigated, and I take the responsibility of saying that so far as I know that aspect of the matter has not been adequately investigated at all at the present time. Whether there is an explanation I do not know. I have seen no explanation and that I regard as farcical at the present moment.

As I have said, the right hon. Gentleman is as ready and as anxious as anybody to strike at this sort of thing, but he must draw this lesson. Here is a firm in the Midlands making something which is of great importance in the war. The Ministry wanted to give orders, to increase the orders. There was one limiting factor. The factory was there, the plant was there, one thing and one thing only held them up and that was lack of finance. To this very day, at this very moment at which I am speaking, they are still held up by lack of finance. For the last six months the firm have been prevented from making what I believe is a most important article, which the right hon. Gentleman desires to get, simply through lack of finance. What I think is very deplorable is that the firm should have been left in this difficulty. There are the factory and the plant, and you want the article, and if there is a difficulty of finance let the Minister go in and commandeer the premises, if necessary. If there is a difficulty in finding finance let him take it over himself. For goodness sake do not let us go on month after month with this hold-up, with the machinery and the skilled people standing idle. I know that is the situation at this very time.

I suggest that there is a criticism against the Ministry, and I do earnestly hope that the Minister will see to it—this was not brought to his personal notice—that there is some clear understanding in his Department that where there is a factory with plant and there is the necessity to produce some commodity its production shall not be held up by lack of working capital. If there is difficulty about that, the Minister should either cause the working capital to be found by some really responsible financier or—as I think the better course—take over the factory and see that the article is made. For the rest, I earnestly hope, and I think the House on all sides will hope, that the matter which I have brought to the attention of the Minister in this way will be inquired into. I wrote to the right hon. Gentleman, as he knows, without telling anybody about it at all. I hope that there will be inquiry in some form or another, formal or informal, and also that there will be a far more searching inquiry, extending in particular into the War Office, than there has been up to the present time.

6.46 p.m.

Sir Percy Harris

I support the suggestion made by the right hon. and learned Gentleman that there should be an inquiry. It should be of such a character that it should report to Members of this House. The Parliamentary Secretary must know that the ramifications of Mr. Scott are rather extensive. A gentleman not very well known to me came to me just before Christmas in great distress because of a contract which he had had from the Ministry of Supply. He was from a well-established concern, dating back to 1864, and was a very responsible man and a man of considerable experience. He could not get an article essential to the manufacture of that which he was to supply to the Ministry of Supply. As other contracts were about to be placed, he very properly went to the Ministry of Supply and pointed out to them the difficulty of getting delivery of the essential part of the article which he had to manufacture.

What was his amazement, when he went to the Ministry, at being sent to a Mr. Scott. He was told that if he only went to Mr. Scott all his difficulties would be removed and his supplies would be forthcoming. Mr. Scott had an address in Piccadilly, and the gentleman in question had great difficulty in finding him. After extensive inquiries he at last found Mr. Scott located, I think, in the office of a theatrical agent. Mr. Scott explained that he did not get paid by the Ministry of Supply, by whom the gentleman had been sent, but had to get his payment from the firm by way of commission. I do not want to elaborate the story, but when the gentleman came to me for advice, I took him personally to the Parliamentary Secretary. I hope the House will think that I acted properly. Let me say at once that the Parliamentary Secretary undertook to investigate the whole matter. A few days later the gentleman got the very sound advice to have nothing more to do with Mr. Scott.

I do not want to go into the details of this matter. It is inadvisable to do so, because it would make the problem only more confused. The very fact that it is possible for an official of a Department to send a contractor to a private agent who proceeds to ask for a commission, not only on the contract in question but on all contracts, shows that there must be, I will not say a little slackness, but a possible leakage, in the organisation of the Department. We know and we recognise that the Ministry of Supply has had to expand very rapidly at a terrific pace. It is quite possible that in an organisation improvised largely since the war it is possible that there may be loopholes; but it is essential that the business interests of the country should have confidence in the Ministry and should feel that there is no possibility of irregularity. In the older Departments that have been built up gradually there are traditions and staffs from which such a thing is not possible. The Minister would be well advised to accept the suggestion of the right hon. and learned Gentleman to have an inquiry by competent persons and, in due course, that the result of their findings should be reported to the House.

6.50 p.m.

Mr. Mander

I intervene only for a moment, because the firm in question communicated with me and asked me to say a few words in support of the hon. Gentleman who initiated the Debate tonight. The firm, as has been said, is in the Midlands. It is well known to me. It is an old-established firm, and I know that over a considerable number of months it has been trying to get finance in order to enable it to make the things that are required by the Ministry of Supply. It has wholly failed up to the present time to obtain it, and we now have before us the story that has been told to-night. The firm has a considerable number of employés, and it is well known for the type of goods it manufactures.

These people say that they are most anxious that there should be a complete inquiry and that they consider the scandal suggested by the question of the hon. Gentleman is of the greatest national importance. Of course, they naturally resent very much being placed in such a position, having been approached by such a person and had a proposition of this nature made to them. Any self-respecting firm would do so. That is their personal feeling; but, in the national interest, it is vital that we should have not only the inquiry which the right hon. Gentleman is most anxious to have—I know that he is desirous of getting thoroughly to the bottom of the matter—but an equally thorough inquiry into the War Office side of the matter, where there has been no satisfaction at all. Nothing has been said at Question Time to-day to indicate that the Government are to take any steps about it. I hope that when the right hon. Gentleman replies he will make it clear on behalf of the Government that they intend to deal, not only with the Ministry of Supply side of the matter, but thoroughly to investigate—I do not know whether by a Departmental inquiry, a Select Committee of this House, or whatever it may be—the extraordinary and alarming story that comes from the War Office.

It would be interesting to know—I think the right hon. Gentleman referred to this matter in one of the answers which he gave to-day—what action of a disciplinary nature he intends to take as regards his own staff. He rather hinted that, as a result of the grave indiscretion which clearly has been committed by certain officials of the Ministry of Supply, it might be necessary to look at the matter from that point of view. Perhaps the right hon. Gentleman would be good enough to indicate whether he contemplates anything of that kind. I am certain that something of the sort ought to be done on that side at once, and that also there should be the fullest inquiry at the War Office.

6.53 p.m.

The Minister of Supply (Mr. Burgin)

May I, in the first place, apologise to you, Mr. Speaker, and to the House, for not being here when this matter came on? I was in the precincts of the House, but I was not aware that the Adjournment Motion had been moved. I would say at once that this is a most regrettable business and that I have every desire to probe it as fully as possible. I think that the best service I can give to the House is to place before hon. Members such facts as are within my knowledge. I would say, in answer to the hon. Baronet, that this is not some new adventure of Mr. Scott's. The hon. Baronet will, I think, agree that the person in whom he is interested was either making a spare part or that this sub-contractor was making it for him.

Sir P. Harris

Perhaps I can make that point clear.

Mr. Burgin

Yes, but may I just finish this point? Upon an inquiry being made about this contractor, the statement was made, "Scott is supplying finance for that firm. Therefore you had better see Scott." I am trying to bring what must have struck the House as a completely new allegation into the remainder of the picture and to show that it was a matter relating to the same contractor and to the same transaction, and that what appears to have happened on that occasion was that an observation was made that Scott was looking after the finance of that contractor. I think it was in those circumstances—I will give way to the hon. Baronet now—that his friend went to Scott.

Sir P. Harris

I think this point is important. What happened is this: He is a manufacturer of a complete article; he manufactures stoves. An essential part was required, and he could not get delivery of it. He went to the Ministry, where he was told that if he wanted to get delivery, he should go to Scott. Scott said he could get delivery provided that the contractor paid him something.

Mr. Burgin

I imagine that the name of the contractor has not been given. This contractor is a public company with a capital of £120,000. For some time it has been endeavouring to reconstruct its finances. At the time when the first Government orders were placed with that contractor the suggestion was made that perhaps, on the notification that Government contracts were being placed, the company's bankers might provide finance. A communication was made to the company's bankers that the Government were prepared to place substantial contracts. Unfortunately the bank were not prepared to make an advance. From that moment on, various attempts were made to find finance for this contractor company. I entirely agree, if I may say so, with the right hon. and learned Gentleman that finance must not be allowed to stop production. I have, in fact, made a proposal to this contractor that all moneys due to their subcontractors which would otherwise make a drain on their working capital will be paid direct by us. That arrangement is in process of being completed with the sub-contractors and is a method of financing contractors whose finances are weak that we have adopted with success on other occasions. I can at once tell the House that if we are satisfied at the Ministry of Supply that lack of working capital is holding up an essential supply, I shall not hesitate to use the powers given to me by the Act and to go to the Treasury to ask for the necessary powers of finance.

Let the House have some sort of idea of the proportions of what we are talking about. The contracts which this contractor holds are of the order of £38,000 and cover three sets of articles: baking dishes, cooking stoves, and water bottles. The water bottles run into something like 250,000, the stoves into 3,600 odd, and the dishes, etc., into some 4,000 odd. There has been a most unfortunate absence of delivery. As the right hon. and learned Gentleman so fairly said, this is a fine contracting capacity. There is the plant, and there are the people, but there has been difficulty throughout over finance.

Now let me give the House an assurance. I am not attempting to support any officer who may have committed any impropriety, but I am perfectly satisfied that the one object of anybody in the Ministry of Supply throughout has been to secure delivery of these stoves, baking dishes, and water bottles. It is no part of the duty of the Ministry of Supply to suggest people to finance others and, in so far as any officer has done anything of that kind, it is certainly negligent, if nothing more. I entirely agree. There are three officers, as I understand it, who have played a part in this story. An officer in the War Office, I believe a colonel, was approached by Scott for a commission. The House will understand the approach best when I say that the officer was badgered to fill up forms and to introduce Scott to the Adjutant-General. He seems after a time to have adopted the line of least resistance and filled up a form of recommendation. In consequence, Scott sees a section of the War Office and so becomes one of constant telephone callers and visitors to this officer in the War Office.

As the right hon. Gentleman says, that officer at a club says, "I hear of someone who has finance"—meaning Scott—"who is anxious to be put into some line of country." Another officer in the War Office says, "Well, I can tell him a line of country. There is a contractor firm under contract to supply water bottles that wants finance." Those two War Office officers suggest that Scott should be put in touch with the firm of contractors. Some telephone messages pass, and an officer of the Ministry of Supply, a progress officer in the Midlands, is asked to arrange a meeting at which Scott can meet the contractor. I do not think the officer of the Ministry of Supply had ever previously heard of Scott.

Sir W. Jowitt

I think the right hon. Gentleman will remember that it was these two officers of the Ministry of Supply who met the gentlemen from the War Office at the club. It was to them—the officers of the Ministry of Supply—that the War Office man said, "Does anybody know a good line of country to go into?" and then the officers of the Ministry of Supply said, "A good line of country? Why, what better than financing this particular Midland firm?" Then they put the officer of the War Office in touch with the contractor. Those are the facts.

Mr. Burgin

Let me deal for the moment with the officer of the Ministry of Supply with regard to whom I thought the right hon. and learned Gentleman was referring. There is a progress officer in the Midlands—a major—who was at all times and is still in the service of the Ministry of Supply. That particular officer was the one I had in mind, because he physically arranged the interview at which Scott met the contractor. I do not want in the least to shirk discussion of any other facts, but for the moment I wanted to point out—

Mr. Thurtle

It is a Major MacGillivray, is it not?

Mr. Burgin

I was not quite sure whether one could give the names of civil servants, but if the name of Major MacGillivray has been mentioned, that' is the officer to whom I refer. If there is to be further inquiry, as there obviously must be, and if matters are going to be inquired into in greater detail, I want to speak with care. Speaking to the best of my recollection—and I have had the whole of these statements carefully taken and prepared by experienced officers—my recollection is that Major MacGillivray was asked to fix up an appointment at which this man said to have funds could meet the contractor said to want funds, and my recollection is that Major MacGillivray went to a hotel in Birmingham, after he had made some telephone arrangements, and that Scott and another man—I believe a man called Beatty—came presumably by train from London. The contractor and either one or more representatives of the contractor firm came, and my information is that Major MacGillivray said, "My business is to introduce you. I am not wanted in your discussion and I shall probably only embarrass you," and he then left.

Mr. Thurtle

Will the right hon. Gentleman permit me for a moment? As I understand it—and this comes from the firm in question—when Major MacGillivray introduced Scott he used this language, "He had been instructed to do so and to vouch for him, and that the company could safely negotiate with him."

Mr. Burgin

The hon. Member is going beyond knowledge that I have. I have no knowledge of language attributed to Major MacGillivray on that occasion, and I think I have accurately summed up the effect of the interview. Of course, language like that would be most important, but I am endeavouring for the moment to give to the House the information such as I have from a tangled set of circumstances, and without wanting to exculpate anyone I wanted to give a fair impression of what I understood to be the part that the officer played. The House should realise that at present two principal officers are in the War Office. The right hon. and learned Member brought this matter to me early in December or at some such time. It was the first I had heard of it at all. I had never heard of the contractor by name, and I did not know any of the parties and should not have known which officers were in the War Office or who were under my control. At once a full and searching inquiry was made—I mean an internal inquiry of a Civil Service character, an inquiry which included as far as possible the officers serving in the War Office—that is to say, their statements were taken after a proper warning of the subject-matter of the statement.

When the whole of those statements had been obtained and the matter had been looked at the papers were then sent to him, as my right hon. and learned Friend says, and he was good enough to communicate with me again, whereupon I had them re-vetted by the Establishment Branch, a department of the Civil Service Department which is responsible for personnel and disciplinary matters within. I felt the report then showed the need for further consideration, and so the matter was submitted to the Treasury Solicitor, and, on the Treasury Solicitor's advice, submitted in detail to the Director of Public Prosecutions. I subscribe to what the right hon. and learned Member said, that in order that the Director of Public Prosecutions can properly go into anything, he must have the materials before him. He had the whole of the material that I could provide, the whole of the documents, statements, papers, and the benefit of the inquiries which we could make. He had submitted to him, not only the question, "Is there evidence of any culpable misbehaviour which would warrant prosecu- tion either for disclosure of official secrets or corruption?" but also, "Is there in your view any further source of information from which inquiries could be made either by the police or anyone else which would be likely to assist the case for a prosecution?"

Sir W. Jowitt

May I ask the right hon. Gentleman one question? He said that after I had communicated with him he had the matter re-vetted. Was that in regard to his own Department or also the War Office? I ask that particularly for this reason. He will remember that when I communicated with him I said that I thought the internal investigation made in his Department was satisfactory, but I said I thought the investigation made in the War Office was wholly unsatisfactory.

Mr. Burgin

I quite agree. The answer is that the re-vetting was in my own Department. [An HON. MEMBER: "Not in the War Office?"] This is a matter which is involved in detail, and I am anxious to show that I am at one with the House in wanting to get absolutely to the bottom of the matter, but I think we shall do better if we proceed by stages. My Ministerial and Parliamentary responsibility was to exhaust inquiries inside my own Department first; it is then my business to transmit the material I have obtained to my right hon. colleague the Minister responsible for the other Department to investigate in his fold matters concerning officers in his Department. I apprehend that there will be no difference of opinion that that was the right course to take. It was on 29th January, only two days ago, that I received the report from the Director of Public Prosecutions. It is not a document of only a few lines, but a reasoned review of all the evidence. There has not been time for me physically to have acquainted my colleague in any other than general terms of the nature of the matter, let alone of the whole of the evidence.

Mr. Attlee

What was the date when this was brought to the right hon. Gentleman's notice?

Mr. Burgin

I have already said—I think it was mid-December. I have not the date before me now; I am speaking from memory. [An HON. MEMBER: "You said 'early December.'"] If I said "early December," I will not quarrel about that. As a matter of fact, it was 22nd November. It was 22nd November when the right hon. and learned Member for Ashton-under-Lyne (Sir W. Jowitt) handed me a large packet of papers to investigate.

Mr. Attlee

I do not understand why, if this came before the right hon. Gentleman then, and it involved another Department, that Department was not notified.

Mr. Burgin

Please do not let us get unnecessarily entangled. First, what Department was involved was not known to me any more than it was to the right hon. and learned Gentleman himself. The inquiries were made between the right hon. and learned Gentleman and myself in the fullest agreement, with the absolute assistance of everybody, until near the end of the year. At that time it became clear that two of the three officers principally concerned were in the War Office. It was through War Office assistance and the War Office staff that the statements from those officers were taken upon which the further inquiries have proceeded. The right hon. and learned Gentleman said, "Was the last re-vetting done by me inclusive of the War Office?" It was not. I want to make that clear. Nothing could be more regrettable than that there should be any shadow of suspicion of corruption against any officer in any public Department. I want delivery of these articles. I am satisfied that my officers were trying to get them. There is not a breath of evidence that the officers were guilty of corruption or that any inducement was held out to them at all. Had there been any, my action would have been very different.

I have made a full inquiry into my side of the matter. I hope the House will accept that, and will allow me to communicate the whole of this material to my colleague at the War Office for a similar investigation to be made there. I do not know whether it is possible for the matter to be raised again in a fortnight's time or something of that kind, but I want the fullest investigation made. I am a little diffident, as a Minister in charge of a Department, in promising inquiries in a Department which is not under my control, but I promise the House the fullest possible investigation, and that a report will be made to the House on the result. We have the same object in mind, to clear everything up, and if the House will allow me to communicate the whole of this to the Secretary of State for War for appropriate action in his Department, on an undertaking being given by me that the result will be reported to the House, I should hope that that would please the House as being a fair method of dealing with the matter.

Sir W. Jowitt

After the right hon. Gentleman had shown me his files, he will remember, I sent him a private report, telling him the impression I had drawn from his files. I drew that up with my own hand, and it took me a great deal of time and trouble. I think the date was about the end of December, or in January. What I pointed out as plainly as I could was that I thought his officers had been negligent, but no worse than that. I thought that, so far as the War Office was concerned, there was a much graver question. I would like to know: When I sent him that report, did he not then communicate it to the War Office? I had seen the result of the preliminary investigation of the War Office. When I sent him that report, surely he communicated it to the War Office, for further re-vetting, when communicating it to the Director of Public Prosecutions.

Mr. Burgin

It was on 2nd January, 1940, that I received the matter, and I submitted it to my advisers in my own Ministry. It then went straight to the Treasury Solicitor and the Director of Public Prosecutions.

Sir W. Jowitt

Not to the War Office?

Mr. Burgin

No. The advice then given to me was to submit the matter to the Treasury Solicitor and the Director of Public Prosecutions. It might well have been, had the Director of Public Prosecutions taken another view, that there was ample evidence for a prosecution.

Mr. Mander

Does the right hon. Gentleman propose to consider taking any disciplinary action, other than what the Director of Public Prosecutions may decide, with regard to members of his own Department, who have acted extremely unwisely?

Mr. Burgin

Yes, there is one member of the Department who has subjected himself to that action, and that action has been taken. I do not think it is in accordance with practice to go into detail about that, but that action was taken, and taken in accordance with what I am advised is the appropriate course.

7.19 p.m.

Mr. Attlee

This seems to me to show a very extraordinary attitude between colleagues in the same Government. Here we have a serious matter brought before the right hon. Gentleman, who has it investigated at some stage which certainly gave very ample time. It must have become clear to him that the persons involved in this were not only the servants of his own Department, but also the servants of the War Office, and he had heard from my right hon. and learned Friend that in his view it was also a War Office matter. The right hon. Gentleman does not seem to have thought of talking to his own colleague, the War Minister. He seems to have relied on advice from his own Department. We ought to have had a representative of the War Office here to-night to explain what action has been taken in that Department. If this is the kind of co-ordination that exists between Departments so closely connected as the War Office and the Ministry of Supply, I shudder to think what happens between other Departments. One would have thought that a Minister would have written to, or, more likely, have seen, a colleague and said. "I am going to investigate this matter very thoroughly in my Department at once, and I suggest that, as there are officials in your Department involved, you should carry out an inquiry there on parallel lines." We could then have had the whole story before the House this evening. I am surprised that the right hon. Gentleman, at the end of his speech, should ask permission to hand it over to his colleague. I suggest that it is his bounden duty at once to notify his colleague, and we ought to have had a representative of the War Office here to-night to give us the other side of the picture.

7.21 p.m.

Earl Winterton

The speech which the Leader of the Opposition has just made is the kind of speech that all Leaders of Oppositions irrespective of party would make, and he is quite entitled to make it. No one could object to it, but I think it goes slightly beyond the necessities of the case. It conveys a suggestion that there has been, on the part of the right hon. Gentleman the Minister of Supply, a kind of concealment which I do not think is the case. The right hon. Gentleman, with the greatest frankness, said that he now realises that this is a matter which will have to be investigated by the Secretary of State for War. It is obvious from the speech made in the House this afternoon that that is so, and he has promised that he will convey the information to the Secretary of State for War. And as far as he can bind his colleagues—and I think we can take it as being binding on his colleagues—the expression of opinion given by the right hon. Gentleman is that the whole matter will be investigated and reported again to this House. I think that the Leader of the Opposition will agree that it will be undesirable at this stage to suggest that there is something behind this until we have had the whole story. We have to remember that in this House we are speaking not only through you, Mr. Speaker, but especially at the present time we are speaking to the whole world, and it will be very unfortunate if any impression were given of anything in the nature either of deliberate concealment or mismanagement between the Departments.

Mr. Attlee

The Noble Lord will acquit me of having made any suggestion of concealment. What puzzled me was the relationship between the two Ministries. I cannot see any reason for concealment or anything else, but it really seems so quaint and curious that the matter was not communicated to the right hon. Gentleman's colleague.

Mr. Burgin

May I point out that there were two courses open—to send the papers to the War Office and make inquiries there, or to send them to the Director of Public Prosecutions? I chose, perhaps wrongly—the circumstances will show—to send them to the Director of Public Prosecutions, and I had them back on 29th January. Now comes the moment when I must submit them to the War Office. Had the opinion of the Director of Public Prosecutions been the other way, that in his view it justified a prosecution, no further inquiry would have been necessary at all.

Earl Winterton

The only other point I want to make is this: If the hon. Gentleman opposite who raised this matter, as he was fully entitled to do, felt that the War Office and the Ministry of Supply were involved in the case, he would presumably have given notice to the Secretary of State for War. I suggest that the question should be allowed to remain on this basis, that the right hon. Gentleman has promised a full inquiry on behalf of the Secretary of State for War, and that until that inquiry has been held it does not seem particularly appropriate to discuss the matter further.

Mr. Thurtle

I would say to the Noble Lord that I took the opportunity after Questions to-day of telling the Financial Secretary to the War Office what I was proposing to do and that I thought that the War Department was involved in the discussion, and it would probably therefore be desirable for the Department to have a representative on the Bench, so that I did as much as I could in that direction. I merely want to say this further word. I think the whole House is very glad to get the assurance from the right hon. Gentleman that he intends to have this matter fully investigated. I would like to ask him whether he feels that he can now make a statement on what is an acknowledged fact in connection with the controversy, and that is, that there was a representative of his Department who took it upon himself to recommend a criminal and a man of straw to a contracting firm as a reliable financial agent, and also whether he does not think that it would be reassuring to the House now if he would get up and say that, as far as that is concerned, it was something which is reprehensible and undesirable.

Mr. Burgin

With the leave of the House, I would say that I agree entirely. It was most reprehensible. I do not want to be committed to saying that he recommended a man of straw. I would prefer the phrase, "He effected the introduction." It is no part of the business of any member of the Ministry of Supply, nor as far as I know of any other Department, to find or to vouch for individuals as good or bad financial agents. It is no part of their business at all, and it is most regrettable that it should happen. It is careless, to say the least of it, and it is wandering out into avenues which have nothing whatever to do with official duties, and I very much regret that it should have happened.