HC Deb 20 April 1951 vol 486 cc2156-62
The Minister of Supply (Mr. G. R. Strauss)

With your permission, Mr. Speaker, I desire to make a statement.

There is a grave shortage of nickel, tungsten and molybdenum, and consequently of alloy steels. We are doing everything possible to obtain greater supplies, but there is immediate need to make savings in the civil use of these metals to provide for the very heavy requirements of the re-armament programme, which of course must be met.

To make this possible in respect of nickel, certain other nickel uses must be cut immediately. Nickel supplies have not fallen, but the heavy defence demand coming on top of a rising civilian demand has produced an acute shortage. As an emergency measure, as from 1st May, the amount of nickel supplied for stainless steel production will be cut to 70 per cent. of the 1950 level, and supplies of nickel anodes for plating will be cut to 50 per cent. of the 1950 level. These cuts will be followed by the prohibition of less essential uses of nickel. As the House will no doubt be aware, the United States Government have already enacted prohibitions in this field.

Supplies of molybdenum, for which we are entirely dependent on the United States, are far below the 1950 level, and there is a sharply increased demand for our defence programme. If the rearmament demand has to be met in full from the current rate of supplies, there will be hardly anything left for civil production. Supplies of tungsten are also precarious. The mining of tungsten ore is to be started again in Devonshire to supplement imports. There is little scope for prohibiting inessential end uses of either molybdenum or tungsten.

Technical committees of the iron and steel industry have been set up to examine urgently what economies can be made in the use of nickel, molybdenum and tungsten in modification of alloy steel specifications. In this they will, I am sure, have the co-operation of the alloy steel using industries. These committees will also be of great assistance to us in our examination of the specifications of alloy steels for the re-armament programme to find what further economies can safely be made there.

All these measures will have to be supplemented as soon as possible by closer control of the distribution of nickel, tungsten, molybdenum and the alloy steels. It must be stressed, however, that the only way in which we can meet the re-armament programme and the basic requirements of our civil economy, including exports, is by obtaining increased supplies of these metals. We attach, therefore, the greatest importance to a favourable outcome of the international discussions on this subject. Even so, we must envisage that measures of economy and restrictions on the lines which we are now compelled to enforce will be necessary for a considerable time.

Sir Arthur Salter

The right hon. Gentleman has made what is obviously a grave statement. It is the more grave if we regard it as a supplement to the statements with regard to other materials which was made by the President of the Board of Trade on Monday, and it is perhaps also more grave—[HON. MEMBERS: "Question."]—I think it is customary to allow a little latitude in putting one's questions in relation to a Ministerial statement of the kind we have heard.

Mr. Speaker

I understand that the right hon. Gentleman is making what I call a preamble to his questions.

Sir A. Salter

In continuation of that preamble, may I say that the statement is all the more grave because, if I understood the Minister correctly, he was really explaining to us the deficiency of these metals in relation to immediate consumption, and we have, of course, to add to that the need that we have for these and other metals in regard to the Government's recently announced stockpiling programme. Not only is the statement grave, but the measures announced are serious and the consequences will be far-reaching.

I should like to ask the Minister one or two questions, but I realise that these questions can neither be put nor answered adequately at the moment, and the Minister may say—and I would be quite content if that is the case—that he prefers to regard my questions as indications of the kind of issues which we should want to discuss when, as I hope, we have an opportunity at a later date of a more adequate discussion of the issues raised.

Since the shortage of these materials has compelled—or, perhaps, to use a more neutral word, in order not to prejudice any future discussions—has impelled the Minister to announce these measures, may I ask him whether our position would not have been very much better if he had taken advantage of opportunities of purchasing these materials last year, when they were more readily available and at a lower price, and when the opportunities and the need for such purchasing were brought to his attention by, among others, my hon. Friend the Member for Bury and Radcliffe (Mr. W. Fletcher) and myself, and by others outside the House at that time? Is it possible that his attention, and that of his Department, was somewhat diverted at that crucial time by having the very great and extra task thrown upon him and then of preparing for the implementation of the Iron and Steel Act?

Mr. Speaker

This is a very long question. I have only heard one actual question so far.

Sir A. Salter

Lastly, I should like to ask whether the shortages which he has now explained to us have not been rather greater than they need have been but for the shortage of ores, and—as I see the Minister of Fuel and Power is present—but for the importation of coal and the timing of that importation of coal last year, which absorbed a good deal of dead weight tonnage which is of the kind needed to bring in heavy cargoes?

Mr. Strauss

In answer to the first question which the right hon. Gentleman put, no shortages of these metals developed or was anticipated by anybody before the Korean war broke out. Since that event, everything possible has been done, irrespective of currency or any other consideration, to encourage the maximum import of these materials. In answer to the second part of the question, the import of coal has really nothing to do with this at all. The total tonnages are comparatively small, and there has been no hold-up as the result of shipping.

Mr. Clement Davies

Is it not obvious that the fullest information should be given to everybody in the country at the earliest possible moment? I realise that that is why the right hon. Gentleman has made his statement this morning; but these statements are given piecemeal. We had a statement last week and now we have another today. Would it be possible to bring these statements together at the earliest possible moment in the form of a White Paper, or whatever it is, so that the fullest information can be given to the House and the country and we may know where we stand? Will the Minister also consider whether it would be possible to have a full debate, the real purpose being to consider the best thing we can do in the circumstances?

Mr. Strauss

I quite agree with the right hon. and learned Gentleman that it is desirable to give the House and the industries concerned the maximum information about these shortages that can be given, and I am very desirous of doing so in the most appropriate way and whenever necessary. To what extent it would be possible or helpful to put all these statements about scarcities together, I do not know, but I have noted the right hon. and learned Gentleman's suggestion and I will consider it with my colleagues. Of course, the question of a debate on this matter is one for my right hon. Friend the Leader of the House.

Mr. Tom Brown

May I ask my right hon. Friend what steps he proposes to take, either by legislation or by Order in Council, to deal with the scrap metal brokers who are now holding large stocks and refusing to release them until they receive the highest possible price?

Mr. Strauss

That really does not apply to those materials about which I have been speaking. There are certain difficulties with steel, but that is really rather outside this issue, and I do not think it would be right for me to deal with it in this way.

Mr. Arthur Colegate

The Minister mentioned the use of nickel anodes, which are most important for the bicycle industry. Does he propose, in making the 50 per cent. cut, to make any differentiation between nickel anodes used in the manufacture of bicycles for export, as compared with nickel anodes used for production for the home market?

Mr. Strauss

No; that is not at present contemplated.

Mr. Harold Davies

May I ask my right hon. Friend whether any arrangements are being made for a fair distribution of the quantities of nickel, tungsten and molybdenum now in stock inside the country; and secondly, is my right hon. Friend aware that, despite the statement of the right hon. Gentleman opposite that this shortage is due to Government mismanagement, Mr. Charles Wilson, mobilisation chief acting for President Truman, said only this week that the bottle-neck in the United States is due entirely to this shortage of metals, which is due, in fact, to the emotional re-armament which has been forced upon the world at the present time.

Mr. Strauss

I think that only the first part of the question requires an answer, and it is that we are considering what allocation scheme would be most appropriate in order to ensure proper distribution of these metals.

Sir John Mellor

Will the Minister give an assurance that none of these metals has been exported to Soviet Russia or her satellites during the past few years?

Mr. Strauss

Well, I cannot at the moment go back over the past few years, but I think it most unlikely, since the export of all these metals—ores, concentrates and semis—is closely controlled.

Sir J. Mellor

During the last six months?

Mr. Strauss

Yes, definitely; in fact, there has been no export of these materials, either in the virginal or manufactured state.

Mr. Eric Fletcher

Is it not a fact that the eventual burden resulting from the announcement made today will inevitably fall upon private consumers of various domestic goods of one kind or another, and will the Minister, when he makes another statement, indicate in as much detail as possible, what the full repercussions of this will be on domestic consumers, and how they can help, either by contributing to measures of economy or by using various alternatives for the goods affected?

Mr. Strauss

I will certainly bear that suggestion in mind.

Mr. James Johnson

Will my right hon. Friend tell us which of these metals, zinc, nickel, tungsten and molybdenum, is bought by bulk purchase?

Mr. Strauss

None of them. They are all imported by private enterprise.

Mr. A. Edward Davies

Can my right hon. Friend tell us what the immediate effect will be upon our export industry; and whether there is likely to be any immediate consequence in terms of unemployment? Also will he take note of the extremely irrelevant questions put by the Opposition in this matter?

Mr. Strauss

It is difficult at the moment to assess what effect, if any, this will have on exports. It may well have some small effect. It is also difficult to say what effect it will have on employment. In some instances it may well cause some, what I hope will be, temporary redundancy.

Sir A. Salter

Will the right hon. Gentleman elucidate one point? He said that these metals are bought privately. Surely the Government will be buying metals of this kind as part of their stockpiling programme, and that will be done by the Government.

Mr. Strauss

Certainly. My point was that none of these metals come within our bulk-purchasing programme. Purchase and import are entirely in private hands. But that does not mean that the Government are not buyers through existing channels.

Mr. Chetwynd

Can my right hon. Friend give any information about the progress of the talks in Washington about international allocations? Is he satisfied that they are being tackled at a sufficiently high level and with sufficient urgency?

Mr. Strauss

I would rather my hon. Friend put that Question to the President of the Board of Trade, who is more directly concerned with those talks. I do not think it would be appropriate for me at the moment to make any statement on that.

Mr. Jack Jones

Is my right hon. Friend satisfied that the engineering industries are doing everything possible to amend their specifications so as to alleviate the demand for these metals?

Mr. Strauss

As I have said, technical committees have been set up to consider this very difficult matter. I have no doubt that we shall get the co-operation of the industries concerned.

Mr. Harold Davies

Will my right hon. Friend bear in mind the request of the Leader of the Liberal Party that a White Paper or some information should be put before this House to enable a constructive discussion upon the entire raw materials situation to take place, in view of the fact that we may not this year be able to spend the money allocated enthusiastically by this House for re-armament?