Clause 16.—(SUSPENSION OF INITIAL ALLOWANCES.)

HC Deb 07 June 1951 vol 488 cc1359-575

10.15 p.m.

Mr. Nabarro (Kidderminster)

I beg to move, in page 10, line 20, at the end, to insert: excepting only expenditure on the following classes of equipment:—

1. (a) Boilers, firegrates, lagging and insulating plant and similar equipment installed as replacements of existing plant, in industrial, commercial and farming establishments, demonstrably for the purpose of economising in the consumption of coal and/or other solid fuel.
2. (b) Electrical generating equipment installed in industrial, commercial and farming establishments to provide local electricity supplies, independent of mains supplies."

We pass from the question of personal allowances for Income Tax purposes to the question of industrial allowances, and while, no doubt, the wider issues involved in the Chancellor's withdrawal or abrogation of initial allowances for Income Tax purposes will be dealt with on the Motion, "That the Clause stand part of the Bill," my purpose is to draw the Committee's attention to what I consider will be very damaging effects on our national economy if the initial allowances are withdrawn from plant, machinery and equipment to be installed in industry primarily for the purpose of saving solid fuel.

I am sure that in this connection I shall have an exceptionally sympathetic hearing from the Treasury Bench, because I believe it is without precedent in the history of this House that the Chancellor should, immediately prior to going to the Treasury, have held the position of Minister of Fuel and Power. The present Chancellor of the Exchequer was Parliamentary Secretary to that Ministry from May, 1946, to October, 1947, and Minister of Fuel and Power from October, 1947, until March, 1950. During that period, he will, no doubt, have had ample experience of the benefits that can accrue to our national economy by pursuing an energetic policy of fuel economy in industry and the optimum utilisation of our available fuel and power resources.

Perhaps, at the outset, I should quote the present Minister of Fuel and Power in support of the Amendment which I am moving. On 1st February, 1951, he said: I could say much about our measures to promote the better use of coal, and the future may well depend upon our success in that regard. In my view, we need a national plan, not only for coal production but for saving coal."—[OFFICIAL REPORT, 1st February, 1951; Vol. 483, c. 1115.] What is the Minister of Fuel and Power doing about it? So far as I can see nothing, other than to continue and perhaps enlarge certain advisory services that he has at his Ministry, with their regional offices in 12 areas of the country.

It is fortunate for the purpose of my Amendment that we did not reach it last evening, because only last night the fifth Annual Report of the National Coal Board was published, and I like to think that I am the first Member of this House to quote from it. There is something in that Report which precisely fits the purpose of this Amendment. I have given the Chancellor prior warning that I intend to quote from that Report and, in particular, Chapter 5, entitled "Efficient Use of Coal." On page 32, paragraph 123, there appear the following words: More important still, there is the question whether it is better for the nation to use capital and labour to expand coal production or to apply some of these resources to ensuring that each ton of coal is converted into a greater amount of useful heat or energy. That is the purpose of this Amendment—to induce by fiscal measures the installation of more efficient coal-saving equipment in industry. The Coal Board's Report continues—and this is even more pertinent—in paragraph 124: Much of the 200 million tons of coal used in this country every year is wastefully burnt. An irreplaceable asset on which the country's industrial future depends is too often being squandered. Paragraph 125 sets out three problems. The first is to make coal go further. The second and third problems would, Sir Charles, be out of order. [Interruption.] The hon. Member for Stoke-on-Trent, South (Mr. Ellis Smith) will know that his own smoke-polluted atmosphere in the Potteries is a glaring example of the inefficient use of coal in industry.

There are two methods of inducing more efficient equipment for burning coal and other solid fuels in industry. The first is through the medium of the advisory services to which I have referred and which are run by the Ministry of Fuel and Power; and the second is the method which has not yet been used in this country, the use of the fiscal weapon as an inducement, through the weapon of taxation, for persuading industry to install more efficient plant.

While initial allowances were in force, there was some mild inducement to industry to spend capital sums on putting in more efficient plants for burning coal and other solid fuels, but there is quite a different argument to be applied to consideration of fuel saving equipment from other forms of capital equipment, which the Chancellor referred to in his Budget speech of 10th April last, when he said: The initial allowances, after all, were introduced at the end of the war as a means of stimulating re-equipment and modernisation. That is, of course, a very desirable aim, but in our present circumstances to stimulate capital expenditure in this way would, I am satisfied, positively endanger the defence and export programmes too much."—[OFFICIAL REPORT, 10th April, 1951; Vol. 486, c. 842.] There might be a good case—although the general arguments against it will, no doubt, be adduced on a later Amendment to this Clause—for opposing the withdrawal of initial allowances on capital equipment generally. In my view, there is no case for supporting the withdrawal of these initial allowances on fuel saving equipment, because if anything is likely to endanger the progress of our defence programme and the programme of exports, it is a shortage of coal. One cannot begin to envisage re-armament in Britain unless we are assured of a continuous flow of coal to industry.

Therefore, considering that out of our total coal consumption in Britain last year we used no less than 105 million tons for the purposes of industrial production, excluding power house consumption, it follows then, that every ton of coal saved in industry is equivalent to another ton of coal deep-mined. That is the measure of the problem. On many occasions in the House hon. Members have referred to the potentialities for saving coal in industry. I hope the Committee will bear with me this evening if I give just a few technical but very glaring examples of what can be achieved by fuel-saving plants.

I purposely select these from a large number of such items available, because it is the class of equipment which I have specifically referred to in this Amendment. At the beginning of the Amendment, boilers are referred to. Every hon. Member will know the effect upon fuel consumption of using an old Lancashire boiler. The hon. Member for Rotherham (Mr. Jack Jones) would be an expert in the matter. The effect very often is to increase fuel consumption from 50 per cent., to 100 per cent.

Mr. Jack Jones

The Tories did nothing about it.

Mr. Nabarro

The period to which the hon. Member is referring is presumably until 1939 and, so far as I am aware, the National Coal Board was not in existence then. Therefore, there was no shortage of fuel.

Mr. Jones

In the period to which the hon. Gentleman refers, there was a surplus of coal because people could not afford to buy it and industry could not afford to waste it.

Mr. Nabarro

I am sure that I should be out of order if I replied to the hon. Member for Rotherham as to the economic implications of the coal surplus in the 1930's. The question whether we should replace fuel consuming equipment in industry is a problem which applies to 1951.

My first example is of an industrial concern that spent £13,500 upon installing a waste-heat boiler, the life of which was approximately 20 years. It was capable of saving 3,000 tons of coal a year. That figure means little unless it is related to miners' effort. For the purpose of simplicity, I take the average output of one British miner as 300 tons in a full year. Therefore that one piece of equipment was capable of saving the efforts of one miner for 10 years or of 10 miners for one year. Surely it is worth the Chancellor's while as a matter of broad national policy to provide every possible form of tax and fiscal inducement to British industry to install equipment of that sort.

My second example concerns the fitting of an economiser to a Lancashire boiler. There are many similar examples in recent issues of "Fuel Efficiency News." It was installed for the modest expenditure of £2100 and again the life of the plant was 20 years. In this case the coal saving was 580 tons in one year. At the average rate of output of 300 tons of coal per year by one miner that represents a saving in the first year of installation of not less than two years' effort on the part of one miner or one year's effort on the part of two miners. Hon. Members will recognise that there must be tens of thousands of Lancashire boilers installed in all parts of the United Kingdom. Inducements should be provided for many of the smaller industrial undertakings to look to their heating equipment.

The third example again concerns a Lancashire boiler with a superheater fitted to it for a capital expenditure of only £675. The fuel saving is of the order of 255 tons in one year, representing approximately nine months' output on the part of one miner. The fourth example, which I have picked purposely because it can apply not only to industry but to farming and to any commercial building in the country heated by steam methods, refers to sectional magnesia lagging applied to a 4-inch steam pipe. Hon. Members will be aware that the efficiency of steam for thermal purposes depends in large degree upon the efficiency of the lagging applied to the pipes. The cost of this equipment was only £1,815 and the life was 10 years. It seems incredible to say so, but the fuel saving amounted to 1,985 tons of coal in the first year.

10.30 p.m.

Mr. Messer (Tottenham)

Is that not an inducement by itself?

Mr. Nabarro

If the hon. Gentleman will allow me to continue, I will come to the strictly taxation aspect of all this in a moment. There are advantages other than the direct saving of coal—

Mr. Messer rose—

Mr. Nabarro

The hon. Member sits for Tottenham, which is a suburb of North London, a long way removed from the coal mines. He would be well advised to study the principle for which I am pleading which is, that not one minute of a miner's labour should be wasted.

Mr. Jack Jones

I am very interested in this able speech of the hon. Gentleman, and I want to give him some further information which he can use. In 1919 and 1920, I advocated and negotiated a coal-saving bonus scheme for the men on the furnace to which he is referring, long before the management thought of doing so.

Mr. Nabarro

I am indebted to the hon. Gentleman for his intervention. He has always been a principal exponent of joint consultation in industry and of the advantages that may be derived from recommendations made from the workers' side. I also support that, as he knows well enough.

The fifth example that I want to give, which fits closely the Amendment, is in connection with insulation. There is not a building in this country that is heated by steam methods, or by many of the other similar methods which is not capable of showing fuel economy by improved insulation. Only 48 hours ago I was talking privately to one of the present Ministers about this Amendment, and in discussing insulation with him he confirmed my view. He said that in his experience of over 25 years in industry, he had rarely come across an industrial building in which the insulation could not be improved by the use of a moderate amount of material. From the use of that material the direct derivative is a great economy in the use of coal or other solid fuel.

I have endeavoured to demonstrate, from the technical point of view, all the advantages to be derived from improved fuel utilisation, and I now want to turn to the fiscal aspect for a few moments. There are some paradoxical considerations inherent in this Amendment. I believe that if the Chancellor would agree not to withdraw the initial allowance for fuel-saving equipment in industry, it would result in an increased revenue to the Treasury in the course of the next few years. That is the paradox to which I refer.

Clearly wasteful coal burning in industry represents an excess expenditure on the part of an industrial undertaking burning the coal; but that excess expenditure is admitted by the Inland Revenue as a charge for trading purposes for computing Income Tax and Profits Tax. Therefore, it results in a diminution of tax collected by the Treasury. Every ton of coal that is burned excessively in a British industrial undertaking today represents a decline in tax yield to the Treasury of approximately £3, assuming that the pithead price of coal is £3 a ton. An initial allowance costs the Treasury nothing. Hon. Members opposite have often argued this point with me. They seem to think that it is money given by the Treasury to the industrial undertaking. It is only an interest-free loan from the Treasury.

Mr. Glenvil Hall

I would remind the hon. Gentleman, now that he has been good enough to give way, that in the third year the suspension of initial allowances will yield and save the Treasury £170 million.

Mr. Nabarro

It would not, and that is where I must cross swords with even so eminent an authority as the former Financial Secretary to the Treasury. Over a period of a decade, that is, 10 years—the right hon. Gentleman well knows that it does not cost the Treasury one iota. All that it means is that, the Treasury grants 40 per cent. in the first year and commensurately less in the remaining life of the plant. Before the introduction of initial allowances the plant or equipment was allowed for depreciation purposes in equal annual sums over the whole life of the plant. Therefore, the initial allowance is only an interest-free loan.

What I am trying to explain to the learned Attorney-General, who I hope will be answering me—[Interruption.]—I apologise to the Economic Secretary to the Treasury, who I understand is to answer—is that there is an indisputable argument in the case of fuel-saving equipment. If initial allowances are not withdrawn, it will result in an increase of revenue for the Treasury. I hope that argument will not be considered disingenuous. Also there is a complementary argument which I think the Committee should consider at this stage.

As things are and assuming an industrialist did not regard as important the national aspect of saving coal, it would pay him to go on wasting coal in old boilers and fire grates rather than to spend money on new capital equipment. It would pay that undertaking to go on wasting coal—

Dr. Morgan (Warrington)

And killing men with silicosis.

Mr. Nabarro

—because of the cost of every ton of coal that was wasted in outworn equipment £2 out of every £3 would be paid by the Treasury. The Chancellor of the Exchequer takes approximately two-thirds of the gross profits of industry in the form of Income Tax and Profits Tax and the fuel costs of an industrial undertaking are admitted as a charge for the purposes of computing those taxes.

Once the Chancellor withdraws the initial allowances, there is no inducement to an industrial undertaking to spend capital on fuel-saving plant, which, in fact, would be very low down on the list of that undertaking's capital equipment priorities. There is scarcely a business today that is not short of working capital due to the high cost of raw materials and replacement of productive machinery, such as lathes, machine tools and other similar plant. Therefore, fuel saving equipment would stand well down on the list of priorities, especially as there is no direct inducement to such industries to install such plant.

I pass now to consideration of the possible reactions of the Chancellor to these proposals. I know he will have objections, and I think it is fair to anticipate what some of those objections may be, for there is an effective answer to each of them. He will undoubtedly say that he cannot create a precedent by retaining initial allowances on only one group of plant and equipment in industry and treat it under a special heading. I would remind the Chancellor that under the 1944 Finance Act, Part IV, and under Part VI of the 1945 Finance Act, special provisions and allowances were given for every form of scientific research. That, in itself, creates a fiscal precedent, and in the 1945 Finance Act, under Part IV, a special allowance was given in respect of agricultural buildings.

The Chancellor will undoubtedly ask—and this objection has often been advanced to me by other people interested in this problem—how the Inland Revenue can obtain proof that the plant and equipment installed in a certain industrial undertaking is capable of saving fuel. That is why I, perhaps inadvisedly, used the rather clumsy word "demonstrably" in this Amendment. According to the English dictionary, "demonstrably" means "capable of positive proof". The positive proof I want provided for the Inland Revenue in regard to the certification of fuel-saving plant in industry should come from the advisory services of the Minister of Fuel and Power which he maintains in the 12 regions of the country for—by exhortation mostly at present—advising industrialists how best they can improve their methods of fuel utilisation. Therefore the method of certification for fuel saving plant to rank for continued initial allowances is in the hands of a Department other than the Treasury, but a Government Department nevertheless—the Ministry of Fuel and Power.

May I pass now to the second group of equipment under this Amendment, that is, the independent generating plant which is shown under paragraph (b). It comprises electrical generating equipment installed in industrial, commercial and farming establishments to provide local electricity supplies, independent of mains supplies. That equipment falls broadly into two important groups. It is either generating plant which is independent of mains electricity and is worked by waste steam or by similar methods, or the second group, of course, would be independent generating equipment which is worked by Diesel oil.

I do not suppose that we in the United Kingdom, except in remote rural areas, would have ever seriously considered installing generating plant independent of mains supplies had it not been for the force of the circumstances which have arisen in the last five years. I hope I make this point in no party political or highly controversial vein when I say that hon. Members in all parts of this Committee must be aggravated and often dismayed by the devastating effects of power cuts. And they are not diminishing. The power cuts in the Midlands in the course of the past few weeks have been worse than ever before.

The purpose of paragraph (b) of the Amendment is to endeavour to provide a fiscal inducement to every industrial undertaking in the country to install for the use of its own factory or workshop or farm a generating plant which can be fired—I use that word metaphorically—by waste steam or by fuel oil, to make that factory independent of mains elec- tricity. Many hundreds of factories have done it already. There is a two-fold advantage. First, it enables the factory to continue its production without interruption when load shedding or power cuts take place. The second, and much more important, point is that if an aggregation of thousands of firms install these independent stand-by generating plants, the effect of abating the load on the electricity mains would be such, particularly at peak hours, that it is probable we could dispense with power cuts and load shedding altogether.

Mr. J. Lewis

I have followed the hon. Gentleman's argument carefully up to the present, but the installation of this special equipment does not replace electricity from the point of view of load shedding. It is suitable only for auxiliary services, such as lighting and small matters. The actual cost involved is such that it does not pay an ordinary industrial undertaking to put in sufficient Diesel oil plant to be able to run the whole factory in the event of load shedding.

10.45 p.m.

Mr. Nabarro

While I am always prepared to listen to an hon. Member who is capable of giving advice, I should state in this instance that I have operated these plants for many years past; furthermore, I have bought such plants, particularly as an insurance policy against power cuts.

I hope that the Committee will bear with me while I read a letter which expresses the experience of an undertaking in Norwich—[An HON. MEMBER: "It is only one."] The hon. Gentleman says it is only one. This is one example selected from hundreds of such cases. I have already said that I have myself operated these plants for many years, and it is now possible, by mechanical means, to install automatic switchovers so that when the power from the mains is shut off or shed, one can automatically bring into use the stand-by generating plant; and hundreds of commercial undertakings have done just this.

The undertaking in Norwich to which I have referred, employs 1,500 people, and if the hon. Gentlemen who represent Norwich constituencies are here, they will probably know of the firm to which I refer. After the close-down of power stations in 1947 had necessitated the closing down of three mills, this firm determined that such a thing should never happen again. They therefore installed independent generating sets in each of their three mills. These installations were concluded before the autumn of 1948, and this firm was able to have a full, normal working day. Staggered hours were suggested to it, but staggered hours meant working until 10 p.m. and this was with a staff which consisted in the bulk of young girls living in the country some miles from Norwich. That meant that there was not the transport to get the girls home.

This is the letter from the Managing Director of Francis Hinde and Hardy of Norwich: After the closing down of all the power stations in 1947 which necessitated the closing down of Messrs. Francis Hinde and Sons, Ltd. for three weeks, we determined that such a thing should never happen to us again. We therefore installed an independent generating set in each of our three mills. The sets installed were 100 KV.A or 80 KW each, 400 volts on 4 core cable for distribution. These installations were completed before the autumn of 1948 with the result that when all industries were asked to institute staggered hours, we were able to carry on with our normal day. If we had been obliged to adopt staggered hours, it would have meant that a large number of our workers would have been on duty until 10 p.m. and in view of the fact that the bulk of our workers are young girls, several of them living miles outside Norwich, it would have meant that they would not have been allowed to come and there would not have been any transport for them in any case. We normally take over the major part of our load from the end of September till the end of April by arrangement with the local authority, so that during these months we are free from the constant power cuts. We should be quite content to carry on providing our own power after this date, but we were advised by the local authority that this was unnecessary. In the event, however, there have been many power cuts since that date, and it would probably have been to our advantage had we continued generating our own power. Although we have a standing contract for the supply of power involving the minimum charge, if we take over the load ourselves by agreement with the local authority, this charge is waived. With regard to cost, there is very little difference in the two sources of supply. In our opinion, the installation of these power units has been of the utmost service to us, and has well repaid the trouble and expense. No one can deny that here are two economic weapons for beating the fuel and power cuts. By installing such independent generating sets, there is continuity of power supply. But, as with solid fuel-saving equipment in industry, unless there is a fiscal inducement to firms to put in the equipment of this sort—which there is not if the initial allowances are withdrawn—then stringency of funds, and the high cost of raw materials and of replacement of production equipment, will mean that this independent generating equipment is not likely to be installed.

I apologise for having kept the Committee so long, but I am dealing with an issue of primary and fundamental importance; and if, without ranging too far from the precise words of this Amendment, I may give a further warning, I should like to remind the Attorney-General that, notwithstanding that over the first four months of this year, by the magnificent efforts of the miners, there was an increase in coal production of 2,300,000 tons compared with the first four months of 1950, yet coal consumption in the same four months was 2,600,000 tons greater than in the preceding year, and we exported 3 million tons of coal less than we did in the previous year.

Today coal stocks for this time of year are lower than they have been at any time since 1945, including the disastrous year of 1947. Unless we provide the fiscal inducements for which I ask in this Amendment as part of a national policy and plan for the scientific utilisation of coal, other solid fuels and fuel oil, then in the course of next winter or the winter after, or both, we are likely to face calamity or a major disaster in a repetition of the complete stoppage of all our factories which we experienced in 1947.

Mr. J. Lewis

The hon. Member for Kidderminster (Mr. Nabarro) need not have apologised to the Committee for staying so long on his feet. The Committee will agree that it is a long time since we heard such a splendid speech on the question of fuel saving. He has rendered a valuable service to the public in dealing with the matter from the technical aspect. In fact, I think many hon. Members will be convinced by the logic of his arguments, and I hope that my hon. Friend the Economic Secretary to the Treasury will keep an open mind on the first part of the Amendment dealing with the question of allowances as an inducement to industrialists to take steps to ensure that there is the maximum amount of fuel saving.

I shall not keep the Committee long in what I have to say, but I should like to refer to one point on which I made an intervention, and which I think the hon. Member did not take too well. The installing of independent sets as an auxiliary form of electricity supply so that factories could continue to produce in times when there was a check on the public supply is not, in my view, an argument that can be applied generally to industry as a whole.

The hon. Member gave an example of sets to produce 80 k.v.a., but that is for a very light industry indeed. In the majority of cases there are 1,000, 2,000 or 3,000 k.v.a. employed, and the hon. Gentleman can accept my assurance that it does not pay a medium or heavy industry to undertake to install independent Diesel oil engines to produce electricity, particularly as they have only to be operated for a few days in the year. So the majority of industrialists in heavy industry could not afford to do so, as it would not be a sound economic policy to install these independent sets.

I quite agree with the hon. Member's arguments as they apply to light industries. I know something about this, because I have employed one of these sets myself. It is extremely useful when there is load shedding. The only value of independent sets in heavy industry is as a small supplementary supply to keep the auxiliary floaters running and the services in operation.

Mr. Nabarro

The hon. Member used the word "auxiliary." I used the word "alternative." There is a subtle difference between the two. My second point was that the shortage of power megawatts over the country as a whole at the peak period was not more than 10 per cent. It would more than fit our purpose to put independent genertors only in a part of the light industries, for that alone would prevent power cuts over the whole industrial and domestic field.

Mr. Lewis

I am sorry that on that technical point I must disagree. The amount of capital investment involved in installing sets to do what the hon. Gentle- man said would be necessary to avoid power cuts is such that, if he had the figure before him, he would not contemplate this proposition. I will leave that point, because he made such a magnificent speech on the other aspect of this matter that we are begging the question on this point of particular power sets.

I will add my voice to his in expressing the hope that the arguments he has advanced in respect of inducing industrialists to take every possible step to install plant in order to save fuel and power—and I can heartily endorse every word he said about fuel-saving equipment, especially in regard to lagging and economic modern boilers, which have a must greater efficiency than the old-fashioned type and in circumstances where the question of coal-saving and fuel-saving is of such vital importance—will lead to my right hon. Friend to indicate that he will give this Amendment, even though tonight he is not prepared to accept it, his consideration and advise the Committee at a later date on the decision which the Treasury are prepared to take on the matter.

Sir Arnold Gridley (Stockport, South)

Perhaps it would not be thought inappropriate if I were to intervene briefly on a subject with which I have been familiar for a great many years. I have been one of those who have found it necessary to adopt what years ago I considered to be an absolute heresy. When I was first associated with the management of electric power undertakings, it was our policy to provide a supply so efficient and so cheap that it was quite unnecessary for any power user to do other than take his whole supply from the public service undertakings. Unfortunately, the experience of the last few years has made it essential to modify that policy.

Now I have no more to do with supplying power, but I have still a fair amount to do with its use. In some of the engineering works with which I am concerned, we have found it necessary to install a certain amount of stand-by plant to assist the national production and, so far as practicable, to maintain our production uninterrupted. I agree with the hon. Member for Bolton, West (Mr. J. Lewis) that there are very few cases in which it would pay to put down a com- plete alternative plant. Nor is it really essential.

What is required by many firms still—although many firms have spent money on providing a certain amount of alternative stand-by plant—is to find out what percentage of cuts one is expected to submit to during times of peak loads in the area in which one's works may be situated, because it is not quite the same in different parts of the country. In some cases, if one were to provide 150 horsepower where one's ordinary load is 1,000 horse-power, that would probably suffice to meet the cut one was called upon to effect, by cutting out some of the motors which would ordinarily be running. Therefore, although I agree more with the hon. Gentleman the Member for Bolton, West, than with the mover of this Amendment, nevertheless it does not detract in any respect from the arguments submitted by my hon. Friend the Member for Kidderminster (Mr. Nabarro). His argument holds absolutely.

11.0 p.m.

I ask the Treasury to give careful consideration to this Amendment for another reason. The more that industrial establishments can be encouraged to install a certain amount of alternative stand-by plant for themselves, the more it will become less necessary for the domestic user to submit to the horrible inconvenience which so many of the women have had to endure during the last few months, and which we are told by Lord Citrine, the head of the British Electricity Authority, are part of a condition which is likely to last for many years.

He has warned the Government, as plainly as any man in the country, of the serious consequences of the cut in capital expenditure on the provision of more power plant in our power stations. I do not know whether his warnings have fallen on deaf ears so far as the responsible members of the Government are concerned, but unless they pay serious regard to what he and others have said, they are carrying a very heavy responsibility.

Clearly, one of the ways in which we can meet the situation which, according to those who know best, we are likely to face for some years is to adopt the proposal contained in this Amendment and to facilitate an easement in the situation, which can be brought about only by the installation of a certain amount of standby plant in our industrial establishments, in the absence of a further speedy extension of our power stations. In serving all of us in our homes, the women of this country are being called upon to face most serious handicaps and inconveniences. In this time of austere living, that is a powerful additional argument why the Government should give sympathetic consideration to the Amendment, which I wholeheartedly support.

Mr. Jack Jones

I think it would be wrong if one more voice were not added from this side of the Committee in approbation of the speech of the hon. Member for Kidderminster (Mr. Nabarro). As one practical man to another, I should like to compliment him on what I consider to be one of the most brilliant speeches of a practical nature made in the House for a very long time.

At the same time, I would remind the Committee, and particularly the Tory Party, that that speech was a complete indictment of the utter failure of the industrialists of the past to make the best possible use of what God gave to this country—its coal. I speak as one who has seen several million cubic feet of gas wasted. Today there are still millions of cubic feet of gas being wasted—every day, for 24 hours a day and for seven days a week—all because of the lack of an integrated policy in the use of that gas.

Let hon. Members come to the place where I live, Irlam, in Lancashire, and see the bleeder which for many years was never out—before the war broke out—burning millions of cubic feet of gas. Go to Kettering, and to Shelton, Stoke. For years there has been a lack of an integrated policy in the use of our most precious possession—coal. One would see these flares lighting up the countryside, while on the road nearby one would see the headlights of ambulances taking to hospital the miners who produced the very commodity which was being wasted.

I compliment the hon. Member for Kidderminster on a brilliant speech, but I would again remind him that it was a complete indictment of the utter failure of industrialists in this country in the past to make the best use of our coal.

Colonel Clarke (East Grinstead)

I want to say a few words in reply to the hon. Member for Rotherham (Mr. Jack Jones). I think he forgets that before the war the problem was the disposal of the coal. We had more coal than we knew what to do with. We were trying all sorts of ways to dispose of it. We spent a lot of money in obtaining plant to make oil from coal. The problem then was to get rid of the coal and to keep the pits going.

I wish to support this Amendment, which is not only a most practical suggestion for the saving of coal but is in conformity with sound financial doctrine. I bring to my support a document with which I think the Treasury will not be unfamiliar. About two years ago a Committee was set up by the Treasury on the Taxation of Trading Profits—the Tucker Committee—and I want to refer very briefly to one of their recommendations. In paragraph 124 they say: We accordingly recommend that a minimum rate of initial allowance should be prescribed; that any association which represents a particular industry should be entitled to apply for a rate of initial allowance in excess of the minimum"— that is exactly what my hon. Friend the Member for Kidderminster (Mr. Nabarro) is doing tonight— and that the authority responsible for determining these applications should be entitled to take into account both the price level of the plant and machinery in question and also the importance of the particular industry to the national economy. I suggest that also is what is being done tonight. Finally, they said: It would be more appropriate to entrust the task not to the Inland Revenue, but to the Treasury as the Department responsible for general economic policy. That is the third point made by my hon. Friend. It is in the interests of the national economy that this should be done, and should be put straight to the Treasury. In this case an exception should be made to the general rule. I shall not touch on the other points. I approach it merely from the financial point of view. I have quoted the advice the Treasury have already had on the subject, which I hope they will accept.

Mr. Charles Ian Orr-Ewing (Hendon, North)

I wish to add my support to the most able speech which we have heard from my hon. Friend the Member for Kidderminster (Mr. Nabarro). Whereas we may not be able to install plant to take the full industrial load, as mentioned by the hon. Member for Bolton, West (Mr. J. Lewis), we can make a very useful contribution by permitting these initial allowances and encouraging industries to put in stand-by plant which, if it cannot take the full load, can at least keep many shops in an industrial plant working.

I think the Committee will appreciate that so many processes in industry today are concerned with sub-assembly and with producing light components which eventually go into the making of the completed product. This sub-assembly and the manufacture of those small components are, in general, undertaken by women, and we have a real obligation to keep these processes going at a time when we suffer fuel cuts. It will be disastrous if this Amendment is rejected and many industries and plants throughout the country are compelled to close down, as they were forced to do last year.

I ask the Financial Secretary to consider this Amendment, which is put forward with great seriousness, and is designed not only to keep our industries going, but at the same time to make a valuable contribution to the defence of the country. It may be that on some future occasion when we are called upon to defend this country the main supply on which we are so largely dependent may be cut. In those circumstances, a very valuable contribution can be made by standby plants. We have not only a peacetime need, which will take away from our peak load which cannot be met for some years to come, but we have also a wartime need, and we therefore have a very real obligation to support this Amendment which can make a worth-while contribution to the industrial efficiency of this country.

Mr. Fort (Clitheroe)

I should like to support the Amendment moved in the extremely able speech of my hon. Friend the Member for Kidderminster (Mr. Nabarro). He has, I think, put before the Committee the first step in carrying out a practical policy for fuel in this country. We have so often in our debates on this subject confined ourselves in the past to looking to, as it were, blood on the coal and, at the present time for the consumers, stone in the grate. By putting forward very practical proposals, my hon. Friend had made a definite suggestion by which we can make a big step forward in using better the coal we raise in this country.

In his Amendment he has, in particular, suggested how fuel economy can be carried out. The important word, it seems to me, in the first part of his Amendment is "demonstrably," because it is possible, by putting suitable instruments on to the boilers, to prove to the management, and also to the firemen, the saving they are making by proper control of their boilers. But these instruments will cost money, and if they are to be installed in the numbers that are necessary in order to achieve large economies, they certainly should have the encouragement of the Treasury in the form of the 40 per cent. initial allowances that have been made to date, and which, alas, in the present Budget it is proposed to withdraw.

With regard to the second part of my hon. Friend's Amendment, that pertaining to electricity, despite what the hon. Gentleman the Member for Bolton (Mr. J. Lewes) has said, there are undoubtedly a great many users of electricity—not the heaviest users, but in the textile mills and many others—who would find it possible to meet cuts which will occur when peak demand comes on to the national grid by installing Diesel-driven generators. Although it may mean that some of the plant will have to be cut out, production will be able to be maintained with only a small loss by installing these Diesel-driven generators. But they are expensive, and again, if this is the policy we should adopt—as I am sure it is—in order to reduce these electricity cuts in this country, those who are prepared to take the risk of installing them should be encouraged by being allowed the initial allowances they have enjoyed to date.

There is one additional point. In the Amendment my hon. Friend refers to lagging. We lose enormous amounts of heat, and therefore coal, by not lagging our pipes in this country. Let me give the Committee one homely example. We know that very often, when we run the hot water to wash our hands, it takes a minute or so to run off the cold water before the hot water comes. That cold water which first comes has all been heated but has lost its heat in the pipes just because those pipes have not been lagged. Although I do not suggest that this allowance should be given for the in- stallation of pipes in our homes, that homely example does show the loss of heat which results from not lagging our pipes, and it could be multiplied many tens of thousands of times in industry.

It is for these reasons that I ask the Economic Secretary, when he replies, to consider with great sympathy this Amendment and, if he cannot accept it in the exact wording put before him, to be prepared to say that on the Report stage he will move a formal Government Amendment with which all of us can agree. By doing this he will be forwarding the first attempts to formulate a proper fuel policy in this country.

11.15 p.m.

Mr. Robert Carr (Mitcham)

I also support the Amendment which has been particularly ably moved by my hon. Friend the Member for Kidderminster (Mr. Nabarro), and I support it because it seems to me to be a constructive attempt to tackle a fundamental problem in this country.

When I think of the chances of surmounting the problems connected with re-armament, of meeting the rising cost of living and preserving our standard of life, our one major hope seems to me to lie in the direction of increasing productivity. When, from my experience of industry, I turn my mind to this problem, it seems that one of the major threats to this hope lies in the shortage of fuel and power. After all, when our experts return from America one of the most common things that is said is that the American workman has more horse-power at his elbow than the British worker, and if we are to increase our productivity we have to give British workmen more power at their elbows. That is why I support this Amendment which attempts to deal with this fundamental problem.

If we are to overcome this threat of a fuel and power shortage, the best hope lies in the great scope which undoubtedly exists in the field of industry for improving our efficiency in fuel consumption. My hon. Friend the Member for Kidderminster gave many examples. I should like to add to them some figures, which I had the privilege of giving in an earlier debate on the coal situation in February of this year, relating to the relative efficiencies which exist in British industry in the matter of steam raising.

Inquiries have shown that the average cost of raising steam in different factories in this country varies between such wide limits as 3s. per 1,000 lbs. to around 11s. per 1,000 lbs. We must admit that that is an enormous scatter in efficiency. If we could bring the average down to something like the 3s. mark, we should have achieved an enormous saving in our coal consumption in industry. In fact, experts have estimated—and, of course, it is only an estimate—that the potential saving of coal consumption in this way may be as much as 20 million tons of coal a year.

My hon. Friend the Member for Kidderminster put forward what I thought was an ingenious and able point to the Chancellor of the Exchequer on the financial aspect of this Amendment when he said that it would prove to be a gain and not a loss to the Revenue. If he was right in his argument—if we can save eventually 20 million tons a year—at £3 a ton that is a saving of £60 million. If that is added to the profits spread over industry, the result is £35 million in revenue to the Exchequer. I would support his argument that this Amendment is potentially a revenue raiser if we are prepared to take a long-term view of it.

But this suggestion of saving coal by putting in this sort of modern equipment is not only offering us a direct saving of coal in steam raising in industry, but is also offering us help in the problem of electricity supplies. I have in mind not so much alternative or auxiliary supplies, such as those whose points were discussed earlier. If we could persuade more firms to use, for example, the back-pressure turbine method of raising steam, we would not only have cheaper steam raising, but also a permanent and not just an alternative method of supply. Many firms, I think, would be able to offer electric power to the common grid, and could do it with greater over-all efficiency than could be achieved by any power station of a public utility. That was admitted by the right hon. Gentleman the present Minister of Labour in replying to the coal debate on 1st February.

These schemes of fuel saving, however, need new plant. They involve capital expenditure. There is an urgent need to install new plant of this kind. That is the fundamental reason for this Amendment. We know the Chancellor's general argu- ment for repealing initial allowances: he says there is a need to damp down demands for capital equipment. In the present circumstances of the re-armament programme there may be such a need, and I am glad that he has proposed to do it by financial means rather than by direct physical controls. I am not sure that the initial allowances is the right method, but that is not the argument here. I submit that, whether or not we admit the Chancellor's general argument, we certainly ought not to admit the Chancellor's argument in this special context of plant which will stimulate greater economy in fuel consumption. On the contrary, it is vitally important that we should not repeal allowances in this connection, but should stimulate the introduction of this type of plant.

How can that be done if not by incentives? First, there are propaganda and persuasion. I pay credit to what the Ministry of Fuel and Power are doing in that way, but it will not be sufficient to get the results we want quickly enough. Something must be done to supplement that work of propaganda. Is it to be compulsion? I asked a Question of the Minister on 5th April on that point, and he replied that the Fuel Efficiency Committee advised that the co-operation of consumers was preferable to compulsion. I was very glad to get that answer. I do not think compulsion can possibly work. But if you reject compulsion, then you have to turn to this method of financial incentives, and that is why I think this Amendment should be agreed to.

What are the Government's possible objections to this Amendment? There may be the objection of administrative difficulties. I also questioned the Minister of Fuel and Power about this, and he replied that the Fuel Efficiency Committee had from time to time suggested various financial incentives but their use raised considerable administrative difficulties. No doubt they do, but I should like to draw attention to the fact that the difficulties were only called considerable, and not insuperable. I appeal to the Chancellor not to hide behind the skirts of this very old lady of an excuse. If there are administrative difficulties, let the Government explain to the Committee something of the nature of these difficulties so that we can weigh them up, and not just use that cliché of these two words.

If it is not administrative difficulties, what other difficulties can there be? It seems to me to lie in this principle of discrimination. It may be argued that if we discriminate in favour of plant for stimulating fuel efficiency, why not in favour of other plant? That is a difficult path to tread, but, as the hon. Member for Kidderminster said, it is a path which has already been trodden in other applications. In any case, it is a bad argument to refuse to do one good thing because it is not possible to do other good things as well.

Moreover, if we are to achieve the industrial flexibility, efficiency and enter-price which we must have in this country, coupled with the degree of direction of our economy necessary to avoid some of the abuses which go with a system of unrestrained laissez faire, then the only way we can do it is by means of a fiscal and monetary policy which must be made a more delicate weapon than it has been in the past. Such an attempt must involve a discrimination of the sort represented by this Amendment.

The Amendment is an example of such a step forward. I hope the Chancellor is going to accept it, because it provides constructive help in this fundamental problem. I make a final appeal to him, if he thinks this Amendment is not acceptable as it stands, to accept at least the principle of financial incentives for this purpose, so that when we come to the Report stage we shall be able to put forward alternative suggestions which are acceptable and on which we can all agree.

I submit to the Committee that this is not a controversial Amendment, but one of fundamental importance to this country. We must stimulate greater fuel efficiency. I hope hon. Members on all sides are going to support this Amendment or press the Government to put forward one designed for the same purpose when we come to the Report stage.

The Economic Secretary to the Treasury (Mr. John Edwards)

I am sure that all hon. Members who have been here since this Amendment was moved will have listened with pleasure to all that has been said about the need for fuel efficiency, and I do not want to say anything which in the slightest way detracts from what has been said about that need.

I should like to add my congratulations to the hon. Gentleman the Member for Kidderminster (Mr. Nabarro) on what I thought was an admirable exposition of the need for fuel efficiency in our present fuel and power circumstances. If I am not able to accept the conclusions which he and other hon. Gentleman have drawn, it is not because I want in the slightest degree to contest anything they have said about fuel and power efficiency.

Although we are not at this stage debating the general problem, it is important that we should recognise that this Amendment and others on the Order Paper have to be considered in relation to the general problem. The hon. Member for Mitcham (Mr. Carr) recognised that this was the real problem. The defence programme to which we are committed cannot be fulfilled in addition to current civilian and export demands. That is the real problem, which cannot be avoided. So far as we are concerned, it is important that we should do nothing which undermines in any serious way the measures we propose in order to try by fiscal means to do something to damp down the demand especially for those products needed for the defence programme.

11.30 p.m.

The hon. and gallant Member for East Grinstead (Colonel Clarke) quoted the recommendations of the Tucker Committee in aid of his case. I think, as the hon. and learned Gentleman the Member for Wirral (Mr. Selwyn Lloyd) indicated, I believe during the Second Reading debate, that there are very different views about this particular recommendation. I do not want to get drawn into this matter tonight, because it is somewhat complicated and highly controversial, but I hope it will be agreed that there ought to be no question of implementing these recommendations in the existing circumstances. Therefore, it seems to me that in bringing in that recommendation the hon. and gallant Gentleman really is not helping his case forward—at any rate from my point of view, nor, if I may add it, from the point of view of some hon. Gentlemen opposite. I am merely going on what the hon. and learned Member for Wirral said.

I do not think, whatever we might feel about this Amendment, that we ought to accept it because the Tucker Com- mittee recommended a system of variable initial allowances. It has been said that I would argue against the Amendment because it would be administratively difficult. I think it would be; but I am not concerned to argue against it on those grounds. What I am concerned to argue is that the moment we start on this path of trying to single out particular categories of plant we are in the greatest of difficulties.

There are other Amendments on the Order Paper dealing with this matter—indeed the hon. Gentleman who moved this one has his name down to another one where he wishes to keep initial allowances, and I can think of a number which have not yet found their place on the Order Paper, and no doubt hon. Gentlemen in all parts of the Committee can do the same. I would not know, nor, I think, would anyone, how to resist the extension of reliefs on other classes, how to draw the line to prevent widespread dissatisfaction among users of plant who were excluded from the scope of the relief.

It has been suggested that initial allowances are only a mild form of inducement, and it is also worth while to point out that expenditure on this kind of plant does pay for itself fairly rapidly, even without any taxation relief. I was interested to note that the hon. Gentleman, in one of his examples, said that it had been worth the trouble and expenditure, and I entirely agree with him. I know from my own experience that some of the devices do pay for themselves in a remarkably short time.

I am not at all disposed to argue the revenue aspect of this, because the suspension of initial allowances is an economic case, as has been made clear by my right hon. Friend the Chancellor. It seems to me that, if we were to accept this Amendment tonight, we should be put in the position of almost certainly having to accept a large number of other cases, and we should then find that the instrument we had intended to be used to damp down a demand by industry was failing in our hands. While I fully appreciate the need for promoting economy in the consumption of fuel and power, I do not think it would be right to do what is now suggested. If we were to do so, we should find ourselves in the greatest difficulty.

I think it was the hon. Member for Clitheroe (Mr. Fort) who gave one or two examples of what might be called minor forms of fuel economy, and perhaps it is worth pointing out that where an industrial concern incurs expenditure in making minor or temporary adjustments of the kind to which the hon. Gentleman referred—like the lagging of steam pipes and so on—then in general that is treated as an expense for taxation purposes. Indeed, any expenditure designed to secure fuel economy which is of a genuine revenue nature is so treated.

So, while I commend everything that has been said about the need for fuel economy, I have to resist the Amendment because, if I were to accept it, I should start on a course which would only end in the complete abandonment of the principle of the suspension of initial allowances which we believe in the present economic circumstances is necessary and which, therefore, I put it to the Committee, should continue.

Mr. Lyttelton

I am sure the Economic Secretary to the Treasury will forgive me if I make a paraphrase of his argument. It is this: "We have made up our minds to cancel the initial allowances, and when we come to examine the perfectly sensible exceptions which people wish to make to that general rule, we find they are so many that we cannot agree to them without upsetting our original decision." Really that will not do, and all hon. Members who have heard the speeches from this side of the Committee, and indeed the speech of the hon. Member for Rotherham (Mr. Jack Jones), thought that the case for these fuel conservation plants was amply made out and would not commit the Treasury to any further concessions, and we propose to press this matter to a Division.

The whole of our industrial effort depends upon our getting enough coal and we must increase, as several hon. Members have said, the horse-power behind the men at the bench. This is one of the ways by which that can be done. I do not wish to follow the fiscal argument into the effect upon the Revenue, but I impress upon the Economic Secretary that here is a means of greatly increasing our industrial effort. The hon. Gentleman said that in the present circumstances we have to turn over to armaments and, so on, and that he did not wish to stimu- late capital equipment; but I do not think that argument applies when we are considering the particular form of fuel conservation which my hon. Friend has ably described.

Therefore, unless we can get some statement from the Treasury Bench that they will look at this matter again before the Report stage, my hon. Friends and I will challenge the Government in a Division.

Mr. Alport (Colchester)

My right hon. Friend has already indicated the disappointment which we feel on this side of the Committee, and which I am sure is shared by hon. Members opposite, at the response which the Economic Secretary to the Treasury has made to the proposals in this Amendment. The hon. Gentleman said that the type of development which it envisages would undermine the defence programme, but I should have thought that anything which would assist in solving the recurrent fuel crises in this country would be of as much assistance to our real defence as would the manufacture of arms itself.

The provision of adequate coal and power for Britain in the future seems to me to be an essential part of our security, not only economic but military, for future years. If I might go further, I would draw his attention to paragraph (b) of the Amendment, which has a definite defence consequence. The possession of auxiliary electrical generating plants throughout the industrial centres of the country would not only be of advantage in the case of power cuts in peace-time, but also of the greatest assistance in the event of bombing in air raids; and I should have thought that it would have been wise and prudent for the Government to encourage in every way possible the type of development which is envisaged in this Amendment.

It would perhaps not be acceptable to hon. Members opposite, or even to my hon. Friends on this side of the Committee, if I gave as my opinion that in actual fact the efforts to increase coal production in the immediate future, at any rate, will not succeed in covering the gap between production and consumption. Therefore, we must find other means of bridging that gap. I draw the Committee's attention to the article, which has already been referred to, by Sir Charles Lidbury, who stated that leading fuel technicians claim that industry's efforts are the best means of saving coal, on balance, to bridge the gap between production and consumption in the immediate future.

Then we have the Annual Report of the National Coal Board, which says that the British Iron and Steel Federation estimates that in 1923 it took 62.7 cwts. of coal to produce one ton of finished steel, but in 1949 only 36.1 cwts. to produce the same amount. In the same Report, it is stated that the annual saving involved was in the nature of 15 million. Now, in case it should be thought that I am partial to private enterprise by quoting that example, let me tell the Committee that in the same Annual Report the National Coal Board states that in 1948 the colliery consumption of coal was 11.3 million tons for an output of 197.6 million tons, whereas in 1950 it was 10.7 million tons for an output of 204.1 million tons.

I merely introduce these figures to give an example of what has been done in practice to save this precious raw material, coal, by two great industries—perhaps the most important that we have. The National Coal Board states that economies on the scale that I have referred to would reduce consumption of 36 million tons a year to about 28 million tons, and I should have thought that that saving would have been something which we should use every endeavour to bring about.

I think that under the Socialist Government the conception of the Finance Act may have changed from the original conception in the past, which was that one of the most important considerations was inducements, and not deterrents, to gain desirable economic ends. Here, surely, is a way in which the Chancellor could achieve the most desirable of economic ends by providing a financial inducement.

I cannot accept the argument, which is the typical, unimaginative argument of the Treasury, that if one exception is made to the general rule, it will be difficult not to allow a large number of other exceptions. After all, what is the purpose of a Government who intend to govern and to have a definite policy in coming to this Committee and saying that, if they make this exception in the case of fuel-saving equipment and electrical generators, they will find it hard to draw the line between those and other forms of desirable improvements and will, there- fore, cause dissatisfaction to other users? Maybe they will, but surely it is public policy at the present time to make every effort to solve the central industrial problem of Britain, which is shortage of the raw material of coal.

11.45 p.m.

I should like now to turn briefly to other aspects of this Amendment. It happens that there is in my constituency one of the firms that is mainly concerned with the production of Diesel generating engines. When the first fuel crisis took place in 1947, this firm, with the enterprise which has perhaps been associated with it, decided the time had come to make a special drive to sell its engines as supplementary generating units. During the subsequent campaign, it sold 700 engines of various horse-power, with a total horse-power of 150,000 and with a combined generating capacity of 100,000 kilowatts.

I merely use those figures because it is interesting to compare that total generating capacity with the generating capacity of one of the newest and most up-to-date generating stations built by the British Electricity Authority, the station at Ipswich, which within the last few weeks had a capacity of 120,000 kilowatts, although it will rise in the future to something like 160,000 kilowatts. The point I am trying to make is that this firm, by means of the small Diesel engines which it produces, has not only been able to assist in meeting the problem of dislocation of British industry which resulted from power cuts, but has added to the generating capacity of this country by almost the equivalent of one of the most modern power stations.

I believe that anything that can be done by His Majesty's Government to encourage this type of development will not only be in the interests of the efficiency of industry, and thereby incidentally and indirectly increase the revenue coming to the Treasury, but also will be of immense assistance in solving that great problem, which has been referred to so often on this Amendment, the shortage of coal in Britain.

Mr. Henry Usborne (Birmingham, Yardley)

I did not intend to intervene in this debate, but I found it impossible to sit here silent listening to the many speeches-which have been delivered by hon. Members opposite. I listened entranced to the speech that was made by the hon. Member for Kidderminster (Mr. Nabarro). I thought it was brilliant. Its brilliance lay in wrapping up almost complete nonsense and selling it hook, line and sinker to an otherwise intelligent Committee.

I may be completely wrong, but I must declare my interest. I happen to have been in this trade for 20 years. My firm has manufactured, designed, sold, supplied and installed fuel-saving appliances, and I do know something about it. At least, I ought to know something about it. It may be, again, that I am entirely wrong, but at least I think I am right when I say I am the only Member of Parliament in this Committee who is in this particular trade. The hon. Member for Kidderminster made two points which I should like to discuss, but before I come to them I should like to take up one point made by the hon. Member for Clitheroe (Mr. Fort) which was typical of some of the specious points made in so many of the speeches.

The hon. Member made a short speech indicating that it is extremely inefficient because, when one turns on a hot water tap, it is a minute or two before the water runs hot, and therefore there ought to be greater lagging. Does he realise that if, in fact, one had a hot water tap which instantly it was turned on provided hot water, it would have to be so efficiently lagged that one would also have to lag one's cold water pipes otherwise they would freeze in winter? One of the reasons one does not lag hot water pipes is that one wants the radiation from the hot water pipes to prevent the cold water pipes from freezing if one happens to leave a window open in winter. Of course, it is possible so to arrange the pipes for hot water that the water does run hot immediately. One can have a ring-main; but it is sometimes more inefficient to put in double pipes and so to save a certain amount of heat at the expense of putting in the extra pipes. The net result is inefficiency.

Now let me come to the points made by the hon. Member for Kidderminster. He is claiming in his Amendment that the Government would be wise to provide a financial inducement from these firms which would install fuel-saving machines or appliances. I have sold these things for some 20 years of my life and I would not be honest if I did not say that most firms do waste an inordinate amount of their fuel by sheer inefficiency. It is not the least bit surprising that manufacturers of appliances, such as my firm make, can indicate that by fitting them they can save sometimes as much as 50 per cent. of the fuel bill.

This is possible because any engineer who goes to those firms, by giving them a few simple tips, can often save 25 per cent. in nine cases out of 10. Firms generally under-pay the individual who stokes the boilers because they think this is a ham-handed job, but in fact they could save a large sum of money if they paid a man who is more intelligently-trained to stoke their boilers in a different fashion, The case for installing fuel-saving appliances is often the case for doing mechanically what an intelligent stoker ought to be able to do himself.

Therefore, the real thing to do with a firm that wastes a great deal of its fuel is to show it what can be done most simply and most economically to save some of that fuel. Let me say perfectly frankly that it pays firms not to buy some of the appliances which are sold. [Interruption.] I happen to know that there is on the market an appliance which is not worth buying. I have said it often, and I make a boast that my firm have said time and again that it is not good business in the long run to sell a man a machine which he does not really require. There are appliances that are sold which, at a price of about £50 or more, can be applied to a boiler and which often save 10 per cent. of the fuel; but one can save precisely the same 10 per cent. by putting a wedge in the boiler door and letting secondary air into it. It is merely that the carbon monoxide is not being burned. Let a little extra air in, and the boiler is more efficient.

I am glad that the Government do not intend to accept the Amendment. If they were to give financial inducement for the use of appliances of this kind, they would be tackling the problem of fuel efficiency from the wrong end. It is logical to say that if a firm spends money in order to be more efficient in its fuel burning, there should be some financial inducement, but at lease there is a good case for saying that a higher-paid stoker is often a better investment than an expensive mechanical appliance. One could advance an argument for some inducement for expenditure on fuel saving which is not shown in any of the items listed in the Amendment.

I will go further and add that fuel saving is desperately important, but we do not always save fuel most efficiently by putting in mechanical contrivances. There are other ways of saving fuel. Incidentally, the most efficient way I know of saving fuel in this country is the new mobile fuel efficiency vans which the National Coal Board are hiring out to any firms which will make use of them. These vans are staffed by experts who, for a period of a week or two, will give to a firm expert advice in order to save its fuel. That is the best investment I know. Obtaining that van and those experts is often better than buying any of the equipment which manufacturers advertise. That is honest advice which I am happy to give.

Sir W. Darling

Is it not a fact that the experts to whom the hon. Gentleman refers who give advice, and have, in fact, given the advice, recommend the use of the very gadgets on which he speaks so disparagingly?

Mr. Usborne

No doubt they do. I could not have survived in business, nor could my firm have survived, unless very often there had been a sound case for installing the things we were supplying. All I say is that a firm should not buy mechanical appliances until it has discovered whether it is not more efficient to save its fuel in some other way. I will not labour the point, however.

I should like to make one further comment on the very skilful speech of the hon. Member for Kidderminster. I thought his case for the installation of independent stand-by generating equipment was about as specious as the rest of his speech, and just about as short-sighted. It is perfectly true that it often pays many firms to install this generating equipment at great expense for use perhaps on only two or three days in a year. It certainly pays some firms to avoid the difficulties which arise from a sudden power cut. That is perfectly true. But why are there power cuts at all? [HON. MEMBERS: "Oh! "] Power cuts happen because industry is now so thriving that the demand for power is very great and the power stations, being short of equipment and of generating equipment in particular, are not able to keep pace with the rapidly growing demand.

The point is this: there is a shortage of manufacturing materials and human skill to provide electrical generating equipment. That skill can be used, to a certain degree, either in making individual generating sets which are supplied to some firms to be used on one or two days in a year; or it can be used for manufacturing the main equipment to go to the big power generating stations which are used almost continually.

The hon. Member for Kidderminster proposes that it is more efficient for hundreds of firms to have hundreds of stand-by equipments, which are very seldom used, because it pays each of them individually; on the other hand, we know that it pays the nation, and all of them collectively, far more that they should not have it but that that equipment and that skill should go direct to the central power generating stations. The hon. Gentleman in effect suggests that it might pay to rob Peter to pay Paul. I suggest that his suggestion is a question of robbing a bob from Peter to pay only a penny to Paul. The thing is absolutely absurd. I am glad that the Opposition propose to divide the Committee to support such a silly Amendment, and I hope they will enjoy doing so.

12 midnight.

Mr. Butcher

The hon. Member for Yardley (Mr. Usborne) referred to the remarkable speech of my hon. Friend the Member for Kidderminster (Mr. Nabarro) as specious and short-sighted, and he applied the word "nonsense" to it. In doing that he was in direct contradiction with his hon. Friend the Economic Secretary to the Treasury, who went out of his way to compliment the hon. Member for Kidderminster, and indeed I thought endeavoured to marshal serious arguments to rebut the case he had put forward.

I should like to examine some of the arguments used by the Economic Secretary. He referred to this, in his opening remarks, as a general problem, which of course it is. What we must guard against is allowing the Treasury in this matter to treat the general problem of fuel economy solely as a Treasury matter. We believe that it is a general problem which must be considered on the broadest possible ground, and that therefore it is right that the Treasury and the Ministry of Fuel and Power should be associated in such a scheme as my hon. Friend has put forward.

There is no dispute that this Committee is eager to find a way in which the provisions of this Finance Bill can best assist the defence programme. The Economic Secretary thought that this proposal might interfere with the implementation of the defence programme. Those of us who support the Amendment believe that it will make a very real contribution to the defence programme, on these grounds: first, that we are modernising the industrial plant of the country; secondly, we are relieving the mines and the mining industry, to some extent, of their capital expenditure; and, above all, we are economising—I shall not go over the ground covered by my hon. Friend—in the work and the labour of miners.

The Economic Secretary then went on to even more dubious ground when he said one could not pick out particular categories of plant which should receive initial allowances. I believe that that is exactly what my hon. Friend has done. If the words proposed are not acceptable to the Treasury, I am quite sure that satisfactory words could be found. As I understand it, the argument which is being applied in the speeches supporting the Amendment is that great economies can be made on the steam-raising equipment in factories throughout the country.

Indeed, so clearly defined is that steam-raising equipment that factories which have been laundries, or breweries, or cotton mills, are sold, and before being sold are gutted of their technical machinery, but the boiler and shafting and generating set are left in because they are of almost universal application to any trader who rents or buys that equipment. Therefore, to say that it is not possible to pick out one particular form of machinery is, I believe, quite wrong. I believe my hon. Friend has put his finger on the one kind of machine which it is possible to pick out.

To pass to another argument used by the Economic Secretary, he said that there would be some feeling of injustice if certain users were excluded from the scope of relief. I do not think that argument would hold water for a moment. I do not believe the user of a motor van is going to feel any sense of grievance at all because he does not receive on his motor van at the present time exactly and precisely the same initial allowances as are to be extended to the man who instals a new boiler and who is going to make a substantial economy in finance and, above all, in fuel.

We have listened with great interest to the speeches from the hon. Members for Rotherham (Mr. Jack Jones) and the hon. Member for Bolton, West (Mr. J. Lewis), both of whom have experience in industrial management. I believe this is one of the cases where the Treasury have looked at the thing from far too narrow a point of view. The Treasury are not infallible. I remember, back in the days of the war, that a proposal was put forward that a scheme of war damage insurance should be instituted. The Treasury decided it was quite impossible. The Minister responsible advised the House in that way.

The Economic Secretary will find some interesting correspondence in his Treasury files from a former hon. Member for Spen Valley, in which the Treasury said how extremely difficult it was to institute a system of Pay-As-You-Earn. The fact remains that, when these matters are pressed by practical means upon the Treasury, the Treasury, by great skill, find an admirable way of carrying out the decisions of the House. I believe this is a matter where similar results can be obtained.

Mr. Peter Roberts (Sheffield, Heeley)

I support this Amendment, and I wish to say what a very poor argument the Economic Secretary used in turning it down. With regard to the speech of the hon. Member for Yardley (Mr. Usborne), I thought his main trouble was that he was trying to be too fair-minded. He started by giving a certain amount of advertisement to his firm, and he had to end by running down his own sales policy.

I was impressed by the speeches of the hon. Member for Bolton, West (Mr. J. Lewis) and the hon. Member for Rotherham (Mr. Jack Jones), and I should like to know whether they are satisfied with the speech by the Economic Secretary. I was much impressed by the point of view they both expressed that this, in itself, was a good idea, and I do not think they have heard any sound reason against it from the Government Front Bench. I shall await with great interest to see which way they vote when we divide.

Only for a very short time during this fairly long discussion have I seen the Minister of Fuel and Power upon the Front Bench. He came in for about two minutes. The question I should like to ask the junior Minister is whether there have been consultations with the Minister of Fuel and Power about this matter, because it is obviously one about which the Ministry must be very keen.

What did the Economic Secretary actually say in his speech? He said that he wanted to deter current demand and to damp off the demand for such products. Is he really telling the Committee that he wants to damp off demand for products that are going to save fuel?

Mr. J. Edwards

I am sure the hon. Gentleman would not want to misrepresent what I said. I made it perfectly clear that I was talking about products required for the defence programme, and he must not use my words in any other sense.

Mr. Roberts

Very well. Does that mean, therefore, that he does not wish to damp down the demand for these economising users of coal?

Mr. Edwards

The answer is that if they are required for the defence programme, yes.

Mr. Roberts

Very well. I see that the Minister of Supply is here. I am sure he would tell the Committee that steel is very necessary indeed for the defence programme. In point of fact, I understand there has been an agreement between the Minister of Fuel and Power and the Minister of Supply to give priority to steel, and I will tell the Economic Secretary that one cannot make steel without coal. It comes to this, that we are at the moment importing something like £4 million worth of coal from America, and here are practical suggestions whereby a large amount of coal could be saved, unless the Minister wishes to damp off the demand.

It is no argument for the Economic Secretary to say that he wants to refuse this Amendment because he feels that it might create a demand which might hamper the defence programme. This demand is very necessary to the defence programme, and I shall strongly advise all Members of the Committee, including those who have supported the Amendment from the other side, to go into the Division Lobby against the Government.

Mr. Jennings

Listening to the Economic Secretary, I formed the opinion that no matter how good the Amendments are, he is going to refuse all of them. I should like to ask him whether he has considered them in relation to how far they go towards helping the re-armament programme, because I am certain from his reply that he has not appreciated what this equipment means in the furtherance of the defence programme. I beg him, instead of giving a bald refusal, to consult those who know what would be the full effect of these Amendments. It is pretty evident that the Minister does not know of their effect, because he accepted the proposition of the hon. Member for Kidderminster (Mr. Nabarro) as perfectly sound; but he did not give the Committee any idea that he has considered the full effect of these Amendments on re-armament, and I beg him to do so.

12.15 a.m.

Mr. Drayson (Skipton)

The very unsatisfactory reply of the Economic Secretary will come as a great disappointment to a number of industrial concerns in my constituency and throughout the whole of the North of England. In fact, he has earned for himself, not the title of Economic Secretary to the Treasury, but that of Uneconomic Secretary to the Treasury.

The hon. Member for Kidderminster (Mr. Nabarro) dealt very extensively with

the question of Lancashire boilers which are the normal power unit in the cotton and woollen mills in Yorkshire and Lancashire, and I know myself of a number of instances where schemes of fuel economy have been under consideration which will now be postponed owing to the withdrawal of the high initial allowance. As has been pointed out, because wasteful fuel consumption in many instances ranks as a normal charge on industry, it will continue because more economical plants cannot be contemplated.

I should like to repudiate the unwarrantable attack on stokers made from the benches opposite. The stokers in our industrial plants today are some of the finest workers we have, and they have had to put up with a great deal from the Socialist Government, especially in the form of dirty coal which has been provided for them and which has added enormously to their work. Many of them, by sheer skill and hard work, have managed to maintain steam in the factories in spite of the poor quality of the fuel the Government have supplied them. Many of them had hoped that with the more ample supply of fuel-saving devices now becoming available, much of their heavy work, and many of the difficulties they have had to put up with in the past few years, would have been overcome.

I hope that the Government will look at this matter again, and see whether they cannot do something to help not only these men but industry in general.

Question put, "That those words be there inserted."

The Committee divided: Ayes, 284; Noes, 292.

Division No. 91.]	AYES	[12.18 a.m.
Aitken, W. T.	Black, C. W.	Carson, Hon. E.
Alport, C. J. M.	Boles, Lt.-Col. D. C. (Wells)	Channon, H.
Amery, Julian (Preston, N.)	Boothby, R.	Churchill, Rt. Hon. W. S.
Amory, Heathcoat (Tiverton)	Bossom, A. C.	Clarke, Col. Ralph (East Grinstead)
Arbuthnot, John	Bowen, E. R. (Cardigan)	Clarke, Brig. Terence (Portsmouth, W.)
Ashton, H. (Chelmsford)	Boyd-Carpenter J. A.	Colegate, A.
Assheton, Rt. Hon. R. (Blackburn, W.)	Boyle, Sir Edward	Conant, Maj. R. J. E.
Astor, Hon. M. L.	Bracken, Rt. Hon. B.	Cooper, Sqn. Ldr. Albert (Ilford, S.)
Baker, P. A. D.	Braine, B. R.	Cooper-Key, E. M.
Baldock, Lt.-Cmdr. J. M.	Braithwaite, Lt.-Cr. G. (Bristol, N. W.)	Corbett, Lt.-Col. Uvedale (Ludlow)
Baldwin, A. E.	Braithwaite, Sir Albert (Harrow, W.)	Craddock, Beresford (Spelthorne)
Banks, Col. G.	Bromley-Davenport, Lt.-Col. W.	Cranborne, Viscount
Baxter, A. B.	Brooke, Henry (Hampstead)	Crookshank, Capt. Rt. Hon. H. F. C.
Beamish, Major Tufton	Browne, Jack (Govan)	Crosthwaite-Eyre, Col. O. E.
Bell, R. M.	Buchan-Hepburn, P. G. T.	Crouch, R. F.
Bennett, Sir Peter (Edgbaston)	Bullock, Capt. M.	Crowder, Capt. John (Finchley)
Bennett, Dr. Reginald (Gosport)	Bullus, Wing Commander E. E.	Crowder, Petre (Ruislip—Northwood)
Bennett, William (Woodside)	Burden, Squadron Leader F. A.	Cundiff, F. W.
Bevins, J. R. (Liverpool, Toxteth)	Butcher, H. W.	Cuthbert, W. N.
Birch, Nigel	Butler, Rt. Hon. R. A. (Saffron Walden)	Darling, Sir William (Edinburgh, S.)
Bishop, F. P.	Carr, Robert (Mitcham)	Davidson, Viscountess
Davies, Nigel (Epping)	Kerr, H. W. (Cambridge)	Profumo, J. D.
de Chair, Somerset	Kingsmill, Lt.-Col. W. H.	Raikes, H. V.
De la Bère, R.	Lambert, Hon. G.	Rayner, Brig. R.
Deedes, W. F.	Lancaster, Col. C. G.	Redmayne, M.
Digby, S. W.	Langford-Holt, J.	Remnant, Hon. P.
Dodds-Parker, A. D.	Law, Rt. Hon. R. K.	Renton, D. L. M.
Donner, P. W.	Leather, E. H. C.	Roberts, Emrys (Merioneth)
Douglas-Hamilton, Lord Malcolm	Legge-Bourke, Maj. E. A. H.	Roberts, Major Peter (Heeley)
Drayson, G. B.	Lennox-Boyd, A. T.	Robertson, Sir David (Caithness)
Dugdale, Maj. Sir Thomas (Richmond)	Lindsay, Martin	Robinson, Roland (Blackpool, S.)
Duncan, Capt. J. A. L.	Linstead, H. N.	Robson-Brown, W. (Esher)
Dun glass, Lord	Llewellyn, D.	Rodgers, John (Sevenoaks)
Duthie, W. S.	Lloyd, Rt. Hn. Geoffrey (King's Norton)	Roper, Sir Harold
Eccles, D. M.	Lloyd Maj. Guy (Renfrew, E.)	Ropner, Col. L.
	Lloyd, Selwyn (Wirral)	Russell, R. S.
Eden, Rt. Hon. A.	Lockwood, Lt.-Col. J. C.	Ryder, Capt. R. E. D.
Elliot, Rt. Hon. W. E.	Longden, Gilbert (Herts, S-W.)	Salter, Rt. Hon. Sir Arthur
Erroll, F. J.	Low, A. R. W.	Scott, Donald
Fisher, Nigel	Lucas, Sir Jocelyn (Portsmouth. S.)	Shepherd, William
Fletcher, Walter (Bury)	Lucas, P. B. (Brentford)	Smiles, Lt.-Col. Sir Waiter
Fort, R.	Lucas-Tooth, Sir Hugh	Smithers, Peter (Winchester)
Foster, John	Lyttelton, Rt. Hon. O.	Smyth, Brig. J. G. (Norwood)
Fraser, Hon. Hugh (Stone)	McAdden, S. J.	Snadden, W. McN
Fraser, Sir Ian (Morecambe & Lonsdale)	McCorquodale, Rt. Hon. M. S.	Soames, Capt. C.
Fyfe, Rt. Hon. Sir David Maxwell	Macdonald, A. J. F. (Roxburgh)	Spearman, A. C. M.
Gage, C. H.	Macdonald, Sir Peter (I. of Wight)	Spence, H. R. (Aberdeenshire, W.)
Galbraith, Cmdr. T. D. (Pollok)	Mackeson, Brig. H. R.	Spens, Sir Patrick (Kensington, S.)
Galbraith, T. G. D. (Hillhead)	McKibbin, A.	Stanley, Capt. Hon. Richard (N. Fylde)
Garner-Evans, E. H. (Denbigh)	McKie, J. H. (Galloway)	Stevens, G. P.
Gates, Maj. E. E.	Maclay, Hon. John	Steward, W. A. (Woolwich, W.)
Glyn, Sir Ralph	Maclean, Fitzroy	Stewart, Henderson (Fife, E.)
Gomme-Duncan, Col. A.	MacLeod, Iain (Enfield, W.)	Stoddart-Scott, Col. M.
	MacLeod, John (Ross and Cromarty)	Storey, S.
Gridley, Sir Arnold	Macmillan, Rt. Hon. Harold (Bromley)	Strauss, Henry (Norwich, S.)
Grimond, J.	MacPherson, Major Niall (Dumfries)	Stuart, Rt. Hon. James (Moray)
Grimston, Hon. John (St. Albans)	Maitland, Cmdr. J. W.	Studholme, H. G.
Grimston, Robert (Westbury)	Manningham-Buller, R. E.	Summers, G. S.
Harden, J. R. E.	Marlowe, A. A. H.	Sutcliffe, H.
Hare, Hon. J. H. (Woodbridge)	Marples, A. E.	Taylor, Charles (Eastbourne)
Harris, Frederic (Croydon, N.)	Marshall, Douglas (Bodmin)	Taylor, William (Bradford, N.)
Harris, Reader (Heston)	Marshall, Sidney (Sutton)	Teeling, W.
Harvey, Air Cdre. A. V. (Macclesfield)		Teevan, T. L.
Harvey, Ian (Harrow, E.)	Maude, Angus (Ealing, S.)	Thomas, J. P. L. (Hereford)
Harvie-Watt, Sir George	Maude, John (Exeter)	Thompson, Kenneth Pugh (Walton)
Hay, John	Maudling, R.	Thompson, R. H. M. (Croydon, W.)
Head, Brig. A. H.	Medlicott, Brig. F.	Thorneycroft, Peter (Monmouth)
Headlam, Lieut.-Col. Rt. Hon. Sir C.	Mellor, Sir John	Thornton-Kemsley, Col. D. N.
Heald, Lionel	Molson, A. H. E.	Thorp, Brig. R. A. F.
Heath, Edward	Monckton, Sir Walter	Tilney, John
Henderson, John (Cathcart)	Moore, Lt.-Col. Sir Thomas	Turner, H. F. L.
Hicks-Beach, Maj. W. W.	Morrison, John (Salisbury)	Turton, R. H.
Higgs, J. M. C.	Morrison, Rt. Hon. W. S. (Cirencester)	Tweedsmuir, Lad
Hill, Mrs. E. (Wythenshawe)	Mott-Radclyffe, C. E.	Vane, W. M. F.
Hill, Dr. Charles (Luton)	Nabarro, G.	Vaughan-Morgan J. K.
Hinchingbrooke, Viscount	Nicholls, Harmar	Wade, D. W.
Hirst, Geoffrey	Nicholson, G.	Wakefield, Edward (Derbyshire, W.)
Holmes, Sir Stanley (Harwich)	Nield, Basil (Chester)	Wakefield, Sir Wavell (Marylebone)
Hope, Lord John	Noble, Cmdr. A. H. P.	Walker-Smith, D. C.
Hopkinson, Henry	Nugent, G. R. H.	Ward, Hon. George (Worcester)
Hornsby-Smith, Miss. P.	Nutting, Anthony	Ward, Miss. I. (Tynemouth)
Horsbrugh, Rt. Hon. Florence	Oakshott, H. D.	Waterhouse, Capt. Rt. Hon. C.
Howard, Gerald (Cambridgeshire)	Odey, G. W.	Watkinson, H.
Howard, Greville (St. Ives)	O'Neill, Rt. Hon. Sir Hugh	Webbe, Sir H. (London)
Hudson, Sir Austin (Lewisham, N.)	Ormsby-Gore, Hon. W. D.	White, Baker (Canterbury)
Hudson, Rt. Hon. Robert (Southport)	Orr, Capt. L. P. S.	Williams, Charles (Torquay)
Hudson, W. R. A. (Hull, N.)	Orr-Ewing, Charles Ian (Hendon, N.)	Williams, Gerald (Tonbridge)
Hutchinson, Geoffrey (Ilford, N.)	Orr-Ewing, Ian L. (Weston-super-Mare)	Williams, Sir Herbert (Croydon, E.)
Hutchison, Lt.-Com. Clark (E'b'rgh W.)	Osborne, C.	Wills, G.
Hutchison, Colonel James (Glasgow)	Peake, Rt. Hon. O.	Wilson, Geoffrey (Truro)
Hyde, Lt.-Col. H. M.	Perkins, W. R. D.	Winterton, Rt. Hon. Earl
Hylton-Foster, H. B.	Peto, Brig. C. H. M.	Wood, Hon. R.
Jennings, R.	Pickthorn, K.	York, C.
Johnson, Howard (Kemptown)	Pitman, I. J.
Jones, A. (Hall Green)	Powell, J. Enoch	TELLERS FOR THE AYES:
Joynson-Hicks, Hon. L. W.	Price, Henry (Lewisham, W.)	Mr. Digby and Mr. Foster.
Kaberry, D.	Prior-Palmer, Brig. O.
NOES
Acland, Sir Richard	Awbery, S. S.	Benn, Wedgwood
Adams, Richard	Ayles, W. H.	Benson, G.
Albu, A. H.	Bacon, Miss. Alice	Beswick, F.
Allen, Arthur (Bosworth)	Baird, J.	Bevan, Rt. Hon. A. (Ebbw Vale)
Allen, Scholefield (Crewe)	Balfour, A.	Bing, G. H. C.
Anderson, Alexander (Motherwell)	Barnes, Rt. Hon. A. J.	Blenkinsop, A.
Anderson, Frank (Whitehaven)	Bartley, P.	Blyton, W. R.
Attlee, Rt. Hon. C. R.	Bellenger, Rt. Hon. F. J.	Boardman, H.

Booth, A.	Hardy, E. A.	Oldfield, W. H.
Bottomley, A. G.	Hargreaves, A.	Oliver, G. H.
Bowden, H. W.	Hastings, S.	Orbach, M.
Bowles, F. G. (Nuneaton)	Hayman, F. H.	Padley, W. E.
Braddock, Mrs. Elizabeth	Henderson, Rt. Hon. A. (Rowley Regis)	Paget, R. T.
Brook, Dryden (Halifax)	Herbison, Miss. M.	Paling, Rt. Hon. W. (Dearne Valley)
Brooks, T. J. (Normanton)	Hewitson, Capt. M.	Paling, Will T. (Dewsbury)
Broughton, Dr. A. D. D.	Hobson, C. R.	Pannell, T. C.
Brown, Rt. Hon. George (Belper)	Holman, P.	Pargiter, G. A.
Brown, Thomas (Ince)	Holmes, Horace (Hemsworth)	Parker, J.
Burke, W. A.	Houghton, D.	Paton, J.
Burton, Miss. E.	Hoy, J.	Pearson, A.
Butler, Herbert (Hackney, S.)	Hubbard, T.	Peart, T. F.
Callaghan, L. J.	Hudson, James (Ealing, N.)	Poole, C.
Carmichael, J.	Hughes, Emrys (S. Ayrshire)	Popplewell, E.
Castle, Mrs. B. A.	Hughes, Hector (Aberdeen, N.)	Porter, G.
Champion, A. J.	Hynd, H. (Accrington)	Price, Philips (Gloucestershire, W.)
Chetwynd, G. R.	Hynd, J. B. (Attercliffe)	Proctor, W. T.
Clunie, J.	Irvine, A. J. (Edge Hilt)	Pryde, D. J.
Cocks, F. S.	Irving, W. J. (Wood Green)	Pursey, Cmdr. H. Rankin, J.
Coldrick, W.	Isaacs, Rt. Hon. G. A.	Rees, Mrs. D.
Collindridge, F.	Janner, B.	Reeves, J.
Cook, T. F.	Jay, D. P. T.	Reid, Thomas (Swindon)
Cooper, Geoffrey (Middlesbrough, W.)	Jeger, George (Goole)	Reid, William (Camlachie)
Cooper, John (Deptford)	Jeger, Dr. Santo (St. Pancras, S.)	Rhodes, H.
Corbet, Mrs. Freda (Peckham)	Jenkins, R. H.	Richards, R.
Cove, W. G.	Johnson, James (Rugby)	Robens, A.
Craddock, George (Bradford, S.)	Johnston, Douglas (Paisley)	Roberts, Goronwy (Caernarvonshire)
Crawley, A.	Jones, David (Hartlepool)	Robertson, J. J. (Berwick)
Crosland, C. A. R.	Jones, Frederick Elwyn (West Ham, S.)	Robinson, Kenneth (St. Pancras, N.)
Crossman, R. H. S.	Jones, Jack (Rotherham)	Rogers, George (Kensington, N.)
Cullen, Mrs. A.	Jones, William Elwyn (Conway)	Ross, William (Kilmarnock)
Dalton, Rt. Hon. H.	Keenan, W.	Royle, C.
Darling, George (Hillsborough)	Kenyon, C.	Shawcross, Rt. Hon. Sir Hartley
Davies, A. Edward (Stoke, N.)	Key, Rt. Hon. C. W.	Shinwell, Rt. Hon. E.
Davies, Harold (Leek)	King, Dr. H. M.	Shurmer, P. L. E.
de Freitas, Geoffrey	Kinghorn, Sqn. Ldr E.	Silverman, Julius (Erdington)
Deer, G.	Kinley, J.	Silverman, Sydney (Nelson)
Dodds, N. N.	Lang, Gordon	Simmons, C. J.
Donnelly, D.	Lee Frederick (Newton)	Slater, J.
Driberg, T. E. N.	Lee, Miss. Jennie (Cannock)	Smith, Ellis (Stoke, S.)
	Lee, Leslie (Ardwick)	Smith, Norman (Nottingham, S.)
Dugdale, Rt. Hon. John. (W. Bromwich)	Lewis, Arthur (West Ham, N.)	Sorensen, R. W.
Dye, S.	Lewis, John (Bolton, W.)	Soskice, Rt. Hon. Sir Frank
Ede, Rt. Hon. J. C.	Lindgren, G. S.	Sparks, J. A.
Edelman, M.	Lipton, Lt.-Col. M.	Steele, T.
Edwards, John (Brighouse)	Logan, D. G.	Stewart, Michael (Fulham, E.)
Edwards, Rt. Hon. Ness (Caerphilly)	Longden, Fred (Small Heath)	Stokes, Rt. Hon. R. R.
Edwards, W. J. (Stepney)	McAllister, G.	Strachey, Rt. Hon. J.
Evans, Albert (Islington, S. W.)	MacColl, J. E.	Strauss, Rt. Hon. George (Vauxhall)
Evans, Edward (Lowestoft)	McGhee, H. G.	Stross, Dr. Barnett
Evans, Stanley (Wednesbury)	McInnes, J.	Summerskill, Rt. Hon. Edith
Ewart, R.	Mack, J. D.	Sylvester, G. D.
Fernyhough, E.	McKay, John (Wallsend)	Taylor, Bernard (Mansfield)
Field, Capt. W. J.	Mackay, R. W. G. (Reading, N.)	Taylor, Robert (Morpeth)
Finch, H. J.	McLeavy, F.	Thomas, David (Aberdare)
Fletcher, Eric (Islington, E.)	MacMillan, Malcolm (Western Isles)	Thomas, George (Cardiff)
Follick, M.	McNeil, Rt. Hon. H.	Thomas, Iorwerth (Rhondda, W.)
Foot, M. M.	MacPherson, Malcolm (Stirling)	Thomas, Ivor Owen (Wrekin)
Forman, J. C.	Mainwaring, W. H.	Thorneycroft, Harry (Clayton)
Fraser, Thomas (Hamilton)	Mallalieu, E. L. (Brigg)	Thurtle, Ernest
Freeman, John (Watford)	Mallalieu, J. P. W. (Huddersfield, E.)	Timmons, J.
Freeman, Peter (Newport)	Mann, Mrs. Jean	Tomney, F.
Gaitskell, Rt. Hon. H. T. N.	Manuel, A. C.	Turner-Samuels, M.
Ganley, Mrs. C. S.	Marquand, Rt. Hon. H. A.	Ungoed-Thomas A. L.
Gibson, C. W.	Mathers, Rt. Hon. G.	Usborne, H.
Gilzean, A.	Mellish, R. J.	Vernon, W. F.
Glanville, James (Consett)	Messer, F.	Viant, S. P.
Gooch, E. G.	Middleton, Mrs. L.	Wallace, H. W.
Gordon-Walker, Rt. Hon. P. C.	Mikardo, Ian	Watkins, T. E.
Greenwood, Anthony (Rossendale)	Mitchison, G. R.	Webb, Rt. Hon. M. (Bradford, C.)
Greenwood, Rt. Hon. Arthur (Wakefield)	Moeran, E. W.	Weitzman, D.
Grenfell, D. R.	Monslow, W.	Wells, Percy (Faversham)
Grey, C. F.	Moody, A. S.	Wells, William (Walsall)
Griffiths, David (Rother Valley)	Morley, R.	West, D. G.
Griffiths, Rt. Hon. James (Llanelly)	Morris, Percy (Swansea, W.)	Wheatley, Rt. Hn. John (Edinb'gh, E.)
Griffiths, William (Exchange)	Morrison, Rt. Hon. H. (Lewisham, S.)	White, Mrs. Eirene (E. Flint)
Gunter, R. J.	Mort, D. L.	White, Henry (Derbyshire, N. E.)
Hale, Joseph (Rochdale)	Moyle, A.	Whiteley, Rt. Hon. W.
Hale, Leslie (Oldham, W.)	Mulley, F. W.	Wilcock, Group Capt. C. A. B.
Hall, John (Gateshcad, W.)	Murray, J. D.	Wilkes, L.
Hall, Rt. Hon. Glenvil (Colne Valley)	Nally, W.	Willey, Frederick (Sunderland)
Hamilton, W. W.	Neal, Harold (Bolsover)	Willey, Octavius (Cleveland)
Hannan, W.	Noel-Baker, Rt. Hon. P. J.	Williams, David (Neath)
Hardman, D. R.	O'Brien, T.	Williams, Rev. Llywelyn (Abertillery)

Williams, Ronald (Wigan)	Winterbottom, Richard (Brightside)	Younger, Hon. K.
William, Rt. Hon. Thomas (Don Valley)	Wise, F. J.
Williams, W. T. (Hammersmith, S.)	Woodburn, Rt. Hon. A.	TELLERS FOR THE NOES:
Wilson, Rt. Hon. Harold (Huyton)	Wyatt, W. L.	Mr. Wilkins and Mr. Delargy.
Winterbottom, Ian (Nottingham, C.)	Yates, V. F.

Mr. Churchill (Woodford)

I beg to move, "That the Chairman do report Progress, and ask leave to sit again."

I move this Motion to elicit from the Leader of the House what the Government's ideas are about the future course of business today. We have had a very valuable and well-sustained debate from both sides of the Committee, in which matters have been examined with great attention and thoroughness by both parties, and we have reached just that period, or thereabouts, in the sitting at which the right hon. Gentleman the Leader of the House moved a similar Motion last night. It seems to me that, as he saw there was no need to utilise, as he could have done, another two hours, we ought to put to the Government a question whether we should not follow the course he indicated last night, and let the Committee terminate their labours for this particular sitting at a reasonable time.

I should like to know what their intentions are—[Interruption.]—I was asking the Leader of the House. I think it is much better to have a series of sittings terminating at a reasonable hour, rather than the trial of strength or tour de force that the Government are trying to put on us by driving us through the night. Two hours could have been expended in useful discussion last night, and we could consume another two hours tonight, but I should like to know from the right hon. Gentleman what view he takes. Why was a pathetic appeal made by an hon. Member of the House even older than myself not to choose Thursday night for a particularly late sitting? I really think the matter should be clarified by the Leader of the House. Two hours were wasted last night. We could do another two hours tonight. After all, there is plenty of time this Session. As I said earlier in the day, the Government have no legislation to propose—

12.30 a.m.

Mr. James Glanville (Consett)

On a point of order, Major Milner. Are we here to do serious business or to listen to this mockery which is now being carried on?

The Chairman

That is not a point of order.

Mr. Churchill

I should like an indication from the right hon. Gentleman of his intentions.

The Secretary of State for the Home Department (Mr. Ede)

I thank the right hon. Gentleman for this opportunity of making clear our intentions. As I said some hours ago, we do not regard adjourning at this time or in two hours' time as being something that meets with the general convenience of the Committee. [HON. MEMBERS: "Why?"] Therefore, we propose to sit for some hours yet, and we hope that during that period we may be able to make substantial progress with the Bill.

Mr. Lyttelton

May I say that if we sit through the night there are some extremely technical Clauses which have to be discussed raising very fine legal points. Does not the Leader of the House think it undesirable, when such matters of grave public importance and such fine legal points are concerned, that they should be discussed at a time when proper consideration cannot be given to them?

Mr. Ede

No, I should not have thought so. I see that the right hon. Gentleman is himself supported with considerable legal talent, and I have noticed that my right hon. and learned Friend the Attorney-General seems to shine brighter the smaller the hours of the morning.

Lieut.-Commander Braithwaite

Might I, with great respect, put another consideration to the right hon. Gentleman? We are about to enter upon that part of the Bill which deals with initial allowances for shipbuilding—in which the Government have an Amendment of their own—a matter which vitally affects both the general public and our constituents, who are entitled to know what steps are being taken to stimulate our merchant shipping in the event of war. Is it proper that this discussion should take place at a time when, owing to the shortage of newsprint, it is most unlikely that that debate will receive adequate reporting in the Press?

Question put, "That the Chairman do report Progress, and ask leave to sit again."

The Committee divided: Ayes, 282; Noes. 292.

Division No. 92.]	AYES	[12.34 a.m.
Aitken, W. T.	Erroll, F. J.	Lucas-Tooth, Sir Hugh
Alport, C. J. M.	Fisher, Nigel	Lyttelton, Rt. Hon.
Amery, Julian (Preston, N.)	Fletcher, Walter (Bury)	McAdden, S. J.
Amory, Heathcoat (Tiverton)	Fort, R.	McCorquodale, Rt. Hon. M. S.
Arbuthnot, John	Foster, John	Macdonald, A. J. F. (Roxburgh)
Ashton, H. (Chelmsford)	Fraser, Hon. Hugh (Stone)	Macdonald, Sir Peter (I. of Wight)
Assheton, Rt. Hon. R. (Blackburn, W.)	Fraser, Sir Ian (Morecambe & Lonsdale)	Mackeson, Brig. H. R.
Astor, Hon. M. L.	Fyfe, Rt. Hon. Sir David Maxwell	McKibbin, A.
Baker, P. A. D.	Gage, C. H.	McKie, J. H. (Galloway)
Baldock, Lt.-Cmdr. J. M.	Galbraith, Cmdr. T. D. (Pollok)	Maclay, Hon. John
Baldwin, A. E.	Galbraith, T. G. D. (Hillhead)	Maclean, Fitzroy
Banks, Col. C.	Garner-Evans, E. H. (Denbigh)	MacLeod, Iain (Enfield, W.)
Baxter, A. B.	Gates, Maj. E. E.	MacLeod, John (Ross and Cromarty)
Beamish, Major Tufton	Glyn, Sir Ralph	Macmillan, Rt. Hon. Harold (Bromley)
Bell, R. M.	Gomme-Duncan, Col. A.	Macpherson, Major Niall (Dumfries)
Bennett, Sir Peter (Edgbaston)	Gridley, Sir Arnold	Maitland, Cmdr. J. W.
Bennett, Dr. Reginald (Gosport)	Grimond, J.	Manningham-Buller, R. E.
Bennett, William (Woodside)	Grimston, Hon. John (St. Albans)	Marlowe, A. A. H.
Bevins, J. R. (Liverpool, Toxteth)	Grimston, Robert (Westbury)	Marples, A. E.
Birch, Nigel	Harden, J. R. E.	Marshall, Douglas (Bodmin)
Bishop, F. P.	Hare, Hon. J. H. (Woodbridge)	Marshall, Sidney (Sutton)
Black, C. W.	Harris, Frederic (Croydon, N.)	Maude, Angus (Eating, S.)
Boles, Lt.-Col. D. C. (Wells)	Harris, Reader (Heston)	Maude, John (Exeter)
Boothby, R.	Harvey, Air Cdre. A. V. (Macclesfield)	Maudlins, R.
Bossom, A. C.	Harvey, Ian (Harrow, E.)	Medlicott, Brig. F.
Bowen, E. R. (Cardigan)	Harvie-Watt, Sir George	Mellor, Sir John
Boyd-Carpenter, J. A.	Hay, John	Molson, A. H. E.
Boyle, Sir Edward	Head, Brig. A. H.	Monckton, Sir Walter
Bracken, Rt. Hon. B.	Headlam, Lieut.-Col. Rt. Hon. Sir C.	Moore, Lt.-Col. Sir Thomas
Braine, B. R.	Heald, Lionel	Morrison, John (Salisbury)
Braithwaite, Sir Albert (Harrow, W.)	Heath, Edward	Morrison, Rt. Hon. W. S. (Cirencester)
Braithwaite, Lt.-Cr. G. (Bristol, N. W.)	Henderson, John (Cathcart)	Mott-Radclyffe, C. E.
Bromley-Davenport, Lt.-Col. W.	Hicks-Beach, Maj. W. W.	Nabarro, G.
Brooke, Henry (Hampstead)	Higgs, J. M. C.	Nicholls, Harmar
Browne, Jack (Govan)	Hill, Mrs. E. (Wythenshawe)	Nicholson, G.
Buchan-Hepburn, P. G. T.	Hill, Dr. Charles (Luton)	Nield, Basil (Chester)
Bullock, Capt. M.	Hinchingbrooke, Viscount	Noble, Cmdr. A. H. P.
Bullus, Wing Commander E. E.	Hirst, Geoffrey	Nugent, G. R. H.
Burden, Squadron Leader F. A.	Holmes, Sir Stanley (Harwich)	Nutting, Anthony
Butcher, H. W.	Hope, Lord John	Oakshott, H. D.
Butler, Rt. Hon. R. A. (Saffron Walden)	Hopkinson, Henry	Odey, G. W.
Carr, Robert (Mitcham)	Hornsby-Smith, Mist P.	Ormsby-Gore, Hon. W. D.
Carson, Hon. E.	Horsbrugh, Rt. Hon. Florence	Orr, Capt. L. P. S.
Channon, H.	Howard, Gerald (Cambridgeshire)	Orr-Ewing, Charles Ian (Hendon, N.)
Churchill, Rt. Hon. W. S.	Howard, Greville (St. Ives)	Orr-Ewing, Ian L. (Weston-super-Mare)
Clarke, Col. Ralph (East Grinstead)	Hudson, Sir Austin (Lewisham, N.)	Osborne, C. Peake, Rt. Hon. O.
Clarke, Brig. Terence (Portsmouth, W.)	Hudson, Rt. Hon. Robert (Southport)	Perkins, W. R. D.
Colegate, A.	Hudson, W. R. A. (Hull, N.)	Peto, Brig. C. H. M.
Cooper, Sqn. Ldr. Albert (Ilford, S.)	Hutchinson, Geoffrey (Ilford, N.)	Pickthorn, K.
Cooper-Key, E. M.	Hutchison, Lt.-Com. Clark (E'b'rghW.)	Pitman, I. J.
Corbett, Lt.-Col. Uvedale (Ludlow)	Hutchison, Colonel James (Glasgow)	Powell, J. Enoch
Craddock, Beresford (Spelthorne)	Hyde, Lt.-Col. H. M.	Price, Henry (Lewisham, W.)
Cranborne, Viscount	Hylton-Foster, H. B.	Prior-Palmer, Brig. O.
Crookshank, Capt. Rt. Hon. H. F. C.	Jennings, R.	Profumo, J. D.
Crosthwaite-Eyre, Col. O. E.	Johnson, Howard (Kemptown)	Raikes, H. V.
Crouch, R. F.	Jones, A. (Hall Green)	Rayner, Brig. R.
Crowder, Capt. John (Finchrey)	Joynson-Hicks, Hon. L. W.	Redmayne, M.
Crowder, Petre (Ruislip—Northwood)	Kaberry, D.	Remnant, Hon. P.
Cundiff, F. W.	Kerr, H. W. (Cambridge)	Renton, D. L. M.
Cuthbert, W. N.	Kingsmill, Lt.-Col. W. H.	Roberts, Emrys (Merioneth)
Darling, Sir William (Edinburgh, S.)	Lambert, Hon. G.	Roberts, Major Peter (Heeley)
Davidson, Viscountess	Lancaster, Col. C. G.	Robertson, Sir David (Caithness)
Davies, Nigel (Epping)	Langford-Holt, J.	Robinson, Roland (Blackpool, S.)
de Chair, Somerset	Law, Rt. Hon. R. K.	Robson-Brown, W. (Esher)
De la Bère, R.	Leather, E. H. C.	Rodgers, John (Sevenoaks)
Deedes, W. F.	Legge-Bourke, Maj. E. A. H.	Roper, Sir Harold
Digby, S. W.	Lennox-Boyd, A. T.	Ropner, Col. L.
Dodds-Parker, A. D.	Lindsay, Martin	Russell, R. S.
Donner, P. W.	Linstead, H. N.	Ryder, Capt. R. E. D.
Douglas-Hamilton, Lord Malcolm	Llewellyn, D.	Salter, Rt. Hon. Sir Arthur
Drayson, G. B.	Lloyd, Rt. Hn. Geoffrey (King's Norton)	Scott, Donald
Dugdale, Maj. Sir Thomas (Richmond)	Lloyd, Maj. Guy (Renfrew, E.)	Shepherd, William
Duncan, Capt. J. A. L.	Lloyd, Selwyn (Wirral)	Smiles, Lt.-Col. Sir Walter
Dunglass, Lord	Lockwood, Lt.-Col. J. C.	Smithers, Peter (Winchester)
Duthie, W. S.	Longden, Gilbert (Herts, S. W.)	Smyth, Brig. J. G. (Norwood)
Eccles, D. M.	Low, A. R. W.	Snadden, W. McN.
Eden, Rt. Hon. A.	Lucas, Sir Jocelyn (Portsmouth, S.)	Soames, Capt. C.
Elliot, Rt. Hon. W. E.	Lucas, P. B. (Brentford)	Spearman, A. C. M.
Spent, Sir Patrick (Kensington, S.)	Thompson, Kenneth Pugh (Walton)	Ward, Hon. George (Worcester)
Stanley, Capt. Hon. Richard (N. Fylde)	Thompson, R. H. M. (Croydon, W.)	Ward, Miss. I. (Tynemouth)
Stevens, G. P.	Thorneycroft, Peter (Monmouth)	Waterhouse, Capt. Rt. Hon. C.
Steward, W. A. (Woolwich, W.)	Thornton-Kemsley, Col. C. N.	Watkinson, H.
Stewart, Henderson (Fife, E.)	Thorp, Brig. R. A. F.	Webbe, Sir H. (London)
Stoddart-Scott, Col. M.	Tilney, John	White, Baker (Canterbury)
Storey, S.	Turner, H. F. L.	Williams, Charles (Torquay)
Strauss, Henry (Norwich, S.)	Turton, R. H.	Williams, Gerald (Tonbridge)
Stuart, Rt. Hon. James (Moray)	Tweedsmuir, Lady	Williams, Sir Herbert (Croydon, E.)
Studholme, H. G.	Vane, W. M. F.	Wills, G.
Sutcliffe, H.	Vaughan-Morgan. J. K.	Wilson, Geoffrey (Truro)
Taylor, Charles (Eastbourne)	Vosper, D. F.	Winterton, Rt. Hon. Earl
Taylor, William (Bradford, N.)	Wade, D. W.	Wood, Hon. R.
Teeling, W.	Wakefield, Edward (Derbyshire, W.)	York, C.
Teevan, T. L.	Wakefield, Sir Wavell (Marylebone)
Thomas, J. P. L. (Hereford)	Walker-Smith, D. C.	TELLERS FOR THE AYES:
		Major Wheatley and Major Conant.
NOES
Acland, Sir Richard	Driberg, T. E. N.	Janner, B.
Adams, Richard	Dugdale, Rt. Hon. John (W. Bromwich)	Jay, D. P. T.
Albu, A. H.	Dye, S.	Jeger, George (Goole)
Allen, Arthur (Bosworth)	Ede, Rt. Hon. J. C.	Jeger, Dr. Santo (St. Panoras, S.)
Allen, Scholefield (Crewe)	Edelman, M.	Jenkins, R. H.
Anderson, Alexander (Motherwell)	Edwards, John (Brighouse)	Johnson, James (Rugby)
Anderson, Frank (Whitehaven)	Edwards, Rt. Hon. Ness (Caerphilly)	Johnston, Douglas (Paisley)
Attlee, Rt. Hon. C. R.	Edwards, W. J. (Stepney)	Jones, David (Hartlepool)
Awbery, S. S.	Evans, Albert (Islington, S. W.)	Jones, Frederick Elwyn (West Ham, S.)
Ayles, W. H.	Evans, Edward (Lowestoft)	Jones, Jack (Rotherham)
Bacon, Miss. Alice	Evans, Stanley (Wednesbury)	Jones, William Elwyn (Conway)
Baird, J.	Ewart, R.	Keenan, W.
Balfour, A.	Fernyhough, E.	Kenyon, C.
Barnes, Rt. Hon. A. J.	Field, Capt. W. J.	Key, Rt. Hon. C. W.
Bartley, P.	Finch, H. J.	King, Dr. H. M.
Bellenger, Rt. Hon. F. J.	Fletcher, Eric (Islington. E.)	Kinghorn, Sqn. Ldr E.
Benn, Wedgwood	Follick, M.	Kinley, J.
Benson, G.	Foot, M. M.	Lang, Gordon
Beswick, F.	Forman, J. C.	Lee, Frederick (Newton)
Bevan, Rt. Hon. A. (Ebbw Vale)	Fraser, Thomas (Hamilton)	Lee, Miss. Jennie (Cannock)
Bing, G. H. C.	Freeman, John (Watford)	Lever, Leslie (Ardwick)
Blenkinsop, A.	Freeman, Peter (Newport)	Lewis, Arthur (West Ham, N.)
Blyton, W. R.	Gaitskell, Rt. Hon. H. T. N.	Lewis, John (Bolton, W.)
Boardman, H.	Ganley, Mrs. C. S.	Lindgren, G. S.
Booth, A.	Gibson, C. W.	Lipton, Lt.-Col. M.
Bottomley, A. G.	Gilzean, A.	Logan, D. G.
Bowden, H. W.	Glanville, James (Consett)	Longden, Fred (Small Heath)
Bowles, F. G. (Nuneaton)	Gooch, E. G.	McAllister, G.
Braddock, Mrs. Elizabeth	Gordon-Walker, Rt. Hon. P. C.	MacColl, J. E.
Brook, Dryden (Halifax)	Greenwood, Anthony (Rossendale)	McGhee, H. G.
Brooks, T. J. (Normanton)	Greenwood, Rt. Hon. Arthur (Wakefield)	McInnes, J.
Broughton, Dr. A. D. D.	Grenfell, D. R.	Mack, J. D.
Brown, Rt. Hon. George (Belper)	Grey, C. F.	McKay, John (Wallsend)
Brown, Thomas (Ince)	Griffiths, David (Rother Valley)	Mackay, R. W. G. (Reading, N.)
Burke, W. A.	Griffiths, Rt. Hon. James (Llanelly)	McLeavy, F.
Burton, Miss. E.	Griffiths, William (Exchange)	MacMillan, Malcolm (Western Isles)
Butler, Herbert (Hackney, S.)	Gunter, R. J.	McNeil, Rt. Hon. H.
Callaghan, L. J.	Hale, Joseph (Rochdale)	MacPherson, Malcolm (Stirling)
Carmichael, J.	Hale, Leslie (Oldham, W.)	Mainwaring, W. H.
Castle, Mrs. B. A.	Hall, John (Gateshead, W.)	Mallalieu, E. L. (Brigg)
Champion, A. J.	Hall, Rt. Hon. Glenvil (Colne Valley)	Mallalieu, J. P. W. (Huddersfield, E.)
Chetwynd, G. R.	Hamilton, W. W.	Mann, Mrs. Jean
Clunie, J.	Hannan, W.	Manuel, A. C.
Cocks, F. S.	Hardman, D. R.	Marquand, Rt. Hon. H. A.
Coldrick, W.	Hardy, E. A.	Mathers, Rt. Hon. G.
Collindridge, F.	Hargreaves, A.	Mellish, R. J.
Cook, T. F.	Hastings, S.	Messer, F.
Cooper, Geoffrey (Middlesbrough, W.)	Hayman, F. H.	Middleton, Mrs.
Cooper, John (Deptford)	Henderson, Rt. Hon. A. (Rowley Regis)	Mikardo, Ian
Corbet, Mrs. Freda (Peckham)		Mitchison, G. R.
Cove, W. G.	Herbison, Miss. M.	Moeran, E. W.
Craddock, George (Bradford, S.)	Hewitson, Capt. M.	Monslow, W.
Crawley, A.	Hobson, C. R.	Moody, A. S.
Crosland, C. A. R.	Holman, P.	Morgan, Dr. H. B.
Crossman, R. H. S.	Holmes, Horace (Hemsworth)	Morley, R.
Cullen, Mrs. A.	Houghton, D.	Morris, Percy (Swansea, W.)
Daines, P.	Hoy, J.	Morrison, Rt. Hon. H. (Lewtsham, S.)
Dalton, Rt. Hon. H.	Hubbard, T.	Mort, D. L.
Darling, George (Hillsborough)	Hudson, James (Ealing, N.)	Moyle, A.
Davies, A. Edward (Stoke, N.)	Hughes, Emrys (S. Ayrshire)	Mulley, F. W.
Davies, Harold (Leek)	Hughes, Hector (Aberdeen, N.)	Murray, J. T.
Davies, Stephen (Merthyr)	Hynd, H. (Accrington)	Nally, W.
de Freitas, Geoffrey	Hynd, J. B. (Attercliffe)	Neal, Harold (Bolsover)
Deer, G.	Irvine, A. J. (Edge Hill)	Noel-Baker, Rt. Hon. P.
Dodds, N. N.	Irving, W. J. (Wood Green)	O'Brien, T.
Donnelly, D.	Isaacs. Rt. Hon. G. A.	Oldfield, W. H.

Oliver, G. H.	Shurmer, P. L. E.	Wallace. H. W.
Orbach, M.	Silverman, Julius (Erdington)	Walkins, T. E.
Padley, W. E.	Silverman, Sydney (Nelson)	Webb, Rt. Hon. M. (Bradford, C.)
Paget, R. T.	Simmons, C. J.	Weitzman, D.
Paling, Rt. Hon. Wilfred (Dearne vally)	Slater, J.	Wells, Percy (Faversham)
Paling, Will T. (Dewsbury)	Smith, Ellis (Stoke, S.)	Wells, William (Walsall)
Pannell, T. C.	Smith, Norman (Nottingham, S.)	West, D. G.
Pargiter, G. A.	Sorensen, R. W.	Wheatley, Rt. Hn. John (Edinb'gh. E.)
Parker, J.	Soskice, Rt. Hon. Sir Frank	White, Mrs. Eirene (E. Flint)
Paton, J.	Sparks, J. A.	While, Henry (Derbyshire, N. E.)
Pearson, A.	Steele, T.	Whiteley, Rt. Hon. W.
Peart, T. F.	Stewart, Michael (Fulham. E.)	Wilcock, Group Capt. C. A
Porter, G.	Stokes, Rt. Hon. R. R.	Wilkes, L.
Price, Philips (Gloucestershire, W.)	Strachey, Rt. Hon. J.	Wilkins, W. A.
Proctor, W. T.	Strauss, Rt. Hon. George (Vauxhall)	Willey, Frederick (Sunderland)
Pryde, D. J.	Stross, Dr. Barnett	Willey, Octavius (Cleveland)
Pursey, Cmdr. H.	Summerskill, Rt. Hon. Edith	Williams, David (Neath)
Rankin J.	Sylvester, G. O.	Williams, Rev. Llywelyn (Abertillery)
Rees, Mrs. D.	Taylor, Bernard (Mansfield)	Williams, Ronald (Wigan)
Reeves, J.	Taylor, Robert (Morpeth)	Williams, Rt. Hon. Thomas (Don Valley)
Rent, Thomas (Swindon)	Thomas, David (Aberdare)	Williams, W. T. (Hammersmith, S.)
Reid, William (Camlachie)	Thomas, George (Cardiff)	Wilson, Rt. Hon. Harold (Huyton)
Rhodes, H.	Thomas, Iorwerth (Rhondda, W.)	Winterbottom, Ian (Nottingham, C.)
Richards, R.	Thomas, Ivor Owen (Wrekin)	Winterbottom, Richard (Brightside)
Roberts, A.	Thorneycroft, Harry (Clayton)	Wise, F. J.
Roberts, Goronwy (Caernarvonshire)	Thurtle, Ernest	Woodburn, Rt. Hon. A.
Robertson, J. J. (Berwick)	Timmons, J.	Wyatt, W. L.
Robinson, Kenneth (St. Pancras, N.)	Tomney, F.	Yates, V. F.
Rogers, George (Kensington, N.)	Turner-Samuels, M.	Younger, Hon. K.
Ross, William (Kilmarnock)	Ungoed-Thomas A. L.
Royle, C.	Usborne, H.	TELLERS FOR THE NOES:
Shawcross, Rt. Hon. Sir Hartley	Vernon, W. F.	Mr. Popplewell and Mr. Delargy.
Shinwell, Rt. Hon. E.	Viant, S. P.

12.45 a.m.

Mr. Redmayne (Rushcliffe)

I beg to move, in page 10, line 20, at the end to insert: excepting only expenditure on the installation or improvement of plant and equipment for the purification of trade effluents discharged into a public sewer or a stream. I should say that, while I agree absolutely with the recent remarks of my right hon. Friend in regard to reporting Progress, as an inexperienced Member of this Committee I should personally have been heart-broken. I understand that this Amendment might have been called 24 hours ago. Had it not been for the stubbornness of the Government in considering the constructive propositions put forward by the Opposition, I should have got this speech, with which I have been so long pregnant, off my chest a very long time ago. To delay that step for another 24 hours or longer would be more than I could bear. The object of the Amendment is in a way similar to that of the last Amendment, in that it is to provide an incentive to industry.

Mr. Ivor Owen Thomas (The Wrekin)

It is stillborn.

Mr. Redmayne

In this case it is an incentive so to improve trade effluents as to maintain and improve again the purity of our rivers. I am unfortunate that I cannot plead this case with the eloquence of my hon. Friend the Member for Kidderminster (Mr. Nabarro), nor indeed is it so attractive in that it does not promise the same sort of immediate and productive results; but nevertheless I do claim, and I hope I can prove, that it is of great national importance. In fact, if anyone who is interested in this particular subject cares to think for a moment of the effect of two great wars on the state of our rivers, and to think of what the added effect of a further expansion of production may be on these rivers, I think the importance of my Amendment will be appreciated.

It is perhaps a pity that we are dealing with this Clause, to some extent putting the cart before the horse. That, perhaps, cannot be helped, but at least, from my point of view it would have been far easier to put my arguments in this limited case if the main arguments relating to the Clause had already been put. I can very well imagine that hon. Gentlemen who accept the fact that there should be a suspension of initial allowances may regard it as absurd that I should put forward an Amendment with an apparently insignificant object compared with the other enormous problems which face industry at this time.

Personally, I do not at all believe that initial allowances should be wholly suspended. I agree that the 40 per cent. allowance has in some small measure encouraged capital extravagance, but only in minor matters. It is true that when we consider capital expenditure having in mind the initial allowance, some of us are apt to show as much irresponsibility in our own affairs as does a woman in a hat shop with the housekeeping money. But these extravagances are only in minor matters. It may be that they require some change in the system, but I am certain that complete suspension is a bad policy.

In passing, I would say that in the initial allowances we have the one feature of our system of taxation which has, for a purpose, encouraged the purchase of quality goods, whereas other taxes have simply driven us to standards of the cheapest and the nastiest. That is at least one excellent argument which can be applied to the initial allowances. Already there is an acknowledged exception to the Chancellor's Budget intention—ship-building; and if I judge correctly, apart from the false impression given by a Division under present circumstances, it is the feeling of the Committee that fuel economy should also be an exception.

Mr. Logan (Liverpool, Scotland)

On a point of order. There are some Members lying down in the Members' Gallery who appear to be in distress. Do they require a doctor?

Mr. Redmayne

Without going further into the general principle of the allowances, I suggest that there should be an allowance, first, for capital investment which can justify itself as having an immediate effect on productivity; secondly, for capital investment which has as its object some means of national economy, as in the case of fuel economy; and thirdly, for capital investment which has within it some point of great national interest, in which category I claim we should regard this question of pure rivers.

Now may I turn briefly to the detailed points of the Amendment? It is a logical sequel to the Rivers (Prevention of Pollution) Bill, which had its Third Reading in the House as recently as last Thursday; so at least it is topical. Hon. Members are familiar with the arguments which were deployed in favour of the principle of the Bill and there is no need for me to repeat them. [HON. MEMBERS: "Hear, Hear."] I can only hope that hon. Members who say "Hear, Hear" have read the OFFICIAL REPORT, if they did not take part in the debate on the Bill, because the arguments were extremely cogent.

Mr. Frederic Harris

They are just ignorant.

Mr. Redmayne

This Amendment is aimed not only at helping the installation of equipment for anti-pollution work, but also at the improvement of existing equipment. One of the points made in the discussion on the Bill was that although industry was prepared to do its best with the position today, it very much doubted whether it could cope with the great extension which will arise out of the defence programme and with the extra pollution problems attached thereto.

The second point, which I believe to be very important, is that this Amendment purposely relates to effluents discharged, not only into streams and rivers, but also into public sewers. Under the Public Health (Drainage of Trade Premises) Act, local authorities have a great responsibility for the receipt of these effluents and for their purification, and in discussion on the Rivers (Prevention of Pollution) Bill fears were expressed that grants for the improvement of sewerage schemes of such a size as to cope with the ever-increasing problem would not be forthcoming from the Government.

While it is the Government's duty to help local authorities with those schemes in so far as the outflow is concerned, this Amendment will greatly ease the burden on local authorities by lessening the problem at the point whether the effluent is received into the sewer. I believe that for that reason alone it will be welcomed by local authorites. It should also be welcomed by the Government as decreasing the demands that are likely to be made on them for grants to help local authorities with their sewerage schemes.

The other point that came up constantly throughout discussion on the Rivers (Prevention of Pollution) Bill was the cost of anti-pollution measures—the cost today and the cost as it would be in an expanding programme. Those objections were made before the Budget Statement, when initial allowances were still an accepted fact. Now the objections must be greatly increased. There is no question of anti-pollution plant paying for itself, as the Economic Secretary said fuel economy plant would do. Anti-pollution pays for nothing from the point of view of industry. All it provides for is the quality of the water in our rivers below the particular industry for the use of other people.

This Amendment offers only a mite towards the burden of the cost; really only an encouragement; but if it were accepted it would at least prove that this Committee supports, with good will, the spirit and the purpose of legislation which it has only just passed. It is sometimes thought that the reason for having pure rivers is limited. I know hon. Members may have heard it all before, but this supports the Amendment, and I shall be as brief as I can.

Mrs. Jean Mann (Coatbridge and Airdrie)

On a point of order. Are we discussing the Rivers (Prevention of Pollution) Bill or the Finance Bill?

The Deputy-Chairman (Colonel Sir Charles MacAndrew)

We are discussing the Amendment on the Order Paper, and the hon. Gentleman is perfectly in order. I have been listening to him very carefully.

Mr. Redmayne

If the hon. Lady had paid me the small compliment of listening to my inexperienced discourse, she would have heard me say that this was a logical sequel to the Rivers (Prevention of Pollution) Bill. I will not keep her from the pleasure of listening to other hon. Members for more than another two or three minutes.

Pure rivers are wanted, above all, by industry, and that is the important thing. Any one trade or factory has a responsibility to other trades and other factories below its outflow. In the past, industry has done much to destroy the purity of rivers and has subsequently done a great deal to restore it, but not enough. I submit that this Amendment will help to maintain the trend towards restoration. Pure rivers are wanted by water undertakings for the people. I feel sure that would appeal to the hon. Lady. Pure rivers are wanted, too, by people for recreation and amenities. Lastly, and I purposely put it last, pure rivers are wanted by fish. First of all because fish are a criterion of purity, and secondly because there are two million fishermen.

1.0 a.m.

The cost of this Amendment would not be large in a technical sense, and it does not make any drain on re-armament. It is an exactly similar point to fuel economy, and I trust that hon. Members on both sides of the Committee, who showed such great interest in this subject in the previous discussion of it—and there are hon. and right hon. Members who can at least adopt an attitude of benevolent neutrality—will help to convince the Chancellor, if he needs convincing, that this concession is one that I put forward with the purest motive, unpolluted by political bias.

Mr. Colegate

I cannot conceive that anyone can really object to this Amendment. The hon. Lady the Member for Coatbridge and Airdrie (Mrs. Mann) drew attention to the fact that there had been a good many arguments heard about the prevention of pollution. I am reminded that on no side of the House was there anything but extreme enthusiasm for that particular case. We passed that Bill on Monday of this week, and I can imagine no better send-off to the river boards in their new task, which is a very heavy task, than that the Chancellor of the Exchequer should show some imagination and give them this concession. It would cost little and has none of the objections that the Economic Secretary made out the previous Amendment had.

Let me remind the Committee of what he said. He said, with regard to that plant, that he wanted to do anything that damped down demand for products that competed with the re-armament programme. Anyone who knows about the installation of equipment for sewerage works, knows that one can hardly find any activity which competes less with the rearmament programme. Talking in general terms of accepting this suspension of initial allowances, the Economic Secretary made out that there were considerable administrative difficulties. Here, again, there is no administrative difficulty whatever, because the whole of the administration would be done by the river boards which the Government have just taken steps to set up. So that argument is disposed of.

The third argument used was that if we gave the concessions to certain pieces of plant, there would be jealousy in other directions; there would be great dissatisfaction in other trades and in respect of other machines. But I can assure the Economic Secretary, even if it does not leap to his eye as it should, that there will be no dissatisfaction on the part of people who are offered a reduction of the money they spend on providing the plant to deal with effluents. The people most likely to show dissatisfaction are the people required by the river boards to undertake this work.

When we were discussing the river boards, we all realise that it must not be a case merely of uniting people to do things they do not necessarily want to do, and on every occasion one need not invoke the law. We all hope—and there is considerable experience to justify the hope—that the whole work of river purification will be carried out largely by co-operation between the people concerned in it. Therefore, it is essential that we should give the maximum amount of financial inducement to people to cooperate with the river boards to undertake to install and improve their plant and equipment for this purpose. It has already been said that this does not pay for itself. There can be no question of that in the short-term view. Of course, in the long-term view one might say that any worth-while improvement pays for itself, but in that respect this matter cannot be placed in the same category as the fuel economisers.

The acceptance of this Amendment would not make any call on the mechanical engineering industry. It would fall almost entirely on civil engineering. For these reasons—and I do not wish to develop the argument at any greater length—it is quite clear that this particular form of plant has a greater and unique claim compared with any other category of plant that can be named. It will help this new crusade we are undertaking for the purification of rivers, and by showing good will, benevolence and a little imagination—a quality of which I am sorry to say the Chancellor has shown himself to be completely destitute—these new boards can be given a good send-off in a task which received the unanimous approval of the House last Monday.

Mr. J. Edwards

The hon. Gentleman who moved this Amendment said that it was similar to the last one. I think I need not weary the Committee by going over all the arguments I used on that occasion, but the mere fact that he has said that it is similar proves one of my main points against the last Amendment. If, let us suppose, the last Amendment had been accepted, the hon. Gentleman would at once have used that acceptance in favour of our acceptance of this Amendment.

The hon. Gentleman made that perfectly plain. He said that it was of the same kind, but the right hon. Member for Aldershot (Mr. Lyttelton) said on the last Amendment that we could accept it without commitment on anything else. It is, however, quite clear that already we are in the process where Members are trying to build one case on the other, and I have no doubt that when we come to other Amendments we shall see the same effect. It looks as if hon. Gentlemen opposite are trying to achieve their purpose on the side, instead of making it explicit that they want to avoid the suspension of initial allowances.

Is not the truth of the matter that any one of us could make out a very good case for any one of our enthusiasms? This particular matter happens to be one of my enthusiasms. I made a number of speeches in the last Parliament on river pollution. I had a great deal to do with what I might term the incubation of the Rivers (Prevention of Pollution) Bill, because I was concerned with it when Parliamentary Secretary to the Ministry of Health. There is nothing I would rather see than our rivers free from pollution. I said once that there was a time when the difficulty was to catch the fish, and now the difficulty was to find the fish to catch. It is, of course, one of the blots on our rural life, and to some extent on our urban life, that our rivers are so badly polluted.

We can all find things of this kind which we are keen about. The truth is that we cannot adopt the principle of saying "Let us wait until we have done everything else we want to do before we give really serious consideration to the defence programme." If we were to take the word of the hon. Member for Burton (Mr. Colegate), we would have more civil engineering people engaged in this work; but it would be difficult to find an industry which is more pressed, and is going to be more hardly pressed, because of the defence programme.

In these circumstances it would be the height of folly to do anything which encouraged a greater use of these resources, which is what the hon. Gentleman is asking for. In circumstances in which our first and real endeavours must be devoted to the defence programme, we must not do anything which diverts resources from that programme; and we must not take too narrow a view of what resources are. In this case they include manpower. Although we might be keen to see more of this work done, we should be doing a great disservice if at present we asked for more of it to be done.

I agree with what both hon. Members have said, that the sooner we can get to the day when we can turn our attention to these matters in the way we would like, the better; but in present circumstances we cannot do everything at once. We cannot do all these good things about which we are agreed and yet carry on the defence programme to which I think we are all committed. For these reasons, together with those which I gave on the last Amendment, I must ask the Committee to reject this Amendment.

Mr. Fort

I was much disappointed to hear the Economic Secretary, who has such deep sympathy with the object of this Amendment, reject it in so few words. While it is true that all of us are here to support re-armament, I was unconvinced by his argument that the additional civil engineering which might result from the implementation of this Amendment would draw away a noticeable quantity of manpower from re-armament industries. If we are to put into effect the Bill we sent to another place a few days ago, industry will be involved in the expenditure of large sums of money. If industry is to spend these large sums, and the law lays upon it the obligation to do so, these initial allowances will be very necessary.

The best information I can get is that in a very large range of manufacturing industries—chemicals and textiles, dyeing and printing, steel—about 10 per cent. of the total capital cost at present replacement rates will have to be spent on the treatment of effluent and the necessary sewers to carry it away. On a factory costing about £3 million, a sum of £300,000 will have to be spent on the equipment necessary to treat effluent. Similarly, with a textile finishing concern going up now at a cost of £450,000, the effluent treatment will cost £50,000. If industry is to be called upon to spend these sums, and implement the Bill we passed so recently, it is only fair and reasonable that it should have some assistance by being allowed to continue these initial allowances.

1.15 a.m.

I was surprised to hear the Economic Secretary sweep aside this Amendment with a far too elementary argument, drawing his deductions from the previous Amendment. In the light of the figures I have put before the House and the recent passing of the Bill to prevent river pollution, I ask the Economic Secretary to reconsider his decision and the Committee to agree to this Amendment.

Mr. Turton (Thirsk and Malton)

I would not have spoken but for the extraordinary argument made by the Economic Secretary. I understood him to say that the Government do not wish to encourage by any means the erection of purification plants.

Mr. Edwards

I do not think that anything I said could in any way be interpreted to mean that. I was trying to refute the arguments that had been advanced for more and more of this work to be done now. We cannot afford to do more and more of this work with the defence programme upon us. We should have competition in the civil engineering industry which would make it difficult for the defence programme to be carried out.

Mr. Turton

That is a very different paraphrase of what the hon. Gentleman said; but if there is any difference, I gladly withdraw what I said. What have the Government done? Within the last six months they have made it a statutory offence for any industry to put effluent into a river without treating it. At the time they brought in that Bill there was a 40 per cent. initial allowance. While the Bill was passing through the House, the Chancellor, no doubt for a very good reason—perhaps for a bad one—withdrew the initial allowance. Either the Government should withdraw or postpone the Rivers (Prevention of Pollution) Bill or the Chancellor should accept this Amendment.

The Economic Secretary told us earlier that he was present at the incubation of that Bill. I cannot congratulate him on the success of his incubating efforts, because when it was brought to the House hon. Members found it completely unworkable and it had to be altered so that it would do what was intended. I think that, in view of the attitude he has taken and the attitude the Chancellor has taken, the Chancellor ought to consider whether he should not postpone the obligation which that Bill places on industry or accept this Amendment. If an enterprise does not carry out this obligation, it is liable to heavy financial penalties, and in cases of repeated failure to observe the conditions of the Bill, there is a sentence of imprisonment. I think it is a matter of grave regret that the Economic Secretary addressed such an argument to the Committee.

Sir Wavell Wakefield (St. Marylebone)

The main argument of the Economic Secretary was that we should not do anything to hinder the re-armament programme. I suggest to him that one of the most important things that can be done to further the security and safety of this country is to set up plant to stop the pollution of rivers. We know that at the present moment a considerable amount of raw materials do pass into rivers, and it is of the utmost importance that these raw materials should be conserved wherever possible. Sulphuric acid is but one of those materials, and I should have thought that it was of the utmost importance that every encouragement should be given to firms to get on as rapidly as possible with the installation of this type of equipment, for in doing so they would conserve raw materials, which in case of war or national emergency would be urgently needed.

I make this plea—will not the hon. Gentleman look at this matter again to see whether he can discover the value, which I believe to be considerable, of raw materials which ought to be saved by the installation of this plant? If my arguments are sound, as I believe them to be. I think I have put forward something which might make the hon. Gentleman reconsider his attitude. I hope he will consider the point I have made and in doing so find that he has full reason to change his mind.

Mr. R. A. Butler (Saffron Walden)

In view of the fact that the main discussion on this matter is evidently to be postponed until we have taken the Amendments, I propose to reserve my argument for the main debate. On this particular Amendment, I wish to indicate that we have here a typical example of Government planning. They deliberately included in the Gracious Speech as the chief piece of legislation the matter of river pollution, and obviously they intended that Bill, which has passed through this House, to have priority, otherwise there was no need to mention it in the Gracious Speech.

In view of the speech of my hon. Friend the Member for Thirsk and Malton (Mr. Turton) and also because the hon. Gentleman the Economic Secretary says he has a special interest in the subject, we shall take the matter to a Division, because we consider that it should be pressed in that way because of the priority the Government have given to the matter.

Major Legge-Bourke

In endorsing what my right hon. Friend has said, may I add one word? I think that all hon. Members were concerned in the debate on the Rivers (Prevention of Pollution) Bill were impressed by the way it was treated on a completely non-party basis. Hon. Gentlemen on all sides were dealing with the matter absolutely objectively, and it is rather disappointing to find that no one from the other side, except the Economic Secretary, has expressed any view about it now.

I think all of us can say that what the Economic Secretary has said is in conflict with what the Minister of Local Government and Planning had to say during the passage of that Bill. The right hon. Gentleman certainly gave an indication that he was in favour of the earliest possible action being taken to prevent river pollution. I do not think we should forget what the right hon. Gentleman the Member for Ebbw Vale (Mr. Bevan) said, when he intervened during the Report stage. He remarked: Just because the factory is man-made and the river God-made, it does not follow that man ought to be in front of God there."—[OFFICIAL REPORT, 31st May, 1951; Vol. 488, c. 473.] The right hon. Gentleman placed it on a high theological plane, but the Economic Secretary has brought us down to earth and drowned us in a polluted river. He has certainly brought us back to more mundane matters and it was unfair of him to compare the Amendment of my hon. Friend with the one which preceded it. I think there is something rather more important, and perhaps more eternal, wrapped up in this Amendment than there was in the preceding one. I am one of those people who believe that one of the greatest sins we can commit is to do something ugly, something which destroys natural beauty. I think that all the hon. Members who took part in the debate on the Rivers (Prevention of Pollution) Bill would agree about that.

The Minister of Local Government and Planning said that his right hon. Friend the Member for Ebbw Vale was the father of the Bill, and added that he thoroughly agreed with what his right hon. Friend had said. What the Economic Secretary has said tonight shows that he certainly does not agree with what the Minister of Local Government and Planning said throughout the proceedings on that Bill, which was that he wanted every step to be taken that could be taken to stop river pollution as early as possible.

The hon. Gentleman tonight has laid some emphasis on the fact that we do not want to interrupt our defence programme. Of course, we do not; but will he bear in mind one important point, that there are some aspects of defence and preparation for defence which are particularly injurious to rivers. Not the least of those is the manufacture of explosives, because there is nothing which is more harmful to a river than TNT if the effluent is not properly controlled. Its manufacture has presented great problems in the past, and it is highly possible that there will be an increase in the manufacture of such materials.

If we have new factories starting up, shall we deliberately encourage them, by the refusal of this Amendment, to start operations with no proper equipment for the prevention of pollution? If so, it is a very different story we are being told tonight from what the Minister of Local Government and Planning had to say. It is another example of the complete and utter lack of liaison between any of the Government Departments. What the hon. Gentleman has said tonight is a crying scandal. It has dashed the hopes of hon. Members on all sides of the Committee, and I certainly hope that some of them who spoke so forcibly in favour of the Rivers (Prevention of Pollution) Bill will join us in the Lobby.

Mr. Grimond (Orkney and Shetland)

With the main argument of the Economic Secretary I personally find myself in agreement; that is, that owing to the rearmament programme, however desirable it may be to install this equipment, we may have to postpone it. But I did hope that we could have some remark from the Government Front Bench on this point, which struck me, as it struck the hon. Member for Thirsk and Malton (Mr. Turton), and the right hon. Member for Saffron Walden (Mr. R. A. Butler).

There may be certain statutory obligations on companies to install this machinery with which they have to comply and on which they may now find their initial allowances removed; but that is inevitable when there is a Bill for the purpose of compelling the installation of this machinery. On the other hand, there is the valid argument that this installation ought to be postponed because it interferes with the re-armament programme. I think, therefore, that the Front Bench ought to indicate that they will take this point into consideration, and that either some instructions will be given on this matter to public authorities and others who may become liable to install that machinery under the Rivers (Prevention of Pollution) Bill, or, as suggested by the hon. Member for Thirsk and Malton, some Amendment to the Bill ought to be introduced.

Colonel Gomme-Duncan (Perth and East Perthshire)

I want to add a word to what my hon. Friend the Member for Thirsk and Malton (Mr. Turton) and my right hon. Friend the Member for Saffron Walden (Mr. R. A. Butler) have said. It may have escaped the notice of the Minister that, in addition to the Rivers (Prevention of Pollution) Bill for England, there is a similar Bill for Scotland, put forward by his right hon. Friend the Secretary of State for Scotland. The right hon. Gentleman put his Bill forward in forcible terms, explaining how urgently necessary it was that the rivers of Scotland should be freed from this pollution to the greatest possible extent. One of the inducements held out was that plant installed for the purpose would carry the benefit of this initial allowance.

1.30 a.m.

Has the hon. Gentleman or the Chancellor of the Exchequer consulted with the Secretary of State for Scotland about these statements which have been made on behalf of Scotland? I doubt it very much, because I am quite convinced that the Secretary of State for Scotland is seldom consulted or considered in anything. If we are to have two Bills going through the House, both of which carry implied guarantees, more or less, of these initial allowances being made, why are we now told that they are all washed out?

The Economic Secretary said, if I understood him correctly, that we on this side seemed to think that re-armament was not necessary, or that we had tried to hinder it. But why is it so much more urgent, and so vastly more costly, today? Because the Government did not take our warnings and start it three years earlier.

Commander Pursey (Hull, East)

Why not 30 years earlier?

Colonel Gomme-Duncan

I do not propose to answer all the questions, but I say this again, referring to this Government—and it is this Government with which we are concerned—that if they had taken our advice, the position would have been very different.

Commander Pursey rose—

Colonel Gomme-Duncan

The hon. and gallant Member belonged to the silent Service, and it is no use his pointing at me and making remarks. I did not belong to a Service which professed to be silent, but he did, and he should be quiet. If the Government had taken our advice on re-armament, it would not have been so urgent or so costly as today. When the Minister says this is because of urgent re-armament, it is not for hon. Members opposite to point an accusing finger at us. We were going to have all this a great deal earlier, and not, if I may so describe it, by the easy instalment system.—[An HON. MEMBER: "What about Korea?"]—The Korean conflict did not happen yesterday.

Mr. Fernyhough (Jarrow)

Nor the pollution of the rivers.

Colonel Gomme-Duncan

The hon. Member is wrong. They were being polluted yesterday just as much as today, and we want this machinery so that we may improve the state of our rivers which are polluted.

I cannot repeat what I have said, but I hope that those who interrupt me will have a word with the Government on the subject we are debating at the moment, because I have an uncomfortable feeling that they are left out of the consideration; and I think that includes the Secretary of State for Scotland. As I have said, there is an implied guarantee in this matter which seems to have been deliberately washed out by the Chancellor in his action in producing this Clause on initial allowances, and I hope that we shall go into the Lobby against it.

Miss. Ward

I shall not detain the Committee for more than a minute, but while all these speeches have been going on I have turned over in my mind this thought. Why are the Government so persistent in their attitude of refusing to accept any Amendment we have proposed this evening? I have come to the conclusion that this can only be an indication that the Government have lost their grip on affairs. It seems to me that a decision must have been taken that in no circumstances, in case they got themselves into further difficulties, must they make any concession, however valid might be the arguments put forward. If the hon. Gentleman had come to the Committee and been prepared to consider each case on its merits—

The Deputy-Chairman (Colonel Sir Charles MacAndrew)

We are considering one case at the moment.

Miss. Ward

I was only discussing why this particular Amendment had been refused. All I want to say is that presumably the hon. Gentleman had decided that in no circumstances, and no matter how valid the arguments advanced were, would he agree to any suggestions in case he got into future difficulties. The Government are losing their grip on affairs, and instead of being a "Oui, oui" Government they are a "non, non" Government.

Question put, "That those words be there inserted."

The Committee divided: Ayes, 278; Noes, 297.

Division No. 93.]	AYES	[1.36 a.m.
Aitken, W. T.	Fraser, Hon. Hugh (Stone)	MacLeod, John (Ross and Cromarty)
Alport, C. J. M.	Fraser, Sir Ian (Morecambe & Lonsdale)	Macmillan, Rt. Hon. Harold (Bromley)
Amery, Julian (Preston, N.)	Fyfe, Rt. Hon. Sir David Maxwell	MacPherson, Major Niall (Dumfries)
Amory, Heathcoat (Tiverton)	Gage, C. H.	Maitland, Cmdr. J. W.
Arbuthnot, John	Galbraith, Cmdr. T. D. (Pollok)	Manningham-Buller, R. E.
Ashton, H. (Chelmsford)	Galbraith, T. G. D. (Hillhead)	Marlowe, A. A. H.
Assheton, Rt. Hon. R. (Blackburn W.)	Garner-Evans, E. H. (Denbigh)	Marples, A. E.
Astor, Hon. M. L.	Gates, Maj. E. E.	Marshall, Douglas (Bodmin)
Baker, P. A. D.	Glyn, Sir Ralph	Marshall, Sidney (Sutton)
Baldock, Lt.-Cmdr. J. M.	Gomme-Duncan, Col. A.	Maude, Angus (Ealing, S.)
Baldwin, A. E.	Gridley, Sir Arnold	Maude, John (Exeter)
Banks, Col. C.	Grimston, Hon. John (St. Albans)	Maudling, R.
Baxter, A. B.	Grimston, Robert (Westbury)	Medlicott, Brig. F.
Beamish, Major Tufton	Harden, J. R. E.	Mellor, Sir John
Bell, R. M.	Hare, Hon. J. H. (Woodbridge)	Molson, A. H. E.
Bennett, Sir Peter (Edgbaston)	Harris, Frederic (Croydon, N.)	Monckton, Sir Walter
Bennett, Dr. Reginald (Gosport)	Harris, Reader (Heston)	Moore, Lt.-Col. Sir Thomas.
Bennett, William (Woodside)	Harvey, Air Cdre. A. V. (Macclesfield)	Morrison, John (Salisbury)
		Morrison, Rt. Hon. W. S. (Cirencester)
Bevins, J. R. (Liverpool, Toxteth)	Harvey, Ian (Harrow, E.)	Mott-Radclyffe, C. E.
Birch, Nigel	Harvie-Watt, Sir George	Nabarro, G.
Bishop, F. P.	Hay, John	Nicholls, Harmar
Black, C. W.	Head, Brig. A. H.	Nicholson, G.
Boles, Lt.-Col. D. C. (Wells)	Headlam, Lieut.-Col. Rt. Hon. Sir C.	Nield, Basil (Chester)
Boothby, R.	Heald, Lionel	Noble, Cmdr. A. H. P.
Bossom, A. C.	Heath, Edward	Nugent, G. R. H.
Boyd-Carpenter, J. P.	Henderson, John (Cathcart)	Nutting, Anthony
Boyle, Sir Edward	Hicks-Beach, Maj. W. W.	Oakshott, H. D.
Bracken, Rt. Hon. B.	Higgs, J. M. C.	Odey, G. W.
Braine, B. R.	Hill, Mrs. E. (Wythenshawe)	O'Neill, Rt. Hon. Sir Hugh
Braithwaite, Sir Albert (Harrow, W.)	Hill, Dr Charles (Luton)	Ormsby-Gore, Hon. W. D.
Braithwaite, Lt.-Cr. G. (Bristol, N. W.)	Hinchingbrooke, Viscount	Orr, Capt. L. P. S.
Bromley-Davenport, Lt.-Col. W.	Hirst, Geoffrey	Orr-Ewing, Charles Ian (Hendon, N.)
Brooke, Henry (Hampstead)	Holmes, Sir Stanley (Harwich)	Orr-Ewing, Ian L. (Weston-super-Mare)
Browne, Jack (Govan)	Hope, Lord John	Osborne, C.
Buchan-Hepburn. P. G. T.	Hopkinson, Henry	Peake, Rt. Hon. O.
Bullock, Capt. M.	Hornsby-Smith, Miss. P.	Perkins, W. R. D.
Bullus, Wing Commander E. E.	Horsbrugh, Rt. Hon. Florence	Peto, Brig. C. H. M.
Burden, Squadron Leader F. A.	Howard, Gerald (Cambridgeshire)	Pickthorn, K.
Butcher, H. W.	Howard, Greville (St. Ives)	Pitman. I. J.
Butler, Rt. Hon. R. A. (Saffron Walden)	Hudson, Sir Austin (Lewisham, N.)	Powell, J. Enoch
Carr, Robert (Mitcham)	Hudson, Rt. Hon. Robert (Southport)	Price, Henry (Lewisham, W.)
Carson, Hon. E.	Hudson, W. R. A. (Hull, N.)	Prior-Palmer, Brig. O.
Channon, H.	Hutchinson, Geoffrey (Ilford, N.)	Profumo, J. D.
Churchill, Rt. Hon. W. S.	Hutchison, Lt.-Com. Clark (E'b'rgh W.)	Raikes, H. V.
Clarke, Col. Ralph (East Grinstead)	Hutchison, Col. James (Glasgow)	Rayner, Brig. R.
Clarke, Brig. Terence (Portsmouth, W.)	Hyde, Lt.-Col. H. M.	Redmayne, M.
Colegate, A.	Hylton-Foster, H. B.	Remnant, Hon. P.
Cooper, Sqn. Ldr. Albert (Ilford, S.)	Jennings, R.	Renton, D. L. M.
Cooper-Key, E. M.	Johnson, Howard (Kemptown)	Roberts, Major Peter (Heeley)
Corbett, Lt.-Col. Uvedale (Ludlow)	Jones, A. (Hall Green)	Robertson, Sir David (Caithness)
Craddock, Beresford (Spelthorne)	Joynson-Hicks, Hon. L. W.	Robinson, Roland (Blackpool, S.)
Cranborne, Viscount	Kaberry, D.	Robson-Brown, W.
Crookshank, Capt. Rt. Hon. H. F. C.	Kerr, H. W. (Cambridge)	Rodgers, John (Sevenoaks)
Crosthwaite-Eyre, Col. O. E.	Kingsmill, Lt.-Col. W. H.	Roper, Sir Harold
Crouch, R. F.	Lambert, Hon. G.	Ropner, Col. L.
Crowder, Capt. John (Finchley)	Lancaster, Col. C. G.	Russell, R. S.
Crowder, Petre (Ruislip—Northwood)	Langford-Holt, J.	Ryder, Capt. R. E. D.
Cundiff, F. W.	Law, Rt. Hon. R. K.	Salter, Rt. Hon. Sir Arthur
Cuthbert, W. N.	Leather, E. H. C.	Scott, Donald
Darling, Sir William (Edinburgh, S.)	Legge-Bourke, Maj. E. A. H.	Shepherd, William
Davidson, Viscountess	Lennox-Boyd, A. T.	Smiles, Lt.-Col. Sir Walter
Davies, Nigel (Epping)	Lindsay, Martin	Smithers, Peter (Winchester)
de Chair, Somerset	Linstead, H. N.	Smyth, Brig. J. G. (Norwood)
De la Bère, R.	Llewellyn, D.	Snadden, W. McN
Deedes, W, F.	Lloyd, Rt. Hn. Geoffrey (King's Norton)	Soames, Capt. C.
Digby, S. W.	Lloyd, Maj. Guy (Renfrew, E.)	Spearman, A. C. M.
Dodds-Parker, A. D.	Lloyd, Selwyn (Wirral)	Spence, H. R. (Aberdeenshire, W.)
Donner, P. W.	Lockwood, Lt.-Col. J. C.	Spens, Sir Patrick (Kensington, S.)
Douglas-Hamilton, Lord Malcolm	Longden, Gilbert (Herts, S. W.)	Stanley, Capt. Hon. Richard (N. Fylde)
Drayson, G. B.	Low, A. R. W.	Stevens, G. P.
Dugdale, Maj. Sir Thomas (Richmond)	Lucas, Sir Jocelyn (Portsmouth, S.)	Steward, W. A. (Woolwich, W.)
Duncan, Capt. J. A. L.	Lucas, P. B. (Brentford)	Stewart, Henderson (Fife, E.)
Dunglass, Lord	Lucas-Tooth, Sir Hugh	Stoddart-Scott, Cot M.
Duthie, W. S.	Lyttelton, Rt. Hon. O.	Storey, S.
Eccles, D. M.	McCorquodale, Rt. Hon. M. S.	Strauss, Henry (Norwich S.)
Eden, Rt. Hon. A.	Macdonald, Sir Peter (I. of Wight)	Stuart, Rt. Hon. James (Moray)
Elliot, Rt. Hon. W. E.	Mackeson, Brig. H. R.	Studholme, H. G.
Erroll, F. J.	McKibbin, A.	Summers, G. S.
Fisher, Nigel	McKie, J. H. (Galloway)	Sutcliffe, H.
Fletcher, Walter (Bury)	Maclay, Hon. John	Taylor, Charles (Eastbourne)
Fort, R.	Maclean, Fitzroy	Taylor, William (Bradford, N.)
Foster, John	MacLeod Iain (Enfield, W.)	Teeling, W.

Teevan, T. L.	Vane, W. M. F.	Williams, Charles (Torquay)
Thomas, J. P. L. (Hereford)	Vaughan-Morgan, J. K.	Wakefield, Sir Wavell (Marylebone)
Thompson, Kenneth Pugh (Walton)	Wakefield, Edward (Derbyshire, W.)	Williams, Gerald (Tonbridge)
Thompson, R. H. M. (Croydon, W.)	Walker-Smith, D. C.	Williams, Sir Herbert (Croydon E.)
Thorneycroft, Peter (Monmouth)	Ward, Hon. George (Worcester)	Wills, G.
Thornton-Kemsley, Col. C. N.	Ward, Miss. I. (Tynemouth)	Wilson, Geoffrey (Truro)
Thorp, Brig. R. A. F.	Waterhouse, Capt. Rt. Hon. C.	Winterton, Rt. Hon. Earl
Tilney, John	Watkinson, H.	Wood, Hon. R.
Turner, H. F. L.	Webbe, Sir H. (London)	York, C.
Turton, R. H.	Wheatley, Major M. J. (Poole)	TELLERS FOR THE AYES:
Tweedsmuir, Lady	White, Baker (Canterbury)	Major Conant and Mr. Vosper.

NOES
Acland, Sir Richard	Ede, Rt. Hon. J. C.	Jones, David (Hartlepool)
Adams, Richard	Edelman, M.	Jones, Frederick Elwyn (West Ham, S.)
Albu, A. H.	Edwards, John (Brighouse)	Jones, Jack (Rotherham)
Allen, Arthur (Bosworth)	Edwards, Rt. Hon. Ness (Caerphilly)	Jones, William Elwyn (Conway)
Allen, Scholefield (Crewe)	Edwards, W. J. (Stepney)	Keenan, W.
Anderson, Alexander (Motherwell)	Evans, Albert (Islington, S. W.)	Kenyon, C.
Anderson, Frank (Whitehaven)	Evans, Edward (Lowestoft)	Key, Rt. Hon. C. W.
Attlee, Rt. Hon. C. R.	Evans, Stanley (Wednesbury)	King, Dr. H. M.
Awbery, S. S.	Ewart, R.	Kinghorn, Sqn. Ldr E.
Ayles, W. H.	Fernyhough, E.	Kinley, J.
Bacon, Miss. Alice	Field, Capt. W. J.	Lang, Gordon
Baird, J.	Finch, H. J.	Lee, Frederick (Newton)
Balfour, A.	Fletcher, Eric (Islington, E.)	Lee, Miss. Jennie (Cannock)
Barnes, Rt. Hon. A. J.	Follick, M.	Lever, Leslie (Ardwick)
Hartley, P.	Foot, M. M.	Lewis, Arthur (West Ham, N.)
Bellenger, Rt. Hon. F. J.	Forman, J. C.	Lewis, John (Bolton, W.)
Benn, Wedgwood	Fraser, Thomas (Hamilton)	Lindgren, G. S.
Benson, G.	Freeman, John (Watford)	Lipton, Lt.-Col. M.
Beswick, F.	Freeman, Peter (Newport)	Logan, D. G.
Bevan, Rt. Hon. A. (Ebbw Vale)	Gaitskell, Rt. Hon. H. T. N.	Longden, Fred (Small Heath)
Bing, G. H. C.	Ganley, Mrs. C. S.	McAllister, G.
Blenkinsop. A.	Gibson, C. W.	MacColl, J. E.
Blyton, W. R.	Gilzean, A.	Macdonald, A. J. F. (Roxburgh)
Boardman, H.	Glanville, James (Consett)	McGhee, H. G.
Booth, A.	Gooch, E. G.	McInnes, J.
Bottomley, A. G.	Gordon-Walker, Rt. Hon. P. C.	Mack, J. D.
Bowden, H. W.	Greenwood, Anthony (Rossendale)	McKay, John (Wallsend)
Bowen, E. R. (Cardigan)	Greenwood, Rt. Hon. Arthur (Wakefield)	Mackay, R. W. G. (Reading, N.)
Bowles, F. G. (Nuneaton)	Grenfell, D. R.	McLeavy, F.
Braddock, Mrs. Elizabeth	Grey, C. F.	MacMillan, Malcolm (Western Isles)
Brook, Dryden (Halifax)	Griffiths, David (Rother Valley)	McNeil, Rt. Hon. H.
Brooks, T. J. (Normanton)	Griffiths, Rt. Hon. James (Llanelly)	MacPherson, Malcolm (Stirling)
Broughton, Dr. A. D. D.	Griffiths, William (Exchange)	Mainwaring, W. H.
Brown, Rt. Hon. George (Belper)	Grimond, J.	Mallalieu, E. L. (Brigg)
Brown, Thomas (Ince)	Gunter, R. J.	Mallalieu, J. P. W. (Huddersfield, E.)
Burke, W. A.	Hale, Joseph (Rochdale)	Mann, Mrs. Jean
Burton, Miss. E.	Hale, Leslie (Oldham, W.)	Manuel, A. C.
		Marquand, Rt. Hon. H. A.
Butler, Herbert (Hackney, S.)	Hall, John (Gateshead, W.)	Mathers, Rt. Hon. G.
Callaghan, L. J.	Hall, Rt. Hon. Glenvil (Colne Valley)	Mellish, R. J.
Carmichael, J.	Hamilton, W. W.	Messer, F.
Castle, Mrs. B. A.	Hannan, W.	Middleton, Mrs. L.
Champion, A. J.	Hardman, D. R.	Mikardo, Ian
Chetwynd, G. R.	Hardy, E. A.	Mitchison, G. R.
Clunie, J.	Hargreaves, A.	Moeran, E. W.
Cocks, F. S.	Hastings, S.	Monslow, W.
Coldrick, W.	Hayman, F. H.	Moody, A, S.
Cook, T. F.	Henderson, Rt. Hon. A. (Rowley Regis)	Morgan, Dr. H. B.
Cooper, Geoffrey (Middlesbrough, W.)	Herbison, Miss. M.	Morris, Percy (Swansea, W.)
Cooper, John (Deptford)	Hewitson, Capt. M.	Morrison, Rt. Hon. H. (Lewisham S.)
Corbet, Mrs. Freda (Peckham)	Hobson, C. R.	Moyle, A.
Cove, W. G.	Holman, P.	Mulley, F. W.
Craddock, George (Bradford, S.)	Holmes, Horace (Hemsworth)	Murray, J. T.
Crawley, A.	Houghton, D.	Nally, W.
Crosland, C. A. R.	Hoy, J.	Neal, Harold (Bolsover)
Crossman, R. H. S.	Hubbard, T.	Noel-Baker, Rt. Hon. P. J.
Cullen, Mrs. A.	Hudson, James (Eating, N.)	O'Brien, T.
Daines, P.	Hughes, Emrys (S. Ayrshire)	Oldfield, W. H.
Dalton, Rt. Hon. H.	Hughes, Hector (Aberdeen, N.)	Oliver, G. H.
Darling, George (Hillsborough)	Hynd, H. (Accrington)	Orbach, M.
Davies, A. Edward (Stoke, N.)	Hynd, J. B. (Attercliffe)	Padley, W. E.
Davies, Harold (Leek)	Irvine, A. J. (Edge Hill)	Paget, R. T.
Davies, Stephen (Merthyr)	Irving, W. J. (Wood Green)	Paling, Rt. Hon. Wilfred (Dearne Vaily)
de Freitas, Geoffrey	Isaacs, Rt. Hon. G. A.	Paling, Will T. (Dewsbury)
Deer, G.	Janner, B.	Pannell, T. C.
Delargy, H. J.	Jay, D. P. T.	Pargiter, G. A.
Dodds, N. N.	Jeger, George (Goole)	Parker, J.
Donnelly, D.	Jeger, Dr. Santo (St. Pancras, S.)	Paton, J.
Driberg, T. E. N.	Jenkins, R. H.	Pearl, T. F.
Dugdale, Rt. Hon. John (W. Bromwich)	Johnson, James (Rugby)	Popplewell, E.
Dye, S.	Johnston, Douglas (Paisley)	Porter, G.

Price, Philips (Gloucestershire, W.)	Soskice, Rt. Hon. Sir Frank	Weitzman, D.
Proctor, W. T.	Sparks, J. A.	Wells, Percy (Faversham)
Pryde, D. J.	Steele, T.	Wells, William (Walsall)
Pursey, Cmdr. H.	Stewart, Michael (Fulham, E.)	West, D. G.
Rankin, J.	Stokes, Rt. Hon. R. R.	Wheatley, Rt. Hn. John (Edinb'gn E.)
Rees, Mrs. D.	Strachey, Rt. Hon. J.	White, Mrs. Eirene (E. Flint)
Reeves, J.	Strauss, Rt. Hon. George (Vauxhall)	White, Henry (Derbyshire, N. E.)
Reid, Thomas (Swindon)	Stross, Dr. Barnett	Whiteley, Rt. Hon. W.
Reid, William (Camlachie)	Summerskill, Rt. Hon. Edith	Wilcock, Group Capt. C. A. B.
Rhodes, H.	Sylvester, G. O.	Wilkes, L.
Richards, R.	Taylor, Bernard (Mansfield)	Wilkins, W. A.
Roberts, A.	Taylor, Robert (Morpeth)	Willey, Frederick (Sunderland)
Roberts, Emrys (Merioneth)	Thomas, David (Aberdare)	Willey, Octavius (Cleveland)
Roberts, Goronwy (Caernarvonshire)	Thomas, George (Cardiff)	Williams, David (Neath)
Robertson, J. J. (Berwick)	Thomas, Iorwerth (Rhondda, W.)	Williams, Rev. Llywelyn (Abertillery)
Robinson, Kenneth (St. Pancras, N.)	Thomas, Ivor Owen (Wrekin)	Williams, Ronald (Wigan)
Rogers, George (Kensington, N.)	Thorneycroft, Harry (Clayton)	Williams, Rt. Hon. Thomas (Don Valley)
Ross, William (Kilmarnock)	Thurtle, Ernest	Williams, W. T. (Hammersmith, S.)
Royle, C.	Timmons, J.	Wilson, Rt. Hon. Harold (Huyton)
Shawcross, Rt. Hon. Sir Hartley	Tomney, F.	Winterbottom, Ian (Nottingham, C.)
Shinwell, Rt. Hon. E.	Turner-Samuels, M.	Winterbottom, Richard (Brightside)
Shurmer, P. L. E.	Ungoed-Thomas A. L.	Wise, F. J.
Silverman, Julius (Erdington)	Usborne, H.	Woodburn, Rt. Hon. A.
Silverman, Sydney (Nelson)	Vernon, W. F.	Wyatt, W. L.
Simmons, C. J.	Viant, S. P.	Yates, V. F.
Slater, J.	Wade, D. W.	Younger, Hon. R.
Smith, Ellis (Stoke, S.)	Wallace, H. W.
Smith, Norman (Nottingham S.)	Watkins, T. E.	TELLERS FOR THE NOES:
Sorensen, R. W.	Webb, Rt. Hon. M. (Bradford. O.)	Mr. Pearson and Mr. Collindridge.

1.45 a.m.

Mr. Macdonald (Roxburgh and Selkirk)

I beg to move, in page 10, line 20, at the end, to insert: except that when machinery is required for new processes of manufacture or packaging in industry an initial allowance of one-fifth shall be retained. I believe that this Amendment is totally different from the two Amendments which have preceded it and I hope, therefore, that it will meet a happier fate. It deals with a matter which is important to the whole of our national life and I trust that it will receive support from both sides of the Committee.

I am fully aware of the vital need for the Government to gear the machine tool industry and the general engineering industry of the country to the re-armament drive so that we get full production of the necessary equipment, but we must remember that if we are to maintain our standards of living and prevent economic collapse, we, more than any other country in the world, must see that our efficiency in production becomes even greater so that we can always maintain and develop export from this country—and it is by exports that we live.

That can be done only if we are prepared to encourage all our manufacturers to continue to improve their production methods and the way they package their goods so that they are more saleable in world markets. If we do not give manufacturers financial encouragement to continue improving their methods, they are likely to retain in practice many of the older machines which have long ceased to be satisfactory in competing with more efficient machines of other countries.

At the end of the war, because of our far greater mobilisation per man in the war effort than any of the allied countries—and I do not mean this in any disparaging way of America—we found that America had captured most of the world's markets. This was due to her great wealth, her enormous manpower and perhaps to the fact that she came into the total war later than we did. During the war she had been able to develop research and improved manufacturing methods in all types of industry which gave her a considerable lead in export markets at the end of the war. This country and many of its industries have made tremendous and very gallant strides to recover that lost place, and they have succeeded, but I do not wish to see them fall into that difficulty again, either during or at the end of this rearmament drive. I believe that we can prevent it if the Chancellor will give some financial encouragement to all industries to keep on improving their processes by the introduction of new methods, and I feel that they must have some financial inducement and assistance to do so.

We can only pay for our re-armament drive and for our ever-increasing standard of living if our efficiency is greater than that of any other country in the world so that we produce better goods, and produce them more cheaply, and thus maintain the largest export trade in the world. That can be done only by a continual improvement in industry, with better and better machines. I realise that it is necessary for the Treasury to secure the maximum revenue by deflecting capital investment into the re-armament drive, but I believe that the small amount that I suggest should be put aside for encouraging this development in machinery would not be felt by the Government in their re-armament drive, and yet it would give a tremendous impetus to improving industry generally.

I wish to make my remarks very brief indeed, because I think the point is obvious to all hon. Members, and because others may wish to speak on this vitally important matter. I hope the Chancellor will give an assurance that he will give careful consideration to this proposal between now and the Report stage.

Mr. Frederic Harris

This Amendment warrants the consideration of all hon. Members because it is vitally important that all companies concerned in manufacturing and handling finished goods today for sale, both in this country and abroad, should be given every inducement to install new machinery to assist them. At present we are in many respects still quite a long way behind, in competing with the United States in particular, in the packaging of many of our goods that we sell in competition abroad, and we are in many ways behind in the presentation and appearance of the finished article.

That can be overcome only by the installation of more modern and up-to-date machinery, and can only be put into effect, particularly by small concerns, if some financial inducement is given to the companies concerned. This Amendment is extremely well designed because, although it might rightly be said that in the difficulties of the moment it is not fully justifiable for our own home trade at present, it is essential to remember that if we are to be competitive in our overseas markets we must have machinery which will enable us to have the length of runs in our production to make that possible. It is not possible to go out to get export trade unless we have a good production turnover upon which to base our manufacture. How can a company install machinery of this kind unless it has sufficient markets and the financial support to make it really worth while from that company's point of view.

I suggest that the Government would do well to consider granting allowances of this kind because, if they do not do so, there will obviously be a continuing tendency to carry on with the machinery the companies have had in store for a considerable time, and which they cannot afford to modernise under present conditions. It is becoming very difficult for many companies to find the necessary finance to keep going with their increasing stocks and all the additional finance required for getting going today, and initial allowances of this kind are necessary to help in the installation of machinery to get the most modern production in these competitive times.

The marketing abroad of many of our light industries, in particular, is becoming increasingly difficult, and it is not easy today to obtain the orders we received some years back. I feel that, unless British industry is in a position to be competitive in its efforts by means of modern machinery, we shall gradually lose money on our markets abroad, and give ground to our competitors. German, and indeed Japanese, competition, which is starting to develop now and make itself felt quite considerably in many markets, is going to be a matter we shall have to face realistically.

I hope the Government, when they respond, will give us a definite assurance that something will, and can, be done, bearing in mind that it is essential to be in a position to maintain our markets. I think that the suggestion of the initial allowance of one-fifth being retained, does not go too far in asking for reasonable help for most manufacturing and packaging concerns. The food industries and light industries should be able to get modern equipment to make us competitive in the appearance of our products. Much of the work has to be done on machines to be excellent in appearance. I hope that, after due consideration, the Government will decide that this is a worthy Amendment and will be prepared to accept it.

Mr. J. Edwards

I imagine that we would all agree, in general terms at any rate, with what the hon. Gentleman had to say in moving the Amendment. It would indeed be a sorry day for us if we in any way impaired the development and undertaking of radically new processes. As I understood him, the hon. Gentleman is not concerned with the mere replacement of machines. He is concerned with those changes that take place in industry when a process really takes a leap forward. I myself have had experience where processes have been almost completely revolutionised and the change has been so radical that one really produced everything new in relation to it.

2.0 a.m.

The Government have appreciated this and, as hon. Members know, we have at work now a new corporation which exists for the development of inventions and for the introduction of these new inventions or new processes into industry. I think, however, that in terms of the Amendment as it stands it is a very difficult matter. I think everyone would agree that it would not be easy to define the processes. I am not sure, anyhow, whether this is the way any help should be given, and I am also in considerable difficulty because the proposal—and I know the hon. Gentleman is trying to be helpful—does in fact introduce the principle of what would be regarded as a differential allowance, and that in itself is a great difficulty.

I shall not, therefore, conceal from the Committee my own feeling that this proposal is not really a practical one, although the purpose behind it, namely, that we should help the development and introduction of essential new processes, is one which has my sympathy. Therefore, while I do not really see how the essential point that the hon. Gentleman has in mind can be made in the way proposed. I will consider what he and his hon. Friend have said.

Mr. Joynson-Hicks

I do not propose to contest, although I feel it is contestable, what the hon. Gentleman has said. I propose to address myself to the part of the Amendment to which he has made no reference. I hope that when he has had an opportunity of considering it, he will give us another reply. I support this Amendment because it also includes the part to which the Economic Secretary did not refer, namely, the machinery required for packaging.

Mr. Edwards

I was very careful not to say new processes in manufacturing. I was talking about new processes in any kind of industry. The hon. Gentleman must not assume I was excluding packaging.

Mr. Joynson-Hicks

I am dealing with that part of the Amendment which does not deal with new processes. He will see that the machinery to which I am referring is packaging for industry, and not for new processes. That is an entirely different matter. It is machinery required for packaging, either by old or new processes, but as far as that particular part is concerned, processes, new or old, do not come into the matter at all.

I want to refer to that aspect of packaging which has occupied the attention of the House in recent weeks and which deals materially with the agricultural and horticultural side of the industry. It is a branch of the main packaging industry of the country, and one which, particularly in Britain, owing to the improvement which can result therefrom to health, hygiene, and the marketing and distribution of food as a whole, is important. I am glad that the Minister of Agriculture is present now, and I hope he will support us in this Amendment. The Government have already expressed considerable interest. We have had three debates on this subject. We are all agreed that a considerable debt is owed to the hon. Lady the Member for Coventry, South (Miss. Burton), who has pursued this matter with great diligence and who has at least succeeded in catching the ear of the Parliamentary Secretary to the Ministry of Food, who has replied to her on numerous occasions.

The exhortation addressed by the Government to the industry has quite rightly been one that agriculturists and horticulturists should take steps to improve the packaging of all goods of a perishable character which they offer for sale through the shops. The Committee do not need any assurance that it is the desire of the horticulturists to be able to improve those conditions of marketing over which they have any control, and packaging is one over which they should have control, but grave difficulties are experienced in the supply of materials and particularly the supply of machinery. It is very difficult for the industry to take steps by itself to introduce machinery for this purpose.

As the hon. Gentleman may or may not know, the agricultural industry has this year accepted a contribution to be found from itself of about £45 million towards increased costs being incurred by the industry. In addition, it has now been saddled with another 4½d. a gallon on the cost of petrol, which is of substantial incidence to the industry. There is no suggestion which I have heard of any special price review.

I mention these matters to show that the industry is unable without further assistance to embark on such long-term capital projects as the installation of machinery for packaging the goods and articles it wants to sell in first-class condition. If the industry is to do this job which the Government are exhorting them to do, it is essential that they should have some assistance, as implied in this Amendment, whereby they will obtain an initial allowance.

Mr. Godfrey Nicholson (Farnham)

I was not surprised but much disappointed with what the Economic Secretary said. It is such a familiar gambit now from hon. Members opposite. They have the greatest sympathy, they think industry should be equipped with the latest tools and equipment, but not a single sign of practical assistance is given. Crocodile tears are shed over the industry, and the crocodile then proceeds to eat the industry. We are entitled to ask the Government what alternative they have. They are familiar with the technique of, "What would you do, chum?" It is now our turn to say that to them. If the Government think British industry should be equipped with the latest tools and machinery, and that the newest processes should be introduced, what proposals have they to bring that about?

This Amendment may not be a practical proposal; it may be undesirable to introduce differentiation into taxation: but it is a proposal, and there is no other proposal before the Committee. We are entitled to ask the Government to accept this Amendment or to introduce proposals of their own directed to the same end. My hon. Friend the Member for Chichester (Mr. Joynson-Hicks) has been dealing with the second part of the Amendment which refers to packaging processes.

Mr. J. Edwards

I think there is probably a misunderstanding. I think the hon. Gentleman who moved the Amendment will confirm what I am about to say. As I understood it, when he talked about machinery required "for new processes of manufacture or packaging," he meant that the words "new processes" should cover both manufacture and packaging. That is the point I was making in an earlier Interruption. I merely make this intervention because it would be a pity if we got at cross purposes.

Mr. Macdonald

The Economic Secretary's interpretation is the correct one.

Mr. Nicholson

Perhaps it shows that the Amendment was drafted in a confused manner. At the same time the principle underlying the Amendment is the same, that new processes of manufacture or packaging should have preferential treatment. What a revolting word "packaging" is. It is a word of trans-Atlantic origin and the Americans are streets ahead of the British industry in matters of packaging. I would support this Amendment with equal fervour if it dealt with packaging alone, because the success of our export trade depends on the adoption of the latest methods of packaging. This applies particularly to the smaller industries and concerns, where the burden of the cost of machinery falls heavily.

To sum up, if the Government do not like this Amendment and are genuine and not hypocritical in the views they express with regard to British industry being equipped with the latest processes and machinery, it is up to them to produce their proposals. We on this side have produced ours.

Lieut.-Colonel Sir Walker Smiles (Down, North)

I read this Amendment and found it, like many Liberal Amendments, a trifle obscure. I thought it meant that new machinery and packaging were intended, and I was brought to my fleet because I know of export markets which have been already lost. From 1935 to 1939 there were several large firms in this country doing a profitable business in importing wood from the Scandinavian countries and Latvia, turning it into three-ply boxes and exporting them to India and the Straits for packing tea, rubber and other goods which came back here I know that in 1951 that market has been largely lost.

I thought this Amendment might help manufacturers to regain this market, because competition is very keen. These firms employ a great number of workpeople. I am afraid that if they are not helped by the Finance Bill this will be another of our export markets lost.

Mr. Selwyn Lloyd

I must confess to a certain degree of mental confusion, not entirely due to the lateness of the hour. I do not understand what the Economic Secretary meant when he said he was going to consider this subject. If that was just a soft answer to turn away any possibility of Liberal wrath, we should know. What does he mean by his answer and where are we getting to?

2.15 a.m.

I think this is a thoroughly bad Clause as a whole. It is a mistake of Government policy to withdraw the initial allowances at the present time. The hon. Gentleman referred to what I said about the Millard Tucker Report. What I did not like about the Report was that it suggested that the initial allowance should be varied according to the value of the industry concerned. I thought that would open all sorts of difficulties. I think that different considerations' apply to this Amendment, because we have a thoroughly bad Clause, and the more industries and processes we can get outside the scope of it, the better it will be, and to that extent it will be improved.

Therefore, I find no difficulty, so far as consistency is concerned, in supporting the Amendment, but I should like to learn from the Economic Secretary, when he says he is going to consider the suggestion carefully, whether it is with a view to maintaining initial allowances in manufacture and packaging, or possibly the proper assessment of profits so that such industries, in common with others, should only pay tax on true profits but not on false profits as now. What has the hon. Gentleman in mind when he says he is going to consider carefully the suggestion? Unless he can give some definite information about the kind of action he is going to take, I hope that this Amendment will be pressed to a Division.

Mr. W. Fletcher (Bury and Radcliffe)

The Government are showing great ingenuity in turning down these Amendments one after another. I do not think I can ever remember arriving at such a stage of the Finance Bill when so few concessions have been made. It seems to me that an order has gone forth that no concessions will be made on this Bill, and that we shall have to swallow it practically unamended. If some of the ingenuity in turning the Amendments had been devoted to helping industry in a constructive way, it would have been much better.

I should like to refer to the packaging side of this Amendment. If there is one series of blunders the Government have committed during the past few years, it has been in the obtaining of the particular raw materials required for this industry from overseas. It started with the great mistake made three years ago with Canada, and since then there has been one mistake after another and one handicap after another. It would be bare justice if, on this occasion, this Amendment could be accepted just to rectify the wrong that has been done to, and the handicaps that have been fastened on, the packaging side of industry.

I do a good deal of export business all over the world in a considerable range of articles—textiles among them—and one of the great handicaps in the textile industry alone is that of packaging, and it is well known to everybody who has had anything to do with it. If the hon. Gentleman, who has considerable knowledge of these things, could sit and think what his refusal means, he would, after the reconsideration he has promised, come forward perhaps with a differently worded Amendment which would have the practical effect of assisting those who have to compete against the brilliant presentation of goods from well-equipped countries such as the United States, Japan and Germany.

So long as the consumer has any choice in the world he will go for those goods which are presented more attractively. It is no good saying that the quality of goods will sell them in the end. It is no longer true in the world today. It is packaging which will attract the consumer and the Economic Secretary should talk a little less lightheartedly and not dismiss this Amendment in so cavalier a fashion.

Mr. Crosland

In the moment or two during which I wish to intervene in this debate, I should like to put a question to those who are going to speak after me, because I am puzzled by an apparent contradiction between two set speeches we have heard from hon. Gentlemen opposite. The second of the set speeches on the Amendment referred to exports, and it was suggested that we can overcome the difficulty only by increasing expenditure on new packaging equipment and seeking concessions in terms of initial allowances and a reduction of the Profits Tax to encourage the maximum possible expenditure on new capital equipment. The other set speech, of which we have had a great number during the Finance Bill, is that which calls for higher rates of interest and dear money, presumably to have the reverse effect of reducing what we are spending on capital investment and capital equipment.

I want to ask the Opposition speakers who will follow me what is their attitude? Do they believe in dear money in order to restrain capital investment, or do they believe in putting back initial allowances and reducing the Profits Tax in order to expand capital equipment?

Mr. Martin Lindsay (Solihull)

I am sure that not only the Economic Secretary but all Members of the Committee are in sympathy with the line of thought which lies behind this Amendment. The British nation at the present time is trying to have its cake and eat it; that is to say, we are trying to embark on an increasing re-armament programme and, at the same time, to make the absolute minimum reductions in our standard of living. There is only one possible way in which these two things can be done at the same time, and that is by increased industrial production in this country.

How can one get increased industrial production? We all know that raw materials are exceedingly short. So also is the labour. There is no surplus labour worth talking about in the country at the present time. The machines cannot turn any faster than they do, and no one suggests that we should work longer hours. Therefore, increased production must come not only by improved management but by improved machinery and manufacturing techniques of one kind or another. So any fiscal policy which will have the effect of making it more difficult for manufacturers continually to turn to modernisation and new processes is extremely harmful.

I agree with the Economic Secretary that it is impossible to define what is a new process, because so many of what may be called new processes are only an improvement in one way or another on a previous process. Therefore, I think that in this respect the Amendment of the hon. Member for Roxburgh and Selkirk (Mr. Macdonald) is completely impracticable. I wish it went much further and proposed that the initial allowances be one-fifth not only for new manufacturing processes and packaging but for all replacements of industrial plant, which would restore the situation to what it was in 1945. At that time, when the proposal of the initial allowances was introduced, it was considered necessary to encourage replacement of plant and machinery. But what have been the increases in the cost of replacement since 1945? If the initial allowance were necessary then, how much more necessary they are today?

In view of the sympathetic remarks which the Economic Secretary made a few minutes ago, for what they were worth. I hope the hon. Gentleman will consider bringing forward a new Clause to restore the initial allowances to the figure of 20 per cent. for all replacements, and not only for those which are covered by this Amendment.

Mr. Hugh Fraser (Stafford and Stone)

The hon. Member for Gloucestershire, South (Mr. Crosland) tried to put the Opposition in a difficulty, but perhaps his mind would be made clearer on the subject if he looked at the Government's own difficulty in this problem. What the Government are intending, or trying, to do by this Clause is to restrict capital investment; and whether that is done by a high rate of interest or a Clause such as this is for the Government to decide. What we have to do is to see that, on the one hand, the maximum resources available are put to the re-armamentand export drive; and this Clause surely goes some way in helping the export drive which must run simultaneously with our re-armament effort.

Some of my hon. Friends say that they are not in agreement with a differentiation of taxation and allowances, but it seems that the principle of supporting the packaging and processing industries—so essential to our export efforts—should be given special consideration. In the period of difficulty through which we are bound to go over the next few years, the question of pure equity in dealing with industries, as with individuals, in this country must unfortunately be abandoned to some extent.

But the method of taxing to get the maximum effort where it is most economically possible by giving special privileges and assistance to certain industries should be followed and the packaging industries should be given these special allowances which the Liberal Party has put forward in an Amendment self-obfuscating and difficult to comprehend. But the main object is clear enough, even if the verbiage is so thick that it is all difficult to follow. What the Liberals need here is some processing and good packaging but perhaps the Liberals may divide, some going into one Lobby and some into the other. None the less, their hearts are in the right place and when the Minister replies I hope he, at least, will be quite clear in his own mind as to what needs to be done.

Surely what is needed is a special allowance for industries which benefit us so much and industries whose capital expenditure will not be on a vast scale. In putting forward this Clause, surely the object has been to restrict capital expenditure. Whether the Clause does that is, I think, doubtful, and possibly the hon. Member for Gloucestershire, South, may wonder if it will work. But surely the Government can agree that in the stage we are in now—when it is vital that there should be maximum efficiency—there are certain key industries where special allowances can, and should, be made; and the packaging and processing industries should have devised for them something supported by so many hon. Members on this side of the Committee.

Mr. Donald Wade (Huddersfield, West)

There is a danger, and the Economic Secretary will agree with me, in regarding the re-armament drive as contained within a short-term programme. It will succeed only if we are able to finance it, and the nation will not be able to finance it unless industry is modernised and becomes more efficient with everything possible being done to encourage new processes. Something should be done; it is of vital importance. In that connection, I think a useful purpose has been served by bringing forward this Amendment and allowing the Committee to have the discussion which has taken place. I was glad to hear the support that has been given to this Amendment. Views were expressed about the wording of the Amendment, but I do not think it is difficult to understand. It is a very difficult point. The important thing is that something should be done.

2.30 a.m.

I welcome the remarks of the Economic Secretary, which were encouraging, and certainly more so than some of the replies given on other Amendments. I hope that consideration of the subject will produce some really practical results. As I have said, the main thing is that something should be done. It is a matter of vital importance not only to the industries concerned, but to the country as a whole. I hope the Economic Secretary will give us some more specific assurance than he has been able to do hitherto.

Mr. Godfrey Nicholson

On a point of order. It may be my personal feeling, but is not this place getting rather hot? It seems to me that hon. Members are going to sleep in all quarters of the Committee. I think the temperature—the physical temperature I mean—is rising.

Mr. H. Fraser

Move for ice.

The Chairman

The air should be the same in all quarters, but I will have inquiries made.

Sir Arthur Salter (Ormskirk)

I wonder whether the Economic Secretary could give us a little more assurance than he has done. It may be that the arguments he has heard, or the intrinsic merits of the case or some other consideration which has not been expressed, may have made him doubt whether he should continue to resist the Amendment. I do not think the Committee are altogether satisfied with the vague and ambiguous reference to some consideration. Could the hon. Gentleman give us some idea of the direction in which his mind is moving, or the new Amendment or Clause which his further consideration is likely to crystallise? That would have a considable effect upon the continuance and the conclusion of the debate.

Mr. J. Edwards

On previous Amendments which I felt bound to reject I was accused of having a closed mind. I listened very carefully to what the hon. Member for Roxburgh and Selkirk (Mr. Macdonald) had to say in moving this Amendment. I appreciate, as I think all hon. Members do, that these revolutionary changes in technique are important. I made it perfectly clear to the Committee that I did not think that the initial allowances method was the method that could be used to further a matter of this kind. Having listened to what was said, I said that I would consider those views, and I hope the Committee think I was behaving honestly by them; but I should be dishonest if I were to suggest to the Committee that this particular way of doing it is the best way. I said that before, and I am saying it again in order to make the issue perfectly plain.

Lieut.-Commander Braithwaite

I feel that the Committee as a whole are grateful to the hon. Member for Roxburgh and Selkirk (Mr. Macdonald) for initiating this extremely valuable and interesting debate, which at one time or another looked as if it might develop on perhaps a wider front than the hon. Member intended. For instance, the hon. Member for Gloucestershire, South (Mr. Crosland), who happens to be my Parliamentary neighbour, extended a courteous but alluring invitation to have a discussion on dear money, Major Milner. But on a Clause confined to initial allowances, one cannot discuss whether the bank rate should be raised. One might get into conflict with the Chair, which I am anxious to avoid. We can only discuss the question of initial allowances on the lines indicated by the hon. Gentleman who moved the Amendment. The Economic Secretary, in his first reply—I think I have the words down correctly—said it would indeed be a sorry day when the Government sought to impede British industry.

Mr. J. Edwards indicated dissent.

Lieut.-Commander Braithwaite

No? Not sorry day?

Mr. Edwards

The words "sorry day" were used but I was concerned with these new and radical changes in the processes of industry. I did say it would be a sorry day if we discouraged these revolutionary changes of technique, which are important.

Lieut.-Commander Braithwaite

I think that is what I understood the hon. Gentleman to say. It is therefore a sorry day, because that is precisely what the Economic Secretary has done in his remarks. I frankly was disappointed, following the speech of my hon. Friend the Member for Chichester (Mr. Joynson-Hicks), when the debate took a course which denied us from hearing the Minister of Agriculture, because when the right hon. Gentleman entered the Committee a short time ago, I felt pleasurable anticipation that he was going to intervene. I realise he is here in his capacity of Minister of Fisheries as well and as we know the shipbuilding Amendment follows this one, I shall hope to hear him then.

I think the moral of this debate emerges quite clearly, as it did from the previous Amendment, and as, I think, it is likely to emerge again when we move on to the next Amendment. The moral of the story surely is the ham-fisted methods which-the Government have employed in this matter in removing at this moment these initial allowances obviously without considering what the impact of their action was going to be in various spheres. The river pollution has just been debated, and I cannot return to that, but the hon. Gentleman the Member for Roxburgh and Selkirk, in one of his opening sentences, said this would have a deleterious effect upon machine-tool production which was in itself an important and vital factor in a re-armament programme.

Mr. Macdonald

My actual words were that I realised how vital it was for the Government to gear the machine-tool production and general engineering to the re-armament drive but at the same time to give encouragement to new processes.

Mr. Frederic Harris

On a point of order. Is it in order for the hon. Member for Newcastle-under-Lyme (Mr. Mack) to be flat out on a seat over there with his legs up and fast asleep?

The Chairman

I do not think that it is out of order or altogether unusual.

Mr. David Renton (Huntingdon)

Further to that point of order. Surely it is essential that we should preserve the dignity of Parliament?

Mr. Usborne

What about the Tories?

Mr. Renton

Surely, there must be some lengths beyond which we should not go in taking part-relaxation whilst sitting in the Chamber? I ask you, Major Milner, if we should unwittingly per-haps, transcend the bounds of dignity that perhaps you will call us to order?

The Chairman

I am obliged to the hon. Member. I will certainly do so. I am afraid that if I were to call attention to every apparent infraction of the rules, I should be intervening in the debate most of the time.

Colonel Ropner (Barkston Ash)

On a point of order. Is it not specifically laid down in Erskine May that it is out of order to lie at full length on the bench?

The Chairman

I should not like to say offhand whether that is so, but according to my observation the hon. Member is not lying at full length.

Mr. H. Hynd (Accrington)

Major Milner, may I call your attention to the hon. Member at the end of the Opposition bench?

Lieut.-Commander Braithwaite

I think it would be best, Major Milner, if I were to take the blame for the whole incident, for it is obviously the soporific nature of my remarks which is responsible. I do not at all complain of hon. Members taking their rest so long as they do so in an orderly manner. When this interlude came upon us, I was about to remark that this Amendment—[Interruption]—hon. Members should permit me to develop my argument; one of the disadvantages of these all-night Sittings is that when this sort of thing happens it is difficult to conduct the business. I am endeavouring to make a serious contribution on a matter of some importance, and it is difficult to do so in face of this hilarity. I do not know what the hon. Member for Accrington (Mr. H. Hynd) is pointing at—I hope it is not at me.

Commander Pursey

You have a dead body over there.

The Chairman

Order! We must keep order. I hope that the hon. and gallant Member for Bristol, North-West (Lieut.-Commander Braithwaite) will conclude his remarks.

Lieut.-Commander Braithwaite

May I say that I propose to continue my remarks, Major Milner, and that they will reach their conclusion in due course?

The hon. Member for Stoke-on-Trent, South (Mr. Ellis Smith) will wish to support this Amendment because the effect of it would be greatly to strengthen British industry in its forthcoming contest with Japanese competition, to which he so rightly called our attention yesterday. May I say that I, for one, support his attitude on that matter and hope that he will succeed in getting a debate on it, although that is outside the Clause about initial allowances which, if continued, would do much to help in that problem. I shall look forward to walking through the Lobby very shortly, arm-in-arm with the hon. Member for Stoke-on-Trent, South.

I feel that in this matter the Government have allowed their greed for revenue to overcome their better judgment and in so doing have gravely neglected certain re-armament processes. That is why I was disappointed that the Economic Secretary, in speaking a second time, removed the impression he had first created—at least, the impression which he had made on me. I thought the hon. Gentleman was saying that he thought the form of words was unworkable; and I am sure the hon. Member for Roxburgh and Selkirk is not wedded to any particular verbiage and would be pleased to see another Amendment, accepting this principle, moved by the Government on Report stage and carried into effect.

2.45 a.m.

I hope the Economic Secretary will not abandon his task because the assistance of the skill of learned Law Officers is readily available to him—one of whom, now sitting on his right hand, is noted for his industry and assiduity and who, I am quite sure, could before the Report stage produce a form of words to give effect to the hon. Member's intention. I hope that will be done. It is always easy to criticise the wording of Amendments which are drafted by Private Members; we have not the facilities which are afforded to Ministers; we have to do our best, and very often our wording is imperfect; we all know that.

However, I should like to hear the Government say that they agree in principle to the suggestion and policy put forward by the hon. Member for Roxburgh and Selkirk. If they do not say so, and if there is to be no consideration of this matter between now and the Report stage, then, speaking in my own capacity, although I do not think I am alone, I hope that the hon. Gentleman will press this matter to a Division. If he does so, I shall be pleased to support him.

Several hon. Members rose—

The Chairman

I hope the Committee will soon agree to come to a decision.

Sir W. Wakefield

I shall not detain the Committee for more than a moment or two, but there is one point I particularly want to make. Again and again Ministers have emphasised the great importance of, first, re-armament, and secondly, the export trade. If Ministers mean what they say, they could implement it by agreeing to accept this Amendment, because there are certain processes of packaging in the United States which would be of the utmost importance to our re-armament programme, and which ought to be encouraged in this country.

I speak with some special knowledge of this business and I beg the Economic Secretary to examine the matter, if he does not already know about it, because we ought not to be left behind in these new processes of packaging, which are taking place across the Atlantic, if our rearmament programme is not to suffer. Other hon. Members have dealt with the importance of making our packaging efficient and up to date for our export trade and I do not want to speak further on that. I beg the Economic Secretary to implement what Ministers have said by agreeing to this Amendment and so showing that Ministers mean what they say.

Colonel Gomme-Duncan

In supporting this Amendment—although a change of wording might be necessary, and I am sure the hon. Member for Roxburgh and Selkirk (Mr. Macdonald) would not mind provided the effect were the same—I should like to refer to what was said by my hon. Friend the Member for Chichester (Mr. Joynson-Hicks) on the effect of this on the horticultural industry, which is of the greatest importance in both Scotland and England, and which every year will become of greater importance.

The greatest difficulty facing the horticultural industry is that of imports, and the greatest feature in that difficulty is the fact that the stuff from abroad is packed in non-returnable containers of the highest quality and of the best possible design, which our own horticulturists cannot produce because they have not the materials. They are discouraged by this Clause from installing the machinery to produce those containers. I am sure the Minister of Agriculture will agree that that is the greatest difficulty facing the horticultural industry at present.

I shall not harrow his soul by referring to the vagaries of the Minister of Food who imports masses of foreign stuff when British crops are ready for cropping. It is a fact that on the production of non-returnable containers will largely depend whether or not the British horticultural industry is successful. If the encouragement they hope for under this Amendment is not given, they will have an added burden, which the Minister of Agriculture will recognise.

Mr. Emrys Roberts (Merioneth)

I was not going to detain the Committee for very long, but in view of the welcome given to my rising, it may be I shall be able to expatiate on this matter for some time. It seems to me that the hon. Member for Stafford and Stone (Mr. H. Fraser), who, having made his oration, is no longer in his place, was rather concerned to belittle this Amendment merely because it was a Liberal Amendment. Having said it was rather obscure, he then said its main object is perfectly clear. Another hon. Member above the Gangway said the same thing.

The hon. Member for Stafford and Stone indicated that there was a risk that the Liberal Party might find itself divided, but on this occasion it is the ranks of the Conservatives which are divided, because some Conservative Members indicated that they would not be able to support the Amendment, while others said they would support it. It is perfectly clear that in all parts of the Committee the main purpose of this Amendment has been well received, and hon. Members have realised the fundamental importance of it.

It is generally realised that the initial allowances the Government introduced since the war have played a very great part in modernising the equipment of British industry. I only wish we had had these allowances during the years between the wars when we had the labour force. The Economic Secretary has twice said he will give the most careful consideration to this matter. For my part, I think we can leave it at that, but if my hon. Friend wishes to divide, we shall of course support him in the Lobby.

Mr. Macdonald

The Economic Secretary will now have had an opportunity of realising the views of the Committee. I feel there has been no opposition to the main terms of the Amendment from the other side. In view of the Economic Secretary's helpful assurance, which he

has given twice to the Committee within the last few minutes, that he will give consideration to the matter contained in this Amendment, I feel that no good purpose would be served in taking it to a Division. I beg to ask leave to withdraw the Amendment.

Hon. Members

No.

Sir Herbert Williams (Croydon, East)

The hon. Gentleman has asked leave to withdraw the Amendment, but there are processes to prevent that. I shall delay the Committee only for a moment to say to the hon. Member from some part of Scotland that he cannot humbug us in this way.

Question put, "That those words be there inserted."

The Committee divided: Ayes. 283, Noes, 291.

Division No. 94.]	AYES	[2.55 a.m.
Aitken, W. T.	Craddock, Beresford (Spelthorne)	Harvey, Ian (Harrow, E.)
Alport, C. J. M.	Cranborne, Viscount	Harvie-Watt, Sir George
Amery, Julian (Preston, N.)	Crookshank, Capt. Rt. Hon. H. F. C.	Hay, John
Amory, Heathcoat (Tiverton)	Crosthwaite-Eyre, Col. O. E.	Head, Brig. A. H.
Arbuthnot, John	Crouch, R. F.	Headlam, Lt.-Col. Rt. Hn. Sir Cuthbert
Ashton, H. (Chelmsford)	Crowder, Capt. John (Finchley)	Heald, Lionel
Assheton, Rt. Hon. R. (Blackburn, W.)	Crowder, Petre (Ruislip—Northwood)	Henderson, John (Cathcart)
Astor, Hon. M. L.	Cundiff, F. W.	Hicks-Beach, Maj. W. W.
Baker, P. A. D.	Cuthbert, W. N.	Higgs, J. M. C.
Baldock, Lt.-Cmdr. J. M.	Darling, Sir William (Edinburgh, $.)	Hill, Mrs. E. (Wythenshawe)
Baldwin, A. E.	Davidson, Viscountess	Hill, Dr. Charles (Luton)
Banks, Col. C.	Davies, Nigel (Epping)	Hinchingbrooke, Viscount
Baxter, A. B.	de Chair, Somerset	Hirst, Geoffrey
Beamish, Major Tufton.	De la Bère, R.	Holmes, Sir Stanley (Harwich)
Bell, R. M.	Deedes, W. F.	Hope, Lord John
Bennett, Sir Peter (Edgbaston)	Digby, S. W.	Hopkinson, Henry
Bennett, Dr. Reginald (Gosport)	Dodds-Parker, A. D.	Hornsby-Smith, Miss. P.
Bennett, William (Woodside)	Donner, P. W.	Horsbrugh, Rt. Hon. Florence
Bevins, J. R. (Liverpool, Texteth)	Douglas-Hamilton, Lord Malcoln	Howard, Gerald (Cambridgeshire)
Birch, Nigel	Drayson, G. B.	Howard, Greville (St. Ives)
Bishop, F. P.	Dugdale, Maj. Sir Thomas (Richmond)	Hudson, Sir Austin (Lewisham, N.)
Black, C. W.	Duncan, Capt. J. A. L.	Hudson, W. R. A. (Hull, N.)
Boles, Lt.-Col. D. G. (Wells)	Dunglass, Lord	Hutchinson, Geoffrey (Ilford, N.)
Boothby, R.	Duthie, W. S.	Hutchison, Lt.-Com. Clark (E'b'rgh W.)
Bossom, A. C.	Eccles, D. M.	Hutchison, Colonel James (Glasgow)
Bowen, E. R. (Cardigan)	Eden, Rt. Hon. A.	Hyde, Lt.-Col. H. M.
Boyd-Carpenter, J. A.	Elliot, Rt. Hon. W. E.	Hylton-Foster, H. B.
Boyle, Sir Edward	Erroll, F. J.	Jennings, R.
Bracken, Rt. Hon. B.	Fisher, Nigel	Johnson, Howard (Kemptown)
Braine, B. R.	Fletcher, Walter (Bury)	Jones, A. (Hall Green)
Braithwaite, Lt.-Cr G. (Bristol, N. W.)	Fort, R.	Joynson-Hicks. Hon. L. W.
Bromley-Davenport, Lt.-Col. W.	Foster, John	Kaberry, D.
Brooke, Henry (Hampstead)	Fraser, Hon. Hugh (Stone)	Kerr, H. W. (Cambridge)
Browne, Jack (Govan)	Fraser, Sir Ian (Morecambe & Lonsdale)	Kingsmill, Lt.-Col. W. H.
Buchan-Hepburn, P. G. T.	Fyfe, Rt. Hon. Sir David Maxwell	Lambert, Hon. G.
Bullock, Capt. M.	Gage, C. H.	Lancaster, Col. C. G.
Bullus, Wing Commander E. E.	Galbraith, Cmdr. T. D. (Pollok)	Langford-Holt, J.
Burden, Squadron Leader F. A.	Galbraith, T. G. D. (Hillhead)	Law, Rt. Hon. R. K.
Butcher, H. W.	Garner-Evans, E. H. (Denbigh)	Leather, E. H. C.
Butler, Rt. Hon. R. A. (Saffron Walden)	Gates, Maj. E. E.	Legge-Bourke, Maj. E. A. R.
Braithwaite, Sir Albert (Harrow, W.)	Glyn, Sir Ralph	Lennox-Boyd, A. T.
Carr, Robert (Mitcham)	Gomme-Duncan, Col. A.	Lindsay, Martin
Carson, Hon. E.	Gridley, Sir Arnold	Linstead, H. N.
Channon, H.	Grimond, J.	Llewellyn, D.
Churchill, Rt. Hon. W. S.	Grimston, Hon. John (St. Albans)	Lloyd, Rt. Hn. Geoffrey (King's Norton)
Clarke, Col. Ralph (East Grinstead)	Grimston, Robert (Westbury)	Lloyd, Maj. Guy (Renfrew, E.)
Clarke, Brig. Terence (Portsmouth, W.)	Harden, J. R. E.	Lloyd, Selwyn (Wirral)
Colegate, A.	Hare, Hon. J. H. (Woodbridge)	Lockwood, Lt.-Col. J. C.
Cooper, Sqn. Ldr. Albert (Ilford, S.)	Harris, Frederic (Croydon, N.)	Longden, Gilbert (Herts, S. W.)
Cooper-Key, E. M.	Harris, Reader (Heston)	Low, A. R. W.
Corbett. Lt.-Col. Uvedale (Ludlow)	Harvey, Air Codre, A. V. (Macclesfield)	Lucas, Sir Jocelyn (Portsmouth, S.)
Lucas, P. B. (Brentford)	Orr, Capt. L. P. S.	Storey, S.
Lucas-Tooth, Sir Hugh	Orr-Ewing, Charles Ian (Hendon, N.)	Strauss, Henry (Norwich, S.)
Lyttelton, Rt. Hon. O.	Orr-Ewing, Ian L. (Weston-super-Mare)	Stuart, Rt. Hon. James (Moray)
McAdden, S. J.	Osborne, C.	Studholme, H. G.
McCorquodale, Rt. Hon. M. S.	Peake, Rt. Hon. O.	Summers, G. S.
Macdonald, A. J. F. (Roxburgh)	Perkins, W. R. D.	Sutcliffe, H.
Macdonald, Sir Peter (I. of Wight.)	Peto, Brig. C. H. M.	Taylor, Charles (Eastbourne)
Mackeson, Brig. H. R.	Pickthorn, K.	Taylor, William (Bradford, N.)
McKibbin, A.	Pitman, I. J.	Teeling, W.
McKie, J. H. (Galloway)	Powell, J. Enoch	Teevan, T. L.
Maclay, Hon. John	Price, Henry (Lewisham, W.)	Thomas, J. P. L. (Hereford)
Maclean, Fitzroy	Prior-Palmer, Brig. O.	Thompson, Kenneth Pugh (Walton)
MacLeod, Iain (Enfield, W.)	Profumo, J. D.	Thompson, R. H. M. (Croydon, W.)
MacLeod, John (Ross and Cromarty)	Raikes, H. V.	Thorneycroft, Peter (Monmouth)
Macmillan, Rt. Hon. Harold (Bromley)	Rayner, Brig. R.	Thornton-Kemsley, Col. C. N.
MacPherson, Major Niall (Dumfries)	Redmayne, M.	Thorp, Brig. R. A. F.
Maitland, Cmdr. J. W.	Remnant, Hon. P.	Tilney, John
Manningham-Buller, R. E.	Renton, D. L. M.	Turner, H. F. L.
Marlowe, A. A. H.	Roberts, Emrys (Merioneth)	Turton, R. H.
Marples, A. E.	Roberts, Major Peter (Heeley)	Tweedsmuir, Lady
Marshall, Douglas (Bodmin)	Robertson, Sir David (Caithness)	Vane, W. M. F.
Marshall, Sidney (Sutton)	Robinson, Roland (Blackpool, S.)	Vaughan-Morgan, J. K.
Maude, Angus (Ealing, S.)	Robson-Brown, W. (Esher)	Vosper, D. F.
Maude, John (Exeter)	Rodgers, John (Sevenoaks)	Wade, D. W.
Maudling, R.	Roper, Sir Harold	Wakefield, Edward (Derbyshire, W.)
Medlicott, Brig. F.	Ropner, Col. L.	Wakefield, Sir Wavell (Marylebone)
Mellor, Sir John	Russell, R. S.	Walker-Smith, D. C.
Molson, A. H. E.	Ryder, Capt. R. E. D.	Ward, Hon. George (Worcester)
Monckton, Sir Walter	Sailor, Rt. Hon. Sir Arthur	Ward, Miss. I. (Tynemouth)
Moore, Lt.-Col. Sir Thomas)	Scott, Donald	Waterhouse, Capt. Rt. Hon. C.
Morrison, John (Salisbury)	Shepherd, William	Watkinson, H.
Morrison, Rt. Hon. W. S. (Cirencester)	Smiles, Lt.-Col. Sir Walter	Webbe, Sir H. (London)
Mott-Radclyffe, C. E.	Smithers, Peter (Winchester)	Wheatley, Major M. J. (Poole)
Nabarro, G.	Smyth, Brig. J. G. (Norwood)	White, Baker (Canterbury)
Nicholls, Harmar	Snadden, W. McN	Williams, Charles (Torquay)
Nicholson, G.	Soames, Capt. C.	Williams, Gerald (Tonbridge)
Nield, Basil (Chester)	Spearman, A. C. M.	Williams, Sir Herbert (Croydon, E.)
Noble, Cmdr. A. H. P.	Spence, H. R. (Aberdeenshire, W.)	Wills, G.
Nugent, G. R. H.	Spens, Sir Patrick (Kensington, S.)	Wilson, Geoffrey (Truro)
Nutting, Anthony	Stanley, Capt. Hon. Richard (N. Fylde)	Winterton, Rt. Hon. Earl
Oakshott, H. D.	Stevens, G. P.	Wood, Hon. R.
Odey, G. W.	Steward, W. A. (Woolwich, W.)	York, C.
O'Neill, Rt. Hon. Sir Hugh	Stewart, Henderson (File, E.)	TELLERS FOR THE AYES:
Ormsby-Gore, Hon. W. D.	Stoddart-Scott, Col. M.	Major Conant and Mr. Edward Heath,
NOES
Acland, Sir Richard	Callaghan, L. J.	Evans, Albert (Islington, S. W.)
Adams, Richard	Carmichael, J.	Evans, Edward (Lowestoft.)
Albu, A. H.	Castle, Mrs. B. A.	Evans, Stanley (Wednesbury)
Allen, Arthur (Bosworth)	Champion, A. J.	Ewart, R.
Allen, Scholefield (Crowe)	Chetwynd, G. R.	Fernyhough, E.
Anderson, Alexander (Motherwell)	Clunie, J.	Field, Capt. W. J.
Anderson, Frank (Whitehaven)	Cocks, F. S.	Finch, H. J.
Attlee, Rt. Hon. C. R.	Coldrick, W.	Fletcher, Eric (Islington, E.)
Awbery, S. S.	Collindridge, F.	Follick, M.
Ayles, W. H.	Cook, T. F.	Foot, M. M.
Bacon, Miss. Alice	Cooper, Geoffrey (Middlesbrough, W.)	Forman, J. C.
Baird, J.	Cooper, John (Deptford)	Fraser, Thomas (Hamilton)
Balfour, A.	Corbet, Mrs. Freda (Peckham)	Freeman, John (Watford)
Barnes, Rt. Hon. A. J.	Cove, W. G.	Freeman, Peter (Newport)
Bartley, P.	Craddock, George (Bradford, S.)	Gailskell, Rt. Hon. H. T. N.
Bellenger, Rt. Hon. F. J.	Crawley, A.	Ganley, Mrs. C. S.
Benn, Wedgwood	Crosland, C. A. R.	Gibson, C. W.
Benson, G.	Crossman, R. H. S.	Gilzean, A.
Beswick, F.	Cullen, Mrs. A.	Glanville, James (Consett)
Bevan, Rt. Hon. A. (Ebbw Vale)	Dalton, Rt. Hon. H.	Gooch, E. G.
Bing, G. H. C.	Darling, George (Hillsborough)	Gordon-Walker, Rt. Hon. P. C.
Blenkinsop, A.	Davies, A. Edward (Stoke, N.)	Greenwood, Anthony (Rossendale)
Blyton, W. R.	Davits, Harold (Leek)	Greenwood, Rt. Hon. Arthur (Wakefield)
Boardman, H.	Davies, Stephen (Merthyr)	Grenfell, D. R.
Booth, A.	de Freitas, Geoffrey	Grey, C. F.
Bottomley, A. G.	Deer, G.	Griffiths, David (Rother Valley)
Bowdon, H. W.	Delargy, H. J.	Griffiths, Rt. Hon. James (Llanelly)
Bowles, F. G. (Nuneaton)	Dodds, N. N.	Griffiths, William (Exchange)
Braddock, Mrs. Elizabeth	Donnelly, D.	Gunter, R. J.
Brook, Dryden (Halifax)	Driberg, T. E. N.	Hale, Joseph (Rochdale)
Brooks, T. J. (Normanton)	Dugdale, Rt. Hon. John (W. Bromwich)	Hale, Leslie (Oldham, W.)
Broughton, Dr. A. D. D.	Dye, S.	Hall, John (Gateshead, W.)
Brown, Rt. Hon. George (Belper)	Ede, At. Hon. J. C.	Hall, Rt. Hon. Glenvil (Colne Valley)
Brown, Thomas (Ince)	Edelman, M.	Hamilton, W. W.
Burke, W. A.	Edwards, John (Brighouse)	Hannan, W.
Burton, Miss. E.	Edwards, Rt. Hon. Ness (Caerphilly)	Hardman, D. R.
Butler, Herbert (Hackney, S.)	Edwards. W. J. (Stepney)	Hardy, E. A.

Hargreaves, A.	Mann, Mrs. Jean	Simmons, C. J.
Hastings, S.	Manuel, A. C.	Slater, J.
Hayman, F. H.	Marquand, Rt. Hon. R.)	Smith, Ellis (Stoke, S.)
Henderson, Rt. Hon. A. (Rowley Regis)	Mathers, Rt. Hon. G.	smith, Norman (Nottingham, S.)
Her bison, Miss. M.	Mellish, R. J.	Sorensen, R. W.
Hewitson, Capt. M.	Messer, F.	Soskice, Rt. Hon. Sir Frank
Hobson, C. R.	Middleton, Mrs. L.	Steele, T.
Holman, P.	Mikardo, Ian	Stewart, Michael (Fulham, E.)
Holmes, Horace (Hemsworth)	Mitchison, G. R.	Stokes, Rt. Hon. R. R.
Houghton, D.	Moeran, E. W.	Strachey, Rt. Hon. J.
Hoy, J.	Monslow, W.	Strauss, Rt. Hon. George (Vauxh[...])
Hubbard, T.	Moody, A. S.	Stross, Dr. Barnett
Hudson, James (Ealing, N.)	Morgan, Dr. H. B.	Summerskill, Rt. Hon. Edith
Hughes, Emrys (S. Ayrshire)	Morley, R.	Sylvester, G. O.
Hughes, Hector (Aberdeen, N.)	Morris, Percy (Swansea, W.)	Taylor, Bernard (Mansfield)
Hynd, H. (Accrington)	Mort, D. L.	Taylor, Robert (Morpeth)
Hynd, J. B. (Attercliffe)	Moyle, A.	Thomas, David (Aberdare)
Irvine, A. J. (Edge Hill)	Mulley, F. W.	Thomas, George (Cardiff)
Irving, W. J. (Wood Green)	Murray, J. T.	Thomas, Iorwerth (Rhondda, W.)
Isaacs, fit. Hon. G. A.	Nally, W.	Thomas, Ivor Owen (Wrekin)
Janner, B.	Neal, Harold (Bolsover)	Thorneycroft, Harry (Clayton)
Jay, D. P. T.	Noel-Baker, Rt. Hon. P. J.	Thurtle, Ernest
Jeger, George (Goole)	O'Brien, T.	Timmons, J.
Jeger, Dr. Santo (St. Pancras, S.)	Oldfield, W. H.	Tomney, F.
Jenkins, R. H.	Oliver, G. H.	Turner-Samuels, M.
Johnson, James (Rugby)	Orbach, M.	Ungoed-Thomas A. L.
Johnston, Douglas (Paisley)	Padley, W. E.	Usborne, H.
Jones, David (Hartlepool)	Paget, R. T.	Vernon, W. F.
Jones, Frederick Elwyn (West Ham, S.)	Paling, Rt. Hon. Wilfred (Dearne Vally)	Viant, S. P.
Jones, Jack (Rotherham)	Paling, Will T. (Dewsbury)	Wallace, H. W.
Jones, William Elwyn (Donway)	Pannell, T. C.	Watkins, T. E.
Keenan, W.	Pargiter, G. A.	Webb, Rt. Hon. M. (Bradford, C.)
Kenyan, C.	Parker, J.	Weitzman, D.
Key, Rt. Hon. C. W.	Paton, J.	Wells, Percy (Faversham)
King, Dr. H. M.	Pearson, A.	Wells, William (Walsall)
Kinghorn, Sqn. Ldr. E.	Peart, T. F.	West, D. G.
Kinley, J.	Poole, C.	Wheatley, Rt. Hn. John (Edinb'gh, E.)
Lang, Gordon	Popplewell, E.	White, Mrs. Eirene (E. Flint)
tee, Frederick (Newton)	Porter, G.	White, Henry (Derbyshire, N. E.)
Lee, Miss. Jennie (Cannock)	Price, Philips (Gloucestershire, W.)	Whiteley, Rt. Hon. W.
Lever, Leslie (Ardwick)	Proctor, W. T.	Wilcock, Group Cap. C. A. R.
Lewis, Arthur (West Ham, N.)	Pryde, D. J.	Wilkes, L.
Lewis, John (Bolton, W.)	Pursey, Cmdr. H.	Wilkins, W. A.
Lindgren, G. S.	Rartkin, J.	Willey, Frederick (Sunderland)
Lipton, Lt.-Col. M.	Rees, Mrs. D.	Willey, Octavius (Cleveland)
Logan, D. G.	Reeves, J.	Williams, David (Neath)
Longden, Fred (Small Heath)	Reid, Thomas (Swindon)	Williams, Rev. Llywelyn (Abertillery)
McAllister, G.	Reid, William (Camlachie)	Williams, Ronald (Wigan)
MacColl, J. E.	Rhodes, H.	Williams, Rt. Hon. Thomas (Don Valley)
McGhee, Ht. G.	Richards, R.	Williams, W. T. (Hammersmith, S.)
McInnes, J.	Robens, A.	Wilson, Rt. Hon. Harold (Huyton)
Mack, J. D.	Roberts, Goronwy (Caernarvonshire)	Winterbottom, Ian (Nottingham, C.)
McKay, John (Wallsend)	Robertson, J. J. (Berwick)	Winterbottom, Richard (Brightside)
Mackay, R. W. G. (Reading, N.)	Robinson, Kenneth (St. Pancras, N.)	Wise, F. J.
McLeavy, F.	Rogers, George (Kensington, N.)	Woodburn, Rt. Hon. A.
MacMillan, Malcolm (Western Isles)	Ross, William (Kilmarnock)	Wyatt, W. L.
McNeil, Rt. Hon. H.	Shawcross, Rt. Hon. Sir Hartley	Yates, V. F.
MacPherson, Malcolm (Stirling)	Shinwell, Rt. Hon. E.	Younger, Hon. K.
Mainwaring, W. H.	Shurmer, P. L. E.
Mallalieu, E. L. (Brigg)	Silverman, Julius (Erdington)	TELLERS FOR THE NOES:
Mallalieu, J. P. W. (Huddersfield, E.)	Silverman, Sydney (Nelson)	Mr. Sparks and Mr. Royle.

Mr. J. Edwards

I beg to move, in page 10, line 20, at the end, to insert: Provided that this subsection shall not apply to expenditure on the provision of a ship for the purposes of a trade if it is shown to the satisfaction of the Commissioners of Inland Revenue that on the tenth day of April, nineteen hundred and fifty-one, the ship was actually under construction for the persons who were carrying on the trade on the said tenth day of April or who were on that date about to carry it on. During the Budget debates, although little anxiety was expressed about the suspension of initial allowances in general, a number of hon. Members referred to the exceptional case of shipping. On the Second Reading of the Finance Bill, my hon. Friend the Financial Secretary said that, in view of the special importance and circumstances of shipping, it had been decided that we would put down an Amendment at this stage of the Bill excepting from the suspension of initial allowances any expenditure on the provision of a ship even though it may have been made after 5th April, 1952, on account of ships that were actually in course of building on Budget day. This Amendment gives effect to that undertaking.

Sir A. Salter

I think it would be for the convenience of the Committee, Major Milner, if you would allow me to move the Amendment to the Amendment standing in my name and then permit discussion to range over the subject matter of both the Government Amendment and mine.

The Chairman

I do not see any objection to that course, especially if it will expedite business in any way.

Sir A. Salter

I beg to move, as an Amendment to the proposed Amendment, in line 1, to leave out from "that," to the end and to insert: nothing in this subsection shall apply to expenditure incurred in pursuance of a contract for the sale of a ship. The effect of this Amendment, if adopted, will be to exclude altogether from shipping the operation of this Clause withdrawing the initial allowances. After the rather lively interchanges we have had, I am glad we are now discussing a subject which is politically non-controversial and on which we are not divided by any question of principle, as has been made clear by the fact that the Government have proposed an Amendment which goes some way, although I regret to say a very little way—certainly not far enough—to meet the case which we raised in the Budget debate. At the same time, I am sorry that a subject which will I hope excite neither levity nor angry emotion should come before the Committee at an hour with which levity and anger are both frequently associated.

By the Amendment they have proposed, the Government have clearly recognised that the full application of the Clause as it stands to shipping would be against the national interest. As the Chancellor has stated clearly—and the Economic Secretary repeated it today—the object of the Clause is not to get revenue at all; it is to effect a certain economic purpose—namely, to reduce the pressure of home demand on the engineering industry for plant and equipment for civilian purposes.

If that is the object of this Clause, the first consideration that must occur to one's mind is whether or not a Clause applying to all industries would really have that effect. One would have thought there would have been a distinction between the application of the Clause to industries which in time of national stress should not be encouraged to extend and its application to others which the very defensive preparations themselves make it desirable should have some extension. The Chancellor recognises this. In his Budget speech he said: 'The production Departments will, of course, take whatever measures are necessary to ensure that the suspension of these allowances does not result, in the case of undertakings engaged on the re-armament programme, in difficulty in providing any necessary addition to their equipment.—[OFFICIAL REPORT, 10th April, 1951; Vol. 486, c. 842–3.] That may be a sufficient measure of countering the evils to some of the munition industries that would otherwise result from Clause 16, but it is quite clear that it has no application at all to shipping. If the shipowners cancel their contracts for new ships now, the Minister of Transport can do nothing to secure that addition to the Mercantile Marine that would otherwise have resulted. The Government have given some recognition to that, but I think it is a very inadequate recognition.

The reason I am proposing this Amendment which goes so much further is that I think the Government's proposal is in some respects both ambiguous and inadequate. It is ambiguous because it limits the concession to shipping that is "already under construction." I do not know whether the Government know what "under construction" means. Does it mean a ship whose keel has already been laid? If it means that, then it certainly does not really cover construction in the full sense.

A few years ago I was in another country where I have seen the interval between the laying of the keel and the launching of a ship to be only three days, because the greater part of the construction was pre-fabricated. We have not got to that stage yet in this country, but we have got to the point where, although the keel has not been laid, the essential parts of the ship, such as the engines, have been begun in pursuance of an order. I do not know whether under the Government's Amendment, if passed in its present form, the ship which had been partly pre-fabricated outside in the yard, as in the example I have just quoted, would be counted as a ship under construction, but I should imagine that probably it would not.

There are, however, much more serious objections to the Clause. It is completely inadequate in its scope. It applies only to ships that are in some sense or another under construction. That concession would doubtless have the effect of enabling some of the orders that have been placed not to be cancelled. But other orders where the keels have not actually been laid, but which are waiting for their turn on the slips, would be cancelled. When those orders were placed the shipowners had in mind the financial situation of their respective companies. One of the factors was the expectation of the 40 per cent. allowance, and they had no knowledge that this was going to be withdrawn suddenly this year. It is inevitable—and the Government appear to have recognised this—that some of these contracts will have to be cancelled.

What is the result of that? The places vacant on the slips which would have been occupied by ships constructed for British shipowners will be used to meet orders from shipowners of foreign nations, who may, if war comes, be allies or not. They may be neutrals. Do the Government really want at the present time to have slips which should be occupied by British ships occupied by foreign orders to the exclusion of British orders that have already been given?

3.15 a.m.

I can hardly believe that this Amendment proposed by the Government is their last word on this subject. I am proposing my Amendment, which goes so much further, not only from an intellectual conviction that the national interest will be served. It so happens that in each of the two great wars of this century I have been associated with the control of shipping. I have been in a position where I have seen directly, and not merely learned as I otherwise should have done, that the fate of this country at a time when the fate of the free world and its security against aggression depended upon the adequacy of our Mercantile Marine in the face of a serious and dangerous submarine attack.

In each of those two wars I have had the responsibility at some time or another of actually finding and allotting ships to the different Departments—to the Munitions Department and to the Supply Departments of our Forces overseas— and I have been through months of wearing anxiety as to whether an inability to find and allot the ships might not fatally impair the success of our Armies abroad, or fatally injure the economic life of our country at home.

Mr. Ellis Smith (Stoke-on-Trent, South)

Does the right hon. Gentleman remember National Shipbuilding Securities and their effect?

Sir A. Salter

Let me say this to the hon. Member, that with that experience in the first war, when I came into this Parliament between the wars—[An HON. MEMBER: "Get on with the job."]—I devoted myself, more than to any other subject—[Interruption.]

Mr. Rankin (Glasgow, Tradeston)

Too much noise on that side.

Sir A. Salter

—to doing what little I could—[Interruption.]

The Temporary Chairman (Mr. Touche)

I think it would be better if we had fewer Interruptions.

Sir A. Salter

If I may continue—I devoted myself more than to any other object to supporting any measure which would to any degree reduce the danger of a shortage of shipping if another war should come. That is true as regards stockpiling and as regards such measures as affected the shipyards at that time, to which the hon. Member for Stoke-on-Trent, South (Mr. Ellis Smith) has referred.

The scope of any special provision—and the Government admits that some special provision must be made for shipping—depends not only on the importance which is attached to securing an adequate Mercantile Marine, but to some idea of the scale of Mercantile Marine which it is desirable in the national interest should be attained in this country. Therefore, I beg the Committee to listen while I suggest certain considerations why it is vitally important that the Mercantile Marine should be increased beyond its present size, and increased more than it would be if nothing more than the Government's Amendment were now passed.

The British Mercantile Marine has made a wonderful recovery in the last few years. After losing in the war no less than 11½ million gross tons—considerably more than half the total tonnage with which we started the war—we have practically got back to the same total tonnage as before. But that does not mean that we are as well equipped as before to face the dangers of another war, even if that war were not greater in scale than the one through which we have passed; because there are certain sections of the fleet, particularly ordinary deadweight tramp tonnage, which have not reached their former dimensions. The total has been brought up because we have had, for reasons everybody can understand, to increase our tanker fleet so much.

But even if we had in every part of the Mercantile Marine as big a tonnage as at the beginning of the war, it would be a terrible thing to have to go through, once more, with so very small a margin even if submarine attack did not increase; and let me remind the Committee that my right hon. Friend the Leader of the Opposition has warned the nation in stern phrases that we must expect to prepare for an even more dangerous submarine attack in any future war.

But it is not only for the eventuality of war that I urge so very strongly the full encouragement of an increase of the Mercantile Marine. British owners have ordered ships, and would be prepared to order ships, unless discouraged by the sudden withdrawal of these allowances. I cannot believe that the Government really desire, by financial methods, to restrict the increase of the Mercantile Marine sailing under the British flag and in British hands which would otherwise occur.

Let me ask the Government how far they really think it desirable, by a special provision for shipping to encourage British shipping, to go. They certainly do not want to stop orders as much as the full application of Clause 16 would do. The Government have shown that by their own Amendment. Do they really wish to restrict the cancellation of orders already given where construction has not begun in the shipyards? Do they really desire this as an economic purpose? Surely if they do they would not help the re-armament preparations as a whole? They would surely weaken our position. Surely they must regard the Mercantile Marine as a fourth arm of defence, which, if deliberately weakened, must make our defences suffer and not gain? The Government can have DO other purpose. Their declared purpose is not to increase revenue. It is solely to help our defence preparations, but here is a financial method which apparently has the deliberate purpose of cancelling orders given by British owners.

I would go even a little further and say that I think it is extremely undesirable that the withdrawal of these allowances should have the effect of discouraging owners from placing new orders which they have not actually placed for ships which they may have intended to built to complete the general pattern of their respective fleets. What is the reason for stopping short of the complete exclusion of shipping from the operation of the Clause altogether? I can hardly think, unless the Government contest some of my arguments, not only as to the importance of shipping in our defensive preparations and not only in war if it comes, but also as an essential adjunct to our munitions and defence preparations in other spheres, that they really desire this. The whole of our defensive preparations depend on an adequate supply of vessels to carry the raw materials, as much as we depend on the Royal Navy for purely warlike activity.

Mr. Ellis Smith

Will the right hon. Gentleman admit that our Mercantile Marine is now more efficient and modern than it has ever been? Will he admit that there is more tonnage being built than ever before and that the shipbuilding industry of this country has greater orders on its books than ever in its history?

Sir A. Salter

First I would say to the hon. Member for Stoke-on-Trent, South that I wish I could agree that the British Mercantile Marine is in all its essential parts more efficient and greater than it has been in the past. That is true of some classes, but not of all. Secondly, I wish still more that I could say that for any future danger of submarine attack it was as well equipped to meet that danger as in the past. Thirdly, I wish I could agree that as many ships are being built as ever. Our shipbuilding industry had a higher rate of output in the past. Fourthly, what is the use of the hon. Member saying that the order books are full, when it is the whole point of my contention that the Government, by withdrawing this initial allowance in this way and at this time, subject only to the limit proposed in their Amendment which covers only ships that are being constructed, will be the means of depleting those order books by what they propose? That is why I ask for an extension of this special provision beyond the narrow limits of the Government's Amendment.

What can be the reason for limiting this special provision to ships actually under construction? Special provision is admitted to be necessary. Why is its scope so narrow? I cannot believe that the Government desire to restrict the increase in the British Mercantile Marine, for all the reasons I have mentioned. I can only feel that perhaps one reason has operated. They perhaps feel that this might be a precedent which could be used by other industries in their claims for similar special provisions. That is the kind of consideration which arises heavily in a Government Department. I also have been in Whitehall, and I know that well. It is argued, "If we give this concession to one industry, will not others claim it, too?"

I suggest to the Government that perhaps in this case the danger of a wide extension beyond what they would desire or think wise might be greater if in the very special case of shipping they devised a provision which was not clearly impossible or impracticable for many other industries. If the Government take shipping, which differs by so many characteristics from any other industry, and make special provision for it along the lines which I have advanced in my Amendment, then I suggest that they are less likely to have it used as a precedent for other industries.

I have attempted to put my case for this Amendment on broad lines, and solely from the point of view of what I believe to be vital to the national interest. I am not concerned in any degree whatever by its effect upon the finances of the shipowning firms except in so far as there is a financial effect which induces a reduction in the British Mercantile Marine below what it would otherwise be. The effect of the Amendment which I propose would be to cancel any danger of that kind.

This is not a revenue point, on the one hand, any more than on the other, it is a question of reducing taxation falling upon a particular class. It is what economic purpose we desire to serve, and what is the best method of achieving that purpose. I believe, beyond any doubt, that the reasons I have mentioned for the complete exemption I propose would serve our purpose best. My hon. Friends who follow me will doubtless, with their current and daily contact with and knowledge of the shipping industry, which goes far beyond mine, add a great many technical considerations to those I have put before the Committee. I venture to put these broad reasons on the wider Amendment I have submitted.

3.30 a.m.

The Temporary Chairman

I am not clear which Amendment the right hon. Gentleman is discussing.

Sir A. Salter

I am sorry. Would you allow me to take this Amendment of mine, the one for the complete exclusion? It is an Amendment to the Government's Amendment, in line 1, to leave out from "that," to the end, and to insert: nothing in this subsection shall apply to expenditure incurred in pursuance of a contract for the sale of a ship. I was proposing that it should be taken now as an Amendment to the Amendment proposed by the Economic Secretary on behalf of the Government. I was not proposing that we should cover now the other Amendments on this subject that appear later on the Order Paper.

Colonel Ropner

To some extent I feel I should discount my own remarks by saying that in the matter of taxation I think one is predisposed to hold the view that an industry with which one is connected merits special or exceptional consideration. Certainly I believe that the shipping industry and ship-building do deserve special consideration in connection with these initial allowances. After hearing what the right hon. Gentleman the Member for Ormskirk (Sir A. Salter) has said, and whatever additional remarks are made by myself and other right hon. and hon. Gentlemen on this side of the Committee, it will, of course, be for the Committee and, in particular, the Chancellor of the Exchequer and his Economic Secretary, to decide whether our convictions are justified or not.

The question of initial allowances for the shipping industry can be tackled from a large number of angles but, in presenting the case for special consideration, I desire only to adduce two arguments either of which I feel would be conclusive, but which taken together must prevail.

The first point I want to make arises out of a consideration in connection with defence itself. I would say that surely this is not the moment to do anything to discourage the building of ships. When the Committee has been dealing with previous Amendments to this Clause, attention has been drawn to the fact that initially these special allowances were introduced to stimulate the modernisation and the re-equipment of industry. It is, however, understandable that in the special circumstances of today and over a large field of civilian expenditure, the Chancellor should desire to restrain capital expenditure because of the over-riding need to fulfil our defence programme.

But surely the provision of an adequate Mercantile Marine must be considered as part and parcel of our defence programme. If he will forgive me for saying so, the Chancellor of the Exchequer is commendably young, but he must recall—indeed he has been reminded of it today—the grave peril in which this nation, and indeed the whole free world, found itself in World War II because of the shortage of ships. I think he has probably heard of the similar and equally grave dangers which faced this nation in World War I.

We have been told on more than one occasion of the large number of submarines which Russia is building—far-ranging submarines of high speed. The power of the bomber certainly does not grow less. Should there be another war, I am sure that this nation and other participants will have to face grave losses in their Mercantile Marine. I am glad that the right hon. Member for Ormskirk drew attention to the truly miraculous recovery which the shipbuilding industry has made and the very large replacement programme which has already been carried out, although of course he was right in warning the Committee that by no means all the gaps left by comparison with the pre-war strength of our Mercantile Marine have been made good.

I am glad to see the Minister of Transport on the Government Front Bench. On grounds of security he still prohibits the sale of certain classes of British ships to foreigners. I think that that is a wrong decision from every point of view. It is a pity that over the last four or five years British owners have not been allowed to sell their old ships and to be enabled thereby to place more orders for new ships, but that is not a question I want to discuss now, and I should be out of order if I attempted to do so.

If the Minister of Transport holds the view that the British Mercantile Marine is not sufficiently strong today, then surely it must be wrong to discourage the construction of new tonnage. Either the Minister of Transport is right in his view that the Mercantile Marine is still inadequate or the Chancellor of the Exchequer is right in discouraging further building. But both Ministers cannot be right. I want to point out to the Chancellor and the Economic Secretary—and, indeed, to the Committee—that purely on grounds of defence it must be obvious that this nation should do all it possibly can to add to the strength and efficiency of its Mercantile Marine as soon as possible.

My second argument is based on the fact that the ships of all nations compete in the same freight market. Competition is truly international; it is ship against ship and flag against flag. In this competition and international market British ships already carry a load of taxation which in the past has placed, and today still places, serious disadvantages on British shipping vis-à-vis that of foreign countries. The consequence of that is that when rates of freight are high, foreign competitors are able to acquire large reserves.

They can buy modern ships more easily than British shipowners can, and generally they are able to increase the efficiency of their fleets more easily than are British shipowners. When freights are low—and the freight market will fall some day—foreign owners will be able, by the reserves they can acquire today on a greater scale than British ship owners, to keep their ships running because of the efficiency of the modern tonnage they are able to buy today. I hope I am in order in reminding the Chancellor that in other Clauses the difficulties of British shipowners are being added to. There is to be a higher Profits Tax and higher Income Tax, and those two are adding to the direct taxation which is already more onerous on British shipping than any burden borne by ships sailing under any other flag.

That was the last point I wanted to make. I do not want to detain the Committee further. I feel that on the grounds of defence alone, and of the ability of British shipowners to compete in an international market, the Chancellor should be very careful before refusing to agree to the Amendment so ably moved by my right hon. Friend the Member for Ormskirk.

Mr. J. N. Browne (Glasgow, Govan)

As the Committee has already been reminded, the Financial Secretary, in his speech on Second Reading, recognised the very special importance of shipbuilding. He used the word "very," and he made a promise. It was a wise and understanding promise, but since I have been in this House I have learned that Treasury promises are not always fulfilled by wise deeds, and this was no exception, because the Chancellor's Amendment is, quite honestly, no credit to the wisdom of either the Treasury or the draftsman who prepared it. My answer to the Chancellor's Amendment would be: "Thank you for nothing."

Let me list my objections. First of all, we are not dealing here with a low-priced article. We are dealing with an industry in which Britain is supreme the world over. We are dealing with an industry on which Britain depends more than any other for her life. We are dealing with an industry which, twice in my lifetime, we have called upon for our very survival, and which, twice in my lifetime, has answered the call.

If the Chancellor is worried about establishing a precedent, I am sure I can speak for hon. Members on both sides in saying that no one will mind if he does establish a precedent for the British shipbuilding industry. The British shipbuilding industry is without precedent and therefore no special treatment given to this industry can create a precedent for other industries.

The proposals of the Chancellor are, to my mind, remarkable for their lack of elementary common sense. Why give the concession to ships that are actually under construction? What does that mean? When and where does construction start? It leads me to suppose that the Treasury are completely removed from what actuaally goes on in life and in industry today. Where does construction start? Does it start on the drawing board? Does it start in the sub-contractor's shop? Does it start in the tool maker's shop or the pattern maker's shop? Does it start when special components are ordered by the shipowner from an outside firm even before the order for the hull is placed?

It starts, as we know, in a variety of ways and in a variety of places, and a great deal of expenditure can already be incurred before the actual keel is laid. Why pick on one feature of this complicated and long-term process and say, "That is the point to which I am going to apply the concession"? Why exclude components and machinery that are ordered by the owner or shipbuilder direct from outside firms? If the Chancellor wishes to bring chaos into the shipbuilding industry, this is the way to do it. The only practical dividing line is either when the order is placed or when the ship is completed.

3.45 a.m.

I have another complaint about the Chancellor's Amendment. The proposal of the Chancellor is to come into force at once. When a Government Department wants to make a change, they can have plenty of time to do it. We are told that changes cannot be made suddenly. I remember that the right hon. Lady the Minister of Pensions came to the House only a few weeks ago wanting to make a change. She wished to give 4s. 0d. rise in the National Assistance scales for old folk. The change should have been made right away, and yet she gets five months in which to do it.

She is only dealing with paper—there is plenty of paper in Government Departments—but we are dealing with ships, ships that take years to build, some of which are ordered now, and thank God for it, but may not be completed until 1955, 1956, or even 1957. It takes time, it takes courage, and it takes considerable financial adjustment to find hundreds of thousands of pounds—nay, millions—to build a ship. This sudden change of policy is wrong. The shipbuilding industry is one on which I consider we should take a five-year view. It is an industry which cannot expand unless they do take a five-year view.

But why not exclude shipbuilding altogether from that cancellation of the 40 per cent.? The arguments are indeed powerful. There is a queue waiting to place orders for ships now. If British shipowners withdraw their orders—and there are already, I am told, orders that have been suspended—there are foreign owners ready to take up the berths. Does the Chancellor really want to endanger the British merchant fleet to the advantage of foreign fleets? I cannot believe it. Britain depends on her merchant fleet. The ravages of war have not yet been made good, in spite of what one hon. Member on the other side of the Committee said. The tramp fleet has still a long way to go before we get back to our pre-war state. If armaments are needed, are ships not armaments?

I will sum up. First, the Chancellor's Amendment as it stands is going to do nothing but sabotage the industry. Secondly, to alter the concession to the date when the order is placed, or will be placed, will seriously injure or damage the industry according to the date when the concession comes into force. To discontinue these allowances altogether, however hedged in they may be with safeguards, is to endanger not only the shipping industry, but Britain herself—Britain's superiority in peace and Britain's defence in war—and to do one more thing to break the chain that holds the Empire together. I think the Committee should consider very carefully before, in these times, they take that step.

Colonel J. R. H. Hutchison

I think I should start in the correct way by declaring that I have an interest in the matter we are discussing inasmuch as, in the past, I have been concerned with, and interested in, a shipbuilding yard. I hope, when this Bill has had its day, week or month, to be able to look into the yard again. Therefore, I must say that I have rather more than a nodding acquaintance with the shipbuilding industry.

The purpose of the abandonment of the initial allowances has been made abundantly clear not only this evening, but when the Chancellor made his Budget speech, and it is that there should be a curtailment of capital expenditure at the present time. I should like to contrast those words with the words of his pre- decessor, Sir Stafford Cripps, two years before, when he said that the Government were constantly stressing the need for higher productivity, and both sides of industry agreed that one important factor in this was more and better mechanisation, and when, later on, he stated that owing to a further rise in prices, he had decided to double the existing initial allowance.

I think it has been recognised—and every hon. Gentleman who has spoken so far to the Chancellor's Amendment has stated so—that ships are in a special category. They are virtually the fourth line of defence. Indeed, the Chancellor has recognised that by the Amendment we are considering, but, in my view it does not go far enough. His action must do one of two things. Either it must result in the cancellation of those orders with which the yards are very full—and in that case we shall be short of the most modern type of our fourth line of defence and we shall not have ships which in terms of productivity would have satisfied his predecessor—or, on the other hand, if it does not result in cancellation, then the Chancellor will not have achieved his purpose.

So whichever happens, there is bound to be either a disappointment in the quality of our ships, and consequently in the mechanisation of our fleet, or in his hope that he would curtail capital expenditure. Indeed, in the short term it will not affect the curtailment of capital expenditure because the sub-contracting work—all the components of the ships—for some time ahead has already been ordered and will in due course be delivered, and there will be full yards for a year or so ahead.

For an independent ship-owning concern the question of financing these expensive vessels is very acute. The initial allowance helped to solve this problem for some of the companies which wished to bring their fleets up to modern standards because, in spite of what was said by the hon. Gentleman the Member for Stoke-on-Trent, South (Mr. Ellis Smith) the British Mercantile Marine is not as modern as it was before the war. The 40 per cent. initial allowance, which was supported in general terms by the Millard Tucker Committee as being a method of dealing with this financial problem, was a very considerable factor in the calcula- tions of shipowners when placing their orders.

I should like to have a look at one or two problems arising from the actual wording of the Chancellor's Amendment. The Amendment talks, as the original Clause does, of the expenditure that is incurred. I would like to know from whoever is to reply when is expenditure incurred. No doubt in terms of Treasury intrepretation it is incurred when it is actually made, but to the ordinary lay mind it is when the contract for the ship has been placed and the undertaking has been given to make certain payments by instalments that the expenditure has been incurred. That point should be cleared up before we can properly understand what we are discussing. If it is when the actual payment takes place, there is nothing to prevent a shipowner from abandoning the normal system of payment by instalments and making a lump sum payment within the year to 5th April, and he can circumvent the wording of the Clause in such a way.

One case has come to my notice of the considerable confusion which has been caused by the abandoning of the initial allowance. Early in 1950 a certain company placed an order for one tanker, for delivery in 1953—and note the lapse of time that takes place in all this. At the beginning of 1951, a second order was placed for a tanker to be delivered early in 1954. For part of the cost of the second tanker the company had to double its capital, the intention being that the balance would be met by a loan, which it was estimated would be paid off in 2½ years. The company's estimates were based on and took into account the full effect of the initial allowance. The cancellation of that allowance has thrown the whole financial plan into confusion, the construction of neither tanker has yet begun, and the company has stated that its plans have been completely upset.

The industry is waiting intently on the result of this debate. At the moment companies can make no definite decisions. They know the Minister has certain concessions in mind. The Committee has learned today what sort of concessions they are. We believe they do not go far enough. It would be very helpful if we could have from the Government something to clear our minds.

I should like to give some illustrations on the observations by the hon. and gallant Member for Barkston Ash (Colonel Ropner) that shipping in this country is not a favoured industry. It is not being treated half as well by this Government as many foreign Governments treat their shipping industry. In Norway the excess value of ships on a 1938 basis plus 20 per cent. may be written down over five years, up to a maximum in any one year of half the profits for that year, and this allowance generally amounts to more than 40 per cent.

In Sweden ships may be written down practically by any amount without restriction. In Denmark allowances work out so that the whole ship may be written down in 12 years. United States shipowners are entitled to receive from the Government financial assistance to bring, the building costs of vessels down to the level of building costs in other countries. When these vessels are operating in the liner trade allowance is made, by subsidy, for the difference between United States working costs and the costs in other countries.

We had this initial allowance. It helped us a good bit. It is now being cancelled. That makes the situation all the worse. I want to ask the hon. Gentleman who, for the purposes of trade, is the trader in this matter. Is it the shipowner; and if so, is a sub-contractor who is supplying a shipbuilder with an engine, or lifeboats, or davits, or any other apparatus, precluded from the 40 per cent. allowances because they are not for the purposes of the trade? Will the concessions in the Amendment apply to all floating craft, to tugs, lighters and other floating appliances belonging to dock authorities? I imagine they will be, but dock authorities will be happy to know that that is the interpretation of the Government.

In supporting the Amendment to the Amendment, I hope we shall draw some further elucidation from the hon. Gentleman who is to reply that will show that something more worthwhile will be-granted than what has already been promised by the Government.

4.0 a.m.

Brigadier Head (Carshalton)

I shall detain the Committee only briefly on a somewhat narrow point. I have no interest in any shipyard, I am sorry to say, but I saw at the start of the last war the appalling shortage of certain specialist types of ship, and then at the conclusion of the war, I saw resolutions come from all sides, from the Services and the politicians, asking that steps should be taken to subsidise the building of these types of ship so that that would never occur again. So far as I know, nothing was subsequently done, despite all those pious resolutions, as often happens when peace breaks out.

The effect of this Treasury Amendment will not only be that nothing is done, but that the very types of ships most required will be reduced, because these types are fast infantry-carrying ships which are expensive to build, take a long time to build and if they are to be used most effectively, should incorporate certain special fittings for rapid conversion. With expenses going up and allowances going down, the likelihood of people building these types unless given assistance by the Treasury seems to me to be practically nil.

My experience of the Treasury is that when they have any real power of fixing matters regarding defence and are not fought tooth and nail by the Service Ministers, defence is cut well below the safety mark. It has always been my opinion that, with the best will in the world, the Treasury have played a large part in causing two world wars. I maintain that opinion. Nobody wants to see that going on again, and therefore I say to the Economic Secretary, who is now paying attention—

Mr. J. Edwards

The hon. and gallant Member must not say anything like that. I have been paying close attention to everything that has been said and it is wrong of him to suggest I was not listening. I was surprised that the hon. and gallant Gentleman should attack successive Chancellors in this rather personal way.

Brigadier Head

I withdraw unreservedly. No doubt the hon. Gentleman was paying full attention, but I know that at this time of the morning it is very easy for people not to do so.

The hon. Member seemed to pay particular attention when I made that remark about the Treasury, about which I am unrepentant. I may be wrong, but it has been a bee in my bonnet for a long time. I suggest that the hon. Gentleman should look into the question of these types of ship. They were known as L.S.I., and were large, fast passenger ships easily convertible for carrying troops. We are an island Power, very short of forces and very much needing mobility. It is the sea that confers mobility to a large number of troops. Once again we shall enter war with world-wide commitments. Once again, if we are not careful, we shall feel the appalling scarcity of such ships. A little foresight now, some concession now, and that difficulty will be overcome. If nothing is done now or next year or two we shall be short of this essential type of equipment. I do beg the hon. Gentleman to reconsider this matter.

Sir R. Glyn

I hope that the hon. Gentleman the Economic Secretary will pass on to his right hon. Friend the Chancellor of the Exchequer how seriously some of us feel about this matter. I think it is clear to us that the shipping industry is in a unique position, because the ships themselves are the tools of that industry, and there is nothing quite the same in any other industry. In order to build a ship it necessarily takes a long time to plan it, and a much longer time to construct it; it has to be built in one piece. In other trades persons can develop equipment and plant and add to it as they want. In the shipping industry one has to keep up to date, especially in the liner trade, and if there is any dropping behind traffic is lost. People insist on travelling in ships that are up-to-date, and shipowners have to be in a position of being able to keep their fleet up to date.

I can assure the Economic Secretary that it is impossible for shipowners to do that, with the tremendous burden of taxation which falls on them, or to maintain their fleets in that condition if the initial allowance is removed, I do beg the hon. Gentleman to realise that once this thing goes it means a great many British ships will be withdrawn from the builders. Foreign owners will occupy the slips and it will result in that additional tonnage taking the water so that by 1956 the British flag will be flown by far fewer vessels. I am convinced that the Treasury have not grasped that this business of shipbuilding, especially of the vast passenger liner is a complicated business and we are being overhauled by certain other countries, which, with the allowances they have, are able to build superior accommodation, not only for the passengers they get but for other purposes. There is the case of the Panama vessels. There is a minute country, which has developed an enormous mercantile marine and which is out to chase other ships off the seas.

This, of all times, is not the moment for the British to risk their fleet. Surely it is not only a question of the United Kingdom, but of the British Commonwealth as well. We are anxious to see British shipyards full of orders from shipowners and firms domiciled in the Commonwealth. They will only come to this country if we can maintain the efficiency of our shipyards, which are by far the most efficient in the world; otherwise, foreign owners would not be clamouring to have their ships built here, but there have been cases brought to my knowledge, that because of the threat of the withdrawal of the initial allowances, vacancies are likely to appear in some British yards.

Because the boards of shipping companies are so uncertain about the future they make their plans for many years but the tremendous weight of taxation which has come upon them, especially in this Budget, is bearing extremely hard on the industry. The situation is such—and I can assure the hon. Gentleman that he can get any amount of evidence—that there is a feeling of real anxiety. There is only one course, and that is to leave the shipping industry in possession of the initial allowances.

Mr. J. Edwards

Did I understand the hon. Member to say that there were vacancies in British yards?

Sir R. Glyn

No. What I said was that there is such congestion now for building in British yards that the managers of the yards have to allocate berths well ahead. It may be that if a slip is occupied today one knows when the ship is to be launched and who will next occupy that berth. It may be a British ship. But if the owners become uncertain about it, the managers of the yard must go to the next person, who may be a foreign owner, and that would mean the occupation of that berth by a foreign owner.

I assure the hon. Gentleman that it is not only in regard to the actual hull. People seem to think that when one lays down the keel that is all that has to be done. It is necessary now for orders for some of the dead, auxiliary machinery which is scarce to be placed by the shipyard a long way ahead in expectation of an order. For instance, it is hard to get auxiliary diesel engines and a lot of electrical equipment in view of the demand for the re-armament programme. Therefore, anything which leads to uncertainty either for the boards of directors of shipping companies or for the managements and boards of shipbuilding berths at this juncture will mean a severe risk not only for the industry but for the future of this country.

Mr. Gage (Belfast, South)

I desire to add a few words in support of this Amendment from the point of view of the shipbuilders. My reason is that the part of the world which I represent is vitally concerned in that industry, which is possibly one of the largest centres of shipbuilding in the world. As I see it, one of the real dangers of the withdrawal of this allowance is that it may well cause a dislocation in the pattern of shipbuilding.

Anyone concerned in that industry—and we in Belfast have cause to know this—realises the importance of having a rhythmic flow of orders coming into the yards. It is not so important to have a tremendous number of orders at one time, some of which one cannot fulfil, and at another very few, as to have the rhythmic pattern which has prevailed over the past year or so in the industry. The withdrawal of this allowance may well have the effect of causing shipping companies to cancel orders if they can do so, and so throw out of gear the pattern of the shipbuilding of this country.

Commander Pursey (Hull, East)

Would the hon. Gentleman allow me to put this question to him? A lot of argument has come from the other side of the Committee about shipbuilding being part of the rhythmic pattern. Why was not this dealt with three or four years ago, when there were practically no orders in the shipyards? [HON. MEMBERS: "Nonsense."] Oh, yes. [HON. MEMBERS: "No."] One hon. Gentleman opposite said order books were full now, but that they were not full a year ago. [HON. MEMBERS: "NO."] There were periods where important shipyards lacked orders because of the failure of the shipowners to give orders so as to keep up this rhythm of shipbuilding about which we have heard.

4.15 a.m.

Mr. Gage

The hon. and gallant Member may be familiar with ships but I cannot say that he seems familiar with shipbuilding. Nobody who knows anything about shipbuilding can support the statement that there were empty slips. There might have been two or three here and there but at the vast yards of Messrs. Harland and Wolff there has been no empty space since the end of the war for the simple reason that replacement has been going on to make good that which we lost during the war. So the hon. and gallant Member's point falls to the ground. But, when the replacement for the Merchant Navy is almost complete, it may well be now that shipping companies will hesitate to order when they know that these allowances are withdrawn.

There is another important aspect. As some hon. Members have pointed out, the building of a ship is a tremendous undertaking. It grows with the size of the ship ordered, and this is not the kind of industry where one says "Well, I think I will order a ship tomorrow." Ships laid down now have probably been planned and ordered some years ago when it was not even thought that these allowances would be withdrawn. The Government has recognised this difficulty to some extent and have made an endeavour to meet it by saying that in the case of ships under construction, the allowances will not be withdrawn.

Other hon. Members have pointed out that the Government should say how it is going to define "under construction." There, I think, the Chancellor will run into a great deal of difficulty. As the hon. Member who has just spoken pointed out, it very often happens that a great deal of work on parts of equipment and on the engines is done before even the keel is laid. Generally speaking, anybody ordering a ship has to wait for a vacant slip; but in a great yard like Harland and Wolff's the diesel engines or something else for the ship are started before work begins on the hull if there is no space. In such a case, who can say if that ship is "under construction"? There may be many important or expensive parts constructed although there is no appearance of a ship.

Then, let us remember that before any construction work at all can be done there has to be a tremendous lot of designing and drawing which is also very expensive. Is it to be said that when all these preliminary things have been carried out, although there is no keel on the slipway, that the vessel is "under construction"? I suggest that it would be very much better, instead of saying "under construction", to say "when the contract for the construction has been made". That would be a very much better yardstick.

The Economic Secretary to the Treasury has pointed out on several occasions in this debate that Amendments have been excellent and has said that he was much in favour of them and would be very willing to grant them; but then, in the final sentence he has said that owing to there-armament programme, and for one or two other reasons which I cannot now remember, it was impossible to make the concession sought. There is one thing that cannot be said about this Amendment, that it has no effect on the re-armament programme. There is practically no class of vessel or craft that cannot be used and is not used in war. From the yacht to the liner they all have their uses, and they are nearly always used as part of the defence programme. That argument certainly is not one that can be put forward.

Ships are in an entirely different category to an ordinary type of factory. Shipping is a trade in itself. It is very important to distinguish ships from any other form of plant to which allowances may apply, for ships are the centre of the whole industry. For that reason, if for no other reason, I think that this Amendment should be accepted.

There is one further point that has not been mentioned and that is the design of ships. The design of ships has changed more in the last six or seven years than ever before in the history of shipping, which is because of the continuous flow of new orders. If once that is interfered with, or anything is done to prevent or make it difficult for shipping companies to place orders for ships, not only will it be disastrous for those employed in the industry, but it will affect the design of the vessels. Shipping in this country should never be neglected, for it is indeed one of our greatest industries. In those circumstances, it is regrettable to find the Government attempting to remove these allowances from the industry. I hope that better counsels will prevail, and that the Chancellor will see his way to accept this Amendment.

Mr. Maclay (Renfrew, West)

As has happened on a number of occasions, I must start my speech by declaring an interest in shipping, and I apologise to the Committee for speaking so often on a subject with which I am very closely connected outside Parliament. The points made so far have been advanced with much strength, and I am not going over them again. The main arguments were most ably put by my right hon. Friend the Member for Ormskirk (Sir A. Salter), who made the major case for taking shipping out of this Clause altogether. However, there are still things that need saying, and I hope they will be listened to with care by hon. Members on the Treasury Bench, and particularly by the Chancellor of the Exchequer when he is considering the results of this debate between now and the Report stage.

The first thing that we must get absolutely clear is that the shipping industry is only too ready to bear its full and proper share of taxation. Initial allowances, in the long run, make no ultimate difference to what the Treasury receives, with one proviso—that the unit in question in its lifetime makes money. I cannot quickly turn up the quotation, but even the Chancellor himself, or one of the Treasury Ministers, said on the Floor of the House, that, after all, these initial allowances are nothing more than a tax-free loan. That, too, has been said on this side and it has been said outside the House. It is absolutely wrong. To certain types of firms with very big resources who can be reasonably certain the unit involved in the discussion is going to make money over its whole lifetime, it may be true.

I should like to refer to "tramps" with which I am connected. I remember very well a ship belonging to the firm with which I am associated and which was built in the 1925–26 period. It made money for a short time with only a 4 per cent. depreciation allowance, paid tax on relatively small profits over and above that, and then ran slap into the depression of the 'thirties and never in its lifetime made depreciation. Therefore, the Treasury actually got money to which, over the life-time of the ship, it was not entitled and there was no way of getting it back. Let us get rid of the idea that initial allowances are nothing more than a tax-free loan because they can be vastly more important than that to certain types of industry and to certain types of ships.

The basic issue is clear. The Chancellor himself really made our case in his Budget speech. Some of his speech has been quoted, and I should like to quote one part of it too. He said: The initial allowances after all were introduced at the end of the war as a means of stimulating re-equipment and modernisation. … And this is the important part. He added: That is, of course, a very desirable aim but in our present circumstances to stimulate capital expenditure in this way would, I am satisfied positive endanger the defence and export programmes too much."—[OFFICIAL REPORT, 10th April, 1951; Vol. 486, c. 842.] If that is applied to shipping it is entirely our argument upside down. What could do more serious damage not only to the defence programme but also to the export programme than if the British Merchant Marine does not progress as fast as it possibly can in this critical period? There can be no shadow of doubt what effect the suspension of initial allowances must have, and I do not want to exaggerate the case.

Other hon. Members have mentioned the question of cancellation of contracts. I believe there may well be cancellation of contracts, but I am not certain of it. But, quite apart from that, the whole mood which prevails, and which has prevailed for some time past, in the shipping industry of this country, must change. The decision to build these extremely expensive units is a matter of economic climate and mood to a very considerable extent. Sir John Anderson, immediately after the war, brought in initial allowances of 20 per cent. He was certainly not a Socialist. Only two years ago, Sir Stafford Cripps increased the allowances to 40 per cent. Obviously it must appear to the industry that there was no difference between political parties on this question. They were bound to assume that initial allowances would continue.

The Lord Privy Seal (Mr. Stokes) indicated dissent.

Mr. Maclay

It is no good the Lord Privy Seal shaking his head. It is true that that is what happened. They assumed, in their basic thinking on new construction, that initial allowances would go on. One cannot run an industry so vital to the nation's fate in war and peace with constant changes in essential policy affecting its finances. The uncertainty since the Budget speech has been very damaging. Owners have not known whether they could go ahead or not. Indeed, they are awaiting the result of this debate, and they will not really know the position until the Finance Bill is on the Statute Book. That has done no good.

4.30 a.m.

I will leave the question of the background of the placing of orders for new tonnage and turn to two further important points. The hon. and gallant Member for Scotstoun (Colonel J. R. H. Hutchison) mentioned the question of taxation in other countries. That is an extremely important point, and it was a great difficulty for British shipowners before the war—before the initial allowances were introduced. That introduction did go some way to meet the advantage which shipowners of other nations had in the matter of taxation. Are we to lose it?

Another point is that there has been a serious recrudescence of what is known as flag discrimination. Other nations are discriminating against the use of British tonnage in a way which has not been seen for some time—certainly not since the 1918 war and possibly before that. It began to grow during the inter-war years and we got rid of it. It has become much worse again since 1945 so that we are fighting against not only taxation advantages which other nations have but also against a deliberate diversion by other nations of cargoes into ships under their own flags. There are many other difficulties, of course. We see the straight subsidies which are being given to foreign shipping. We are not asking for a subsidy in this country or anything like it; that is the last thing we want. If we are given a fair deal and fair taxation we can get on in the world, but we must not be in a worse position than our competitors from a taxation point of view.

Finally, without labouring the point, may I deal with shipbuilding? The hon. and gallant Member for Hull, East (Commander Pursey) made a statement which I think should be corrected because it might go out to the public—and the public ought to know what the true position is. Since the war it has not been possible for an owner wanting to build a ship of 400 feet and upwards to get delivery within a couple of years. At no point has a slip been available for putting down a new keel for a new order which had not been in the order books for some time past. The hon. and gallant Gentleman is right only up to this point—that for a short time about a year ago some of the yards building small ships up to 250 or 300 feet were running short of orders in their order books. But there has been no time at which one could place an order for a big ship and get delivery within less than two, three or four years. That may appear to strengthen the Government's case for taking this action. But of course they must realise that they are risking cancellation.

Let us look a little further ahead. Even if the Government insist on including shipping in this suspension of the initial allowances, that will not affect the position for the next two years when the whole weight of re-armament will be falling on the country. It cannot stop the ships which are on the stocks now, and the great majority which are on the stocks now will be there for a considerable time. The Government will get no advantage during that time. What they will be doing will be to jeopardise employment in the ship yards two, three, four or five years from now.

Let it be realised that all shipping—particularly tramp shipping—moves in a cycle and not all the efforts of the planners in Whitehall can stop that for years to come, because whatever they may be able to do in this country they cannot believe that they can influence what is to happen in an international market like this. I hope that the Economic Secretary will convey this information to the Chancellor, because I cannot believe that it is fully appreciated. There was a fall in freights about a year ago and the marginal ship, the old ship, was already being laid up. That was the ship which was less efficient and which could not trade at a profit. The result was that tramp owners in particular were waiting to see how the freight market was going to move, before deciding on their future building programmes.

We all regret the war in Korea and all that went with it, but it had a staggering effect on the freight market in the early autumn—with in addition, of course, the effect on the freight market of the handling of the import programme by Government Departments during last winter. We must mention that because it is one of the major factors in the very high rise in freights. No one likes the present high level of freights. However, if we maintain initial allowances on new building it will have the effect, three or four years from now, in constituencies like my own, which are very dependent on shipbuilding, of helping to maintain employment, because shipowners will feel that if they can get the initial allowance and, therefore, their ships written down while freights are good, and if money can be put to reserve a bit of a risk can be taken three, four or five years from now, when we must almost certainly go back to a low freight market always assuming that we avoid war.

Whatever the policy of liner and tanker companies may be, I assure the Chancellor that the policy of a tramp owner has got to be based on building his ship at a period when he hopes he can get some money in the bank to carry him through the depression which is inevitable within the next seven or eight years. That has been the experience through the whole history of shipping; there is an eight to ten year cycle.

Clearly, if the initial allowance can be maintained when freights are good, one can get a margin which will see one through the bad years. Without it, I am convinced that as soon as the excessive demand on world markets disappears with, as we hope, the disappearance of the threat of war, we are bound to slide fairly quickly back into the position where marginal shipping will again be laid up, and there will be no inducement whatever to an owner who has not a lot of money put away to go in for new building at a time when it will be essential to keep our shipyards going.

For these and other reasons, which I will not go into now, I strongly support the Amendment of the right hon. Member for Ormskirk, and I sincerely hope that we shall get some indication from the Chancellor that he will be sympathetic to it before the Bill goes through all its stages.

Mr. Scholefield Allen (Crewe)

I must declare my interest in the Government's Amendment. It is a conflicting interest. As a lawyer, of course, I should be all for ambiguity, but as a legislator I have often been chided by His Majesty's judges about some of the legislation passed in the last six years, and I have been asked what it means. I feel that the phrase which has been criticised on the benches opposite is ambiguous. I refer to the phrase ships actually under construction. I do not want to develop the argument, but I merely express my view that it is an ambiguous phrase, and I think the Government might look into it again, not for the benefit of the lawyers but for the benefit of the Committee as legislators.

Mr. J. Edwards

I think the Committee will appreciate that the fact that the Government have tabled the Amendment is an indication that we recognise shipping to be an exceptional case. The word "unique" has been used, and I should be prepared to accept that as a fair description of the shipping industry. Since this matter was first raised I have, without pretending to any expert knowledge about shipping, been doing my best to understand the essential character of the problem, and I have had the benefit of a discussion with representatives of the General Council of Shipping on the whole matter. I therefore felt that a very large amount of what was said by most hon. Members about the importance of shipping was something which could be accepted on all sides.

What bothered me was that almost everybody—although I would except to some degree the hon. Member for Renfrew, West (Mr. Maclay), and the hon. Member for Abingdon (Sir R. Glyn)—made a leap to another conclusion—the conclusion that the initial allowance ought to be maintained; that shipping is important and, therefore, the initial allowance ought to be maintained. Quite apart from the logic of that, I should have thought that it was precisely that gap in the argument which it was somebody's business to fill up.

The two hon. Members to whom I have referred were the only people who, to any extent, tried to fill the gap. The right hon. Gentleman who opened the discussion burked the whole question. He assumed what it was his duty to try to demonstrate. At no point did he ever come to grips with the problem, which was to show that, if the initial allowances are withdrawn, it is going to mean that the shipbuilding companies are going to be in a position where they will not be able to go on with the ships, they will not be able to fulfil the contracts that have been made, and so on.

The hon. Gentleman on the opposite benches who spoke last did, I think, indicate the character of the problem, and he did it not in any extreme way, as almost everybody else has done. He did it in the most moderate way, and in a way which I accept—that is to say, that the effect of the suspension of these allowances is not something to be thought of as washing out the whole of the contracts, but having a marginal effect in two spheres in particular, namely the small tanker and the small tramp. That seemed to me to be the gap in the right hon. Gentleman's answer. He asserted what I would like him to have demonstrated.

Sir A. Salter

I did not say or suggest that the withdrawal of these allowances would result in cancellations of the contracts that have now been placed or the major part of those contracts. I did imply, and I thought it was common knowledge and recognised by the Government, that the tendency must be to diminish contracts and result in the cancellation of some of the contracts and, indeed, the placing of further contracts. If the initial allowances had no adverse effect of that kind, I do not know why the Government itself have proposed this limited and, I think, quite inadequate Amendment. If I had thought there would be any doubt about the adverse effect on the placing of contracts, I could have quoted. I do not know whether the Economic Secretary has seen the speech of Sir William Curry of the P. & O. reported in today's issue of "The Times." I can refer him, again, to the representative of a great tanker fleet.

Mr. Edwards

I am glad to have the right hon. Gentleman's explanation. I am even more pleased to have some of the actual cases which have been given to me as a result of my inquiries into the matter, and I would not deny that at the margin, the withdrawal of the allowances, especially in the cases I have indicated, could have an effect. I cannot understand why the right hon. Gentleman should be so concerned about the placing of orders in the future. I think we all agree there are orders placed which are certainly going to take all our capacity for three or four years. If I understood what the hon. Member for Govan (Mr. J. N. Browne) was saying, the yards are full for years.

Mr. Browne

Provided there is no cancellation.

Mr. Edwards

I am dealing with the hon. Gentleman's point that he wants freedom for further orders. I have admitted that, marginally, the withdrawal of the allowances would have an effect. But the gap which was not really filled up, and which I respectfully submit that it was his duty to fill up, is that I would have expected him to say, "This is the position of the industry; Here are its accumulated resources—these are the reserves which I expect the industry to be able to accumulate on the basis of present tax levels"—and then, making some reasonable allowance for borrowing, reach a conclusion about how much new shipping industry in fact can cover with its reserves.

4.45 a.m.

That is what I would have expected to happen. Certainly, no one has even begun to demonstrate that the effect of the withdrawal of the initial allowance would have a disastrous effect on the industry. I admit that it would have a marginal effect, but unless the industry is put under a strict inquiry as to its needs, or unless hon. Gentleman who speak for shipping and have a great knowledge of it, can demonstrate the real stress under which the industry is, then I must say I beg leave to express a certain view.

Sir A. Salter

I did not say that it would have a disastrous effect on the shipping industry. I did say that it would tend to reduce the extent to which the British Merchant Marine is now being very fortunately increased. If the hon. Gentleman says that the yards are full for several years what does it matter? I would say what does it matter for his purpose, which is that of protecting the present re-armament programme, if it is only for that period that the initial allowances have that effect when he can always later, if the situation develops, and the Government no longer desire to see the mercantile fleet increased, withdraw the allowance?

Mr. Edwards

That does not get away from the fact that the right hon. Gentleman presented only half a case and he drew an exaggerated conclusion on the basis of no evidence whatever. After all, would it be denied that at the present time shipping is booming, and that profits, on the whole, are high? Would it be denied that freight rates are higher now than they have been for a very long time in real terms and not just money terms? Those are factors which have to be taken into account.

Colonel Hutchison

The hon. Gentleman is not taking into calculation the remarks I made on this theme. He is trying to show that the effect of the cancellation or annulment of the initial allowance is not going to have much of an effect. If it does not, the whole of the Chancellor's purpose is defeated because he is trying to stop capital expenditure which the hon. Gentleman is trying to show will not be affected.

Mr. Edwards

I am not trying to show anything of the kind. I am trying to show that most hon. Gentlemen opposite have presented half a case and that they have exaggerated it. I vastly prefer the case put by the hon. Member for Renfrew, West (Mr. Maclay), which I believe essentially to be the right one.

Mr. Maclay

While I appreciate the polite remarks of the hon. Gentleman, I take a gloomy view of this Clause, and I do not want there to be any misunderstanding about that. I share the views of my hon. Friend, although I tried to fill up some of the obvious difficulties. This thing, over a period, can have serious consequences.

Mr. Edwards

I entirely agree, and I am grateful to the hon. Gentleman for filling the gap. It would have been a pity if the case had not been stated during the whole course of the debate. The state of the industry, after all, is very different from the position when there were no initial allowances for shipping, and hon. Gentlemen opposite have the shortest of memories. They get indignant about changes when only a little while ago—within the memory of all of us—they might have reached a somewhat different conclusion.

One hon. Gentleman—I think the hon. and gallant Gentleman who sits for Scotstoun (Colonel Hutchison)—brought the Millard Tucker report into the argument. I think it will be agreed that it would be a great mistake to take a decision on the basis of that Committee's recommendation because the last thing it would be right for us to do now would be to accept the recommendation, as I said on an earlier Amendment.

Colonel Clarke

This is the second time the hon. Gentleman has raised this point, without producing any argument to prove it. We have no evidence to show why he should know better than the Millard Tucker Committee, which has been considering this matter two years, whereas he has been considering it only about two weeks since he got his brief.

Mr. Edwards

All I am saying is that I do not want to prejudge a complicated matter. But my view coincides with that of the hon. Member for Wirral (Mr. Selwyn Lloyd), who put that point of view on Second Reading. If hon. Gentlemen want to argue that the Millard Tucker is on their side, all right. I am only saying that I cannot accept that as an argument in this' case.

The hon. Member for Renfrew, West, implied that when the initial allowances were introduced, and when they were increased, the implication had been that they were to be permanent. I think that is wrong. Neither the Chancellor of the Exchequer of the time, nor any successive Chancellor as far as I am aware, has ever suggested that this was a permanent part of our tax system. In all these matters we do this year by year. Even if that were the case, it would not constitute an argument in favour of the total exclusion of shipping from the proposal in the Finance Bill. It would constitute an argument in respect of contracts made before Budget day.

While I feel bound to reject the claim for total exclusion, I shall be very interested, when we come to the following Amendments, to hear what hon. Members have to say on this point of the contracts, and I may then be able to be a little more helpful. It is a pity that we are not discussing all these together, but since we are not I had better content myself with the reasons against total exclusion and reserve my remarks on the contract point till we get to the Amendments.

Mr. Lyttelton

I would like to begin by complimenting the Economic Secretary at this hour for complaining that the argument had not been fully developed. That was a capital statement. If the argument has not been fully developed, the reason is that the whole show has been given away by the Chancellor. He said, on 10th April— The importance of this proposal lies, therefore, as I hope the Committee appreciate, not in the yield to the Exchequer but in the effect which I judge it will have on the placing of orders for capital equipment."—[OFFICIAL REPORT, 10th April, 1951; Vol. 485, c. 843. That means the Chancellor is doing this because he thinks it will lead to the cancellation of orders for capital equipment.

The second point I want to make is that, all through, the excuse advanced from the Treasury Bench for not doing anything whatever about anything is that we cannot do it because of the re-armament programme. That is a double-edged argument when it comes to shipping. It recoils on the Government, because there is nothing more important to the defence of this island than a balanced mercantile marine. I thought when my hon. and gallant Friend the Member for Carshalton (Brigadier Head) was developing this case that I saw a great deal of argument opposite to what he was saying.

All of us who had something to do with the running of the war know that this matter of fast merchant ships became a supreme importance. One would have expected the Treasury Bench to develop the argument that they are sympathetic to this Amendment because they regard these proposals as an integral and important part of the re-armament programme and, therefore, fall outside those concessions for which the Opposition have so far asked. I do not think we can exaggerate the defence aspect of this problem. I believe it would be true to say that there has been an over-construction of tanker tonnage since the war.

We wish now to build a more balanced Merchant Navy, and this is the moment when the decisions have to be taken. I would point out to the Committee that we are dealing only with a concession given by the Chancellor to ships under construction. Obviously, and the Chancellor agrees with this, that the contracts for these ships will be cancelled in a certain number of cases, which means that over a period of five or six years the possibility of reaching a balanced Merchant Navy will be greatly hampered.

The Committee will know the large contributions that invisible exports made in restoring the position of our balance of payments last year. Shipping is perhaps the most desirable of all invisible exports, perhaps more desirable than banking and insurance, because if we are carrying a large portion of world trade, we are getting insurance and banking business as a result of the carrying trade. I do not want to develop the argument about invisible exports at this witching hour, but time and again the Government seem to be less anxious about invisible exports than I think they should be.

The Economic Secretary said that nobody had a right to count on this allowance for ever. I agree with him there. I do not think that any shipowner or shipbuilder regards any of the promises of any Government as permanent in all circumstances. But that is not a good answer to sweeping away to nothing in one day of a 40 per cent. initial allowance.

It would have been serious if the initial allowance had been cut, but to do away with it altogether and give only one year's notice in an industry in which the period of gestation, if I may so put it, is very long, and in which contracts have to be placed for delivery four and five years ahead, is a typical Whitehall attitude towards industry. Industry cannot carry on when a major factor in their whole programme is subject to these violent changes, which have been extremely mercurial over the last few years.

I conclude by saying that the Chancellor has told us he expects the result of the cancellation of initial allowances to be the cancellation of a large number of contracts for capital equiup- ment, so it is quite unnecessary to argue that effect. I take words out of the Chancellor's mouth. That is the main point I wish to make. The right hon. Gentleman also said that it was necessary to take action now to restrain investment in 1952 and later years. That is why my hon. Friend did not think it fit to develop that argument as far as he would have liked. The Economic Secretary said he would be glad to receive instances. In Parliamentary language that usually means he is prepared to look at this again. If so, between now and the Report stage we will take action to procure for him information

that will make good his depleted and imperfect knowledge.

Several Hon. Members rose—

The Deputy-Chairman

I think we might come to a decision now. We have had a long debate.

Several Hon. Membersrose—

Mr. R. J. Taylor (Lord Commissioner of the Treasury) rose in his place, and claimed to move, "That the Question be now put."

Question put, "That the Question be now put."

The House divided: Ayes, 291; Noes, 276.

Division No. 95.]	AYES	[5.0 a.m.
Acland, Sir Richard	Davies, A. Edward (Stoke, N.)	Hewitson, Capt. M.
Adams, Richard	Davies, Harold (Leek)	Hobson. C. R.
Albu, A. H.	Davies, Stephen (Merthyr)	Holman, P.
Allen, Arthur (Bosworth)	de Freitas, Geoffrey	Holmes, Horace (Hemsworth)
Allen, Scholefield (Crewe)	Deer, G.	Houghton, D.
Anderson, Alexander (Motherwell)	Delargy, H. J.	Hoy, J.
Anderson, Frank (Whitehaven)	Dodds, N. N.	Hubbard, T.
Attlee, Rt. Hon. C. R.	Donnelly, D.	Hudson, James (Ealing, N.)
Awbery, S. S.	Driberg, T. E. N.	Hughes, Entrys (S. Ayrshire)
Ayles, W. H.	Dugdale, Rt. Hon. John (W. Bromwich)	Hughes, Hector (Aberdeen, N.)
Bacon, Miss. Alice	Dye, S.	Hynd, H. (Accrington)
Baird, J.	Ede, Rt. Hon. J. C.	Hynd, J. B. (Attercliffe)
Balfour, A.	Edelman, M.	Irvine, A. J. (Edge Hill)
Barnes, Rt. Hon. A. J.	Edwards, John (Brighouse)	Irving, W. J. (Wood Green)
Bartley, P.	Edwards, Rt. Hon. Ness (Caerphilly)	Isaacs, Rt. Hon. G. A.
Bellenger, Rt. Hon. F. J.	Edwards, W. J. (Stepney)	Janner, B.
Benn, Wedgwood	Evans, Albert (Islington, S. W.)	Jay, D. P. T.
Benson, G.	Evans, Edward (Lowestoft)	Jeger, George (Goole)
Beswick, F.	Evans, Stanley (Wednesbury)	Jeger, Dr. Santo (St. Panoras, S.)
Bevan, Rt. Hon. A. (Ebbw Vale)	Ewart, R.	Jenkins, R. H.
Bing, G. H. C.	Fernyhough, E.	Johnson, James (Rugby)
Blenkinsop, A.	Field, Capt. W. J.	Johnston, Douglas (Paisley)
Blyton, W. R.	Finch, H. J.	Jones, David (Hartlepool)
Boardman, H.	Fletcher, Eric (Islington, E.)	Jones, Frederick Elwyn (West Ham, S.)
Booth, A.	Follick, M.	Jones, Jack (Rotherham)
Bottomley, A. G.	Foot, M. M.	Jones, William Elwyn (Conway)
Bowden, H. W.	Forman, J. C.	Keenan, W.
Bowles, F. G. (Nuneaton)	Fraser, Thomas (Hamilton)	Kenyan, C.
Braddock, Mrs. Elizabeth	Freeman, John (Watford)	Key, Rt. Hon. C. W.
Brook, Dryden (Halifax)	Freeman, Peter (Newport)	King, Dr. H. M.
Brooks, T. J. (Normanton)	Gaitskell, Rt. Hon. H. T. N.	Kinghorn, Sqn. Ldr. E.
Broughton, Dr. A. D. D.	Ganley, Mrs. C. S.	Kinley, J.
Brown, Rt. Hon. George (Belper)	Gibson, C. W.	Lang, Gordon
Brown, Thomas (Ince)	Gilzean, A.	Lee, Frederick (Newton)
Burke, W. A.	Glanville, James (Consett)	Lee, Miss. Jennie (Cannock)
Burton, Miss. E.	Gooch, E. G.	Lever, Leslie (Ardwick)
Butler, Herbert (Hackney, S.)	Gordon-Walker, Rt. Hon. P. C.	Lewis, Arthur (West Ham, N.)
Caffaghan, L. J.	Greenwood, Anthony (Rossendale)	Lewis, John (Bolton, W.)
Carmichael, J.	Greenwood, Rt. Hon. Arthur (Wakefield)	Lindgren, G. S.
Castle, Mrs. B. A.	Grenfell, D. R.	Lipton, Lt.-Col. M.
Champion, A. J.	Grey, C. F.	Logan, D. G.
Chetwynd, G. R.	Griffiths, David (Rother Valley)	Longden, Fred (Small Heath)
		McAllister, G.
Clunie, J.	Griffiths, Rt. Hon. James (Llanlly)	MacColl, J. E.
Cocks, F. S.	Griffiths, William (Exchange)	McGhee, H. G.
Coldrick, W.	Gunter, R. J.	McInnes, J.
Collindridge, F.	Hale, Joseph (Rochdale)	Mack, J. D.
Cook, T. F.	Hale, Leslie (Oldham, W.)	McKay, John (Wallsend)
Cooper, Geoffrey (Middlesbrough, W.)	Hall, John (Gateshead, W.)	Mackay, R. W. G. (Reading, N.)
Cooper, John (Deptford)	Hall, Rt. Hon. Glenvil (Colne Valley)	McLeavy, F.
Corbet, Mrs. Freda (Peckham)	Hamilton, W. W.	MacMillan, Malcolm (Western Isles)
Cove, W. G.	Hannan, W.	McNeil, Rt. Hon. H.
Craddock, George (Bradford, S.)	Hardman, D. R.	MacPherson, Malcolm (Stirling)
Crawley, A.	Hardy, E. A.	Mainwaring, W. H.
Crosland, C. A. R.	Hargreaves, A.	Mallalieu, E. L. (Brigg)
Crossman, R. H. S.	Hastings, S.	Mallalieu, J. P. W. (Huddersfield, E.)
Cullen, Mrs. A.	Hayman, F. H.	Mann, Mrs. Jean
Dalton, Rt. Hon. H.	Henderson, Rt. Hon. A. (Rowley Regis)	Manuel, A. C.
Darling, George (Hillsborough)	Herbison, Miss. M.	Marquand, Rt. Hon. H. A.
Mathers, Rt. Hon. G.	Rees, Mrs. D.	Timmons, J.
Mellish, R. J.	Reeves, J.	Tomney, F.
Messer, F.	Reid, Thomas (Swindon)	Turner-Samuels, M.
Middleton, Mrs. L.	Reid, William (Camlachie)	Ungoed-Thomas, Sir Lynn
Mikardo, Ian	Rhodes, H.	Usborne, H.
Mitchison, G. R.	Richards, R.	Vernon, W. F.
Moeran, E. W.	Roberts, Rt. Hon. A.	Viant, S. P.
Monslow, W.	Roberts, Goronwy (Caernarvonshire)	Wallace, H. W.
Moody, A. S.	Robertson, J. J. (Berwick)	Watkins, T. E.
Morgan, Dr. H. B.	Rogers, George (Kensington, N.)	Webb, Rt. Hon. M. (Bradford, C.)
Morley, R.	Ross, William (Kilmarnock)	Weitzman, D.
Morris, Percy (Swansea, W.)	Royle, C.	Wells, Percy (Faversham)
Mort, D. L.	Shawcross, Rt. Hon. Sir Hartley	Wells, William (Walsall)
Moyle, A.	Shinwell, Rt. Hon. E.	West, D. G.
Mulley, F. W.	Shurmer, P. L. E.	Wheatley, Rt. Hn. John (Edinb'gh, E.)
Murray, J. D.	Silverman, Julius (Erdington)	White, Mrs. Eirene (E. Flint)
Nally, W.	Silverman, Sydney (Nelson)	White, Henry (Derbyshire, N. E.)
Neal, Harold (Bolsover)	Simmons, C. J.	Whiteley, Rt. Hon. W.
Noel-Baker, Rt. Hon. P. J.	Slater, J.	Wilcock, Group Capt. C. A. B.
O'Brien, T.	Smith, Ellis (Stoke, S.)	Wilkes, L.
Oldfield, W. H.	Smith, Norman (Nottingham, S.)	Wilkins, W. A.
Oliver, G. H.	Sorensen, R. W.	Willey, Frederick (Sunderland)
Orbach, M.	Soskice, Rt. Hon. Sir Frank	Willey, Octavius (Cleveland)
Padley, W. E.	Sparks, J. A.	Williams, David (Neath)
Paget, R. T.	Steele, T.	Williams, Rev. Llywelyn (Abertillery)
Paling, Rt. Hon. Wilfred (Dearne Vally)	Stewart, Michael (Fulham, E.)	Williams, Ronald (Wigan)
Paling, Will T. (Dewsbury)	Stokes, Rt. Hon. R. R.	Williams, Rt. Hon. Thomas (Don Valley)
Pannell, T. C.	Strachey, Rt. Hon. J.	Williams, W. T. (Hammersmith, S.)
Pargiter, G. A.	Strauss, Rt. Hon. George (Vauxhall)	Wilson, Rt. Hon. Harold (Huyton)
Parker, J.	Stross, Dr. Barnett	Winterbottom, Ian (Nottingham, C.)
Paton, J.	Summerskill, Rt. Hon. Edith	Winterbottom, Richard (Brightside)
Pearson, A.	Sylvester, G. O.	Wise, F. J.
Peart, T. F.	Taylor, Bernard (Mansfield)	Woodburn, Rt. Hon. A.
Poole, C.	Taylor, Robert (Morpeth)	Wyatt, W. L.
Porter, G.	Thomas, David (Aberdare)	Yates, V. F.
Price, Philips (Gloucestershire, W.)	Thomas, George (Cardiff)	Younger, Hon. K.
Proctor, W. T.	Thomas, Iorwerth (Rhondda, W.)
Pryde, D. J.	Thomas, Ivor Owen (Wrekin)	TELLERS FOR THE AYES:
Pursey, Cmdr. H.	Thorneycroft, Harry (Clayton)	Mr. Popplewell and
Rankin, J.	Thurtle, Ernest	Mr. Kenneth Robinson.
NOES
Aitken, W. T.	Churchill, Rt. Hon. W. S.	Gage, C. H.
Alport, C. J. M.	Clarke, Col. Ralph (East Grinstead)	Galbraith, Cmdr. T. D. (Pollok)
Amery, Julian (Preston, N.)	Clarke, Brig. Terence (Portsmouth, W.)	Galbraith, T. G. D. (Hillhead)
Amory, Heathcoat (Tiverton)	Colegate, A.	Garner-Evans, E. H. (Denbigh)
Arbuthnot, John	Conant, Maj. R. J. E.	Gates, Maj. E. E.
Ashton, H. (Chelmsford)	Cooper, Sqn. Ldr. Albert (Ilford, S.)	Glyn, Sir Ralph
Assheton, Rt. Hon. R. (Blackburn, W.)	Cooper-Key, E. M.	Gomme-Duncan, Col. A.
Astor, Hon. M. L.	Corbett, Lt.-Col. Uvedale (Ludlow)	Gridley, Sir Arnold
Baker, P. A. D.	Craddock, Beresford (Spelthorne)	Grimond, J.
Baldwin, A. E.	Cranborne, Viscount	Grimston, Hon. John (St. Albans)
Banks, Col. C.	Crookshank, Capt. Rt. Hon. H. F. C.	Grimston, Robert (Westbury)
Baxter, A. B.	Crosthwaite-Eyre, Col. O. E.	Harden, J. R. E.
Beamish, Major Tufton	Crouch, R. F.	Hare, Hon. J. H. (Woodbridge)
Bell, R. M.	Crowder, Capt. John (Finchley)	Harris, Frederic (Croydon, N.)
Bennett, Sir Peter (Edgbaston)	Crowder, Petre (Ruislip—Northwood)	Harris, Reader (Heston)
Bennett, William (Woodside)	Cundiff, F. W.	Harvey, Air Cdre. A. V. (Macclesfield)
Bevins, J. R. (Liverpool, Toxteth)	Cuthbert, W. N.	Harvey, Ian (Harrow, E.)
Birch, Nigel	Darling, Sir William (Edinburgh, S.)	Harvie-Watt, Sir George
Bishop, F. P.	Davidson, Viscountess	Hay, John
Black, C. W.	Davies, Nigel (Epping)	Head, Brig. A. H.
Boles, Lt.-Col. D. C. (Wells)	de Chair, Somerset	Headlam, Lieut.-Col. Rt. Hon. Sir C.
Boothby, R.	Do la Bère, R.	Heald, Lionel
Bossom, A. C.	Deedes, W. F.	Heath, Edward
Bowen, E. R. (Cardigan)	Digby, S. W.	Henderson, John (Cathcart)
Boyd-Carpenter, J. A.	Dodds-Parker, A. D.	Hicks-Beach, Maj. W. W.
Boyle, Sir Edward	Donner, P. W.	Higgs, J. M. C.
Bracken, Rt. Hon. B.	Drayson, G. B.	Hill, Mrs. E. (Wythenshawe)
Braine, B. R.	Dugdale, Maj. Sir Thomas (Richmond)	Hill, Dr. Charles (Luton)
Braithwaite, Sir Albert (Harrow, W.)	Duncan, Capt. J. A. L.	Hinchingbrooke, Viscount
Braithwaite, Lt.-Cr. G. (Bristol, N. W.)	Dunglass, Lord	Hirst, Geoffrey
Bromley-Davenport, Lt.-Col. W.	Duthie, W. S.	Holmes, Sir Stanley (Harwich)
Brooke, Henry (Hampstead)	Eccles, D. M.	Hope, Lord John
Browne, Jack (Govan)	Eden, Rt. Hon. A.	Hopkinson, Henry
Buchan-Hepburn, P. G. T.	Elliot, Rt. Hon. W. E.	Hornsby-Smith, Miss. P.
Bullock, Capt. M.	Erroll, F. J.	Horsbrugh, Rt. Hon. Florence
Bullus, Wing Commander E. E.	Fisher, Nigel	Howard, Gerald (Cambridgeshire)
Burden, F. A.	Fletcher, Walter (Bury)	Howard, Greville (St. Ives)
Butcher, H. W.	Fort, R.	Hudson, Sir Austin (Lowisharm, N.)
Butler, Rt. Hon. R. A. (Saffron Walden)	Foster, John	Hudson, Rt. Hon. Robert (Southport)
Carr, Robert (Mitcham)	Fraser, Hon. Hugh (Stone)	Hudson, W. R. A. (Hull, N.)
Carson, Hon. E.	Fraser, Sir Ian (Morecambe & Lonsdale)	Hutchinson, Geoffrey (Ilford, N.)
Channon, H.	Fyfe, Rt. Hon. Sir David Maxwell	Hutchison, Lt.-Com. Clark (E'b'rgh W.)

Hutchison, Colonel James (Glasgow)	Mellor, Sir John	Spearman, A. C. M.
Hyde, Lt.-Col. H. M.	Molson, A. H. E.	Spence, H. R. (Aberdeenshire, W.)
Hylton-Foster, H. B.	Monckton, Sir Walter	Spens, Sir Patrick (Kensington, S.)
Jennings, R.	Moore, Lt.-Col. Sir Thomas	Stanley, Capt. Hon. Richard (N. Fylde)
Johnson, Howard (Kemptown)	Morrison, John (Salisbury)	Stevens, G. P.
Jones, A. (Hall Green)	Morrison, Rt. Hon. W. S. (Cirencester)	Steward, W. A. (Woolwich, W.)
Joynson-Hicks, Hon. L. W.	Mott-Radclyffe, C. D.	Stewart, Henderson (Fife, E.)
Kaberry, D.	Nabarro, G.	Stoddart-Scott, Col. M.
Kerr, H. W. (Cambridge)	Nicholls, Harmar	Storey, S.
Kingsmill, Lt.-Col. W. H.	Nicholson, G.	Strauss, Henry (Norwich, S.)
Lambert, Hon. G.	Nield, Basil (Chester)	Stuart, Rt. Hon. James (Moray)
Lancaster, Col. C. G.	Noble, Cmdr. A. H. P.	Summers, G. S.
Langford Holt, J.	Nugent, G. R. H.	Sutcliffe, H.
Law, Rt. Hon. R. K.	Nutting, Anthony	Taylor, Charles (Eastbourne)
Leather, E. H. C.	Oakshott, H. D.	Taylor, William (Bradford, N.)
Legge-Bourke, Maj. E. A. H.	Odey, G. W.	Teeling, W.
Lennox-Boyd, A. T.	O'Neill, Rt. Hon. Sir Hugh	Teevan, T. L.
Lindsay, Martin	Ormsby-Gore, Hon. W. D.	Thomas, J. P. L. (Hereford)
Linstead, H. N.	Orr, Capt. L. P. S.	Thompson, Kenneth Pugh (Walton)
Llewellyn, D.	Orr-Ewtng, Ian L. (Weston-super-Mare)	Thompson, R. H. M. (Croydon, W.)
Lloyd, Rt. Hn. Geoffrey (King's Norton)	Osborne, C.	Thorneycroft, Peter (Monmouth)
Lloyd, Maj. Guy (Renfrew, E.)	Peake, Rt. Hon. O.	Thornton-Kemsley, Col. C. N.
Lloyd, Selwyn (Wirral)	Perkins, W. R. D.	Thorp, Brig. R. A. F.
Lockwood, Lt.-Col. J. C.	Peto, Brig. C. H. M.	Tilney, John
Longden, Gilbert (Herts, S. W.)	Pickthorn, K.	Turner, H. F. L.
Low, A. R. W.	Pitman, I. J.	Turton, R. H.
Lucas, Sir Jocelyn (Portsmouth, S.)	Powell, J. Enoch	Tweedsmuir, Lady
Lucas, P. B. (Brentford)	Price, Henry (Lewisham, W.)	Vane, W. M. F.
Lucas-Tooth, Sir Hugh	Prior-Palmer, Brig. O.	Vaughan-Mergan, J. K.
Lyttelton, Rt. Hon. O.	Raikes, H. V.	Vosper, D. F.
McAdden, S. J.	Rayner, Brig. R.	Wakefield, Edward (Derbyshire, W.)
McCorquodale, Rt. Hon. M. S.	Redmayne, M.	Wakefield, Sir Wavell (Marylebone)
Macdonald, Sir Peter (I. of Wight)	Remnant, Hon. P.	Walker-Smith, D. C.
McKibbin, A.	Renton, D. L. M.	Ward, Hon. George (Worcester)
McKie, J. H. (Galloway)	Roberts, Major Peter (Heeley)	Ward, Miss. I. (Tynemouth)
Maclay, Hon. John	Robertson, Sir David (Caithness)	Waterhouse, Capt. Rt. Hon. C.
Maclean, Fitzroy	Robinson, Roland (Blackpool, S.)	Watkinson, H.
MacLeod, Iain (Enfield, W.)	Robson-Brown, W. (Esher)	Webbe, Sir H. (London)
MacLeod, John (Ross and Cromarty)	Rodgers, John (Sevenoaks)	White, Baker (Canterbury)
Macmillan, Rt. Hon. Harold (Bromley)	Roper, Sir Harold	Williams, Charles (Torquay)
MacPherson, Major Niall (Dumfries)	Ropner, Col. L.	Williams, Gerald (Tonbridge)
Maitland, Cmdr. J. W.	Russell, R. S.	Williams, Sir Herbert (Croydon, E.)
Manningham-Buller, R. E.	Ryder, Capt. R. E. D.	Wills, G.
Marlowe, A. A. H.	Salter, Rt. Hon. Sir Arthur	Wilson, Geoffrey (Truro)
Marples, A. E.	Scott, Donald	Winterton, Rt. Hon. Earl
Marshall, Douglas (Bodmin)	Shepherd, William	Wood, Hon. R.
Marshall, Sidney (Sutton)	Smiles, Lt.-Col. Sir Walter	York, C.
Maude, Angus (Ealing, S.)	Smithers, Peter (Winchester)
Maude, John (Exeter)	Smyth, Brig. J. G. (Norwood)	TELLERS FOR THE NOES:
Maudling, R.	Snadden, W. McN	Mr. Studholme and Major Wheatley.
Medlicott, Brig. F.	Soames, Capt. C.

Question put accordingly, "That the words proposed to be left out to the word 'to' in line 1, stand part of the proposed Amendment."

The Committee divided: Ayes, 291; Noes, 281.

Division No. 96.]	AYES	[5.13 a.m.
Acland, Sir Richard	Bottomley, A. G.	Cove, W. G.
Adams, Richard	Bowden, H. W.	Craddock, George (Bradford, S.)
Albu, A. H.	Bowles, F. G. (Nuneaton)	Crawley, A.
Allen, Arthur (Bosworth)	Braddock, Mrs. Elizabeth	Crosland, C. A. R.
Allen, Scholefield (Crewe)	Brook, Dryden (Halifax)	Crossman, R. H. S.
Anderson, Alexander (Motherwell)	Brooks, T. J. (Normanton)	Cullen, Mrs. A.
Anderson, Frank (Whitehaven)	Broughton, Dr. A. D. D.	Danies, P.
Attlee, Rt. Hon. C. R.	Brown, Rt. Hon. George (Belper)	Dalton, Rt. Hon. H.
Awbery, S. S.	Brown, Thomas (Ince)	Darling, George (Hillsborough)
Ayles, W. H.	Burke, W. A.	Davies, A. Edward (Stoke, N.)
Bacon, Miss. Alice	Burton, Miss. E.	Davies, Harold (Leek)
Baird, J.	Butler, Herbert (Hackney, S.)	Davies, Stephen (Merthyr)
Balfour, A.	Callaghan, L. J.	de Freitas, Geoffrey
Barnes, Rt. Hon. A. J.	Carmichael, J.	Deer, G.
Bartley, P.	Castle, Mrs. B. A.	Delargy, H. J.
Bellenger, Rt. Hon. F. J.	Champion, A. J.	Dodds, N. N.
Benn, Wedgwood	Chetwynd, G. R.	Donnelly, D.
Benson, G.	Clunie, J.	Driberg, T. E. N.
Beswick, F.	Cocks, F. S.	Dugdale, Rt. Hon. John (W. Bromwich)
Bevan, Rt. Hon. A. (Ebbw Vale)	Coldrick, W.	Dye, S.
Bing, G. H. C.	Collindridge, F.	Ede, Rt. Hon. J. C.
Blenkinsop, A.	Cook, T. F.	Edelman, M.
Blyton, W. R.	Cooper, Geoffrey (Middlesbrough, W.)	Edwards, John (Brighouse)
Boardman, H.	Cooper, John (Deptford)	Edwards, Rt. Hon. Ness (Caerphilly)
Booth, A.	Corbet, Mrs. Freda (Peckham)	Edwards, W. J. (Stepney)
Evans, Albert (Islington, S. W.)	Lang, Gordon	Roberts, Goronwy (Caernarvonshire)
Evans, Edward (Lowestoft)	Lee, Frederick (Newton)	Robertson, J. J. (Berwick)
Evans, Stanley (Wednesbury)	Lee, Miss. Jennie (Cannock)	Rogers, George (Kensington, N.)
Ewart, R.	Lever, Leslie (Ardwick)	Ross, William (Kilmarnock)
Fernyhough, E.	Lewis, Arthur (West Ham, N.)	Royle, C.
Field, Capt. W. J.	Lewis, John (Bolton, W.)	Shawcross, Rt. Hon. Sir Hartley
Finch, H. J.	Lindgren, G. S.	Shinwell, Rt. Hon. E.
Fletcher, Eric (Islington, E.)	Lipton, Lt.-Col. M.	Shurmer, P. L. E.
Follick, M.	Logan, D. G.	Silverman, Julius (Erdington)
Foot, M. M.	Longden, Fred (Small Heath)	Silverman, Sydney (Nelson)
Forman, J. C.	McAllister, G.	Simmons, C. J.
Fraser, Thomas (Hamilton)	MacColl, J. E.	Slater, J.
Freeman, John (Watford)	McGhee, H. G.	Smith, Ellis (Stoke, S.)
Freeman, Peter (Newport)	McInnes. J.	Smith, Norman (Nottingham, D.)
Gaitskell, Rt. Hon. H. T. N.	Mack, J. D.	Sorensen, R. W.
Ganley, Mrs. C. S.	McKay, John (Wallsend)	Soskice, Rt. Hon. Sir Frank
Gibson, C. W.	Mackay, R. W. G. (Reading, N.)	Sparks, J. A.
Gilzean, A.	McLeavy, F.	Steele, T.
Glanville, James (Consett)	MacMillan, Malcolm (Western Isles)	Stewart, Michael (Fulham, R.)
Gooch, E. G.	McNeil, Rt. Hon. H.	Stokes, Rt. Hon. R. R.
Gordon-Walker, Rt. Hon. P. C.	MacPherson, Malcolm (Stirling)	Strachey, Rt. Hon. J.
Greenwood, Anthony (Rossendale)	Mainwaring, W. H.	Strauss, Rt. Hon. George (Vauxhall)
Greenwood, Rt. Hon. Arthur (Wakefield)	Mallalieu, E. L. (Brigg)	Stross, Dr. Barnett
Grenfell, D. R.	Mallalieu, J. P. W. (Huddersfield, E.)	Summerskill, Rt. Hon. Edith
Grey, C. F.	Mann, Mrs. Jean	Sylvester, G. D.
Griffiths, David (Rother Valley)	Manuel, A. C.	Taylor, Bernard (Mansfield)
Griffiths, Rt. Hon. James (Llanelly)	Marquand, Rt. Hon. H. A.	Taylor, Robert (Morpeth)
Griffiths, William (Exchange)	Mathers, Rt. Hon. G.	Thomas, David (Aberdare)
	Mellish, R. J.	Thomas, George (Cardiff)
Gunter, R. J.	Messer, F.	Thomas, Iorwerth (Rhondda, W.)
Hale, Joseph (Rochdale)	Middleton, Mrs. L.	Thomas, Ivor Owen (Wrekin)
Hale, Leslie (Oldham, W.)	Mikardo, Ian	Thorneycroft, Harry (Clayton)
Hall, John (Gateshead, W.)	Mitchison, G. R.	Thurtle, Ernest
Hall, Rt. Hon. Glenvil (Colne Valley)	Moeran, E. W.	Timmons, J.
Hamilton, W. W.	Monslow, W.	Tomney, F.
Hannan, W.	Moody, A. S.	Turner-Samuels, M.
Hardman, D. R.	Morgan, Dr. H. B.	Ungoed-Thomas, Sir Lynn
Hardy, E. A.	Morley, R.	Usborne, H.
	Morris, Percy (Swansea, W.)	Vernon, W. F.
Hargreaves, A.	Mort, D. L.	Viant, S. P.
Hastings, S.	Moyle, A.	Vosper, D. F.
Hayman, F. H.	Mulley, F. W.	Wallace, H. W.
Henderson, Rt. Hon. A. (Rowley Regis)	Murray, J. T.	Waikins, T. E.
Herbison, Miss. M.	Nally, W.	Webb, Rt. Hon. M. (Bradford, C.)
Hewitson, Capt. M.	Neal, Harold (Bolsover)	Weitzman, D.
Hobson, C. R.	Noel-Baker, Rt. Hon. P. J.	Wells, Percy (Faversham)
Holman, P.	O'Brien, T.	Wells, William (Walsall)
Holmes, Horace (Hemsworth)	Oldfield, W. H.	West, D. G.
Houghton, D.		Wheatley, Rt. Hn. John (Edinb'gh, E.)
Hoy, J.	Oliver, G. H.	White, Mrs. Eirene (E. Flint)
Hubbard, T.	Orbach, M.	White, Henry (Derbyshire. N. E.)
Hudson, James (Ealing, N.)	Padley, W. E.	Whiteley, Rt. Hon. W.
Hughes, Emrys (S. Ayrshire)	Paget, R. T.	Wigg, G.
Hughes, Hector (Aberdeen, N.)	Paling, Rt. Hon. Wilfred (Dearne Vally)	Wilcock, Group Capt. C. A. R.
Hynd, H, (Accrington)	Paling, Will T. (Dewsbury)	Wilkes, L.
Hynd, J. B. (Attercliffe)	Pannell, T. C.	Wilkins, W. A.
Irvine, A, J. (Edge Hill)	Pargiter, G. A.	Willey, Frederick (Sunderland)
Irving, W. J. (Wood Green)	Parker, J.	Willey, Octavius (Cleveland)
Isaacs, Rt. Hon. G. A.	Paton, J.	Williams, David (Neath)
Janner, B.	Pearson, A.	Williams, Rev. Llywelyn (Abertillery)
Jay, D. P. T.	Peart, T. F.	Williams, Ronald (Wigan)
Jeger, George (Goole)	Poole, C.	Williams, Rt. Hon. Thomas (Don Valley)
Jenkins, R. H.	Porter, G.	Williams, W. T. (Hammersmith, S.)
Johnson, James (Rugby)	Price, Philips (Gloucestershire, W.)	Wilson, Rt. Hon. Harold (Huyton)
Johnston, Douglas (Paisley)	Proctor, W. T.	Winterbottom, Ian (Nottingham, C.)
Jones, David (Hartlepool)	Pryde, D. J.	Winterbottom, Richard (Brightside)
Jones, Frederick Elwyn (West Ham, S.)	Pursey, Cmdr. H.	Wise, F. J.
Jones, Jack (Rotherham)	Rankin, J.	Woodburn, Rt. Hon. A.
Jones, William Elwyn (Conway)	Rees, Mrs. D.	Wyatt, W. L.
Keenan, W.	Reeves, J.	Yates, V. F.
Kenyon, C.	Reid, Thomas (Swindon)	Younger, Hon. K.
Key, Rt. Hon. C. W.	Reid, William (Camlachie)
King, Dr. H. M.	Rhodes, H.	TELLERS FOR THE AYES:
Kinghorn, Sqn. Ldr. E.	Richards, R.	Mr. Popplewell and
Kinley, J.	Robens, Rt. Hon. A.	Mr. Kenneth Robinson.
NOES
Aitken, W. T.	Baldock, Lt.-Cmdr. J. M.	Bevins, J. R. (Liverpool, Toxteth)
Alport, C. J. M.	Baldwin, A. E.	Birch, Nigel
Amery, Julian (Preston, N.)	Banks, Col. C.	Bishop, F. P.
Amory, Heathcoat (Tiverton)	Baxter, A. B.	Black, C. W.
Arbuthnot, John	Beamish, Major Tufton	Boles, Lt.-Col. D. C. (Wells)
Ashton, H. (Chelmsford)	Bell, R. M.	Boothby, R.
Assheton, Rt. Hon. R. (Blackburn, W.)	Bennett, Sir Peter (Edgbaston)	Bossom, A. C.
Astor, Hon. M. L.	Bennett, Dr. Reginald (Gosport)	Bowen, E. R. (Cardigan)
Baker, P. A. D.	Bennett, William (Woodside)	Boyd-Carpenter J. A.

Boyle, Sir Edward	Higgs, J. M. C.	Ormsby-Gore, Hon. W. D.
Bracken, Rt. Hon. B.	Hill, Mrs. E. (Wythenshawe)	Orr, Capt. L. P. S.
Brains, B. R.	Hill, Dr. Charles (Luton)	Orr-Ewing, Charles Ian (Hendon, N.)
Braithwaite, Sir Albert (Harrow, W.)	Hinchingbrooke, Viscount	Orr-Ewing, Ian L. (Weston-super-Mare)
Braithwaite, Lt.-Cr. G. (Bristol, N. W.)	Hirst, Geoffrey	Osborne, C.
Bromley-Davenport, Lt.-Col. W.	Holmes, Sir Stanley (Harwich)	Peake, Rt. Hon. O.
Brooke, Henry (Hampstead)	Hope, Lord John	Perkins, W. R. D.
Browne, Jack (Govan)	Hopkinson, Henry	Peto, Brig. C. H. M.
Buchan-Hepburn, P. G. T.	Hornsby-Smith, Miss. P.	Pickthon, K.
Bullock, Capt. M.	Horsbrugh, Rt. Hon. Flare-nee	Pitman, I. J.
Bullus, Wing Commander E. E.	Howard, Gerald (Cambridgeshire)	Powell, J. Enoch
Burden, F. A.	Howard, Greville (St. Ives)	Price, Henry (Lewisham, W.)
Butcher, H. W.	Hudson, Sir Austin (Lewisham, N.)	Prior-Palmer, Brig. O.
Butler, Rt. Hon. R. A. (Saffron Walden)	Hudson, Rt. Hon. Robert (Southport)	Profumo, J. D.
Carr, Robert (Mitcham)	Hudson, W. R. A. (Hull, N.)	Raikes, H. V.
Carson, Hon. E.	Hutchinson, Geoffrey (Ilford, N.)	Rayner, Brig. R.
Channon, H.	Hutchison, Lt.-Com. Clark (E'b'rghW.)	Redmayne, M.
Churchill, Rt. Hon. W. S.	Hutchison, Colonel James (Glasgow)	Remnant, Hon. P.
Clarke, Col. Ralph (East Grinstead)	Hyde, Lt.-Col. H. M.	Renton, D. L. M.
Clarke, Brig. Terence (Portsmouth, W.)	Hylton-Foster, H. B.	Roberts, Major Peter (Heeley)
Colegate, A.	Jennings, R.	Robertson, Sir David (Caithness)
Conant, Maj. R. J. E.	Johnson, Howard (Kemptown)	Robinson, Roland (Blackpool, S.)
Cooper, Sqn. Ldr. Albert (Ilford, S.)	Jones, A. (Hall Green)	Robson-Brown, W.
Cooper-Key, E. M.	Joynson-Hicks, Hon. L. W.	Rodgers, John (Sevenoaks)
Corbett, Lt.-Col. Uvedale (Ludlow)	Kaberry, D.	Roper, Sir Harold
Craddock, Beresford (Spelthorne)	Kerr, H. W. (Cambridge)	Ropner, Col. L.
Cranborne, Viscount	Kingsmill, Lt.-Col. W. H.	Russell, R. S.
Crookshank, Capt. Rt. Hon. H. F. C.	Lambert, Hon. G.	Ryder, Capt. R. E. D.
Crosthwaite-Eyre, Col. O. E.	Lancaster, Col. C. G.	Salter, Rt. Hon. Sir Arthur
Crouch, R. F.	Langford-Holt, J.	Scott, Donald
Crowder, Capt. John (Finchley)	Law, Rt. Hon. R. K.	Shepherd, William
Crowder, Petre (Ruislip—Northwood)	Leather, E. H. C.	Smiles, Lt.-Col. Sir Walter
Cundiff, F. W.	Legge-Bourke, Maj. E. A. H.	Smithers, Peter (Winchester)
Cuthbert, W. N.	Lennox-Boyd, A. T.	Smyth, Brig. J. G. (Norwood)
Darling, Sir William (Edinburgh, S.)	Lindsay, Martin	Snadden, W. McN
Davidson Viscountess	Linstead, H. N.	Soames, Capt. C.
Davies, Nigel (Epping)	Llewellyn, D.	Spearman, A. C. M.
de Chair, Somerset	Lloyd, Rt. Hn. Geoffrey (King's Norton)	Spence, H. R. (Aberdeenshire, W.)
De la Bère, R.	Lloyd, Maj. Guy (Renfrew. E.)	Spens, Sir Patrick (Kensington, S.)
Deedes, W. F.	Lloyd, Selwyn (Wirral)	Stanley, Capt. Hon. Richard (N. Fylde)
Digby, S. W.	Lockwood, Lt.-Col. J. C.	Stevens, G. P.
Dodds-Parker, A. O.	Longden, Gilbert (Herts, S. W.)	Steward, W. A. (Woolwich, W.)
Donner, P. W.	Low, A. R. W.	Stewart, Henderson (Fife. E.)
Douglas-Hamilton, Lord Malcolm	Lucas, Sir Jocelyn (Portsmouth, S.)	Stoddart-Scott, Col. M.
Drayson, G. B.	Lucas, P. B. (Brentford)	Storey, S.
Dugdale, Maj. Sir Thomas (Richmond)	Lucas-Tooth, Sir Hugh	Strauss, Henry (Norwich, S.)
Duncan, Capt. J. A. L.	Lyttelton, Rt. Hon. O.	Stuart, Rt. Hon. James (Moray)
Dunglass, Lord	McAdden, S. J.	Summers, G. S.
Duthie, W. S.	McCorquodale, Rt. Hon. M. S.	Sutcliffe, H.
Eccles, D. M.	Macdonald, Sir Peter (I. of Wight)	Taylor, Charles (Eastbourne)
Eden, Rt. Hon. A.	Mackeson, Brig. H. R.	Taylor, William (Bradford, N.)
Elliot, Rt. Hon. W. E.	McKibbin, A.	Teeling, W.
Erroll, F. J.	McKie, J. H. (Galloway)	Teevan, T. L.
Fisher, Nigel	Maclay, Hon. John	Thomas, J. P. L. (Hereford)
Fletcher, Walter (Bury)	Maclean, Fitzroy	Thompson, Kenneth Pugh (Walton)
Fort, R.	MacLeod, Iain (Enfield, W.)	Thompson, Lt.-Cmdr. R. (Croydon, W.)
Foster, John	MacLeod, John (Ross and Cromarty)	Thorneycroft Peter (Monmouth)
Fraser, Hon. Hugh (Stone)	Macmillan, Rt. Hon. Harold (Bromley)	Thornton-Kemsley, Col. C. N.
Fraser, Sir Ian (Morecambe & Lonsdale)	MacPherson, Major Niall (Dumfries)	Thorp, Brig. R. A. F.
Fyfe, Rt. Hon. Sir David Maxwell	Maitland, Cmdr. J. W.	Tilney, John
	Manningham-Buller, R. E.	Turner, H. F. L.
Gage, C. H.	Marlowe, A. A. H.	Turton, R. H.
Galbraith, Cmdr. T. D. (Pollok)	Marples, A. E.	Tweedsmuir, Lady
Galbraith, T. G. D. Hillhead)	Marshall, Douglas (Bodmin)	Vane, W. M. F.
Garner-Evans, E. H. (Denbigh)	Marshall, Sidney (Salton)	Vaughan-Morgan J. K.
Gates, Maj. E. E.	Maude, Angus (Ealing, S.)	Vosper, D. F.
Glyn, Sir Ralph	Maude, John (Exeter)	Wakefield, Edward (Derbyshire, W.)
Gomme-Duncan, Col. A.	Maudling, R.	Wakefield, Sir Wavell (Marylebone)
Gridley, Sir Arnold	Medlicott, Brig. F.	Walker-Smith, D. C.
Grimond, J.	Mellor, Sir John	Ward, Hon. George (Worcester)
Grimston, Hon. John (St. Albans)	Molson, A. H. E.	Ward, Miss. I. (Tynemouth)
Grimston, Robert (Westbury)	Monckton, Sir Waller	Waterhouse, Capt. Rt. Hon. C.
Harden, J. R. E.	Moore, Lt.-Col. Sir Thomas	Watkinson, H.
Hare, Hon. J. H. (Woodbridge)	Morrison, John (Salisbury)	Webbe, Sir H. (London)
Harris, Frederic (Croydon, N.)	Morrison, Rt. Hon. W. S. (Cirencester)	White, Baker (Canterbury)
Harris, Reader (Heston)	Mott-Radclyffe, C. E.	Williams, Charles (Torquay)
Harvey, Air Cdre. A. V. (Macclesfield)	Nabarro, G.	Williams, Gerald (Tonbridge)
Harvey, Ian (Harrow, E.)	Nicholls, Harmar	Williams, Sir Herbert (Croydon, E.)
Harvie-Watt, Sir George	Nicholson, G.	Wills, G.
Hay, John	Nield, Basil (Chester)	Wilson, Geoffrey (Truro)
Head, Brig. A. H.	Noble, Cmdr. A. H. P.	Winterton, Rt. Hon. Earl
Headlam, Lieut.-Col. Rt. Hon. Sir C.	Nugent, G. R. H.	Wood, Hon. R.
Heald, Lionel	Nutting, Anthony	York, C.
Heath, Edward	Oakshott, H. D.
Henderson, John (Cathcart)	Odey, G. W.	TELLERS FOR THE NOES:
Hicks-Beach, Maj. W. W.	O'Neill, Rt. Hon. Sir Hugh	Mr. Studholme and Major Wheatley.

Colonel J. R. H. Hutchison

I beg to move as an Amendment to the proposed Amendment, in line 1, to leave out from "apply," to the end, and to insert: save only that where there is a contract for the sale of a ship made before the said sixth day of April and either—

1. (a) the price becomes payable on or after that date; or
2. (b) the price is payable in instalments, some of which are payable before that date and some of which are payable on or after that date;

so much of the price as becomes payable on or after the said sixth day of April shall for the purposes of this subsection be deemed to be expenditure incurred on the fifth day of April, nineteen hundred and fifty-two. We have been listening to the main arguments upon the general and broad purpose our Amendments are intended to cover. I believe that it would be for the convenience of the Committee if this Amendment and the remaining Amendment to line 1 of the proposed Amendment, which are both narrower, were discussed together. The Economic Secretary indicated that he would wait to hear what we had to say on them before he came to a final decision upon the whole matter. While we believe that we shall be able to persuade him to do something more satisfactory for the industry, we should like to reserve the right, in taking these two Amendments together, to take a vote on each of them if necessary.

The words of the Economic Secretary were very guarded, and I am afraid that he may have been prompted to be so guarded because the wording of our Amendments is perhaps rather doubtful for the purpose we intend. He knows well, and I have no doubt the whole Committee will realise, that the issue which these two Amendments bring forward is really very easy of comprehension.

The whole story of the special position in which ships are placed as a result of the suspension of the initial allowances has already been discussed, so I can confine myself to the narrow point which the first Amendment seeks to establish—that the shipowner shall be able to claim the full 40 per cent. initial allowance on any expenditure incurred on a contract placed between now and April, 1952. In other words, we ask that the shipowner shall be placed on a basis similar to that of other industrialists in the country. The intention of the Chancellor was clear, both in what he said and in the Clause. He intended that there should be a year's warning of what is to happen, that orders could be placed within that year, and that the goods delivered would still be eligible for the 40 per cent. initial allowance.

That is all right. If one sees an expensive piece of plant lying about and buys it, and it is delivered straightaway—that is all right. But ships are not bought like that; ships do not sit on shelves. Ships have to be designed over a long period, and a long time is taken in their construction. If we were allowed this year of grace for the ordering of a ship, and if ships were treated in the same way as other capital plant, that would place us on a reasonable basis. It was suggested earlier that the dry tonnage fleet of the United Kingdom had largely been replaced since the war. I want to correct that misapprehension. In numbers that may be the case, but in quality there is still a great deal to be done to bring the mercantile fleet of this country up to the 1939 standard.

I submit to the Chancellor and to the Economic Secretary that the only way this matter can be dealt with is to take the date of the placing of the contract. We have already asked the Chancellor, if he adopts any other method, when a ship is regarded as "under construction." In my yard, we have an order for a hull for an engine which was bought by the owner of the vessel some time ago. Would that be a vessel "under construction"? All kinds of such complications will arise, and I am sure the Chancellor is beginning to understand that the only clean and tidy method, and the only method free from the possibility of great argument and discussion, is that of taking the date at which the contract was placed.

Air Commodore Harvey (Macclesfield)

I should like to support what has been said by my hon. and gallant Friend the Member for Scotstoun (Colonel J. R. H. Hutchison) and at the same time declare my interest in the subject I am about to discuss—that is in distant fishing vessels, large trawlers. That is a part of the industry to which no reference has been made today. Although it is a small part of the fishing industry, it is important from the point of view of providing food, of sustaining this country and of providing the necessary naval reserve in time of emergency.

It is generally thought that distant fishing vessels have had a prosperous time. I can assure hon. Members opposite that for the last two years 90 per cent. of them have lost money. The hon. Member for Coatbridge and Airdrie (Mrs. Mann) frequently raises the question of the high price at which fish is sold in the shops. That may be true during periods of bad weather and gales, but usually the landings are sold at a very low price indeed. Only yesterday 10 stone of cod was sold for 36s. Hundreds of tons of fine fish are going to the fish-meal factories.

5.30 a.m.

The fishing industry is not in such a good position as the merchant shipping companies. The shipping industry has far less capital to work on. A modern fishing trawler today costs something like £200,000; it is fitted with radar, depth meters and very modern quarters for the crew in the aft of the vessels, and unless something is done to assist the industry it may well die in the next two or three years.

I beg the Economic Secretary to give this aspect of the shipping industry his full and sympathetic consideration, for two reasons: first, to supply food which we require more than ever before; and, secondly, because in the event of an emergency these vessels will be required. Many owners have taken their courage in both hands and built new vessels, but today they are seeing German and Swedish vessels competing with them at East Coast ports, and I hope something will be done to sustain them.

Mr. Dodds-Parker (Banbury)

I hope that the Economic Secretary will not expect us to produce at short notice the sort of details he apparently expected us to produce when he was replying to the debate on the last Amendment. However, at the short notice he has given us I should like to put some facts to him on a particular aspect of this subject in which I have an interest, and that is the ore carrying trade. I am sorry that the Chancellor is not here, because he is the individual who has recently done very great harm to the steel industry of this country by denying a Treasury allocation of dollars to obtain rich iron ore from abroad. This matter was before us when the Economic Secretary was in rather warmer climes on other business.

In addition, in the last eight months or so, since the war broke out in Korea, through Government mismanagement the shipping of this ore has not been possible because forward contracts have not been met.

The Chairman

I am not clear how this affects the matter of initial allowances.

Mr. Dodds-Parker

I was just coming to that.

I have an interest in trying to obtain shipping, and the particular point at issue was whether two or three ships should be constructed, largely for the purpose of this trade. Since this declaration of the abolition of the initial allowance, the whole project is now in the melting pot once more awaiting the decision of the Chancellor on whether or not these initial allowances will be permitted.

I can put a specific case to the Economic Secretary, and I assure him that this is not raised now because this is a rather inconvenient time. This is of very great importance to the shipping industry of this country. He having refused to accept our previous Amendment, I hope he will accept this Amendment, which will mean that if a contract is made between now and April, 1952, it will make a considerable difference to the future of our shipping.

Mr. Maclay

When my hon. and gallant Friend the Member for Scotstoun (Colonel Hutchison) opened this debate he indicated that, with the agreement of yourself, Major Milner, and the Committee, we might discuss the Amendment standing in my name at the same time. He pointed out that, "woolly" as our speeches might be at this hour of the morning, there is also a certain "woolliness" in the drafting of the Amendments. I am guilty of that. The reason is probably obvious. Here, I pay tribute to those at the Treasury who drafted their Amendment after our original Amendments were put down so that we had to make rather hasty alterations.

However, the object of both Amendments is quite clear. There is an important difference between the Amendment of my hon. and gallant Friend and my Amendment. Both disagree with "under construction" as a possible means of determining the operative date for this allowance. My hon. and gallant Friend's Amendment would make much the most desirable alteration to the Chancellor's proposed Amendment, namely, that a contract placed by April, 1952, should be eligible for maintaining the initial allowance; whereas mine is really the last line of defence. It provides only for ships contracted for on Budget day of this year, as distinct from ships "under construction" on Budget day as in the Chancellor's Amendment.

I suggest most strongly that the Amendment moved by my hon. and gallant Friend deserves most serious consideration. He pointed out that it would produce a most remarkable anomaly if what was given to every other industry should be denied to shipping companies because it happens that ships take a long time to produce. If one goes into a shop tomorrow and buys a tractor it is possible to get it and the initial allowance, but if one goes into a shipyard tomorrow and orders a ship there is not a hope of getting the initial allowance. It just does not make sense to me.

I do not think the Government realise the surprising anomaly that arises out of the date position. As regards "contracts" as distinct from "under construction," I cannot imagine how the Commissioners of Inland Revenue would ever decide whether a ship was actually under construction, or at what point it came under construction. I think it would be an impossible power to give them. In the old days it was quite normal for a keel to be laid and the ship to grow around the keel.

That does not happen these days, for many reasons. One is the relatively modern technique of prefabrication. Another is that if an owner has been in the last four years contemplating building a ship, he thinks what is the most likely thing to be difficult to get quickly. If he thinks the hull is a serious matter, he goes to the builder first, but most likely, particularly if he is having a diesel engined ship, he knows that diesel engines are difficult to get, so he will order the diesel engine long before he finds a berth for the hull. He may order his lifeboats before the hull. When he finds a yard which has a berth available for a hull he says: "Thank goodness. There is my hull. I have already got the engine." When does that ship start construction? The only practicable interpretation is when the intention to build first comes into the mind of the ship- owner and he takes some positive action to achieve the building of that ship. That I believe can be expressed by the word "contract," but it simply cannot be expressed by the words "under construction."

I feel that when the Chancellor has really thought over the implications and, possibly, had further consultation with technical experts outside the Treasury—because this is now entering into very technical work connected with the building of ships which is unlike any other industry—he will be ready to give us both the points raised by the Amendments.

Mr. J. Edwards

I would first of all assure hon. Members opposite that while the placing of our Amendment on the Order Paper may have embarrassed them, it was by accident and not by design. I accept that it was a question of working against time with their Amendment, but to say that it was "woolly" was a masterpiece of understatement. The first of the Amendments that have been moved would, strictly speaking, require the initial allowance to be continued generally. The second is almost as bad, because it would mean going back on the debate we have just had. Nevertheless, the intention of the movers of the Amendment has been made perfectly plain, and it is with that that the Committee will expect me to deal.

The Amendment of the hon. and gallant Member for Scotstoun (Colonel Hutchison) seeks to provide for 12 months' warning to be given to the industry in the sense that any contracts placed in the next 12 months would be covered by this exemption. I think that is not reasonable. It is not a fair comparison to take the shipping industry with, as we know, four years' work—and one hon. Gentleman suggested more—in hand, and say it will have another year in which to place orders. I think it would be contrary to all practice for anything like that to be done.

On the other hand, I see greater justification for the viewpoint in the second Amendment, which is concerned with contracts made before Budget day. My advisers and the Board of Inland Revenue do not take the same view about the treatment of ships under construction. They believe it is quite possible to operate this because the Committee will recollect that if there were difficulties or differences of opinion there is an elaborate system for appeal to Special or General Commissioners.

Nevertheless, in the light of what has been said, in the light of discussions with representatives of the industry, and in the light of inquiries I have been able to make, and while not wishing to make a final commitment, there is a case for further examination on the point of contracts. I am authorised by my right hon. Friend to say, while he could not possibly agree in any circumstances to the substance of the first Amendment, that we will between now and the Report stage consider the points in the second amendment, and consider, looking at the thing comprehensively, whether it is possible for us to agree that ships contracted to be bought before Budget day shall get the benefit. If there are any technical views that any hon. Gentleman or any of the bodies concerned would like to put, we shall be glad to receive their representations.

It seems to me that this is an eminently reasonable approach to the problem, and that if we are able to approach it in the way I have now indicated it will go a long way to meeting the needs of the marginal cases where real difficulty is likely to be experienced. I hope the Amendment will not be pressed, and that we shall be allowed to have our Amendment.

Mr. Maclay

The Economic Secretary has undoubtedly made a big move forward, far further than he has done during a great deal of this sitting. We obviously thank him for that, but I would have liked to argue for a long time on what he said about the reasonableness of the other Amendment. I am sorry the Chancellor feels strongly that he is not able to consider it in any circumstances. By pure bad luck, by the run of the date of Budget day, I believe that two very large and expensive ships had their contracts signed a couple of days, or something like that, after. It does not make sense, decisions having been taken months and months ago, perhaps years, that the fact of the contract being signed after the Budget speech should result in firms suddenly finding themselves in an utterly different position over the initial allowance.

As far as this concession is concerned, the Chancellor has moved stage by stage towards it. He took up a flat position in presenting his Budget. By the end of the Budget he had moved a little towards us. Now we have reached another stage, and I would personally ask my hon. Friend to agree to withdraw the Amendment because I hope that between now and Report stage, after full consideration and consultation, the Chancellor will realise the strength of our arguments for 1952. I think the case is really there, and when he hears the arguments he will move to the final stage. As far as I am concerned, I should be quite happy to leave the matter as it stands and see what happens on Report.

5.45 a.m.

Mr. Selwyn Lloyd

Before the hon. Member takes the course proposed, I would ask if the Economic Secretary will leave the door slightly open for reconsideration of the first Amendment. It may be that the period of a full 12 months is too long, but as the matter stands now it would appear that the fixing of an arbitrary date which might affect contracts completely planned and carried through except for the formal signing is an arbitrary distinction. I would ask him to reconsider what he has just said, and to indicate that that matter also will be considered by the Chancellor.

Mr. J. Edwards

I have said that we think it would be unreasonable to give 12 months notice on this contract point. It would be contrary to every precedent I know, and would constitute the kind of precedent that might make things extremely difficult. The only grounds on which I feel able to agree to consider sympathetically the point of contracts made before Budget day is because I agree that in the shipping industry we have something that is unique. To go further would be to create all kinds of trouble and grievances, and I would have thought we had gone a very long way to meet the real difficulties of the industry. I hope I shall not be pressed to go further in this matter, because I am not able to do so.

Mr. Selwyn Lloyd

The hon. Gentleman said it would be contrary to any precedent to give notice in this way. Surely on the wording of the Clause as it stands it is not limited to contracts entered into before Budget day?

Mr. Edwards

If the hon. and learned Member cannot differentiate between the kind of transaction which is settled in the year after the Budget and the kind of transaction involved in ordering a new ship now for delivery in 1954, I cannot at this stage begin to explain it.

Colonel Hutchison

In considering whether I should ask leave to withdraw the Amendment I am placed in something of a dilemma. I agree that the Economic Secretary has gone some way to meet us. I do not think that he has gone far enough. I hope that in the intervening period he will come to realise the force of our argument that he is putting the shipping industry into a prejudicial position compared with others. But having gone to the Treasury to get a correct drafting for the Amendment, we find now that we have got such a draft that if I were to press it we should not get what we want. I think the only course open to me is to beg to ask leave to withdraw the Amendment.

Amendment to the proposed Amendment, by leave, withdrawn.

Amendment agreed to.

Mr. Geoffrey Hutchinson (Ilford, North)

I beg to move, in page 10, line 20, at the end, to insert: Provided that this section shall have no effect upon any initial allowance which apart from this subsection would have been given in respect of any works undertaken by any statutory water undertaking prior to the eleventh day of April, nineteen hundred and fifty-one. The purpose of this Amendment is to exclude from the operation of this Clause new works by water undertakings. Perhaps it is unduly optimistic at this stage of our proceedings to expect the Committee to take any passionate interest in the subject of the initial allowances for waterworks. Nevertheless, this is an important subject and one which, so far as I have followed the arguments used by the Economic Secretary on previous Amendments, no answer which he has given hitherto seems to fit.

This Amendment applies only to works actually commenced at the date of the Budget. Therefore, the objection that they will make undue demands upon supplies of material and labour seems to have no relevance to this matter. The Chancellor said in his Budget speech that this is not a revenue question. If both the question of priority of materials and labour and the revenue aspect are excluded, there seems to be no reason why the Economic Secretary should not accept this Amendment. This Amendment really stands on quite a different footing to any other Amendment that has been pressed on him tonight.

The merits or otherwise of this proposal depend entirely on the effect it will have on the financial arrangements of the water undertakings. Most of these undertakings are owned by local authorities or joint boards of local authorities. There are some companies, but water companies are not trading companies in the same way as ordinary commercial companies. Waterworks take a long time to complete and unlike capital works of other undertakings they do not bring any new revenue for a long time after their completion. In many cases the new works may lead to no increased revenue at all. Water undertakings do not, generally speaking, earn their revenue by selling the commodity which they supply in the way that gas and electricity undertakings do. It does not matter how much water they distribute, their revenues are not affected. New works do not, therefore, necessarily produce additional revenue.

What will be the effect on an undertaking that works in that way of the withdrawal of the initial allowance? Clearly, if no new revenue is attracted, the capital cost of new works has to be borne on the existing revenue of the undertaking. The result will probably be that by losing the initial allowance they will have to put up the rates. The revenue of water undertakings is, generally speaking, derived from rates and not from charges. That means that, unlike gas or electricity, a reduction in consumption will not enable the consumer to reduce the amount which he has to pay. The consumer of water cannot escape the payment of the rate by using less water. Because of the capital cost of new works, which they might have been able to carry had they retained the initial allowance, without recourse to any increase in their rates, many water undertakings will now have to increase their water rates.

Questions of labour and materials are not the only questions of importance at this moment. The question of the cost of living is also of importance, and rates, including water rates, play their part in the cost of living. Any increases in the water rate will be reflected in the rent of every council house and every controlled dwelling. The withdrawal of the initial allowances will mean that smaller undertakings, which have embarked on major capital works relying on these allowances to tide them over the period until they can expect an increased revenue, will now have to go to the Ministry of Local Government and Planning to get the Minister's consent to an increase in the rates. I am sure that is not a result the Economic Secretary desires to bring about.

If no question of increased demand for supplies of materials is involved, because these works have already been begun and have to be completed, and if revenue questions are not involved, the only thing which is really of importance is the effect on the finances of the local undertakings. The matter can be brought within that narrow compass, and I hope that the Economic Secretary will be able to give an assurance that all exception will be made in the case of works of water undertakings. The strongest criticism of the way the right hon. Gentleman has dealt with this question is that he has always been unwilling to make any exceptions.

This is essentially a matter which falls on different classes of undertakings in different ways. It is essentially a matter on which the right hon. Gentleman ought to have been willing to consider the conditions of each individual industry and make necessary exceptions when it is clear that an industry will be affected in some special way. I hope the Economic Secretary will be able to say that in this case he finds himself able to make an exception.

6.0 a.m.

Mr. John Hay (Henley)

The case of my hon. and learned Friend the Member for Ilford, North (Mr. Hutchinson) was cogently put. Hon. Members opposite who laughed and jeered at some of the remarks he made to the Committee did a great disservice to themselves, because few of them have anything like the experience of water undertakings of my hon. and learned Friend. In his case for this concession—which I support by saying that I consider it to be a very reasonable one—he is doing something to help those of us who represent rural con- stituencies where the problem of water supply is becoming more and more acute as time passes. Anything, therefore, which can be done to help the small village, miles from a large town, to get a supply of piped water, is to be commended by this Committee. Therefore, I hope that the Economic Secretary, when he replies to the points raised by my hon. and learned Friend, will say that the Government are prepared to consider this Amendment favourably.

Mr. J. Edwards

I said earlier, I think it was yesterday, that we could all make speeches about our own enthusiasms. We know that the hon. and learned Member for Ilford, North (Mr. Hutchinson) has a passion for water and a great knowledge of it. I agree that he put the case cogently, or at any rate clearly. Like all the others who have moved any Amendments, either last night or this morning, however, he has insisted that this is on an entirely different footing from anything else. We have had one hon. Member after another moving Amendments, a veritable parade of people, all saying, "This is exceptional." There would be no end to the people who would join in if we began to give way.

The hon. and learned Gentleman is correct in saying that there are Statutory differences involved here, but I do not accept the view of the hon. Member for Henley (Mr. Hay) that this will be of any interest in regard to the supply of piped water in the way he described. The hon. and learned Member for Ilford, North, was at pains to say precisely the opposite. He said that this was really a technical matter and that we ought not to bother about it in this way, that it would make a complicated matter of raising money, but that it would not affect the water.

Mr. Hutchinson

The Economic Secretary will admit that it would raise the cost of rural water and make it more difficult to connect with a main supply when it was brought into a village.

Mr. Edwards

I do not think that necessarily follows, and certainly the hon. and learned Gentleman said it would not make any difference to the labour supply, to materials, or anything of that sort.

But in this matter, as in the others on which I have spoken, there is the genuine problem of where to draw the line. The case of shipping seemed to be exceptional, but if this case were considered one could at once see a number of other cases concerning constructional works of this kind being brought forward, and before we knew where we were we should be driven to concede the principle, which I have no doubt will be argued in due course, that we ought not to have suspended the initial allowances at all. [HON. MEMBERS: "Hear, hear."] Quite. In fact, the arguments put before us have all been designed to try to pave the way for the general debate which is to follow, and I am not prepared to make any concessions other than the concession that has been made on shipping. I believe that we cannot single out these other cases that have been argued in such a way as to distinguish them from all the other cases that could be put forward. Therefore, while I appreciate the enthusiasm of the hon. and learned Gentleman, I am afraid that I cannot help him tonight.

Sir Herbert Williams (Croydon, East)

I must say that I am not very impressed by the reply of the Economic Secretary. [An HON. MEMBER: "He is not very impressed with the hon. Member, either."] Whether he is impressed with me or not, has no bearing on the observation I have made. He says that if he makes this concession the whole of the Clause will be in peril; but, surely that proves that it must be a very bad Clause. The degree of hardship resulting from change must vary from case to case, and I submit that it is entirely without any intellectual value for him to say to my hon. and learned Friend—who I consider has made out a very strong case, although I do not claim any special knowledge of the subject—that the Amendment cannot be considered because there have been similar Amendments.

Here we have a body of traders in water, and they have a fixed revenue, based almost entirely on rateable value, a small amount of water also being sold through industrial meters. These traders in water have to incur, may be, certain capital expenditure, because even in spite of the former Minister of Health the Government are producing a few houses somehow, and those houses ought to have a piped water supply. That supply has to be provided before the fixed revenue begins to come in.

There is the great Metropolitan Water Board. About two-thirds of the water supply of this country is in the hands of this vast and amorphous body, the Metropolitan Water Board, and municipal undertakings. It is absurd for hon. Members opposite to think that this is some private enterprise undertaking. I know that they think all private enterprise is bad because it exposes incompetence in businesses run by the Government. May I remind the Committee that the Chancellor is not with us? Unless the Treasury has changed its habits, all those on the Front Bench who represent the Treasury have their printed briefs, and can do nothing without the boss. He is away, quite properly, having some refreshment, I suppose, but we shall have some dummy replying from his brief because he has not the authority to give any other sort of reply. Of course, if someone is going to get up and assert that he has the freedom to give a concession, then I shall be delighted to give him the opportunity.

Mr. Edwards

I would say to the hon. Gentleman that if he had been here during the whole of the last eight hours, as some hon. Members have been, he would not make such a stupid statement about printed briefs. Had he been here for the last eight hours, he would have seen that I have replied from notes which I have made. It is because he has been here only a short time that he adopts this stupid role.

Sir H. Williams

I am delighted to hear that the Economic Secretary indulges in note taking. I was wondering why his speeches were so dull. I have listened to a great deal of this debate, and also of the whole of the debate which dealt with shipping. Obviously, the Economic Secretary was so busy making notes that he had not time to look round the Chamber and see who was here. I want to know what sound logic is to be presented against our case, apart altogether from the argument that if this concession is given in one case it has to be given in all the rest.

The Chancellor of the Exchequer has returned. It might be as well if he devoted himself to this problem. He has been talking to one of his secretaries and is in a position to give his mind to the problem. What is to happen to a water undertaking, which is to incur capital expenditure and will not get any revenue for some little time? Is it any wonder that some villages lack water supplies? We all know the emotion of the right hon. Gentleman about water supplies, but perhaps he will tell us on what ground he proposes to refuse the modest request of this Amendment.

Mr. Colegate

I wanted to say a word about rural water supplies. The Economic Secretary completely misunderstood the position when he said that if he gave way on rural water supplies it would mean great demands on materials and manpower. It would not mean anything of the kind.

Mr. J. Edwards

I did not say anything of the kind. The only time I mentioned that was when I said that the hon. and learned Gentleman the Member for Ilford. North (Mr. Hutchinson) had stated that it would make no difference to labour and materials. That was the only time I mentioned it, and the hon. Member for Burton (Mr. Colegate) has completely misrepresented what I said.

Mr. Colegate

Certainly not. The Economic Secretary confirms that my hon. and learned Friend said that it would not make any difference to labour and materials, and he denied it. Otherwise,

what was the object of referring to it? The only effect of the dropping of these allowances will be that the cost of supplying water in rural areas will be increased. One of the great difficulties in supplying piped water in rural areas is the scattered nature of the houses.

The Economic Secretary also said that this case was not marked by any peculiar circumstances which could not apply to other aspects of the matter. But here again he was wrong. There are no other statutory companies and, therefore, this case is unique in the fullest sense of the term.

The Government, partly in response to the agitation of an association, of which I had the honour to be President, maintained that they were going to do a great deal in the way of piped water supplies in rural areas. But the first thing they did when they got the opportunity was to make piped water supplies in rural areas very much more expensive. The reply of the Economic Secretary was most disappointing, and shows a complete lack of understanding of the problem of supplying water in the rural areas.

Question put, "That those words be there inserted."

The Committee divided: Ayes, 280; Noes, 289.

Division No. 97.]	AYES	[6.15 a.m.
Aitken, W. T.	Brooke, Henry (Hampstead)	De la Bère, R.
Alport, C. J. M.	Browne, Jack (Govan)	Deedes, W. F.
Amery, Julian (Preston, N.)	Buchan-Hepburn, P. G. T.	Digby, S. W.
Amory, Heathcoat (Tiverton)	Bullock, Capt. M.	Dodds-Parker, A. D.
Arbuthnot, John	Bullus, Wing Commander E. E.	Donner, P. W.
Ashton, H. (Chelmsford)	Burden, F. A.	Douglas-Hamilton, Lord Malcolm
Assheton, Rt. Hon. R. (Blackburn, W.)	Butcher, H. W.	Drayson, G. B.
Astor, Hon. M. L.	Butler, Rt. Hon. R. A. (Saffron Walden)	Dugdale, Maj. Sir Thomas (Richmond)
Baker, P. A. D.	Braithwaite, Sir Albert (Harrow. W.)	Duncan, Capt. J. A. L.
Baldock, Lt.-Cmdr. J. M.	Carr, Robert (Mitcham)	Dunglass, Lord
Baldwin, A. E.	Carson, Hon. E.	Duthie, W. S.
Banks, Col. C.	Channon, H.	Eccles, D. M.
Baxter, A. B.	Churchill, Rt. Hon. W. S.	Eden, Rt. Hon. A.
Beamish, Major Tufton	Clarke, Col. Ralph (East Grinstead)	Elliot, Rt. Hon. W. E.
Bell, R. M.	Clarke, Brig. Terence (Portsmouth, W.)	Erroll, F. J.
Bennett, Sir Peter (Edgbaston)	Colegate, A.	Fisher, Nigel
Bennett, Dr. Reginald (Gosport)	Cooper, Sqn. Ldr. Albert (Ilford, S.)	Fort, R.
Bennett, William (Woodside)	Cooper-Key, E. M.	Foster, John
Bevins, J. R. (Liverpool, Toxteth)	Corbett, Lt.-Col. Uvedale (Ludlow)	Fraser, Hon. Hugh (Stone)
Birch, Nigel	Craddock, Beresford (Spelthorne)	Fraser, Sir Ian (Morecambe & Lonsdale)
Bishop, F. P.	Cranborne, Viscount	Fyfe, Rt. Hon. Sir David Maxwell
Black, C. W.	Crookshank, Capt. Rt. Hon. H. F. C.	Gage, C. H.
Boles, Lt.-Col. D. C. (Wells)	Crosthwaite-Eyre, Col. O. E.	Galbraith, Cmdr. T. D. (Pollok)
Boothby, R.	Crouch, R. F.	Galbraith, T. G. D. (Hillhead)
Bossom, A. C.	Crowder, Capt. John (Finchley)	Garner-Evans, E. H. (Denbigh)
Bowen, E. R. (Cardigan)	Crowder, Petre (Ruislip—Northwood)	Gates, Maj. E. E.
Boyd-Carpenter, J. A.	Cundiff, F. W.	Glyn, Sir Ralph
Boyle, Sir Edward	Cuthbert, W. N.	Gomme-Duncan, Col. A.
Bracken, Rt. Hon. B.	Darling, Sir William (Edinburgh, S.)	Gridley, Sir Arnold
Braine, B. R.	Davidson, Viscountess	Grimond, J.
Braithwaite, Lt.-Cr. G. (Bristol, N. W.)	Davits, Nigel (Epping)	Grimston, Hon. John (St. Albans)
Bromley-Davenport, Lt.-Col. W.	de Chair, Somerset	Grimston, Robert (Westbury)
Harden, J. R. E.	McCorquodale, Rt. Hon. M. S.	Ropner, Col. L.
Hare, Hon. J. H. (Woodbridge)	Macdonald, Sir Peter (I. of Wight)	Russell, R. S.
Harris, Frederic (Croydon, N.)	Mackeson, Brig. H. R.	Ryder, Capt. R. E. D.
Harris, Reader (Heston)	McKibbin, A.	Salter, Rt. Hon. Sir Arthur
Harvey, Air Cdre. A. V. (Macclesfield)	McKie, J. H. (Galloway)	Scott, Donald
Harvey, Ian (Harrow, E.)	Maclay, Hon. John	Shepherd, William
Harvie-Watt, Sir George	Maclean, Fitzroy	Smiles, Lt.-Col. Sir Walter
Hay, John	MacLeod, Iain (Enfield, W.)	Smithers, Peter (Winchester)
Head, Brig. A. H.	MacLeod, John (Ross and Cromarty)	Smyth, Brig. J. G. (Norwood)
Headlam, Lieut.-Col. Rt. Hon. Sir C.	Macmillan, Rt. Hon. Harold (Bromley)	Snadden, W. McN.
Heald, Lionel	MacPherson, Major Niad (Damfries)	Soames, Capt. C.
Heath, Edward	Maitland, Cmdr. J. W.	Spearman, A. C. M.
Henderson, John (Cathcart)	Manningham-Buller, R. E.	Spence, H. R. (Aberdeanshire, W.)
Hicks-Beach, Maj. W. W.	Marlowe, A. A. M.	Spens, Sir Patrick (Kensington, S.)
Higgs, J. M. C.	Marples, A. E.	Stanley, Capt. Hon. Richard (N. Fylde)
Hill, Mrs. E. (Wythenshawe)	Marshall, Douglas (Bodmin)	Stevens, G. P.
Hill, Dr. Charles (Luton)	Marshall, Sidney (Sutton)	Steward, W. A. (Woolwich, W.)
Hinchingbrooke, Viscount	Maude, Angus (Ealing, S.)	Stewart, Henderson (Fife, E.)
Hirst, Geoffrey	Maude, John (Exeter)	Stoddart-Scott, Col. M.
Holmes, Sir Stanley (Harwich)	Maudling, R.	Storey, S.
Hope, Lord John	Medlicott, Brig. F.	Strauss, Henry (Norwich, S.)
Hopkinson, Henry	Mellor, Sir John	Stuart, Rt. Hon. James (Moray)
Hornsby-Smith, Miss. P.	Molson, A. H. E.	Summers, G. S.
Horsbrugh, Rt. Hon. Florence	Monckton, Sir Walter	Sutcliffe, H.
Howard, Gerald (Cambridgeshire)	Moore, Lt.-Col, Sir Thomas	Taylor, Charles (Eastbourne)
Howard, Greville (St. Ives)	Morrison, John (Salisbury)	Taylor, William (Bradford, N.)
Hudson, Sir Austin (Lewisham, N.)	Morrison, Rt. Hon. W. S. (Cirencester)	Teeling, W.
Hudson, Rt. Hon. Robert (Southport)	Mott-Radclyffe, C. E.	Teevan, T. L.
Hudson, W. R. A. (Hull, N.)		Thomas, J. P. L. (Hereford)
Hutchinson, Geoffrey (Ilford, N.)	Nabarro, G.	Thompson, Kenneth Pugh (Walton)
Hutchison, Lt.-Com. Clark (E'b'rgh W.)	Nicholls, Harmar	Thompson, R. H. M. (Croydon, W.)
Hutchison, Colonel James (Glasgow)	Nicholson, G.	Thorneycroft, Peter (Monmouth)
Hyde, Lt.-Col. H. M.	Nield, Basil (Chester)	Thornton-Kemsley, Col. C. N.
Hylton-Foster, H. B.	Noble, Cmdr. A. H. P.	Thorp, Brig. R. A. F.
Jennings, R.	Nugent, G. R. H.	Tilney, John
Johnson, Howard (Kemptown)	Nutting, Anthony	Turner, H. F. L.
Jones, A. (Hall Green)	Oakshott, H. D.	Turton, R. H.
Joynson-Hicks, Hon. L. W.	Odey, G. W.	Tweedsmuir, Lady
Kaberry, D.	O'Neill, Rt. Hon. Sir Hugh	Vane, W. M. F.
Kerr, H. W. (Cambridge)	Ormsby-Gore, Hon. W. D.	Vaughan-Morgan, J. K.
Kingsmill, Lt.-Col. W. H.	Orr, Capt. L. P. S.	Vosper, D. F.
	Orr-Ewing, Charles Ian (Hendon, N.)	Wakefield, Edward (Derbyshire, W.)
Lambert, Hon. G.	Orr-Ewing, Ian L. (Weston-super-Mare)	Wakefield, Sir Wavell (Marylebone)
Lancaster, Col. C. G.	Osborne, C. Peake, Rt. Hon. O.	Walker-Smith, D. C.
Langford-Holt, J.	Perkins, W. R. D.	Ward, Hon. George (Worcester)
Law, Rt. Hon. R. K.	Peto, Brig. C. H. M.	Ward, Miss. I. (Tynemouth)
Leather, E. H. C.	Pickthorn, K.	Waterhouse, Capt. Rt. Hon. C.
Legge-Bourke, Maj. E. A. H.	Pitman, I. J.	Watkinson, H.
Lennox-Boyd, A. T.	Powell, J. Enoch	Webbe, Sir H. (London)
Lindsay, Martin	Price, Henry (Lewisham, W.)	Wheatley, Major M. J. (Poole)
Linstead, H. N.	Prior-Palmer, Brig. O.	White, Baker (Canterbury)
Llewellyn, D.	Profumo, J. D.	Williams, Charles (Torquay)
Lloyd, Rt. Hn. Geoffrey (King's Norton)	Raikes, H. V.	Williams, Gerald (Tonbridge)
Lloyd, Maj. Guy (Renfrew, E.)	Rayner, Brig. R.	Williams, Sir Herbert (Croydon, E.)
Lloyd, Selwyn (Wirral)	Redmayne, M.	Wills, G.
Lockwood, Lt.-Col. J. C.	Remnant, Hon. P.	Wilson, Geoffrey (Truro)
Longden, Gilbert (Herts, S. W.)	Renton, D. L. M.	Winterton, Rt. Hon. Earl
Low, A. R. W.	Roberts, Major Peter (Heeley)	Wood, Hon. R.
Lucas, Sir Jocelyn Portsmouth, S.)	Robertson, Sir David (Caithness)	York, C.
Lucas, P. B. (Brentford)	Robinson, Roland (Blackpool, S.)
Lucas-Tooth, Sir Hugh	Robson-Brown, W.	TELLERS FOR THE AYES.
Lyttelton, Rt. Hon. O.	Rodgers, John (Sevenoaks)	Mr. Studholme and Major Conant.
McAdden, S. J.	Roper, Sir Harold
NOES
Acland, Sir Richard	Blenkinsop, A.	Chetwynd, G. R.
Adams, Richard	Blyton, W. R.	Clunie, J.
Albu, A. H.	Boardman, H.	Cocks, F. S.
Allen, Arthur (Bosworth)	Booth, A.	Coldrick, W.
Allen, Scholefield (Crewe)	Bottomley, A. G.	Collindridge, F.
Anderson, Alexander (Motherwall)	Bowden, H. W.	Cook, T. F.
Anderson, Frank (Whitehaven)	Bowles, F. G. (Nuneaton)	Cooper, Geoffrey (Middlesbrough, W.)
Attlee, Rt. Hon. C. R.	Braddock, Mrs. Elizabeth	Cooper, John (Deptford)
Awbery, S. S.	Brook, Dryden (Halifax)	Corbet, Mrs. Freda (Peckham)
Ayles, W. H.	Brooks, T. J. (Normanton)	Cove, W. G.
Baird, J.	Broughton, Dr. A. D. D.	Craddock, George (Bradford, S.)
Balfour, A.	Brown, Rt. Hon. George (Belper)	Crawley, A.
Barnes, Rt. Hon. A. J.	Brown, Thomas (Ince)	Crosland, C. A. R.
Bartley, P.	Burke, W. A.	Crossman, R. H. S.
Bellenger, Rt. Hon. F. J.	Burton, Miss. E.	Cullen, Mrs. A.
Benn, Wedgwood	Butler, Herbert (Hackney, S.)	Daines, P.
Benson, G.	Cattaghan, L. J.	Dalton, Rt. Hon. H.
Beswick, F.	Carmichael, J.	Darling, George (Hillsborough)
Bevan, Rt. Hon. A. (Ebbw Vale)	Castle, Mrs. B. A.	Davies, A. Edward (Stoke, N.)
Bing, G. H. C.	Champion, A. J.	Davies, Harold (Leek)

Davies, Stephen (Merthyr)	Jones, Frederick Elwyn (West Ham, S.)	Reid, William (Camlachie)
de Freitas, Geoffrey	Jones, Jack (Rotherham)	Rhodes, H.
Deer, G.	Jones, William Elwyn (Conway)	Richards, R.
Dodds, N. N.	Keenan, W.	Robens, Rt. Hon. A.
Donnelly, D.	Kenyon, C.	Roberts, Goronwy (Caernarvonshire)
Driberg, T. E. N.	Key, Rt. Hon. C. W.	Robertson, J. J. (Berwick)
Dugdale, Rt. Hon. John (W. Bromwich)	King, Dr. H. M.	Robinson, Kenneth (St. Pancras, N.)
Dye, S.	Kinghorn, Sqn. Ldr. E.	Rogers, George (Kensington, N.)
Ede, Rt. Hon. J. C.	Kinley, J.	Ross, William (Kilmarnock)
Edelman, M.	Lang, Gordon	Shawcross, Rt. Hon. Sir Hartley
Edwards, John (Brighouse)	Lee, Frederick (Newton)	Shinwell, Rt. Hon. E.
Edwards, Rt. Hon. Ness (Caerphilly)	Lee, Miss. Jennie (Cannock)	Shurmer, P. L. E.
Edwards, W. J. (Stepney)	Lever, Leslie (Ardwick)	Silverman, Julius (Erdington)
Evans, Albert (Islington, S. W.)	Lewis, Arthur (West Ham, N.)	Silverman, Sydney (Nelson)
Evans, Edward (Lowestoft)	Lindgren, G. S.	Simmons, C. J.
Evans, Stanley (Wednesbury)	Lipton, Lt.-Col. M.	Slater, J.
Ewart, R.	Logan, D. G.	Smith, Ellis (Stoke, S.)
Fernyhough, E.	Longden, Fred (Small Heath)	Smith, Norman (Nottingham, S.)
Field, Capt. W. J.	McAllister, G.	Sorensen, R. W.
Finch, H. J.	MacColl, J. E.	Soskice, Rt. Hon. Sir Frank
Fletcher, Eric (Islington, E.)	McGhee, H. G.	Sparks, J. A.
Follick, M.	McInnes, J.	Steele, T.
Fool, M. M.	Mack, J. D.	Stewart, Michael (Fulham, E.)
Forman, J. C.	McKay, John (Wallsend)	Stokes, Rt. Hon. R. R.
Fraser, Thomas (Hamilton)	Mackay, R. W. G. (Reading, N.)	Strachey, Rt. Hon. J.
Freeman, John (Watford)	McLeavy, F.	Strauss, Rt. Hon. George (Vauxhall)
Freeman, Peter (Newport)	MacMillan, Malcolm (Western Isles)	Stross, Dr. Barnett
Gaitskell, Rt. Hon. H. T. N.	McNeil, Rt. Hon. H.	Summerskill, Rt. Hon. Edith
Ganley, Mrs. C. S.	MacPherson, Malcolm (Stirling)	Sylvester, G. O.
Gibson, C. W.	Mainwaring, W. H.	Taylor, Bernard (Mansfield)
Gilzean, A.	Mallalieu, E. L. (Brigg)	Taylor, Robert (Morpeth)
Glanville, James (Consett)	Mallalieu, J. P. W. (Huddersfield, E.)	Thomas, David (Aberdare)
Gordon-Walker, Rt. Hon. P. C.	Mann, Mrs. Jean	Thomas, George (Cardiff)
Greenwood, Anthony (Rossendale)	Manuel, A. C.	Thomas, Iorwerth (Rhondda, W.)
Greenwood, Rt. Hon. Arthur (Wakefield)	Marquand, Rt. Hon. H. A.	Thomas, Ivor Owen (Wrekin)
Grenfell, D. R.	Mathers, Rt. Hon. G.	Thorneycroft, Harry (Clayton)
Grey, C. F.	Mellish, R. J.	Thurtle, Ernest
Griffiths, David (Rother Valley)	Messer, F.	Timmons, J.
Griffiths, Rt. Hon. James (Llanelly)	Middleton, Mrs. L.	Tommy, F.
Griffiths, William (Exchange)	Mikardo, Ian	Turner-Samuels, M.
Gunter, R. J.	Mitchison, G. R.	Ungoed-Thomas, Sir Lynn
Hale, Joseph (Rochdale)	Moeran, E. W.	Usborne, H.
Hall, John (Gateshead, W.)	Monslow, W.	Vernon, W. F.
Hall, Rt. Hon. Glenvil (Colne Valley)	Moody, A. S.	Viant, S. P.
Hamilton, W. W.	Morgan, Dr. H. B.	Wallace, H. W.
	Morley, R.	Watkins, T. E.
Hannan, W.	Morris, Percy (Swansea, W.)	Webb, Rt. Hon. M. (Bradford, C.)
Hardman, D. R.	Mort, D. L.	Weitzman, D.
Hardy, E. A.	Moyle, A.	Wells, Percy (Faversham)
Hargreaves, A.	Mulley, F. W.	Wells, William (Walsall)
Hastings, S.	Murray, J. T.	West, D. G.
Hayman, F. H.	Nally, W.	Wheatley, Rt. Hn. John (Edinb'gh, E.)
Henderson, Rt. Hon. A. (Rowley Regis)	Neal, Harold (Bolsover)	White, Mrs. Eirene (E. Flint)
Herbison, Miss. M.	Noel-Baker, Rt. Hon. P. J.	White, Henry (Derbyshire, N. E.)
Hewitson, Capt. M.	O'Brien, T.	Whiteley, Rt. Hon. W.
Hobson, C. R.	Oldfield, W. H.	Wilcock, Group Capt. C. A. B.
Holman, P.	Oliver, G. H.	Wilkes, L.
Holmes, Horace (Hemsworth)	Orbach, M.	Wilkins, W. A.
Houghton, D.	Padley, W. E.	Willey, Frederick (Sunderland)
Hoy, J.	Paget, R. T.	Willey, Octavius (Cleveland)
Hubbard, T.	Paling, Rt. Hon. Wilfred (Dearne Vally)	Williams, David (Neath)
Hudson, James (Ealing, N.)	Paling, Will T. (Dewsbury)	Williams, Rev. Llywelyn (Abertillery)
Hughes, Emrys (S. Ayrshire)	Pannell, T. C.	Williams, Ronald (Wigan)
Hughes, Hector (Aberdeen, N.)	Pargiter, G. A.	Williams, Rt. Hon. Thomas (Don Valley)
Hynd, H. (Accrington)	Parker, J.	Williams, W. T. (Hammersmith, S.)
Hynd, J. B. (Attercliffe)	Paton, J.	Wilson, Rt. Hon. Harold (Huyton)
Irvine, A. J. (Edge Hill)	Pearson, A.	Winterbottom, Ian (Nottingham, C.)
Irving, W. J. (Wood Green)	Peart, T. F.	Winterbottom, Richard (Brightside)
Isaacs, Rt. Hon. G. A.	Popplewell, E.	Wise, F. J.
Janner, B.	Porter, G.	Woodburn, Rt. Hon. A.
Jay, D. P. T.	Price, Philips (Gloucestershire, W.)	Wyatt, W. L.
Jeger, George (Goole)	Proctor, W. T.	Yates, V. F.
Jeger, Dr. Santo (St. Pancras, S.)	Pursey, Cmdr. H.	Younger, Hon. K.
Jenkins, R. H.	Rankin, J.
Johnson, James (Rugby)	Rees, Mrs. D.	TELLERS FOR THE NOES:
Johnston, Douglas (Paisley)	Reeves, J.	Mr. Royle and Mr. Delargy.
Jones, David (Hartlepool)	Reid, Thomas (Swindon)

Miss. Ward

I beg to move, in page 10, line 20, at the end to insert: Provided that this section shall not apply in respect of any expenditure on the construction, extension or modernisation of dry docks contracted for prior to the tenth day of April, nineteen hundred and fifty-one. In moving this Amendment, I am slightly encouraged by the recent concession of the Economic Secretary to the Amendment on shipping, and also by the fact that in answer to a Question yesterday afternoon the President of the Board of Trade said how important it was to support our traditional export trade. I am very glad to have this opportunity of arguing the case for the dry docks, because the greatest concentration of dry dock capacity is to be found on the North-East coast. In fact, it is the greatest concentration of dry dock capacity in the world. In my constituency, Smith's ship repairing docks provide the greatest single unit capacity for ship repairing in the world, and the performance of management and men through the decades has made a valuable contribution to both national security and national prosperity. Therefore, I make no apology for arguing very strongly the case of this important industry.

Now there is a unique feature in the claim of dry docks for the restoration of the initial allowance. I know that in their case the initial allowance is only 10 per cent. We do not regard that as satisfactory, but that is another story, which I cannot argue today. The unique feature is that, after the war it became apparent that in the rebuilding of the tanker fleet much larger tankers were the order of the day, and to keep pace with the new modern tankers it became essential to provide adequate dry dock facilities. It is, therefore, a unique feature in the case I am now arguing.

As soon as dry docks owners became aware of the fact that dry dock capacity would have to be available for tankers of 26,000, 28,000 and up to 30,000 tonnage, the industry set about modernising the dry docks and fitting them to meet the new circumstances of the times. That being so, I think we have a right to ask for special consideration by the Chancellor of the Exchequer. There are certain features of my case to which I would like to direct the right hon. Gentleman's attention. The first is that dry dock capacity serves a dual purpose in the national economy. They are providing a valuable part of our invisible exports. We are a maritime nation and our prosperity has been built up on that fact. It is true that we have for decades provided invisible exports for this country. By repairing foreign ships that come to our shores we are also adding to our export trade.

6.30 a.m.

The second point to which I wish to direct the right hon. Gentleman's atten- tion is that we are fulfilling an important function in the re-armament and defence programme. I am quite certain that on this question the right hon. Gentleman cannot argue that the provision of appropriate dry dock facilities is in any way competing with the re-armament programme, because it is, in fact, part of it. If he is satisfied that, for defence purposes, we need a modern tanker programme, then we must have modern dry dock facilities. Modern dry docks are essential to our national security.

Thirdly, it is of the greatest importance from the point of view of our great rivers and of their future employment that we should not run the risk of allowing our competitors to think we are not going to provide adequate dry dock facilities. They would step in and provide them to the detriment of those who look to this country for their employment and for their security.

I would remind the right hon. Gentleman that the cause of some of our unemployment difficulties on our rivers in the past has been the fact that, although from the early days industrially we led the world, we also taught the world. Countries like Sweden and Japan became great shipbuilding nations and we were in competition with them. If we fail today to provide these dry dock facilities, our competitors are likely to step in. There must be somewhere to accommodate these modern ships. To accommodate tankers of 84 feet beam there are only 14 dry docks available, and those who have the national interest at heart realise that it is not an adequate capacity.

I do not want to labour the point of maintaining employment, but in my part of the world we do look for the future to maintaining our skilled men and the labourers who work with them in good remunerative employment. We also want to ensure that management, which has served this nation so well, can also seek its livelihood in this country, and that it will not have possibly to seek its fortunes abroad.

I cannot help feeling that all the points I have made must be in the minds of the Chancellor of the Exchequer and the Economic Secretary because I observed in the papers within the last fortnight that it has been decided that there shall be a modernisation programme of the naval dockyards. If this is true—as indeed I am sure it is—it is equally important that our private yards on the North-East coast, where we have the greatest concentration of capacity in the world, must also be modernised in the same way. The Economic Secretary is going to find it difficult to argue against me on this issue because there can be no question, if the naval dockyards are going to modernise their capacity, of our dry docks under private enterprise not being put on an equal footing.

I have listened to the arguments which the Economic Secretary has used to answer one Amendment after another in this Sitting, and I have come to the conclusion that the sponsoring Departments have not done their jobs satisfactorily. In other words, I thought that the Economic Secretary—and I say this respectfully and not unpleasantly—did not know the case for industry. The point is that it is up to the sponsoring Departments to see that the Treasury is fully informed on their case. I think it was the hon. and gallant Gentleman the Member for Carshalton (Brigadier Head) who said that in matters of defence the Service Departments always find themselves in conflict with the Treasury. I very well remember writing an article for the "Spectator" on Treasury control.

In this case the sponsoring Department, the Admiralty, have not fully briefed the Economic Secretary. The Ministry of Transport are also involved, but I do not see them taking much interest in this discussion on the vital question of transport in its wider sense which is of supreme interest to this country. In this matter I look to the Admiralty. I cannot believe they have put up a sufficiently strong case, otherwise the Economic Secretary could not have made some of the replies that he has made.

I sent a letter to the new First Lord of the Admiralty covering the terms of my Amendment and asking for his intervention with the Treasury. I am sorry that I have not a copy of the letter here, but I can assure the Economic Secretary that I set out in great detail the case for the Amendment and asked Lord Pakenham if he would have a word with the Chancellor of the Exchequer if he supported the view I was expressing. The Dry Dock Owners and Repairers' Council wrote to the Chancellor pointing out their problems, and so far they have received only a postcard. That is not a fitting way for any Government Department to treat those who represent our national interests.

I have received from Lord Pakenham a telephone message saying Lord Pakenham has been very busy during the change-over but has brought the matter to the attention of the Chancellor of the Exchequer about your letter of 4th June. That is an indication to me that Lord Pakenham did not disagree with the letter I sent. If he had done—understanding as I do the-technique of Government Departments—I should have received no answer at all, and I would have been harrying the noble Lord for an answer before I moved this Amendment. Lord Pakenham has already taken some action in the interests of the North-East coast, and if he is as successful in his second attempt to help us as he was in his first I feel we shall have a friend in the First Lord of the Admiralty.

The Committee may wonder why, having regard to the Clause it is necessary to move this Amendment in respect particularly of two important new extensions which have already been started on the North-East Coast—an extension of Smith's docks in my constituency, and to Greenwells' ship-repairing yard on the Wear. I am looking to hon. Gentlemen opposite who represent the great rivers of the North to support this Amendment. This is a non-party matter. It is a national matter in which we are all interested. Now is the chance of those who believe in a high level of employment in the shipbuilding and ship-repairing industry to support me.

As the hon. Gentleman's Department has only sent a postcard to acknowledge the receipt of this letter I propose to read the pertinent paragraphs of a letter from the Dry Dock Owners and Repairers Central Council, dated 18th May, 1951, addressed to the right hon. H. T. N. Gaitskell, in reply to which the dry dock owners received only a postcard. This is the relevant part: A number of projects for the construction of much-needed new dry docks in this country has already been put in hand, on the assumption that at least the ten per cent. initial allowance would be available. Unless the Financial Bill is appropriately amended, the ship repairers who have, with concern for the future of an industry vitally important to the national security and economy, embarked upon expenditure which because of the nature of dry dock construction must be spread over a considerable period of time, are in our view to be unfairly and unjustifiably penalised. The same considerations apply in cases where the extension and modernisation of existing dry docks is involved. The withdrawal of the initial allowances besides operating unfairly on those who have already committed themselves to expenditure in this direction, will undoubtedly discourage other ship repairers from putting in hand any projects they may have had under close review in recent months. The discouragement in any way of expenditure on the construction, extension or modernisation of dry docks in the U.K. is in our view contrary to the Government's declared policy in regard to defence and re-armament and contrary to the national interest. I am sure that I have made a case not only on behalf of my part of the world, on behalf of the Dry Dock Owners and Repairers' Council and on behalf of my party, but I feel that I have made a good enough case in the national interest and I am asking for the acceptance of my Amendment.

6.45 a.m.

Mr. Geoffrey Wilson (Truro)

I wish to say a few words in support of my hon. Friend the Member for Tynemouth (Miss. Ward), because we in the West are also interested in dry docks. There are no dry docks in my division, but there are in Falmouth, which is just over the border, and a great many workers in Falmouth Docks live in my division. I see that the hon. Member for Falmouth (Mr. Hayman) is not in his place at the moment and I have not spoken to him about this Amendment, but I should like to put two points on the general position in regard to dry docks that deal with the repair of oil tankers. First, there has been a good deal of unemployment recently at such dry docks and secondly, such docks deal to a certain extent with foreign tankers and to that extent are an invisible export.

For these reasons I hope the members of the Committee and the Chancellor will look at this Clause carefully to see whether the argument put forward by the proposer of the Amendment can be sustained. If there is a reasonable case that the proposal made would help in getting further dock work to this country by making this apparently small concession, I hope it will be given serious consideration.

Mr. Browne

I should like to support the Amendment so adequately and eloquently moved by my hon. Friend. She spoke of the new dry docks under construction to accommodate tankers of 28,000 tons, and of the tendency for merchant ships to become larger and faster. It is a good thing indeed that these big docks are being built. The industry took a big risk in building them at a very heavy cost, and the Chancellor of the Exchequer should realise that the danger is no more 40 per cent. no more docks. Where are we now? We are all engaged on a buying spree where one can get a concession for short term delivery of goods in a year. But here they get no concession and nothing from the Chancellor although they have done all they could for the industry and Britain.

Mr. J. Edwards

I find it hard to argue with the hon. Lady, but not because I have been convinced by her arguments. I was entranced by her description of the dry docks, and a speech at this hour of the morning in praise of dry docks is indeed worthy of a compliment. She referred to a letter she had sent to my noble Friend the First Lord of the Admiralty. I have a copy of that letter. It is a pity the hon. Lady did not have it herself so that the Committee could have had the benefit of hearing what she wrote.

Miss. Ward

Please read it.

Mr. Edwards

This is what she wrote to Lord Pakenham: You were so very helpful over our civil aerodrome problems that I hasten to ask your support over our desire to protect our ship repairing yards from the suspension of the initial allowance. We regard it as essential to have modern dry docks to take ships and tankers not only from the point of view of employment, but from the angle of the needs of defence. I understand your predecessor was approached as the sponsoring Department to bring pressure to bear on the Chancellor. We have two huge projects on the North-East coast. I am moving an Amendment on Clause 16 in most conciliatory terms. Hoping that you will have a word with the Chancellor. It is urgent as it may come up on Wednesday. I do think the matter has only arisen because the Chancellor has not been properly informed. That gives the essence of her case, but what it does not do, and what the hon. Lady did not say in her speech in praise of dry docks, is to say, that the work was not going on.

There is absolutely no reason to suppose at all that the modernisation or extension of the dry docks is in the slightest degree imperilled by the suspension of the 10 per cent. initial allowance, and unless she or some of her hon. Friends, can demonstrate that there is a danger of that happening their case falls. To talk as though the suspension of the 10 per cent. initial allowance is going to have so disastrous a consequence that the work is going to stop is so exaggerated that it is difficult to reply to it. I do not believe that there is any risk: I do not believe the case she has made out would justify all the consequences that would flow from such a precedent in this field of long-term construction.

We have had so many Amendments that it is absolutely obvious that the Opposition would be much better occupied, as we on this side would be, if we were to get down to discuss the general principle because in certain of the cases they have put up to us they do not believe initial allowances ought to be suspended at all. I cannot, in the circumstances, agree to give what the hon. Lady has asked, although I would very much like if possible to have been pleasant at this hour of the morning.

Miss. Ward

Might I make this point? May I put it this way? There was a 10 per cent. initial allowance, then there was a 20 per cent. initial allowance given by Sir John Anderson, then there was a 40 per cent. initial allowance given by Sir Stafford Cripps. Are we to understand that all that is held up and that we are never to take any initial allowances as being a stabilised offer? If that is the attitude of the Government, no industrialist will ever trust the Socialist Government again. May I also suggest to the hon. Gentleman that he comes up to the North-East coast, meets the dry dock owners, the management and the men, and learns something about how we believe in honesty in industry. I am not at all satisfied with the answer given by the hon. Gentleman.

Lieut.-Commander Braithwaite

Those of us who have shared the long vigil of the hon. Gentleman, as some of us have done all night, had some sympathy with his closing remark that he thought it was time we got down to it. Certainly we are all looking forward to the some what lengthy discussion on the Question that the Clause should stand part of the Bill, which we shall be coming to shortly. In the meantime, I want to say in the friendliest manner to the hon. Gentleman that I thought he swept aside the Amendment of my hon. Friend the Member for Tynemouth (Miss. Ward) in a somewhat brusque fashion.

Mr. Gaitskell indicated dissent.

Lieut.-Commander Braithwaite

That was the impression the right hon. Gentleman gave me and no shaking of his head will alter my impression.

I want to submit to the right hon. Gentleman, now that he is back with us, that this matter is linked in every way with that of merchant shipping and shipbuilding. The dry dock facilities will form undoubtedly as important a part of our war-time organisation, if such a thing be necessary, as does the construction of merchant tonnage. That is a reasonable and, indeed, an unanswerable point to make, and when the hon. Lady was telling us about the necessity for taking these large tankers, it seemed to me that her remarks tied up completely with those made by my right hon. Friend the Member for Ormskirk (Sir A. Salter) earlier when we were discussing the shipbuilding Clauses. He explained how, despite the fact that 11½ million tons of shipping sunk during the war had been made good in terms of the global figure, it had got somewhat unbalanced and that there had been a considerable concentration upon tanker building.

I want to make a suggestion to the right hon. Gentleman which will enable this Amendment to be disposed of and progress to be made. He has already given an undertaking, through the Economic Secretary, that certain questions raised by my hon and gallant Friend the Member for Scotstoun (Colonel J. R. H. Hutchison) will be sympathetically re-examined between now and the Report stage, with a view to the possibility of the Government putting down Amendments of their own at that stage to meet this difficulty over shipbuilding.

While I have not had an opportunity to discuss it with my hon. Friend the Member for Tynemouth, it seems to me that if the Chancellor were to say that the review would include the subject of the dry dock question, for my part I should feel that the right hon. Gentleman had met what is an extremely important and relevant point.

The machinery of a Division has been set in motion many times since we commenced our proceedings at 3.30 p.m. yesterday, and if he could say that, my hon. Friend might feel that she need not set it in motion again. If he can say that in this conciliatory atmosphere of daylight and we are feeling fresh now that a new day has started. I, for one, would be well content.

7.0 a.m.

Mr. Charles Williams (Torquay)

I was hoping that, after the very timely and affable way in which a suggestion has been made to the Chancellor, he might conceivably have risen at once to save the time of the Committee—which many of us are using in the best possible way—by offering to go into this matter between now and the Report stage. We all know that, at any rate, would have brought fresh light to the subject. I listened to the Economic Secretary, and I heard him assure the Committee that, of course, there was no danger whatever to any of these dockyards, but I hope that too much store will not be set by that.

Those of us who have sat for the past six years with this Government have come to know that sometimes there has been a short reply and things have gone quite differently. Over and over again, we have had terrific assurances from the Front Bench, and then, in a short time, matters have been settled. Now this matter before us this morning is of importance, not only to the North-East coast, or some of the other great docking centres; there is the question of developing dockyards and dry docks in many places right throughout the country. It may well be that in Falmouth, or Plymouth, these developments are going on. Although, of course, Plymouth has a Royal dockyard which will go on, one supposes. I do not represent either of those places, and we rarely see the hon. Member for Falmouth and Camborne (Mr. Hayman) in the House. [HON. MEMPERS: "Yes."] Oh, yes, I know he is a good voter; he is good Lobby-fodder.

I am in the same mood as the hon. Lady who spoke to this Amendment; I am trying to get a concession from the Government. This goes far wider than those important places of the North-East coast, and I do hope that the Chancellor, for the general expediency of this Amendment, which he cannot just turn down by saying everything is all right, and because of the most courteous and kindly speech of the hon. Lady, will now get up and say we have helped him.

All the right hon. Gentleman has to do is to get up and give us some assurance, and then to get the assistance of the Admiralty; because they know far more about dockyards than the whole, terrifically swollen, staff at the Treasury. If he would do that, and get on, instead of looking like his predecessor, bar one, and rolling his eyes in much the same manner, we should have done something for one of the most important of the industries of this country.

Mr. Eccles

I make an appeal to the Chancellor, especially in relation to the Smith dock scheme. The argument in regard to ships has been accepted in principle; and ships are so closely associated with our defence that it is right to give them such concession under this Clause. Dry docks, it follows, especially with all these new types to accommodate very large tankers, must be put into the same category. I can understand that it might be rather difficult to select the whole of the dry dock programme of all sorts and kinds, but when one considers a proposition like the Smith docks, hon. Members will appreciate that the amount of capital involved is large, and I happen to know that a large proportion of the company's capital is involved. They will go on with this scheme, because they know very well that it is very much in the interests of the country. The withdrawal of the 40 per cent. allowance means that they have to find this short-term money. As the project is decided upon, as the company are going to carry it out, and as the allowance is withdrawn, it simply means that 40 per cent.—

Mr. J. Edwards

It is 10 per cent. in this case, not 40 per cent.

Mr. Eccles

All right, it is only 10 per cent. I think I am right in saying that the company were very much relying on that to help them with their short-term finances.

The Chancellor, in his Budget speech, said that when the allowances were withdrawn the production Departments would take whatever measures might be necessary to ensure that the suspension of the allowances did not result in difficulties for undertakings engaged in re-armament. If these special dry docks are classified as coming into the same category as ships in relation to defence, and if there is a short-term financing problem, can we have an assurance that the undertaking given in the Budget speech will be implemented? That is the very least that the Government ought to do this morning if we are not divide on this Amendment.

Mr. Edwards

It seems to me quite impossible without all kinds of trouble for anything to be drawn from initial allowances, but the statement of my right hon. Friend stands. Therefore, I would

suggest if there is a real difficulty arising from the suspension of the 10 per cent. initial allowance in respect of the capital needed, the matter should be raised with us, and I am sure that we will give the matter our very greatest attention.

Mr. Assheton

I think the whole Committee enjoyed very much the speech of my hon. Friend the Member for Tyne-mouth (Miss. Irene Ward). We listened to the reply of the Economic Secretary and did not believe that he met her points at all. Even hon. Members from the North-East coast in his own party did not feel that he met her arguments. For that reason we have no hesitation in taking the Amendment to a Division.

Question put. "That those words be there inserted."

The Committee divided: Ayes, 277; Noes, 287.

Division No. 98.]	AYES	[7.5 a.m.
Aitken, W. T.	Cranborne, Viscount	Hay, John
Alport, C. J. M.	Crookshank, Capt. Rt. Hon. H. F. C.	Head, Brig. A. H.
Amery, Julian (Preston, N.)	Crosthwaite-Eyre, Col. O. E.	Headlam, Lieut.-Col. Rt. Hon. Sir C.
Amory, Heathcoat (Tiverton)	Crouch, R. F.	Heald, Lionel
Arbuthnot, John	Crowder, Capt. John (Finchley)	Heath, Edward
Ashton, H. (Chelmsford)	Crowder, Petre (Ruislip—Northwood)	Henderson, John (Cathcart)
Assheton, Rt. Hon. R. (Blackburn, W.)	Cundiff, F. W.	Hicks-Beach, Maj. W. W.
Astor, Hon. M. L.	Cuthbert, W. N.	Higgs, J. M. C.
Baker, P. A. D.	Darling, Sir William (Edinburgh, S.)	Hill, Mrs. E. (Wythenshawe)
Baldock, Lt.-Cmdr. J. M.	Davidson, Viscountess	Hill, Dr. Charles (Luton)
Baldwin, A. E.	Davies, Nigel (Epping)	Hinchingbrooke, Viscount
Banks, Col. C.	de Chair, Somerset	Hirst, Geoffrey
Baxter, A. B.	De la Bère, R.	Holmes, Sir Stanley (Harwich)
Beamish, Major Tufton	Deedes, W. F.	Hope, Lord John
Bell, R. M.	Digby, S. W.	Hopkinson, Henry
Bennett, Dr. Reginald (Gosport)	Dodds-Parker, A. D.	Hornsby-Smith, Miss. P.
Bennett, William (Woodside)	Donner, P. W.	Horsbrugh, Rt. Hon. Florence
Bevins, J. R. (Liverpool, Toxteth)	Douglas-Hamilton, Lord Malcolm	Howard, Gerald (Cambridgeshire)
Birch, Nigel	Drayson, G. B.	Howard, Greville (St. Ives)
Bishop, F. P.	Dugdale, Maj. Sir Thomas (Richmond)	Hudson, Sir Austin (Lewisham, N.)
Black, C. W.	Duncan, Capt. J. A. L.	Hudson, Rt. Hon. Robert (Southport)
Boles, Lt.-Col. D. C. (Wells)	Dunglass, Lord	Hudson, W. R. A. (Hull, N.)
Boothby, R.	Duthie, W. S.	Hutchinson, Geoffrey (Ilford, N.)
Bossom, A. C.	Eccles, D. M.	Hutchison, Lt.-Com. Clark (E'b'rgh W.)
Bowen, E. R. (Cardigan)	Eden, Rt. Hon. A.	Hutchison, Colonel James (Glasgow)
Boyd-Carpenter, J. A.	Elliot, Rt. Hon. W. E.	Hyde, Lt.-Col. H. M.
Boyle, Sir Edward	Erroll, F. J.	Hylton-Foster, H. B.
Bracken, Rt. Hon. B.	Fisher, Nigel	Jennings, R.
Braine, B. R.	Fort, R.	Johnson, Howard (Kemptown)
Braithwaite, Lt.-Cr. G. (Bristol, N. W.)	Foster, John	Jones, A. (Hall Green)
Bromley-Davenport, Lt.-Col. W.	Fraser, Hon. Hugh (Stone)	Joynson-Hicks, Hon. L. W.
Brooke, Henry (Hampstead)	Fraser, Sir Ian (Morecambe & Lonsdale)	Kaberry, D.
Browne, Jack (Govan)	Fyfe, Rt. Hon. Sir David Maxwell	Kerr, H. W. (Cambridge)
Buchan-Hepburn, P. G. T.	Gage, C. H.	Kingsmill, Lt.-Col. W. H.
Bullus, Wing Commander E. E.	Galbraith, Cmdr. T. D. (Pollok)	Lambert, Hon. G.
Burden, F. A.	Garner-Evans, E. H. (Denbigh)	Lancaster, Col. C. G.
Butcher, H. W.	Gates, Maj. E. E.	Langford-Holt, J.
Butler, Rt. Hon. R. A. (Saffron Walden)	Glyn, Sir Ralph	Law, Rt. Hon. R. K.
Carr, Robert (Mitcham)	Gomme-Duncan, Col. A.	Leather, E. H. C.
Carson, Hon. E.	Gridley, Sir Arnold	Legge-Bourke, Maj. E. A. H.
Channon, H.	Grimond, J.	Lennox-Boyd, A. T.
Churchill, Rt. Hon. W. S.	Grimston, Hon. John (St. Albans)	Lindsay, Martin
Clarke, Col. Ralph (East Grinstead)	Grimston, Robert (Westbury)	Linstead, H. N.
Clarke, Brig. Terence (Portsmouth, W.)	Harden, J. R. E.	Llewellyn, D.
Colegate, A.	Hare, Hon. J. H. (Woodbridge)	Lloyd, Rt. Hn. Geoffrey (King's Norton)
Conant, Maj. R. J. E.	Harris, Frederic (Croydon, N.)	Lloyd, Maj. Guy (Renfrew, E.)
Cooper, Sqn. Ldr. Albert (Ilford, S.)	Harris, Reader (Heston)	Lloyd, Selwyn (Wirral)
Cooper-Key, E. M.	Harvey, Air. Cdre. A. V. (Macclesfield)	Lockwood, Lt.-Col. J. C.
Corbett, Lt.-Col. Uvedale (Ludlow)	Harvey, Ian (Harrow, E.)	Longden, Gilbert (Herts, S. W.)
Craddock, Beresford (Spelthorne)	Harvie-Watt, Sir G. S.	Low, A. R. W.
Lucas, Sir Jocelyn (Portsmouth, S.)	Orr, Capt. L. P. S.	Strauss, Henry (Norwich, S.)
Lucas, P. B. (Brentford)	Orr-Ewing, Charles Ian (Hendon, N.)	Stuart, Rt. Hon. James (Moray)
Lucas-Tooth, Sir Hugh	Orr-Ewing, Ian L. (Weston-super-Mare)	Studholme, H. G.
Lyttelton, Rt. Hon. O.	Osborne, C.	Summers, G. S.
McAdden, S. J.	Peake, Rt. Hon. O.	Sutcliffe, H.
McCorquodale, Rt. Hon. M. S.	Perkins, W. R. D.	Taylor, Charles (Eastbourne)
Macdonald, Sir Peter (I. of Wight)	Peto, Brig. C. H. M.	Taylor, William (Bradford, N.)
Mackeson, Brig. H. R.	Pickthorn, K.	Teeling, W.
McKibbin, A.	Pitman, I. J.	Teevan, T. L.
McKie, J. H. (Galloway)	Powell, J. Enoch	Thomas, J. P. L. (Hereford)
Maclay, Hon. John	Price, Henry (Lewisham. W.)	Thompson, Kenneth Pugh (Walton)
Maclean, Fitzroy	Prior-Palmer, Brig. O.	Thompson, R. H. M. (Croydon, W.)
MacLeod, Iain (Enfield, W.)	Profumo, J. D.	Thorneycroft, Peter (Monmouth)
MacLeod, John (Ross and Cromarty)	Raikes, H. V.	Thornton-Kemsley, Col. C. N.
Macmillan, Rt. Hon. Harold (Bromley)	Rayner, Brig. R.	Thorp, Brig. R. A. F.
Macpherson, Major Niall (Dumfries)	Redmayne, M.	Tilney, John
Maitland, Comdr. J. W.	Remnant, Hon. P.	Turner, H. F. L.
Manningham-Buller, R. E.	Renton, D. L. M.	Turton, R. H.
Marlowe, A. A. H.	Roberts, Major Peter (Heeley)	Tweedsmuir, Lady
Marples, A. E.	Robertson, Sir David (Caithness)	Vane, W. M. F.
Marshall, Douglas (Bodmin)	Robinson, Roland (Blackpool, S.)	Vaughan-Morgan, J. K.
Marshall, Sidney (Sutton)	Robson-Brawn, W.	Wakefield, Edward (Derbyshire, W.)
Maude, Angus (Ealing, S.)	Rodgers, John (Sevenoaks)	Wakefield, Sir Wavell (Marylebone)
Maude, John (Exeter)	Roper, Sir Harold	Walker-Smith, D. C.
Maudling, R.	Ropner, Col. L.	Ward, Hon. George (Worcester)
Medlicott, Brig. F.	Russell, R. S.	Ward, Miss. I. (Tynemouth)
Mellor, Sir John	Ryder, Capt. R. E. D.	Waterhouse, Capt. Rt. Hon. C.
Molson, A. H. E.	Salter, Rt. Hon. Sir Arthur	Watkinson, H.
Monckton, Sir Walter	Scott, Donald	Webbe, Sir Harold
Moore, Lt.-Col. Sir. Thomas.	Shepherd, William	Wheatley, Major M. J. (Poole)
Morrison, John (Salisbury)	Smiles, Lt.-Col. Sir Walter	White, Baker (Canterbury)
Morrison, Rt. Hon. W. S. (Cirencester)	Smithers, Peter (Winchester)	Williams, Charles (Torquay)
Mott-Radclyffe, C. E.	Smyth, Brig. J. G. (Norwood)	Williams, Gerald (Tonbridge)
Nabarro, G.	Snadden, W. McN.	Williams, Sir Herbert (Croydon, E.)
Nicholls, Harmar	Soames, Capt. C.	Wills, G.
Nicholson, G.	Spearman, A. C. M.	Wilson, Geoffrey (Truro)
Nield, Basil (Chester)	Spence, H. R. (Aberdeenshire, W.)	Winterton, Rt. Hon. Earl
Noble, Comdr. A. H. P.	Spens, Sir Patrick (Kensington, S.)	Wood, Hon. R.
Nugent, G. R. H.	Stanley, Capt. Hn. Richard (N. Fylde)	York, C.
Nutting, Anthony	Stevens, G. P.
Oakshott, H. D.	Steward, W. A. (Woolwich, W.)	TELLERS FOR THE AYES:
Odey, G. W.	Stewart, Henderson (Fife, E.)	Mr. T. G. D. Galbraith and
O'Neill, Rt. Hon. Sir Hugh	Stoddart-Scott, Col. M.	Mr. Vosper.
Ormsby-Gore, Hon. W. D.	Storey, S.
NOES
Acland, Sir Richard	Castle, Mrs. B. A.	Ewart, R.
Adams, Richard	Champion, A. J.	Fernyhough, E.
Albu, A. H.	Chetwynd, G. R.	Field, Capt. W.
Allen, Arthur (Bosworth)	Clunie, J.	Finch, H. J.
Allen, Scholefield (Crewe)	Cooks, F. S.	Fletcher, Eric (Islington, E.)
Anderson, Alexander (Motherwell)	Coldrick, W.	Follick, M.
Anderson, Frank (Whitehaven)	Collindridge, F.	Foot, M. M.
Attlee, Rt. Hon. C. R.	Cook, T. F.	Forman, J. C.
Awbery, S. S.	Cooper, Geoffrey (Middlesbrough W.)	Fraser, Thomas (Hamilton)
Ayles, W. H.	Cooper, John (Deptford)	Freeman, John (Watford)
Bacon, Miss. Alice	Corbet, Mrs. Freda (Peckham)	Freeman, Peter (Newport)
Baird, J.	Cove, W. C.	Gaitskell, Rt. Hon. H. T. N.
Balfour, A.	Craddock, George (Bradford, S.)	Ganley, Mrs. C. S.
Barnes, Rt. Hon. A. J.	Crawley, A.	Gibson, C. W.
Bartley, P.	Crosland, C. A. R.	Gilzean, A.
Bellenger, Rt. Hon. F. J.	Crossman, R. H. S.	Glanville, James (Consett)
Bern, Wedgwood	Cullen, Mrs. A.	Gooch, E. G.
Benson, G.	Daines, P.	Gordon-Walker, Rt. Hon. P. C.
Beswick, F.	Dalton, Rt. Hon. H.	Greenwood, Anthony (Rossendale)
Bevan, Rt. Hon. A. (Ebbw Vale)	Darting, George (Hillsborough)	Greenwood, Rt. Hon. Arthur (Wakefield)
Bing, G. H. C.	Davies, A. Edward (Stoke, N.)	Grenfell, D. R.
Blenkinsop, A.	Davies, Harold (Leek)	Grey, C. F.
Blyton, W. R.	Davies, Stephen (Merthyr)	Griffiths, David (Rother Valley)
Board man, H.	de Freitas, Geoffrey	Griffiths, Rt. Hon. James (Llanelly)
Booth, A.	Deer, G.	Griffiths, William (Exchange)
Bottomley, A. G.	Delargy, H. J.	Gunter, R. J.
Bowden, H. W.	Dodds, N. N.	Hale, Joseph (Rochdale)
Bowles, F. G. (Nuneaton)	Donnelly, D.	Hall, John (Gateshead, W.)
Braddock, Mrs. Elizabeth	Driberg, T. E. N.	Hall, Rt. Hon. Glenvil (Colne Valley)
Brook, Dryden (Halifax)	Dugdale, Rt. Hon. John (W. Bromwich)	Hamilton, W. W.
Brooks, T. J. (Normanton)	Dye. S.	Hannan, W.
Broughton, Dr. A. D. D.	Ede, Rt. Hon. J. C.	Hardy, E. A.
Brown, George (Belper)	Edelman, M.	Hargreaves, A.
Brown, Thomas (Ince)	Edwards, John (Brighouse)	Hastings, S.
Burke, W. A.	Edwards, Rt. Hon. Ness (Caerphilly)	Hayman, F. H.
Burton, Miss. E.	Edwards, W. J. (Stepney)	Henderson, Rt. Hon. A. (Rowley Regis)
Butler, Herbert (Hackney, S.)	Evans, Albert (Islington, S. W.)	Herbison, Miss. M.
Callaghan, L. J.	Evans, Edward (Lowestoft)	Hewitson, Capt. M.
Carmichael, J.	Evans, Stanley (Wednesbury)	Hobson, C. R.

Holman, P.	Messer, F.	Smith, Norman (Nottingham, S.)
Holmes, Horace (Hemsworth)	Middleton, Mrs. L.	Sorensen, R. W.
Houghton, D.	Mikardo, Ian	Soskice, Rt. Hon. Sir Frank
Hoy, J.	Mitchison, G. R.	Steele, T.
Hubbard, T.	Monslow, W.	Stewart, Michael (Fulham, E.)
Hudson, James (Ealing, N.)	Moody, A. S.	Stokes, Rt. Hon. R. R.
Hughes, Emrys (S. Ayrshire)	Morgan, Dr. H. B.	Strachey, Rt. Hon. J.
Hughes, Hector (Aberdeen, N.)	Morley, R.	Strauss, Rt. Hon. George (Vauxhall)
Hynd, H. (Accrington)	Morris, Percy (Swansea, W.)	Stross, Dr. Barnett
Hynd, J. B. (Attercliffe)	Mort, D. L.	Summerskill, Rt. Hon. Edith
Irvine, A. J. (Edge Hill)	Moyle, A.	Sylvester, G. O.
Irving, W. J. (Wood Green)	Mulley, F. W.	Taylor, Bernard (Mansfield)
Isaacs, Rt. Hon. G. A.	Murray, J. D.	Taylor, Robert (Morpeth)
Janner, B.	Nally, W.	Thomas, David (Aberdare)
Jay, D. P. T.	Neal, Harold (Bolsover)	Thomas, George (Cardiff)
Jeger, George (Goole)	Noel-Baker, Rt. Hon. P. J.	Thomas, Iorwerth (Rhondda, W.)
Jeger, Dr. Santo (St. Pancras, S.)	O'Brien, T.	Thomas, Ivor Owen (Wrekin)
Jenkins, R. H.	Oldfield, W. H.	Thorneycroft, Harry (Clayton)
Johnson, James (Rugby)	Oliver, G. H.	Thurtle, Ernest
Johnston, Douglas (Paisley)	Orbach, M.	Timmons, J.
Jones, David (Hartlepool)	Padley, W. E.	Tomney, F.
Jones, Frederick Elwyn (West Ham, S.)	Paget, R. T.	Turner-Samuels, M.
Jones, Jack (Rotherham)	Paling, Rt. Hon. Wilfred (Dearne V'lly)	Ungoed-Thomas, Sir Lynn.
Jones, William Elwyn (Conway)	Paling, Will T. (Dewsbury)	Usborne, H.
Keenan, W.	Panned, T. C.	Vernon, W. F.
Kenyon, C.	Pargiter, G. A.	Viant, S. P.
Key, Rt. Hon. C. W.	Parker, J.	Wallace, H. W.
King, Dr. H. M.	Paton, J.	Watkins, T. E.
Kinghorn, Sqn. Ldr. E.	Pearson, A.	Webb, Rt. Hon. M. (Bradford, C.)
Kinley, J.	Peart, T. F.	Weitzman, D.
Lang, Gordon	Popplewell, E.	Wells, Percy (Faversham)
Lee, Frederick (Newton)	Porter, G.	Wells, William (Walsall)
Lee, Miss. Jennie (Cannock)	Price, Philips (Gloucestershire, W.)	West, D. G.
Lever, Leslie (Ardwick)	Proctor, W. T.	Wheatley, Rt. Hon. John (Edinb'gh, E.)
Lewis, Arthur (West Ham, N.)	Pryde, D. J.	White, Mrs. Eirene (E. Flint)
Lewis, John (Bolton, W.)	Pursey, Cmdr. H.	White, Henry (Derbyshire, N. E.)
Lindgren, G. S.	Rankin, J.	Whiteley, Rt. Hon. W.
Lipton, Lt.-Col. M.	Rees, Mrs. D.	Wilcock, Group Capt. C. A. B.
Logan, D. G.	Reeves, J.	Wilkes, L.
Longden, Fred (Small Heath)	Reid, Thomas (Swindon)	Willey, Frederick (Sunderland)
McAllister, G.	Reid, William (Camlachie)	Willey, Octavius (Cleveland)
MacColl, J. E.	Rhodes, H.	Williams, David (Neath)
McGhee, H. G.	Richards, R.	Williams, Rev. Llywelyn (Abertillery)
McInnes, J.	Robens, Rt. Hon. A.	Williams, Ronald (Wigan)
Mack, J. D.	Roberts, Goronwy (Caernarvonshire)	Williams, Rt. Hon. Thomas (Don V'lly)
McKay, John (Wallsend)	Robertson, J. J. (Berwick)	Williams, W. T. (Hammersmith, S.)
Mackay, R. W. G. (Reading, N.)	Robinson, Kenneth (St. Pancras, N.)	Wilson, Rt. Hon. Harold (Huyton)
McLeavy, F.	Rogers, George (Kensington, N.)	Winterbottom, Ian (Nottingham, C.)
MacMillan, Malcolm (Western Isles)	Ross, William (Kilmarnock)	Winterbottom, Richard (Brightside)
McNeil, Rt. Hon. H.	Royle, C.	Wise, F. J.
MacPherson, Malcolm (Stirling)	Shawcross, Rt. Hon. Sir Hartley	Woodburn, Rt. Hon. A.
Mallalieu, E. L. (Brigg)	Shinwell, Rt. Hon. E.	Wyatt, W. L.
Mallalieu, J. P. W. (Huddersfield, E.)	Shurmer, P. L. E.	Yates, V. F.
Mann, Mrs. Jean	Silverman, Julius (Erdington)	Younger, Hon. K.
Manuel, A. C.	Silverman, Sydney (Nelson)
Marquand, Rt. Hon. H. A.	Simmons, C. J.	TELLERS FOR THE NOES:
Mathers, Rt. Hon. G.	Slater, J.	Mr. Wilkins and Mr. Sparks.
Mellish, R. J.	Smith, Ellis (Stoke, S.)

Mr. Churchill

I beg to move, "That the Chairman do report Progress and ask leave to sit again."

I do so in order that we may elicit from the Government a further statement of their intentions or desires. It is for them to say what they wish to do; the Committee must make up its mind accordingly. We have had, I think, a remarkable all-night sitting, unblemished by any ill-temper. Nobody has been assaulted in the Lobby. The debating level has been very high. The Government have made certainly one concession, in regard to the shipbuilding industry, which is substantial and rewards the labours of those who felt that the previous proposal was unduly severe. Generally speaking, we greet the morning light with good spirits and resolve to do our duty as well as we can in whatever circumstances are placed upon us. I therefore invite from the Leader of the House a statement of what he intends to do and what course he intends to take. We shall consider very carefully what he says and then be able to reach a conclusion, which I hope will match his own for clarity and decision.

Mr. Ede

I confirm what the right hon. Gentleman has said about the spirit in which the night's debates have been conducted. I was once rather pushed about by some Members of his party who were trying to get into the Lobby, passing in front of me instead of proceeding by the more normal route, but I do not hold that against anyone.

The right hon. Gentleman asks for my intentions and desires. Upon how my desires are met depends what my intentions will be. I think it is generally agreed that it is desirable that, when one gets to an important Clause of the Bill it should be discussed by the Committee when it is reasonably fresh. I do not see many signs of jaded looks yet, and I know the high spirits that are kept alive by songs in the tea-room. I would myself think that it would be a good thing if we started on Monday afternoon at Clause 24, which is, I think, after we have disposed of this Clause, which we have been debating since about 10.15 last night, the next really important Clause in the Bill. [HON. MEMBERS: "No."] Well, I know that one star may outshine another star in glory, and that Clauses are apt to vary in importance according to the side of the Committee upon which one sits.

I have tried to make a reasonable analysis of these Clauses, and if we could get to the end of Clause 23 by a reasonable hour today I would hope that we should then be able to report Progress and start on Monday afternoon at the commencement of Clause 24. I make that suggestion to the Committee. To use the phrase of the right hon. Gentleman, that is the desire that I would express to the Committee.

Mr. Churchill

Might I ask the right hon. Gentleman what he means by "a reasonable hour today"? Human judgment varies so much as to what is reasonable.

Mr. Ede

I would hope that we could get that by, say, 10 o'clock.

Lieut.-Commander Braithwaite

A.m. or p.m.?

Mr. Ede

Anti-meridian, let us say. In view of the spirit that has prevailed all night, I do not think that that is asking an impossible task of the Committee.

Mr. Churchill

If we go on beyond 10 o'clock, the debate set down for Friday will never arrive. Thursday will have overlapped Friday.

Mr. Ede

No, it is 11 o'clock. I did allow some time for the kind of unpredictable incident that generally occurs when one fixes an hour, and there is an hon. Member who feels he has a message he must deliver.

Mr. Churchill

I feel quite sure that I shall be allowed to express my obligation to the right hon. Gentleman for having made a plain and clear statement of his desires and intentions. For out part, we have listened with great interest to them, and we see no season why the Government should not pursue that course. We cannot enter into an agreement as to when the debate should be brought to a conclusion. [HON. MEMBERS: "Why?"] Clause 23 is a very important Clause and raises large principles. Moreover, we are now in the light of day. The reports will be available to the public of what takes place in the Committee. That leaves Clause 24 for next week. Naturally, we have that before us. I cannot give the right hon. Gentleman any assurance, but we shall watch with interest how Government business proceeds.

Mr. Ede

I never expect prophecies. I have been with the right hon. Gentleman at Epsom Downs too often to place any reliance on prophecies by anyone, and I only hope that the suggestion I have made may yet find favour with the Committee in the practical working out of the business of the morning.

The Chairman

Does the right hon. Gentleman ask leave to withdraw his Motion?

Mr. Churchill

I find difficulty in withdrawing. I feel bound to say that after the excellent and admirable night we have passed, I think the right thing would be to report Progress at the point now reached. We have done a good hard span of work. Therefore, I think I shall press my Motion to a Division. Otherwise, we shall not in any way alter the procedure we have indicated.

Question put, "That the Chairman do report Progress and ask leave to sit again."

The Committee divided: Ayes, 279; Noes, 287.

Division No. 99.]	AYES	[7.29 a.m.
Aitken, W. T.	Fraser, Hon. Hugh (Stone)	MacLeod, Iain (Enfield, W.)
Alport, C. J. M.	Fraser, Sir Ian (Morecambe & Lonsdale)	MacLeod, John (Ross and Cromarty)
Amery, Julian (Preston, N.)	Fyfe, Rt. Hon. Sir David Maxwell	Macmillan, Rt. Hon. Harold (Bromley)
Amory, Heathcoat (Tiverton)	Gage, C. H.	Macpherson, Major Niall (Dumfries)
Arbuthnot, John	Galbraith, Cmdr. T. D. (Pollok)	Maitland, Comdr. J. W.
Ashton, H. (Chelmsford)	Garner-Evans, E. H. (Denbigh)	Manningham-Buller, R. E.
Assheton, Rt. Hon. R. (Blackburn, W.)	Gates, Maj. E. E.	Marlowe, A. A. H.
Astor, Hon. M. L.	Glyn, Sir Ralph	Marples, A. E.
Baker, P. A. D.	Gomme-Duncan, Col. A.	Marshall, Douglas (Bodmin)
Baldock, Lt.-Cmdr. J. M.	Gridley, Sir Arnold	Marshall, Sidney (Sutton)
Baldwin, A. E.	Grimond, J.	Maude, Angus (Eating, S.)
Banks, Col. C.	Grimston, Hon. John (St. Albans)	Maude, John (Exeter)
Baxter, A. B.	Grimston, Robert (Westbury)	Maudling, R.
Beamish, Major Tufton	Harden, J. R. E.	Medlicott, Brig. F.
Bell, R. M.	Hare, Hon. J. H. (Woodbridge)	Mellor, Sir John
Bennett, Sir Peter (Edgbaston)	Harris, Frederic (Croydon, N.)	Molson, A. H. E.
Bennett, Dr. Reginald (Gosport)	Harris, Reader (Heston)	Monckton, Sir Walter
Bennett, William (Woodside)	Harvey, Air Cdre. A. V. (Macclesfield)	Moore, Lt.-Col. Sir Thomas
Bevins, J. R. (Liverpool, Toxteth)	Harvey, Ian (Harrow, E.)	Morrison, John (Salisbury)
Birch, Nigel	Harvie-Watt, Sir G. S.	Morrison, Rt. Hon. W. S. (Cirencester)
Bishop, F. P.	Hay, John	Mott-Radclyffe, C. E.
Black, C. W.	Head, Brig. A. H.	Nabarro, G.
Boles, Lt.-Col. D. C. (Wells)	Headlam, Lieut.-Col. Rt. Hon. Sir C.	Nicholls, Harmar
Boothby, R.	Heald, Lionel	Nicholson, G.
Bossom, A. C.	Heath, Edward	Nield, Basil (Chester)
Bowen, E. R. (Cardigan)	Henderson, John (Cathcart)	Noble, Comdr. A. H. P.
Boyd-Carpenter, J. A.	Hicks-Beach, Maj. W. W.	Nugent, G. R. H.
Boyle, Sir Edward	Higgs, J. M. C.	Nutting, Anthony
Bracken, Rt. Hon. B.	Hill, Mrs. E. (Wythenshawe)	Oakshott, H. D.
Braine, B. R.	Hill, Dr. Charles (Luton)	Odey, G. W.
Braithwaite, Sir Albert (Harrow, W.)	Hinchingbrooke, Viscount	O'Neill, Rt. Hon. Sir Hugh
Braithwaite, Lt.-Cr. G. (Bristol, N. W.)	Hirst, Geoffrey	Ormsby-Gore, Hon. W. D.
Bromley-Davenport, Lt.-Col. W.	Holmes, Sir Stanley (Harwich)	Orr, Capt. L. P. S.
Brooke, Henry (Hampstead)	Hope, Lord John	Orr-Ewing, Charles Ian (Hendon, N.)
Browne, Jack (Govan)	Hopkinson, Henry	Orr-Ewing, Ian L. (Weston-super-Mare)
Buchan-Hepburn, P. G. T.	Hornsby-Smith, Miss. P.	Osborne, C.
Bullus, Wing Commander E. E.	Horsbrugh, Rt. Hon. Florence	Peake, Rt. Hon. O.
Burden, F. A.	Howard, Gerald (Cambridgeshire)	Perkins, W. R. D.
Butcher, H. W.	Howard, Greville (St. Ives)	Peto, Brig. C. H. M.
Butler, Rt. Hon. R. A. (Saffron Walden)	Hudson, Sir Austin (Lewisham, N.)	Pickthorn, K.
Carr, Robert (Mitcham)	Hudson, Rt. Hon. Robert (Southport)	Pitman, I. J.
Carson, Hon. E.	Hudson, W. R. A. (Hull, N.)	Powell, J. Enoch
Channon, H.	Hutchinson, Geoffrey (Ilford, N.)	Price, Henry (Lewisham, W.)
Churchill, Rt. Hon. W. S.	Hutchison, Lt.-Com. Clark (E'b'rgh W.)	Prior-Palmer, Brig. O.
Clarke, Col. Ralph (East Grinstead)	Hutchison, Colonel James (Glasgow)	Profumo, J. D.
Clarke, Brig. Terence (Portsmouth, W.)	Hyde, Lt.-Col. H. M.	Raikes, H. V.
Colegate, A.	Hylton-Foster, H. B.	Rayner, Brig. R.
Conant, Maj. R. J. E.	Jennings, R.	Redmayne, M.
Cooper, Sqn. Ldr. Albert (Ilford, S.)	Johnson, Howard (Kemptown)	Remnant, Hon. P.
Cooper-Key, E. M.	Jones, A. (Hall Green)	Renton, D. L. M.
Corbett, Lt.-Col. Uvedale (Ludlow)	Joynson-Hicks, Hon. L. W.	Roberts, Major Peter (Heeley)
Craddock, Beresford (Spelthorne)	Kaberry, D.	Robertson, Sir David (Caithness)
Cranborne, Viscount	Kerr, H. W. (Cambridge)	Robinson, Roland (Blackpool, S.)
Crookshank, Capt. Rt. Hon. H. F. C.	Kingsmill, Lt.-Col. W. H.	Robson-Brown, W.
Crosthwaite-Eyre, Col. O. E.	Lambert, Hon. G.	Rodgers, John (Sevenoaks)
Crouch, R. F.	Lancaster, Col. C. G.	Roper, Sir Harold
Crowder, Capt. John (Finchley)	Langford-Holt, J.	Ropner, Col. L.
Crowder, Petre (Ruislip—Northwood)	Law, Rt. Hon. R. K.	Russell, R. S.
Cundiff, F. W.	Leather, E. H. C.	Ryder, Capt. R. E. D.
Cuthbert, W. N.	Legge-Bourke, Maj. E. A. H.	Salter, Rt. Hon. Sir Arthur
Darling, Sir William (Edinburgh, S.)	Lennox-Boyd, A. T.	Scott, Donald
Davidson, Viscountess	Lindsay, Martin	Shepherd, William
Davies, Nigel (Epping)	Linstead, H. N.	Smiles, Lt.-Col. Sir Walter
de Chair, Somerset	Llewellyn, D.	Smithers, Peter (Winchester)
De la Bère, R.	Lloyd, Rt. Hn. Geoffrey (King's Norton)	Smyth, Brig. J. G. (Norwood)
Deedes, W. F.	Lloyd, Maj. Guy (Renfrew, E.)	Snadden, W. McN.
Digby, S. W.	Lloyd, Selwyn (Wirral)	Soames, Capt. C.
Dodds-Parker, A. D.	Lockwood, Lt.-Col. J. C.	Spearman, A. C. M.
Donner, P. W.	Longden, Gilbert (Herts, S. W.)	Spence, H. R. (Aberdeenshire, W.)
Douglas-Hamilton, Lord Malcolm	Low, A. R. W.	Spens, Sir Patrick (Kensington, S.)
Drayson, G. B.	Lucas, Sir Jocelyn (Portsmouth, S.)	Stanley, Capt. Hon. Richard (N. Fylde)
Dugdale, Maj. Sir Thomas (Richmond)	Lucas, P. B. (Brentford)	Stevens, G. P.
Duncan, Capt. J. A. L.	Lucas-Tooth, Sir Hugh	Steward, W. A. (Woolwich, W.)
Dunglass, Lord	Lyttelton, Rt. Hon. O.	Stewart, Henderson (Fife, E.)
Duthie, W. S.	McAdden, S. J.	Stoddart-Scott, Col. M.
Eccles, D. M.	McCorquodaie, Rt. Hon. M. S.	Storey, S.
Eden, Rt. Hon. A.	Macdonald, Sir Peter (I. of Wight)	Strauss, Henry (Norwich, S.)
Elliot, Rt. Hon. W. E.	Mackeson, Brig. H. R.	Stuart, Rt. Hon. James (Moray)
Erroll, F. J.	McKibbin, A.	Studholme, H. G.
Fisher, Nigel	McKie, J. H. (Galloway)	Summers, G. S.
Fort, R.	Maclay, Hon. John	Sutcliffe, H.
Foster, John	Maclean, Fitzroy	Taylor, Charles (Eastbourne)

Taylor, William (Bradford, N.)	Tweedsmuir, Lady	While, Baker (Canterbury)
Teeling, W.	Vane, W. M. F.	Williams, Charles (Torquay)
Teevan, T. L.	Vaughan-Morgan, J. K.	Williams, Gerald (Tonbridge)
Thomas, J. P. L. (Hereford)	Wakefield, Edward (Derbyshire, W.)	Williams, Sir Herbert (Croydon
Thompson, Kenneth Pugh (Walton)	Wakefield, Sir Wavell (Marylebone)	Wills, G.
Thompson, R. H. M. (Croydon, W.)	Walker-Smith, D. C.	Wilson, Geoffrey (Truro)
Thorneycroft, Peter (Monmouth)	Ward, Hon. George (Worcester)	Winterton, Rt. Hon. Earl
Thornton-Kemsley, Col. C. N.	Ward, Miss. I. (Tynemouth)	Wood, Hon. R.
Thorp, Brig. B. A. F.	Waterhouse, Capt. Rt. Hon. C.	York, C.
Tilney, John	Watkinson, H.
Turner, H. F. L.	Webbe, Sir Harold	TELLERS FOR THE AYES:
		Cmdr. T. G. D. Galbraith and
Turton, R. H.	Wheatley, Major M. J. (Poole)	Mr. Vosper.

NOES
Acland, Sir Richard	Edalman, M.	Keenan, W.
Adams, Richard	Edwards, John (Brighouse)	Kenyan, C.
Albu, A. H.	Edwards, Rt. Hon. Ness (Caerphilly)	Key, Rt. Hon. C. W.
Allen, Arthur (Bosworth)	Edwards, W. J. (Stepney)	King Dr. H. M.
Allen, Scholefield (Crewe)	Evans, Albert (Islington, S. W.)	Kinghorn, Son. Ldr
Anderson, Alexander (Motherwell)	Evans, Edward (Lowtstoft)	Kinley, J.
Anderson, Frank (Whitehaven)	Evans, Stanley (Wednesbury)	Lang, Gordon
Attlee, Rt. Hon. C. R.	Ewart, R.	Lee, Frederick (Newton)
Awbery, S. S.	Fernyhough, F.	Lee, Miss. Jennie (Cannock)
Ayles, W. H.	Field, Capt. W. J.	Lever, Leslie (Ardwick)
Bacon, Miss. Alice	Finch, H. J.	Lewis, Arthur (West Ham, N.)
Baird, J.	Fletcher, Erie (Islington, E.)	Lewis, John (Bolton, W.)
Balfour, A.	Follick, M.	Lindgren, G. S.
Barnes, Rt. Hon. A. J.	Foot, M. M.	Lipton, Lt.-Col. M.
Bartley, P.	Forman, J. C.	Logan, D. G.
Bellenger, Rt. Hon. F. J.	Fraser, Thomas (Hamilton)	Longden, Fred (Smart Heath)
Bonn, Wedgwood	Freeman, John (Watford)	McAllister, G.
Benson, G.	Freeman, Peter (Newport)	MacColl, J. E.
Beswick, F.	Gaitskell, Rt. Hon. H. T. N.	McGhee, H. G.
Bevan, Rt. Hon. A. (Ebbw Vale)	Ganley, Mrs. C. S.	McInnes, J.
Bing, G. H. C.	Gibson, C. W.	Mack, J. D.
Blenkinsop, A.	Gilzean, A.	McKay, John (Wallsend)
Blyton, W. R.	Glanville, James (Consett)	Mackay, R. W. G. Reading, N.)
Boardman, H.	Gooch, E. G.	McLeavy, F.
Booth, A.	Gordon-Walker, Rt. Hon. P. C.	MacMillan, Malcolm (Western Isles)
Bottomley, A. G.	Greenwood, Anthony (Rossendale)	McNeil, Rt. Hon. H.
Bowden, H. W.	Greenwood, Rt. Hon. Arthur (Wakefield)	MacPherson, Malcolm (Stirling)
Bowles, F. G. (Nuneaton)	Grenfell, D. R.	Mallalieu, E. L. (Begg)
Braddock, Mrs. Elizabeth	Grey, C. F.	Mallalieu, J. P. W. (Huddersfield, E.)
Brook, Dryden (Halifax)	Griffiths, David (Rother Valley)	Mann, Mrs. Jean
Brooks, T. J. (Normanton)	Griffiths, Rt. Hon. James (Llanelly)	Manuel, A. C.
Broughton, Dr. A. D. D.	Griffiths, William (Exchange)	Marquand, Rt. Hon. H. A.
Brown, Rt. Hon. George (Belper)	Gunter, R. J.	Mathers, Rt. Hon. G.
Brown, Thomas (Ince)	Hale, Joseph (Rochdale)	Mellish, R. J.
Burke, W. A.	Hall, John (Gateshead, W.)	Messer, F.
Burton, Miss. E.	Hall, Rt. Hon. Glenvil (Colne Valley)	Middleton, Mrs. E.
Butler, Herbert (Hackney, S.)	Hamilton, W. W.	Mikardo, Ian
Callaghan, L. J.	Hannan, W.	Mitchison, G. R.
Carmichael, J.	Hardy, E. A.	Moeran, E. W.
Castle, Mrs. B. A.	Hargreaves, A.	Monslow, W.
Champion, A. J.	Hastings, S.	Moody, A. S.
Chetwynd, G. R.	Hayman, F. H.	Morgan, Dr. H. B.
Clunie, J.	Henderson, Rt. Hon. A. (Rowley Regis)	Morley, R.
Cocks, F. S.	Herbison, Miss. M.	Morris, Percy (Swansea, W.)
Coldrick, W.	Hewitson, Capt. M.	Mort, D. L.
Collindridge, F.	Hobson, C. R.	Moyle, A.
Cook, T. F.	Holman, P.	Mulley, F. W.
Cooper, Geoffrey (Middlesbrough, W.)	Holmes, Horace (Hemsworth)	Murray, J. T.
Cooper, John (Deptford)	Houghton, D.	Nally, W.
Corbel, Mrs. Freda (Peckham)	Hoy, J.	Neal, Harold (Bolsover)
Cove, W. G.	Hubbard, T.	Noel-Baker, Rt. Hon. P. J.
Craddock, George (Bradford, S.)	Hudson, James (Ealing, N.)	O'Brien, T.
Crawley, A.	Hughes, Emrys (S. Ayrshire)	Oldfield, W. H.
Crosland, C. A. R.	Hughes, Hector (Aberdeen, N.)	Oliver, G. H.
Crossman, R. H. S.	Hynd, H. (Accrington)	Orbach, M.
Cullen, Mrs. A.	Hynd, J. B. (Attercliffe)	Padley, W. E.
Daines, P.	Irvine, A. J. (Edge Hill)	Paget, R. T.
Dalton, Rt. Hon. H.	Irving, W. J. (Wood Green)	Paling, Rt. Hon. Wilfred (Dearne V'lly)
Darling, George (Hillsborough)	Isaacs, Rt. Hon. G. A.	Paling, Will T. (Dewsbury)
Davies, A. Edward (Stoke, N.)	Janner, B.	Pannell, T. C.
Davies, Harold (Leek)	Jay, D. P. T.	Pargiter, G. A.
Davies, Stephen (Merthyr)	Jeger, George (Goole)	Parker, J.
de Freitas, Geoffrey	Jeger, Dr. Santo (St. Pancras, S.)	Paton, J.
Deer, G.	Jenkins, R. H.	Pearson, A.
Dodds, N. N.	Johnson, James (Rugby)	Peart, T. F.
Donnelly D.	Johnston, Douglas (Paisley)	Porter, G.
Driberg, T. E. N.	Jones, David (Hartlepool)	Price, Philips (Gloucestershire, W.)
Dugdale, Rt. Hon. John (W. Bromwich)	Jones, Frederick Elwyn (West Ham, S.)	Proctor, W. T.
Dye, S.	Jones, Jack (Rotherham)	Pryde, D. J.
Ede Rt. Hon. J. C.	Jones, William Elwyn (Conway)	Pursey, Cmdr. H.

Rankin, J.	Stokes, Rt. Hon. R. R.	West, D. G.
Rees, Mrs. D.	Strachey, Rt. Hon. J.	Wheatley, Rt. Hon. John (Edmb'gh, E.)
Reeves, J.	Strauss, Rt. Hon. George (Vauxhall)	White, Mrs. Eirene (E. Flint)
Reid, Thomas (Swindon)	Stress, Dr. Barnett	White, Henry (Derbyshire, N. E.)
Reid, William (Camlachie)	Summerskill, Rt. Hon. Edith	Whiteley, Rt. Hon. W.
Rhodes, H.	Sylvester, G. O.	Wilcock, Group Capt. C. A. B.
Richards, R.	Taylor, Bernard (Mansfield)	Wilkes, L.
Robens, Rt. Hon. A.	Taylor, Robert (Morpeth)	Wilkins, W. A.
Roberts, Goronwy (Caernarvonshire)	Thomas, David (Aberdare)	Willey, Frederick (Sutherland)
Robertson, J. J. (Berwick)	Thomas, George (Cardiff)	Willey, Octavius (Cleveland)
Robinson, Kenneth (St. Pancras, N.)	Thomas, Iorwerth (Rhondda, W.)	Williams, David (Neath)
Rogers, George (Kensington, N.)	Thomas, Ivor Owen (Wrekin)	Williams, Rev. Llywelyn (Abertillery)
Ross, William (Kilmarnock)	Thorneycroft, Harry (Clayton)	Williams, Ronald (Wigan)
Royle, C.	Thurtle, Ernest	Williams, Rt. Hon. Thomas (Don V'lly)
Shawcross, Rt. Hon. Sir Hartley	Timmons, J.	Williams, W. T. (Hammersmith, S.)
Shinwell, Rt. Hon. E.	Tomney, F.	Wilson, Rt. Hon. Harold (Huyton)
Shurmer, P. L. E.	Turner-Samuels, M.	Winterbottom, Ian (Nottingham, C.)
Silverman, Julius (Erdington)	Ungoed-Thomas, Sir Lynn	Winterbottom, Richard (Brightside)
Silverman, Sydney (Nelson)	Usborne, H.	Wise, F. J.
Simmons, C. J.	Vernon, W. F.	Woodburn, Rt. Hon. A.
Slater, J.	Viant, S. P.	Wyatt, W. L.
Smith, Ellis (Stoke, S.)	Wallace, H. W.	Yates, V. F.
Smith, Norman (Nottingham, S.)	Watkins, T. E.	Younger, Hon. K.
Sorensen, R. W.	Webb, Rt. Hon. M. (Bradford, C.)
Soskice, Rt. Hon. Sir Frank	Weitzman, D.	TELLERS FOR THE NOES:
Sparks, J. A.	Wells, Percy (Faversham)	Mr. Popplewell and Mr. Delargy.
Steele, T.	Wells, William (Walsall)

Mr. J. Edwards

I beg to move, in page 10, line 24, at the end, to add: Provided that a trade shall not be deemed for the purposes of that subsection to be discontinued by reason only of the happening of any event which, by virtue of any of the provisions of Rule 11 of the Rules applicable to Cases I and II of Schedule D, is to be treated as equivalent to the discontinuance of the trade.

Mr. Boyd-Carpenter

I hope we may have some explanation of this Amendment, which was moved by the Economic Secretary with commendable brevity but a certain lack of display of his powers of exposition.

Mr. Edwards

I referred to this Amendment when I moved the original Amendment and said we would take them together.

Mr. Boyd-Carpenter

I did not understand the Economic Secretary to explain the effect of this Amendment. It may be that the fault was in my comprehension or may be it was in his exposition, but the fact remains that it has not been explained. On the face of it, it is a somewhat obscurely drafted provision. Subsection (2) applies to subsection (1), Part VIII of the Income Tax Act of 1945, which applies a number of rules which, of course, are not set out in this Bill. Therefore, it seems proper that before the Committee accepts this Amendment, put down by the Government, we should be given some explanation of its effect and its purpose. I hope that that explanation may be sufficiently clear to enable us to part with what is no doubt a technical provision.

The Attorney-General (Sir Frank Soskice)

If there is a change of owners of a ship undertaking and ship between the date of the Budget and the date in April, 1952, when the expenditure is incurred, without this Amendment the shipbuilder or repairer would not have the advantage of the initial allowance which the earlier Government Amendment to this Clause would otherwise give him. This is to prevent the initial allowance not being given in the event of there being a change of owners between the Budget and the date of incurring the expenditure.

Amendment agreed to.

Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."

Mr. R. A. Butler

We now come quite fresh to consider initial allowances, a subject to which we have devoted our attention since 10.15 p.m. In the extraordinary manner in which our business is conducted, we have had no general discussion on this subject at all. Every debate has been on individual instances, the major one being shipping. I attempted to put an Amendment down in order that we should have a general discussion at the opening of our debate, a procedure hitherto followed in our debates with great benefit. We have debated on details without considering the general subject, putting the cart before the horse. If such a procedure is carried out, that is quite agreeable to us, but it is not calculated to expedite business. In spite of that procedure, we have had constructive debates and have wrung from the Government a valuable concession on the question of shipping.

7.45 a.m.

I shall not be unreasonable and enter into a detailed argument on the subject of the individual trades described during the night, but it is essential to show up the tergiversations, the total lack of economic planning and the muddle with which this whole question of initial allowances has been handled by the Government during the last few months. In their Report the E.C.E. describe the procedure relating to initial allowances as "curious." When I remind the Committee that this procedure on initial allowances was originally brought in in 1945, and was doubled by Sir Stafford Cripps in 1949 on the understanding that it would be an assistance in advancing plant replacement—I am using the former Chancellor's words—it is surprising that, despite that history, his disciple the present Chancellor of the Exchequer should, at the stroke of a pen and at a moment when plant replacement is as critical as it has ever been in industry, remove the allowance altogether. That is why the E.C.E. report describes it as "curious," and we could describe it in rather more impolite language.

Sir Stafford Cripps had a definite policy in doubling this initial allowance. The Chancellor of the Exchequer, on the other hand, has now imported a new argument to his procedure, namely that he wishes to control investments on the home front and in industry. When the allowances were doubled by his predecessor, we had a very important argument brought to our discussion, that the present system of depreciation and other allowances for plant replacement took no account of the fall in the value of money, and nobody who has looked into the question, as indeed it will be examined during our later debates on the Profits Tax, with any knowledge of the present situation in industry, knows that what industry is suffering from is a grave uncertainty in the value of money and, also, a certainty, not uncertainty, that money is rapidly losing its value and it is taking three to four times the amount of money to replace plants than it did three years ago.

These initial allowances were no doubt introduced and backed by Sir Stafford Cripps for the purpose of being some complement to the general system of depreciation which exists in other ways in our fiscal system. I do not claim, and I am not going to make any claim, that the system of initial allowances is ideal. It is one to which a good deal of careful consideration can be given by the Committee and there is no doubt that these allowances are a form of loan to industry, and that they are not so valuable to large businesses with capital as they are to small firms. They are more important to certain types of industry such as shipping than they are to others. In general they have formed a valuable aid, particularly to small businesses, and their removal by the Bill, unless we can wring a further concession from the Chancellor, will come as a shock to a variety of industry.

What we object to in the Chancellor's move is that the Government over the last few years have not looked ahead; they doubled the allowances as late as 1949 for one purpose and now are taking them away for another. We regard it as a highly dangerous procedure to introduce legislation for one purpose, and to retain it for another. That is what has happened in the case of Purchase Tax, which was introduced as a physical control, and is now a magnificent producer of revenue. This destroys our confidence in the management of our affairs by the right hon. Gentleman and his predecessors.

I come now to one or two features of the arguments which have been brought in to justify the virtual cancellation of these allowances, before I give some sort of picture of the part these allowances play in the general financing of industry. In his Budget speech the Chancellor alluded to the fact that the Defence Departments would be asked to temper the wind to industries which were engaged in the defence programme. This phrase of his has been referred to in the course of our debates during the night, but we have had no explanation from the right hon. Gentleman at all has to how the Defence Departments will set to work, what procedure they will undertake in order to temper the wind or to mitigate the blow to industries which are engaged in defence or on the edge of defence. I hope the right hon. Gentleman will give us some further answer and substantiate what he said in his Budget speech.

The second point I want to make about the defence programme is that many of these industries, in particular shipping, which we have discussed, are a practical part of that programme. And not only shipping. We have not had time during the night to consider many other industries. I have before me the memorandum addressed to the Chancellor of the Exchequer by the Federation of Master Cotton Spinners' Association Ltd., and I want to ask the Chancellor where, in the case of cotton, he considers that defence needs begin and where they end. Because there is no doubt, as this memorandum—which I will not read in toto to the Committee and which the right hon. Gentleman himself must have had—indicates, that in the whole range and realm of the cotton and textile industry there are processes which are vital to the defence programme and processes which impinge upon it.

How can he then, differentiate between industries totally engaged in defence and those on the edge of defence and mixed up in the defence programme? I hope he will give us some explanation about that. Further, I hope he will indicate to us how, in the case of an industry like cotton, he can introduce some apparatus which will enable them to have those grants and assistance which they need so much. Anyone who has any knowledge at all of Lancashire, whether he be a Lancashire Member or not, remembers its fate during the years when the cotton industry went through difficult times, knows of the difficulties of plant replacement, and that the initial allowances have played a part, especially in the smaller sections of the cotton industry, in providing, as I described it earlier, a form of loan or assistance in the early stages for the replacement of plant. In the case of plant which is going to be used for quasi-defence purposes, why does the right hon. Gentleman withdraw the initial allowance and therefore aim a further crippling blow to the cotton industry of Lancashire? We trust that the right hon. Gentleman will give us explanations on these points, and thus clear up matters to which he has made reference in his speech but which have not been cleared up.

Now I come to the nature of the allowances and their relation to the needs of industry. The Committee should know—and I see no reason why, just because we have been sitting here this long time, to limit the serious character of the arguments I want to bring forward—that by abolishing initial allowances and increasing the Distributed Profits Tax from 6s. to 10s. the Chancellor takes another £236 million from the earnings of businesses in a full year. The effect is not absolutely immediate and the total effect may later tend to diminish but, nevertheless, this is a very large sum which is being taken away from the nest egg from which the whole of our future productivity in this country will be financed.

The importance of the reserves of industry are well known, but I do not think that the Committee can give enough attention to this vital aspect of the background of our production programme. The Economic Survey for 1951 mentions that provisions for stock appreciation by companies and public authorities is estimated at £700 million. The figure for companies alone, leaving aside public authorities, is about £600 million, but this figure almost entirely swallows up the £780 million which is calculated in the same document for the undistributed company profits from which sums must be found for the amounts necessary to replace fixed assets at the enhanced prices which I referred to earlier.

This leaves industry only some £180 million over, as compared with the figure of £171 million in 1938–39, with which to finance plant at a critical moment of our production at prices almost treble and at a figure only the same as was thought necessary in 1938. This is an indication of the seriousness of the financial position in regard to the reserves of industry, and the Chancellor should think again before indulging in speeches, as he did the other night, of a purely political character, no doubt in an effort to rejuvenate from their rather jaded condition his hon. Friends behind him. He should turn to the serious economic arguments which we are trying to put before him, and study the figures which can be tested by some of the finest industries in this country. I hope, therefore, that in a more serious vein, he will reply with economic arguments, trying to relieve the anxiety which many of us must feel about the resources of industry for the replacement of plant.

During our debates, some reference has been made to the Millard Tucker Report, and on each occasion that it has been mentioned, the Economic Secretary has rather pooh-poohed the value of this Committee and the reference in its Report to the initial allowances. But the summary of the findings of the Committee is: Our suggestion for a system of flexible initial allowances is the only solution which meets the objections we have enumerated, and those objections are schemes of revalorisation or of reserves for replacement. If that be one of the findings—and I do not agree with parts of that Committee's Report—the Chancellor should remedy the deficiency, which he made plain in his Budget speech, of not having studied the Report. Perhaps that is why he went against one of the main findings of the Committee. If the right hon. Gentleman thinks that I have not properly represented what I have read out—and he can find it on page 46 of the Report—perhaps he will say more than the Economic Secretary had to say about it. It does seem remarkable that this Committee should have a whole chapter on the problem of inflation, and should definitely recommend an elastic use of the system of initial allowances, when the Chancellor, at the same time that he receives the Report, should abandon the system of these allowances. I do not want to detain the Committee any longer, but I should like an answer to what I have asked.

I conclude by asking the right hon. Gentleman if he has any alternative steps for dealing with plant replacement and depreciation, other than by initial allowances. Although the hour is so advanced, I make one constructive suggestion. First, the initial allowances should not be abandoned in this hurry, but should continue until such time as a better method than this loan system has been found; and, secondly, the Chancellor, in that period, with his advisers, aided by an accelerated Report of the Committee on Taxation, should consider whether there is not some method of creating a fund dedicated to replacement into which would go bona fide means for depreciation, used for no other purpose. Any wrong use of money set aside for depreciation is not only a wrong method of accounting, but a wrong method of using the money set aside for reserves. I appeal to the Chancellor to revise his attitude, and, if possible, allow this system to continue, particularly for industries on the edge of defence work, and small industries.

8.0 a.m.

Mr. Hayman (Falmouth and Camborne)

I should like to make a personal statement. During one of the debates on an earlier Amendment the hon. Member for Torquay (Mr. C. Williams) made a reference to my absence when he was addressing the Committee. I think he is absent now while I am speaking. He also referred to my work here in this place. I should like to point out that I have only missed seven out of 160 Divisions—

The Temporary Chairman (Mr. Diamond)

I thought the hon. Gentleman was going to relate his remarks to this Clause.

Mr. Hayman

It is a personal explanation and refers to shipbuilding—

The Temporary Chairman

The hon. Member has reminded me that it is a personal statement, and I have to tell him that that is not in order at present.

Mr. Nigel Birch

I want to add one or two remarks to those made by my right hon. Friend the Member for Saffron Walden (Mr. R. A. Butler). My right hon. Friend started by saying that the Economic Commission for Europe had described the Government's behaviour in this matter as curious. I should like to quote what was said, because it is a good summary of what has happened. Here is the quotation from that report: The history of these initial allowances is curious. They were raised from 20 to 40 per cent. of the cost of new investment in plant and machinery in 1949, where there was no apparent need to stimulate investment demand. Now that they are to be lowered, business men have been given a year's notice. It would seem possible that, unless there is some restriction of credit, this may encourage entrepreneurs to do all they can to bring forward their investment plans in the current year and so increase inflationary pressure in the current year. Unless there is a further worsening of the terms of trade, which does not seem to be contemplated, the need to cut investment may actually be less in 1952 than in 1951. That was a very comprehensive criticism of the past, the present and the future of the Government's policy, and I think it ought to go on record because it is a damning one.

This whole business has been a very good example of planning. The trouble about planning with this Government is that instead of changing from red to amber and then to green, they always change from red to amber and back again to red. This abnormal process lands them in a mess. They have their own plans upset and they lose money to the general detriment of the whole country. As my right hon. Friend said, this problem of the initial allowances is the difference between paper profits subject to tax and true profits in real terms.

The Chancellor was very violent on this subject when winding up the other night. I know he will take this as a compliment when I say that he reminds me very much now of his right hon. Friend the Minister of Local Government and Planning, whom he is increasingly coming to resemble. I did say that night that I thought it would be a good thing if accounts were true, but he seemed to think that that was an old-fashioned idea and one which was positively immoral. Indeed, he could not bring himself to agree that there was this difference between real profits and paper profits subject to tax. That is the whole trouble we are in at the moment, and one of the reasons why the initial allowances were increased in 1949. I will quote what the Millard Tucker Committee said: This relief "— meaning the raising of the allowance from 20 per cent. to 40 per cent.— was a recognition of the difficulties which industry experienced in replacing its fixed assets as a result of the fall in the value of money, and was intended as at any rate a temporary palliative pending further examination of the problem. As far as I can make out, the temporary palliative had been taken away and the Chancellor has resorted to the Royal Commission, which is one of the most time-honoured Ministerial devices for evading an awkward issue and shelved from his point of view until he has no further concern with it.

What is happening now is dangerous. My right hon. Friend pointed out that the solution of the Tucker Committee—I do not say it is a particularly good one —that there should be a selective raising of the initial allowance. They recognised that paper profits are not true profits, and that was their solution. I am not prepared to offer a solution today, but all I can say about the conduct of the Government is that they have knocked down the only solution put up by then-own Committee and have put nothing in its place. And it is difficult to see how the present situation can long endure.

Mr. Grimond

The argument for this clause is that owing to the need for rearmament we have to divert a certain amount of our resources from industry making for civilian uses to industries which are engaged in the re-armament programme. On the whole I think that argument has to be accepted. But I think the question we have to ask ourselves about the Clause is, is it adequate for that task?

We were also asked last night whether we were in favour of a reduction of investments. I think the answer to that is that the primary need is for a better selection in investment so that we use our resources better and so that that portion of our resources which we can afford for capital investment is used to the best possible purpose for the armament programme, and to a lesser extent for the export drive and the general welfare of the country.

So again we have to ask ourselves whether this Clause will attain that end. I must say that the abolition of the initial allowance in this Clause seems to me a very blunt instrument. If it is to be used at all it would seem to me that the Government should have agreed that there were a great many reasonable amendments to the general principle, but it is quite obvious that they rejected that line entirely and their argument has been that one must take the principle as it stands, and, except for one very small concession, they gave nothing away whatsoever. Yet in their own arguments contradictions did appear. In the debate on the shipping Amendment, as I understand it, they said, on the one hand that they did not want to reduce the amount of new tonnage and, on the other hand, the only purpose in removing the initial allowance was to achieve just that object, that is to reduce tonnage ordered. The Chancellor will no doubt say that there is a happy medium to be struck, but the hon. Gentleman has not told the Committee whether he really thinks that by wiping out this initial allowance, he is going to strike the right balance.

Re-armament percolates throughout the whole economic system, and one cannot take certain industries and say these are the re-armament industries. The right hon. Member for Saffron Walden (Mr. R. A. Butler) was right when he spoke of the cotton industry. It is a diverse and complicated industry which must take part in the re-armament drive. Is the Chancellor satisfied that this Clause is going to gain the desired end in that and similar situations?

I should like also to ask how the Chancellor proposes to deal with the question of interest rates? If he is going to reduce the amount of investment, the interest rate has relevance to that problem. It seems to me that it may offer a more flexible way of dealing with the general question of the amount of investment, than this planning which, as has been pointed out, has led to these rather curious contortions over the last four or five years.

The truth is that the economic situation is never normal. It may be exceptionally abnormal just now, but we shall never have it in a state of equilibrium. It will always be rapidly changing and it seems to me that the present system of planning does not respond quickly enough to the various changes in direction which we have to make. We are faced then with sudden reversals such as this sudden change in initial allowances which probably does not entirely meet the real need of the moment, which upsets industry, and which I feel may well not achieve the object which the Chancellor has in mind.

Take the case of agriculture. It is a vital industry for this country in peace and doubly and trebly so in time of war. I do not pretend that the Clause will have a very great effect on agriculture; I do not think it will, but it will have some effect—an incalculable effect; and I think we are entitled at least to ask for some indication of what the Chancellor has in mind for this industry. For instance, in the price review; is this factor to be taken into account and, if there is a rise in costs, is it to be passed on to the consumer? There will be all sorts of repercussions from this rather blunt removal of the initial allowances and I should be much happier if, before we leave the Clause, we were given a good deal more information from the Chancellor as to whether he has decided that he really can distinguish between the armaments and other industries and whether he thinks this method meets the task which he has set himself.

Commander Maitland (Horncastle)

I have not been a Member of the House very long, but I have taken part in a good many long and late debates, and I think this has been outstanding among them for the standard of the debate throughout. I think that is a measure of the importance which we on this side of the Committee attach to the principle involved in this Clause.

I wish to follow my right hon. Friend the Member for Saffron Walden (Mr. R. A. Butler), who opened the debate, on two points. My right hon. Friend that during the night said the Chancellor had given us a valuable concession on shipping. I do not agree that it was a very valuable concession and I think we shall have to go a good deal further. I hope it may be possible even now, at this late stage of the Bill, for the Chancellor to reconsider his decision on this issue.

May I also follow the comments of my right hon. Friend on the attitude of the Economic Secretary to the Millard Tucker Report? Obviously it is very annoying, when the Government calls for a Report, for that Report to be entirely contrary to the lines the Government are following, but it seems to me that on the issue of initial allowances the Report is quite clear. I was interested to see that it uses shipping as an example of why it advocates the retention of initial allowances. Since shipping is directly related to defence, I do not think it can be said that the Report should be ignored because in general it did not take our re-armament problems into account. I think the Tucker Committee are correct in their diagnosis.

There is another point about initial allowances which has not been dealt with so far. It has been touched on but not really pressed home. It affects certain industries considerably. With initial allowances the value of a ship can be written down in a shorter period than would otherwise be the case. For example, with a 40 per cent. initial allowance a ship can be written down in 12 years, with a 20 per cent. allowance in 16 years, and if there is no allowance at all, as is now proposed, it takes 20 years.

8.15 a.m.

In certain industries, of which shipping is one, it is very important to have a quick turnover of the capital represented by the ships involved if there is to be economic efficiency in both peace and war. The initial allowance has been extremely useful to the ship industry in that regard, and I know that it is regarded as a most important factor in enabling the industry to maintain fleets of modern ships. That point has not really been sufficiently stressed during the night. Throughout the debate we have tried to relate specific items on which we have sought amendment directly to defence. I cannot see that the Chancellor can maintain his position when he says that to abandon the initial allowance is to help the defence programme. Surely the action he proposes can be selective and not as sweeping as the Chancellor seems to be prepared to make it.

Mr. Watkinson

I should like to start by quoting a document which I think shows that the Chancellor is perhaps a little deviationist in his sudden sweeping away of all the initial allowances. I have listened to nearly all our discussions during the night and, necessarily, because they have been on rather narrow points, it has not been possible to bring in what I believe to be the most important matter that rests on this question of the initial allowance. I venture to say that it is the most important matter in front of us in the country today on any plane or in any circumstances. I refer to the level of productivity which we can achieve this year and in the years to come.

I cannot see how we can achieve a higher level of productivity than has been promised us this year—which, of course, is no increase at all—without a continual inflow of new plant and equipment into industry. Yet the Chancellor, by suddenly cutting away the initial allowances without any offset or any consideration, without even considering the Millard Tucker Report on the Taxation of Trading Profits, which has already been mentioned by several of my hon. Friends—one of the strongest and, I think, most original recommendations of which was the continuation of initial allowances—has struck a blow at the future productivity of this country at the very time when, as never before, we need a steadily increasing level of productivity.

If I might, I should like to quote one remark from a Trades Union Congress publication entitled "The Trade Unions and Productivity." Dealing with the problem of the trade unions, this publication—a very able and valuable one, if I may say so—says on page 59: A rising standard of living can only be achieved by increasing productivity obtained from labour saving machinery. That is what is before us when we consider this Clause. Will the removal of the initial allowances assist in increasing productivity, or will it be a blow at productivity, as I believe it will be?

I suggest that the right course to have adopted would have been that already suggested by my right hon. Friend the Member for Saffron Walden (Mr. R. A. Butler) that further consideration should have been given to this matter before the entire initial allowances were swept away; and that the recommendations of the Millard Tucker Committee should, if they could not have been accepted, at least have been a guide to the Chancellor. It might have been better to have waited and taken further counsel before sweeping these allowances away. From my personal knowledge, I know the work and expert advice that went into the Millard Tucker Report, and it is very small thanks to all the experts in many walks of life who gave their advice and their time for the right hon. Gentleman to have swept the whole thing away in what I think was almost an insulting manner.

As we continue our examination of this Budget through the Finance Bill, I think it becomes more and more evident to us all what a very bad Budget this is for business as a whole. If it is a bad Budget for business, I would point out, because of what has been said from the back benches on the other side of the Committee, that it is a bad Budget not only for the managerial side and the directors in business but for everyone who works in industry. Unless we maintain an increasing level of production, we cannot meet our export commitments, and we certainly could not justify any increase in our standard of living. I think we are entitled to some explanation from the Government as to whether this question of initial allowances was considered in relation to the general desirability of increasing productivity, and whether it was considered that the sudden removal of the 40 per cent. allowance was going to assist firms to modernise and improve their plant by installing new machinery.

I know the right hon. Gentleman would answer by saying that it is not desirable that many firms should modernise and improve their machinery at the present time, and that in the case of the re-armament industry special help is being given. I know, for example, that a firm now turning over to jet engine production will not have to pay for their tools. The tools will be furnished to them on loan. That is one method of getting round the allowance, and I concede that it is a proper point.

It is my estimate that we may have to find in the next 12 months at least £500 million worth of extra exports to pay for the extra materials we have to bring in. This sets a terriffic task for British industry, quite apart from the re-armament programme. My objection to this sudden blow is that I should have thought we had to consider the re-armament programme from two aspects. The first is to get the maximum increase in productivity in the armament industry. But what about the long view as well as the short one? What about having to go on for four or five years of armed peace, having to build up our armaments and holding them at the highest level, and at the same time increasing enormously our export industry in order that our export targets can be met? I cannot see how we can do that unless we accept as our first priority an annual increase in productivity in the whole range of industry of something not less than seven per cent. a year.

I believe that the Chancellor's promise for four per cent. is entirely inadequate. Yet I do not think we shall be able to achieve the four per cent. this year. I hope I am proved wrong. I think the Chancellor has done a great disservice to the drive, efficiency, and constant renewal of British industry which would enable us to hit a productivity target increase of at least 7 per cent. this year. If that could have been increased to 10 or 12 per cent., a target not in any way technically impossible if the tools were available, the re-armament programme could surely have been reached without additional taxation and a reduction in the standard of living.

That is the problem I should have thought the Budget would have been designed entirely to try to solve, but to me it appears to be a Budget designed to make life as difficult as possible for those in engineering and other productive industries which are trying to solve this difficult problem of achieving the rearmament programme while maintaining the standard of living.

Mr. Eccles

I think my right hon. Friend the Member for Saffron Walden (Mr. R. A. Butler) was quite right when he said that one of the worst features of Government policy has been the swift changes we have had in allowances. The Government seem to think capital programmes can be turned on and off like a tap. They cannot. They take a long time to mature, and when the programmes are large they always take a long time to be carried out. Nothing is more unsettling to business than very large changes in the financial conditions under which they must carry on. That is the first thing I feel that is bad about the attempt to damp down the investment programme by abolishing the allowances at one stroke.

One has to answer the Chancellor's question of last night whether it was really necessary to cut the capital programme and, if so, if this is the right way to do it. It has always been my view that while we have been in these difficulties of under-investment, first because the war was so destructive, and secondly because we have to prepare against another war, the Government have never represented to the public the enormous importance of keeping up the rate of investment and, if necessary, of cutting consumption for a period.

That is why my hon. Friend the Member for Woking (Mr. Watkinson), who knows so much about the machine tool industry, is right. Our standard of living does depend on 10 years' con- centrated investment, and I think the public would have responded if they had been clearly told of the advantages of going short now in order to provide more investment, better tools and equipment, in order to benefit in the years to come. That has not been the Government's view. They have given too high priority to expenditure on consumption.

If one then looks at the present situation, it is true to say that one could not squeeze out of consumption the right kind of resources to maintain the full rate of investment we had before the defence programme, and add the defence programme on top. The reason for that is that the products of the heavy engineering industry are wanted for defence, and if they are taken for defence we cannot maintain the civil investment programme at its height. We can do more than we are doing, but we have to give up some-thins somewhere.

8.30 a.m.

If part of the investment programme is to be cut, and if we start by saying that the whole country must do its best to see that it is by the smallest fraction, we must first get the priorities right. We on this side feel that the first contribution should have been made by the Government in their own non-defence capital programme, putting industrial investment for high-priority defence or for high-priority exports—it is impossible to separate the two—and dwelling-houses in the top bracket. The rest of the investment programme should be pruned by selective and monetary methods. That is what this proposal does not do. I would have preferred to see a pruning of Government offices, all those things which take steel—which is a fairly good measure of investment—which did not fall into the two highest priorities. Among them is the sale of motor cars. The initial allowances have been taken off business motor cars and commercial vehicles. I do not think that will do much harm. I would not mind taking away the initial allowance that a professional man changing his car every two years can get on the purchase if that were the instrument which stopped him getting a new car. But it is not. The Government manage that control through a strict limit on the number of new motor cars coming into the home market, so that what one would have said would have been a useful measure has no effect.

If the cut has been adequately done by these physical controls, we are still left with a range of investment which cannot be dealt with in that way. The method proposed in this Clause is really a selective use of the interest rate, by the back door and in a very clumsy and unsatisfactory way. The effect of withdrawing the allowance is to take away from industry some very cheap money, in fact money which it gets for nothing from the Treasury as an advance payment towards capital costs. Incidentally this comes very hard on agriculture. When industry no longer gets these interest-free advances, as they have been called, it will have to borrow. It will not by a long margin have the cash in its own resources, and therefore will go to the capital market. That will influence the interest rate, and that is a means of making money scarcer for the industrial borrower. It is not a very efficient means. In the first place there is this year of grace before the allowance disappears. We want to do something about cutting the investment programme as soon as we can, because it is one of the influences making for inflation. If any of it can safely be pruned it ought to be.

I agree that you cannot get delivery of heavy plant within 12 months, but you can still get delivery of things like tractors. You can get machinery in Europe which comes in here and is paid for through the European Payments Union. It takes three years to get delivery of a good printing machine made by British manufacturers, but you can go to the Continent and get one in six months, and you can get your initial allowance on it. That seems to me to prove that this selection is too long delayed; the capital programme should be dealt with more quickly and more skilfully.

What is going to happen under this Clause? According to the Chancellor, over the whole of industry £170 million will be taken away, in the sense that they will have to borrow that money or find it from their own cash resources. Their cash is going to be seriously depleted, and this may have very serious consequences. I have seen a sample of a large number of industrial firms showing the relation between their cash resources and their turnover in 1938 and 1949. In 1938 they had 13 per cent. of their annual turnover in cash. From pre-war experience that may well be considered as none too high. Nobody would have said that industry in 1938 had too much cash. In 1945, for which I have no figures, I know that the cash ratio was much higher. The figure for 1949 is 7½ per cent. It has dropped already to nearly half of what it was before the war. This is one of the most serious figures in industry today.

There are four reasons why cash relative to turnover is becoming so dangerously short in industry. The first is that war-time reserves have been spent—E.P.T. refunds and so on. The second is the rise in prices. As the cost of raw materials rise, the reserves of industry fall in value. When raw material prices rise by 20 per cent., as they have done in the last few months, the effect on the real value of industry's reserves is catastrophic. That is seen by the fact that they have to put more and more cash into stocks in order to carry on. May I say, in parentheses, that the fact that industry did not stock up as it might have done with more raw materials in the first half of last year is not unconnected with the fact that its cash reserves were going down all the time.

The third reason is that the effect of Income Tax. Profits Tax and the removal of initial allowances, taken together, has been a tremendous drain on the cash they have left. My right hon. Friend mentioned the figure of over £200 million which was going to fall on industry from the increase in Profits Tax and the abolition of these allowances. There is also the extra 6d. on the standard rate of Income Tax.

If we put together these three drains on industry's cash, we see that the position is serious indeed. None the less, something has to be done to try to weed out some of the less essential projects, but it is a difficult and delicate matter because of the cash situation. The defect of taking the allowances away is precisely that the whole effect will fall indiscriminately on developing firms who really are trying to do something to improve their productivity. I wonder if that is the right thing to do. Would it not have been possible, and perhaps better, to have raised interest rates, because it would have brought in more borrowers besides those in industry, such as local authorities, and it would have been easier in that way to restrict the investment programme? I am afraid that the removal of these initial allowances is not going to do the weeding out in the way it should be done, and all I have said about industry is true about agriculture. In agriculture, I should doubt very much if the relation between cash and turnover is visible. This Clause will be serious for many farmers.

I am sorry to keep the Committee at this time of the morning, but this is a very important subject. There is very little politics in this between myself and the Chancellor of the Exchequer, because both of us agree that the investment programme has to be got into proper shape. But one cannot by his method distinguish between what is a vital industry and what is not. If that can be done it must be by some other and more selective means.

I think that this proposal will seriously embarrass companies whose cash has been depleted for the reasons I have given, and if I were Chancellor I would conduct an inquiry to find out whether it is necessary to do this in order to curb investment. Is not the growing dear-ness and scarcity of money doing this for him? I should have thought that a careful inquiry into the cash position of industry and the borrowing it is expected to do this year and next—and the right hon. Gentleman himself will be in the market borrowing money for rearmament, because he is not going to get it all by taxation—would be useful. I suggest that the Government take the Clause away and see whether its operation cannot be achieved without it or in a better way.

Mr. Gaitskell

I think it may be for the convenience of the Committee if I make a simple reply to the three or four excellent speeches we have heard. The right hon. Gentleman the Member for Saffron Walden (Mr. Butler) objected to what he described as a political speech by me the other night. My difficulty is that sometimes I have to reply to political speeches, and though perhaps he regarded the speech of his right hon. Friend the Member for Aldershot (Mr. Lyttelton) as being completely inoffensive, from my point of view it did not look like that. We are, after all, politicians, and there is no harm in having a little hard hitting, but this morning I will, in response to the speeches which have been made, try to keep the temperature a little lower.

I should like to begin with some remarks about the background of our problem today. The Government have to achieve three major objectives—to carry out the defence programme as safely and smoothly as possible; to maintain as far as they can our exports at a level which they have described as sufficient to pay for current imports, excluding stockpiling, and to restrict inflation internally as far as lies within our power to do.

8.45 a.m.

In considering these three objectives, which I do not think are in dispute, one must have special regard to the position of what is described in the jargon as the "investment cuts industries"—the heavy industries, the engineering group, those on which the demands for capital equipment are concentrated. Because, undoubtedly, it is in this sphere that our major difficulties in trying to reach all three of those objectives—certainly the first two—arise.

The first point I want to make clear is that the capacity there is limited. It is undoubtedly very heavily loaded at the moment. Most of the firms concerned are in the position where they have long order books, and I do not think it is appropriate to say that, with that situation, productivity will be greatly affected by the change we are proposing. Perhaps I can explain that a little more fully. We have from this group of industries to try to extort, as it were—to extract—sufficient, first, for the defence programme, secondly for the maintenance, at least, if we possibly can of the same volume of exports, contributing as this group does something like half our total exports, and, thirdly, the equipment that British industry needs.

The hon. Member for Chippenham (Mr. Eccles) is quite right. He and I both agree that this group of industries cannot do all these things with their limited capacity. At the same time, we cannot afford to increase the activity and, at the same time, even if we tried to do that in present circumstances, as I have explained and as my right hon. Friends have explained to the House on many occasions, there would not be sufficient raw materials. Therefore something has to go. Some pruning has to be done. The question is where is the pruning to be made? [An HON. MEMBER: "Government expenditure."] Obviously we would prefer not to have to do it at all. We would like to have the exports at the maximum level, we would like to carry out the defence programme, and to have as much as possible for British industry.

Then where is it to come from? I think we have here to accept some reduction below what we would like in home investment. Again the hon. Member for Chippenham agrees with that. If we take no action about this one of the consequences will be that we shall not maintain our exports. I must emphasise in present circumstances how absolutely vital it is to do that. I think it was the hon. Member for Woking (Mr. Watkinson) who asked how serious was the recent deterioration in our terms of trade. I would not like, without looking up the figures, to say anything very precise, but I will tell the Committee that the position is, if anything, rather worse than it was when the Economic Survey was written, and certainly we shall need to strain every nerve, particularly in the field of engineering, if we are to hold our ground there in the balance of payments.

That leads one on to the necessity of doing something to restrict home investment further. If we do not do that, either we lose exports or—and this is perhaps even more serious—we do not get the defence output we need. And, on top of that, undoubtedly we shall have a very substantial inflationary process being generated.

Perhaps I may divert to that for a moment because I do not think much has been said about it. It is, after all, a fairly obvious feature of the situation that if more and more orders are placed on to an already overloaded industry, it has a distinct tendency to induce purchasers to push prices up still further. That has nothing to do with the general inflationary tendencies which, unfortunately, exist at the moment.

How, then, should we deal with it? The hon. Member for Orkney and Shetland (Mr. Grimond) suggested that the instrument we had chosen here was too blunt. Perhaps I may remind him of what I said on this general subject in the defence debate last February. I suggested that, in trying to exercise control over our economic affairs generally, we could use physical controls, and we could use the monetary policies. I do not think that it would be disputed that, as between the two, initial allowances fall into the latter rather than the former category. They are rather similar, as the hon. Member for Chippenham has said, to credit restriction; but, just as I said at that time, that money policy is the blunt instrument—physical controls are finer and more precise in nature—I emphasised that it is not possible to control the situation by these abnormal needs if one has an adverse climate on the monetary side. I do not think I say anything with which hon. Members would disagree. Therefore, even though we desire to use physical controls, they must be supported on the other side as well.

Now let me say something about the investment programme. It has got to be reduced and so far as the various programmes of the different departments are concerned, that is being done. They are being limited in the same way as in recent years, but we have a special problem in private industry. In that, at any rate, unless one gets back to a far more elaborate system of controls than we have contemplated so far, one has to rely more on the monetary side.

We shall, of course, use the investment programme to play its part; that is also, in my view, quite essential. I am, therefore, a little surprised that hon. Members opposite should criticise this particular move because it is within the category of action which they generally recommend to us—[HON. MEMBERS: "No."] Yes it is; but if hon. Members disagree, then let me develop my argument.

We are often told by hon. Members opposite that we should have a more strict credit policy and that by leaving the ordinary maximum of interest rates we should induce a reduction in investment. But I am sure the Committee will appreciate that the Chancellor of the Exchequer has to be very careful what he says about interest rates, for half a sentence may give all sorts of wrong impressions. Therefore, I am not going to say anything very precise on this subject, but if hon. Members opposite say we believe that credit should be more restricted that is not a very different instrument from that which they use when they say the first thing they would do by this Clause would be to say, "No more interest-free loans". That is the way the initial allowances could be described, and I have no great objection to that terminology. But as the hon. Member for Chippenham (Mr. Eccles) suggested, this is not a necessary alternative. I do not agree that interest rates, in fact, have gone up, and I will leave the matter at that. In so far as there would be difficulties for firms in a shortage of credit as a result, well, one is doing very much the same thing as is done in suspending the initial allowances.

Perhaps I should say a word about productivity, to which the hon. Member for Woking referred to earlier. I hope he will agree with me when we say that we have got to limit the orders placed on the engineering group of industries for home industrial purposes, because that is all we can afford, and that it is not then much good seeking for higher productivity for that purpose. All we can do is to get the best level of productivity—

Mr. Watkinson

Would the right hon. Gentleman accept that if we get increased productivity of another 7 or 8 per cent., as we have in recent years, we have gone a great way to solving our problems?

Mr. Gaitskell

The hon. Member knows that I have repeatedly impressed on the country as far as I can the great importance of higher productivity, but we have to consider the problem in the light of that demand on industry and on the raw materials situation. It is no good hoping to find a solution by saying, "All right, we will not restrict investment at all, but we will let people go ahead as fast as they can, despite the effect on raw materials, which is going to hold things up, and despite the fact that we know if that happens the defence programme would not be carried out and exports would fall." It is not lack of enthusiasm on our part but the framework in which the problem has to be considered.

I should like to say one thing at any rate about the other major criticism that has been made—that the result of this will be to make industry short of cash. The hon. Member for Chippenham made the point that if we do this we will carry things so far as to create a kind of deflationary situation. If I thought that the Government were going to create unemployment in the industries concerned by this policy, I would not be standing here recommending it to the Committee. I am quite certain that there is not the slightest danger of that.

I have tried to follow the arguments of hon. Members opposite on this point, and I know that they sincerely believe that we are creating a shortage of cash in industry, but how can they reconcile that with the fact that at the same time there is still tremendous pressure on demand in the engineering industry, with which we are trying to deal? That seems to me to be the answer to the situation.

Mr. Eccles

The Chancellor of the Exchequer overlooks the fact that a company uses its cash for several purposes. I am thinking, for example, of Imperial Chemical Industries. They might get an allowance of £3 million for a new sulphur plant. That will be a drain on their reserves if the right hon. Gentleman will not lend it, for with cash reserves they have to buy raw materials and invest in other forms of working capital. I think he will agree that the net result of his proposal will be a larger queue of business men at the bankers' parlours or at the insurance companies asking for money.

Mr. Gaitskell

I do not deny that, but it largely depends on what is meant by shortage of cash. Some firms may, as a result of this, find themselves obliged to borrow from the banks, but I do not think it will be on anything like the scale, which hon. Members would have us believe. Further, the hon. Member for Chippenham has overlooked the very substantial reserves that, in fact, are held by most firms.

Sir H. Williams

Those are not cash.

Mr. Pitman

Reserves have nothing to do with cash.

Mr. Gaitskell

Reserves are available in a form which can easily be converted into purchasing power.

Hon. Members

No.

Sir H. Williams

Nonsense.

Mr. Gaitskell

Everybody knows that reserves can be held in purely physical form, and they can certainly be used for that purpose.

Mr. Pitman

A company could have a large overdraft and large reserves.

Mr. Gaitskell

I quite agree, but I do not think that that proves anything at all. I am not denying in any case the possibility that there might be some firms going to the banks for money.

9.0 a.m.

I repeat that it is a matter of opinion, and hon. Members are entitled to their opinions. My view, in the light of the advice I have received, is that I do not think it would be on the scale hon. Members opposite anticipate. But that there would be some tendency that way is true. Is that an argument for doing nothing about this? If we want to create a rather divided situation and to create less inflationary pressure and reduce the tendency for firms to place quite so many orders as they are at the moment, is it not necessary, if one is to use these monetary controls, to try and create a situation in which they will not find it so easy to do as before. That is all that is being proposed in this.

Hon. Members opposite have always argued that one cannot do these things by physical controls. I suggest that one is driven back on this in the present circumstances as an essential measure. That brings me to my last point. I do not think the effect of this should be exaggerated, and there is awfully little evidence to suggest serious problems would be faced. If one is to try and reduce inflationary pressure by these methods, one must face the fact that some firms would find it more difficult than before to realise and spend all the money they would like to spend.

In the present circumstances, I am convinced that this policy is necessary. It is our hope, and we have every reason to believe, that it will be temporary only, and I find it difficult to reconcile some different points of view. We are told by some hon. Members than one cannot keep on changing these initial allowances because firms must know exactly where they are a long time ahead, and other hon. Members say that we do not adapt our- selves sufficiently rapidly to the changed situation.

When these initial allowances were introduced, everybody agreed—there was no great enthusiasm for them on the benches opposite—that it was a good idea to try and stimulate and encourage firms to spend more on capital equipment and make it easier for them to place orders and buy more capital equipment. That was true then, but we have a new situation now, and in that new situation, from the start, I have said we have to use every possible measure that is at our disposal for carrying out the rearmament programme, maintaining the export trade, and controlling inflation.

When the defence programme is completed and when we are in a position to allow greater pressure from the home market on this group of industries, I should have thought there would be everything to be said for replacing the initial allowances. I am certain that in the present circumstances any Government that failed to do this, and it has no political advantage which is obvious enough although I knew there would be some reaction from industry, both from those who want the allowances and from those who like as long order books as possible—

Mr. Turton rose—

Mr. Gaitskell

Please, let me conclude. Nevertheless, in the circumstances of today, any Government who refused to do this would be failing in its duty to the country.

Mr. R. J. Taylor rose in his place and claimed to move, "That the Question be now put."

Hon. Members

Gag.

The Chairman

I think I should inform the Committee that, whilst I have a very wide discretion if there is no abuse of the Rules, or the rights of the minority are not being infringed, and if there has been a fair opportunity for debate, I have no other alternative but to accept the Closure. May I say that the debate on this very Clause and on all the Amendments I have selected has continued for some nine hours. If any right hon. Gentleman had desired to intervene, I would have called upon him, but, in the circumstances, I think I am fully justified in accepting the Motion proposed from the Government Front Bench.

Mr. Turton

When you were not in the Chair, Major Milner, the Chancellor said—and he will contradict me if I am wrong—that he rose to speak at that point in order to deal with the first four speeches. There are a number of hon. Members who have wished to put points in detail on the agricultural industry. Two points in that connection were addressed to the Chancellor and he made no answer. When I rose to ask him a question he told me that he wished to finish his speech, presumably to allow the debate on agriculture to follow.

The Chairman

I have no knowledge of that. It does not seem to me to be very relevant.

Mr. Pitman

On a point of order.

The Chairman

The question of whether the Closure is accepted or not is not debatable. Having regard to the circumstances. I thought I might perhaps explain the grounds on which I thought it proper to accept that Motion.

Question put, "That the Question be now put."

The Committee divided: Ayes, 282; Noes, 271.

Division No. 100.]	AYES	[9.6 a.m.
Acland, Sir Richard	Bellenger, Rt. Hon. F. J.	Broughton, Dr. A. D. D.
Adams, Richard	Benn, Wedgwood	Brown, Rt. Hon. George (Belper)
Albu, A. H.	Benson, G.	Brown, Thomas (Ince)
Allen, Arthur (Bosworth)	Beswick, F.	Burke, W. A.
Allen, Scholefield (Cram)	Bevan, Rt. Hon. A. (Ebbw Vale)	Burton, Miss. E.
Anderson, Alexander (Motherwell)	Bing, G. H. C.	Butler, Herbert (Hackney, S.)
Anderson, Frank (Whitehaven)	Blenkinsop, A.	Callaghan, L. J.
Attlee, Rt. Hon. C. R.	Boardman, H.	Carmichael, J.
Awbery, S. S.	Booth, A.	Castle, Mrs. B. A.
Ayles, W. H.	BoMomley, A. G.	Champion. A. J.
Bacon, Miss. Alice	Bowdon, H. W.	Chetwynd, G. R.
Baird, J.	Bowles, F. G. (Nuneaton)	Clunie, J.
Balfour, A.	Braddock, Mrs. Elizabeth	Cocks, F. S.
Barnes, Rt. Hon. A. J.	Brook, Dryden (Halifax)	Coldrick, W.
Bartley, P.	Brooks, T. J. (Normanton)	Collindridge, F.
Cook, T. F.	Irving, W. J. (Wood Green)	Pursey, Cmdr. H.
Cooper, Geoffrey (Middlesbrough, W.)	Isaacs, Rt. Hon. G. A.	Rankin, J.
Cooper, John (Deptford)	Janner, B.	Rees, Mrs. D.
Corbel, Mrs. Freda (Peckham)	Jay, D. P. T.	Reeves, J.
Cove, W. G.	Jeger, George (Goole)	Reid, Thomas (Swindon)
Craddock, George (Bradford, S.)	Jeger, Dr. Santo (St. Pancras, S.)	Reid, William (Camlachie)
Crawley, A.	Jenkins, R. H.	Rhodes, H.
Crosland, C. A. R.	Johnson, James (Rugby)	Richards, R.
Crossman, R. H. S.	Johnston, Douglas (Paisley)	Robens, Rt. Hon. A.
Cullen, Mrs. A.	Jones, David (Hartlepool)	Roberts, Goronwy (Caernarvonshire)
Daines, P.	Jones, Frederick Elwyn (West Ham, S.)	Robertson, J. J. (Berwick)
Dalton, Rt. Hon. H.	Jones, Jack (Rotherham)	Robinson, Kenneth (St. Pancras, N.)
Darling, George (Hillsborough)	Jones, William Elwyn (Conway)	Rogers, George (Kensington, N.)
Davies, A. Edward (Stoke, N.)	Keenan, W.	Ross, William (Kilmarnock)
Davies, Harold (Leek)	Kenyon, C.	Shawcross, Rt. Hon. Sir Hartley
de Freitas, Geoffrey	Key, Rt. Hon. C. W.	Shinwell, Rt. Hon. E.
Deer, G.	King, Dr. H. M.	Shurmer, P. L. E.
Delargy, H. J.	Kinghorn, Sqn. Ldr. E.	Silverman, Julius (Erdington)
Dodds, N. N.	Kinley, J.	Silverman, Sydney (Nelson)
Donnelly, D.	Lang, Gordon	Simmons, C. J.
Driberg, T. E. N.	Lee, Frederick (Newton)	Slater, J.
Dugdale, Rt. Hon. John (W. Bromwich)	Lee, Miss. Jennie (Cannock)	Smith, Ellis (Stoke, S.)
Dye, S.	Lever, Harold (Cheetham)	Smith, Norman (Nottingham, S.)
Ede, Rt. Hon. J. C.	Lever, Leslie (Ardwick)	Sorensen, R. W.
Edelman, M.	Lewis, Arthur (West Ham, N.)	Soskice, Rt. Hon. Sir. Frank
Edwards, John (Brighouse)	Lewis, John (Bolton, W.)	Sparks, J. A.
Edwards, Rt. Hon. Ness (Caerphilly)	Lindgren, G. S.	Steele, T.
Edwards, W. J. (Stepney)	Lipton, Lt.-Col. M.	Stewart, Michael (Fulham, E.)
Evans, Albert (Islington, S. W.)	Longden, Fred (Small Heath)	Stokes, Rt. Hon. R. R.
Evans, Edward (Lowestoft)	McAllister, G.	Strachey, Rt. Hon. J.
Evans, Stanley (Wednesbury)	MacColl, J. E.	Strauss, Rt. Hon. George (Vauxhall)
Ewart, R.	McGhee, H. G.	Stross, Dr. Barnett
Fernyhough, E.	McInnes, J.	Summerskill, Rt. Hon. Edith
Field, Cap. W. J.	Mack, J. D.	Sylvester, G. O.
Finch, H. J.	McKay, John (Wallsend)	Taylor, Bernard (Mansfield)
Fletcher, Eric (Islington, E.)	Mackay, R. W. G. (Reading, N.)	Taylor, Robert (Morpeth)
Follick, M.	McLeavy, F.	Thomas, David (Aberdare)
Foot, M. M.	MacMillan, Malcolm (Western Isles)	Thomas, George (Cardiff)
Forman, J. C.	McNeil, Rt. Hon. H.	Thomas, Iorwerth (Rhondda, W.)
Fraser, Thomas (Hamilton)	MacPherson, Malcolm (Stirling)	Thomas, Ivor Owen (Wrekin)
Freeman, John (Watford)	Mallalieu, E. L. (Brigg)	Thorneycroft, Harry (Clayton)
Freeman, Peter (Newport)	Mallalieu, J. P. W. (Huddersfield, E.)	Thurtle, Ernest
Gaitskell, Rt. Hon. H. T. N.	Mann, Mrs. Jean	Timmons, J.
Ganley, Mrs. C. S.	Manuel, A. C.	Tomney, F.
Gibson, C. W.	Marquand, Rt. Hon. H. A.	Turner-Samuels, M.
Gilzean, A.	Mathers, Rt. Hon. G.	Ungoed-Thomas, Sir Lynn
Glanville, James (Consett)	Mellish, R. J.	Usborne, H.
Gooch, E. G.	Messer, F.	Vernon, W. F.
Gordon-Walker, Rt. Hon. P. C.	Middleton, Mrs. L.	Viant, S. P.
Greenwood, Anthony (Rossendale)	Mikardo, Ian	Wallace, H. W.
Greenwood, Rt. Hon. Arthur (Wakefield)	Mitchison, G. R.	Watkins, T. E.
Grenfell, D. R.	Moeran, E. W.	Webb, Rt. Hon. M. (Bradford, C.)
Grey, C. F.	Monslow, W.	Weitzman, D.
Griffiths, David (Rother Valley)	Moody, A. S.
Griffiths, Rt. Hon. James (Llanelly)	Morgan Dr. H. B.	Wells, Percy (Faversham)
Griffiths, William (Exchange)	Morlay, R.	Wells, William (Walsall)
Gunter, R. J.	Morris, Percy (Swansea, W.)	West, D. G.
Hale, Joseph (Rochdale)	Mort, D. L.	Wheatley, Rt. Hon. John (Edinb'gh, E.)
Hall, John (Gateshead, W.)	Moyle, A.	White, Mrs. Eirene (E. Flint)
Hall, Rt. Hon. Glenvil (Colne Valley)	Mulley, F. W.	White, Henry (Derbyshire, N. E.)
Hamilton, W. W.	Murray, D.	Whiteley, Rt. Hon. W.
Hannan, W.	Nally, W.	Wilcock, Group Capt. C. A. B.
Hardy, E. A.	Neal, Harold (Bolsover)	Wilkins, W. A.
	Noel-Baker, Rt. Hon. P.	Willey, Frederick (Sunderland)
Hargreaves, A.	O'Brien, T.	Willey, Octavius (Cleveland)
Hastings, S.	Oldfield, W. H.	Williams, David (Neath)
Hayman, F. H.	Oliver, G. H.	Williams, Rev. Llywelyn (Abertillery)
Henderson, Rt. Hon. A. (Rowley Regis)	Orbach, M.	Williams, Ronald (Wigan)
Herbison, Miss. M.	Padley, W. E.	Williams, Rt. Hon. Thomas (Don V'lly)
Hewitson, Capt. M.	Paling, Rt. Hon. Wilfred (Dearne V'lly)	Wilson, Rt. Hon. Harold (Huyton)
Hobson, C. R.	Paling, Will T. (Dewsbury)	Winterbottom, Ian (Nottingham, C.)
Holman, P.	Pannell, T. C.	Winterbottom, Richard (Brightside)
Holmes, Horace (Hemsworth)	Pargiter, G. A.	Wise, F. J.
Hoy, J.	Parker, J.	Woodburn, Rt. Hon. A.
Hubbard, T.	Paton, J.	Wyatt, W. L.
Hudson, James (Eating, N.)	Peart, T. F.	Yates, V. F.
Hughes, Emrys (S. Ayrshire)	Popplewell, E.	Younger, Hon. K.
Hughes, Hector (Aberdeen, N.)	Porter, G.
Hynd, H. (Accrington)	Price, Philips (Gloucestershire, W.)	TELLERS FOR THE AYES:
Hynd, J. B. (Attercliffe)	Proctor, W. T.	Mr. Pearson and Mr. Royle.
Irvine, A. J. (Edge Hill)	Pryde, D. J.

NOES
Aitken, W. T.	Galbraith, T. G. D. (Hillhead)	Marshall, Douglas (Bodmin)
Alport, C. J. M.	Garner-Evans, E. H. (Denbigh)	Marshall, Sidney (Sutton)
Amery, Julian (Preston, N.)	Gates, Maj. E. E.	Maude, Angus (Ealing, S.)
Amory, Heathcoat (Tiverton)	Gomme-Duncan, Col. A.	Maudling, R.
Arbuthnot, John	Gridley, Sir Arnold	Medlicott, Brig. F.
Ashton, H. (Chelmsford)	Grimond, J.	Mellor, Sir John
Assheton, Rt. Hon. R. (Blackburn, W.)	Grimston, Hon. John (St. Albans)	Molson, A. H. E.
Astor, Hon. M. L.	Grimston, Robert (Westbury)	Monckton, Sir Walter
Baker, P. A. D.	Harden, J. R. E.	Moore, Lt.-Col. Sir Thomas
Baldock, Lt.-Cmdr. J. M.	Hare, Hon. J. H. (Woodbridge)	Morrison, John (Salisbury)
Baldwin, A. E.	Harris, Frederic (Croydon, N.)	Morrison, Rt. Hon. W. S. (Chencester)
Banks, Col. C.	Harris, Reader (Heston)	Mott-Radclyffe, C. E.
Baxter, A. B.	Harvey, Air Cdre. A. V. (Macclesfield)	Nabarro, G.
Beamish, Major Tufton	Harvey, Ian (Harrow, E.)	Nicholls, Harmar
Bell, R. M.	Harvie-Watt, Sir G. S.	Nicholson, G.
Bennett, Sir Peter (Edgbaston)	Hay, John	Nield, Basil (Chester)
Bennett, Dr. Reginald (Gosport)	Head, Brig. A. H.	Noble, Comdr. A. H. P.
Bennett, William (Woodside)	Headlam, Lieut.-Col. Rt. Hon. Sir C.	Nugent, G. R. H.
Bevins, J. R. (Liverpool, Toxteth)	Heald, Lionel	Nutting, Anthony
Bishop, F. P.	Heath, Edward	Oakshott, H. D.
Black, C. W.	Henderson, John (Cathcart)	Odey, G. W.
Boles, Lt.-Col. D. C. (Wells)	Hicks-Beach. Maj. W. W.	O'Neill, Rt. Hon. Sir Hugh
Boothby, R.	Higgs, J. M. C.	Ormsby-Gore, Hon. W. D.
Bossom, A. C.	Hill, Mrs. E. (Wythenshawe)	Orr, Capt. L. P. S.
Bowen, E. R. (Cardigan)	Hill, Dr. Charles (Luton)	Orr-Ewing, Charles Ian (Hendon, N.)
Boyd-Carpenter, J. A.	Hinchingbrooke, Viscount	Orr-Ewing, Ian L. (Weston-super-Mare)
Boyle, Sir Edward	Hirst, Geoffrey	Osborne, C.
Bracken, Rt. Hon. B.	Holmes, Sir Stanley (Harwich)	Peake, Rt. Hon. O.
Braine, B. R.	Hope, Lord John	Perkins, W. R. D.
Braithwaite, Sir Albert (Harrow, W.)	Hopkinson, Henry	Peto, Brig. C. H. M.
Braithwaite, Lt.-Cr. G. (Bristol, N. W.)	Hornsby-Smith, Miss. P.	Pickthorn, K.
Bromley-Davenport, Lt.-Col. W.)	Horsbrugh, Rt. Hon. Florence	Pitman, I. J.
Brooke, Henry (Hampstead)	Howard, Gerald (Cambridgeshire)	Powell, J. Enoch
Browne, Jack (Govan)	Howard, Greville (St. Ives)	Price, Henry (Lewisham, W.)
Buchan-Hepburn, P. G. T.	Hudson, Sir Austin (Lewisham, N.)	Prior-Palmer, Brig. O.
Bullus, Wing Commander E. E.	Hudson, Rt. Hon. Robert (Southport)	Profumo, J. D.
Burden, F. A.	Hudson, W. R. A. (Hull, N.)	Raikes, H. V.
Butcher, H. W.	Hutchinson, Geoffrey (Ilford, N.)	Rayner, Brig. R.
Butler, Rt. Hon. R. A. (Saffron Walden)	Hutchison, Lt.-Com. Clark (E'b'rgh W.)	Redmayne, M.
Carr, Robert (Mitcham)	Hutchison, Colonel James (Glasgow)	Remnant, Hon. P.
Carson, Hon. E.	Jennings, R.	Renton, D. L. M.
Channon, H.	Johnson, Howard (Kemptown)	Roberts, Major Peter (Heeley)
Churchill, Rt. Hon. W. S.	Jones, A. (Hall Green)	Robertson, Sir David (Caithness)
Clarke, Col. Ralph (East Grinstead)	Joynson-Hicks, Hon. L. W.	Robinson, Roland (Blackpool, S.)
Clarke, Brig. Terence (Portsmouth, W.)	Kaberry, D.	Robson-Brown, W.
Colegate, A.	Kerr, H. W. (Cambridge)	Rodgers, John (Sevenoaks)
Conant, Maj. R. J. E.	Kingsmill, Lt.-Col. W. H.	Roper, Sir Harold
Cooper, Sqn. Ldr. Albert (Ilford, S.)	Lambert, Hon. G.	Ropner, Col. L.
Cooper-Key, E. M.	Lancaster, Col. C. G.	Russell, R. S.
Corbett, Lt.-Col. Uvedale (Ludlow)	Langford-Holt, J.	Ryder, Capt. R. E. D.
Craddock, Beresford (Spelthorne)	Law, Rt. Hon. R. K.	Salter, Rt. Hon. Sir Arthur
Cranborne, Viscount	Leather, E. H. C.	Scott, Donald
Crookshank, Capt. Rt. Hon. H. F. C.	Legge-Bourke, Maj. E. A. H.	Shepherd, William
Crosthwaite-Eyre, Col. O. E.	Lennox-Boyd, A. T.	Smithers, Peter (Winchester)
Crouch, R. F.	Lindsay, Martin	Smyth, Brig. J. G. (Norwood)
Crowder, Capt. John (Finchley)	Linstead, H. N.	Snadden, W. McN.
Cundiff, F. W.	Llewellyn, D.	Soames, Capt. C.
Cuthbert, W. N.	Lloyd, Rt. Hn. Geoffrey (King's Norton)	Spearman, A. C. M.
Darling, Sir William (Edinburgh, S.)	Lloyd, Maj. Guy (Renfrew, E.)	Spence, H. R. (Aberdeenshire, W.)
Davidson, Viscountess	Lloyd, Selwyn (Wirral)	Spens, Sir Patrick (Kensington, S.)
Davies, Nigel (Epping)	Lockwood, Lt.-Col. J. C.	Stanley, Capt. Hon. Richard (N. Fylde)
de Chair, Somerset	Longden, Gilbert (Herts, S. W.)	Stevens, G. P.
De la Bère, R.	Low, A. R. W.	Steward, W. A. (Woolwich, W.)
Deedes, W. F.	Lucas, Sir Jocelyn (Portsmouth, S.)	Stewart, Henderson (Fife, E.)
Dodds-Parker, A. J.	Lucas, P. B. (Brentford)	Stoddart-Scott, Col. M.
Donner, P. W.	Lucas-Tooth, Sir Hugh	Storey, S.
Douglas-Hamilton, Lord Malcolm	Lyttelton, Rt. Hon. O.	Strauss, Henry (Norwich, S.)
Drayson, G. B.	McAdden, S. J.	Stuart, Rt. Hon. James (Moray)
Dugdale, Maj. Sir Thomas (Richmond)	McCorquodale, Rt. Hon. M. S.	Summers, G. S.
Duncan, Capt. J. A. L.	Macdonald, Sir Peter (I. of Wight)	Sutcliffe, H.
Dunglass, Lord	Mackeson, Brig. H. R.	Taylor, Charles (Eastbourne)
Duthie, W. S.	McKibbin, A.	Taylor, William (Bradford, N.)
Eccles, D. M.	McKie, J. H. (Galloway)	Teeling, W.
Eden, Rt. Hon. A.	Maclay, Hon. John	Teevan, T. L.
Elliot, Rt. Hon. W. E.	Maclean, Fitzroy	Thomas, J. P. L. (Hereford)
Erroll, F. J.	MacLeod, Iain (Enfield, W.)	Thompson, Kenneth Pugh (Walton)
Fisher, Nigel	MacLeod, John (Ross and Cromarty)	Thompson, R. H. M. (Croydon, W.)
Fort, R.	Macmillan, Rt. Hon. Harold (Bromley)	Thorneycroft, Peter (Monmouth)
Fraser, Hon. Hugh (Stone)	Macpherson, Major Niall (Dumfries)	Thornton-Kemsley, Col. C. N.
Fraser, Sir Ian (Morecambe & Lonsdale)	Maitland, Comdr. J. W.	Thorp, Brig. R. A. F.
Fyfe, Rt. Hon. Sir David Maxwell	Manningham-Buller, R. E.	Tilney, John
Gage, C. H.	Marlowe, A. A. H.	Turner, H. F. L.
Galbraith, Cmdr. T. D. (Pollok)	Marples, A. E.	Turton, R. H.

Tweedsmuir, Lady	Ward, Miss. I. (Tynemouth)	Williams, Sir Herbert (Croydon, E.)
Vane, W. M. F.	Waterhouse, Capt. Rt. Hon. C.	Wills, G.
Vaughan-Morgan, J. K.	Watkinson, H.	Wilson, Geoffrey (Truro)
Vosper, D. F.	Webbe, Sir Harold	Winterton, Rt. Hon. Earl
Wakefield, Edward (Derbyshire, W.)	Wheatley, Major M. J. (Poole)	Wood, Hon. R.
Wakefield, Sir Wavell (Marylebone)	White, Baker (Canterbury)	York, C.
Walker-Smith, D. C.	Williams, Charles (Torquay)	TELLERS FOR THE NOES:
Ward, Hon. George (Worcester)	Williams, Gerald (Tonbridge)	Mr. Studholme and Mr. Digby.

Question put, "That the Clause, as amended, stand part of the Bill."

The Committee divided: Ayes, 285; Noes, 270.

Division No. 101.]	AYES	[9.20 a.m.
Acland, Sir Richard	Edelman, M.	Jones, William Elwyn (Conway)
Adams, Richard	Edwards, John (Brighouse)	Keenan, W.
Albu, A. H.	Edwards, Rt. Hon. Nets (Caerphilly)	Kenyon, C.
Allen, Arthur (Bosworth)	Edwards, W. J. (Stepney)	Key, Rt. Hon. C. W.
Allen, Scholefield (Crewe)	Evans, Albert (Islington, S. W.)	King, Dr. H. M.
Anderson, Alexander (Motherwell)	Evans, Edward (Lowestoft)	Kinghorn, Sqn. Ldr. E.
Anderson, Frank (Whitehaven)	Evans, Stanley (Wednesbury)	Kinley, J.
Attlee, Rt. Hon. C. R.	Ewart, R.	Lang, Gordon
Awbery, S. S.	Fernyhough, E.	Lee, Frederick (Newton)
Ayles, W. H.	Field. Capt. W. J.	Lee, Miss. Jennie (Cannock)
Bacon, Miss. Alice	Finch, H. J.	Lever, Harold (Cheetham)
Baird, J.	Fletcher, Eric (Islington, E.)	Lever, Leslie (Ardwick)
Balfour, A.	Follick, M.	Lewis, Arthur (West Ham, N.)
Barnes, Rt. Hon. A. J.	Foot, M. M.	Lewis, John (Bolton, W.)
Bartley, P.	Forman, J. C.	Lindgren, G. S.
Bellenger, Rt. Hon. F. J.	Fraser, Thomas (Hamilton)	Lipton, Lt.-Col. M.
Benn, Wedgwood	Freeman, John (Watford)	Longden, Fred (Small Heath)
Benson, G.	Freeman, Peter (Newport)	McAllister, G.
Beswick, F.	Gaitskell, Rt. Hon. H. T. N.	MacColl, J. E.
Bevan, Rt. Hon. A. (Ebbw Vale)	Ganley, Mrs. C. S.	McGhee, H. G.
Bing, G. H. C.	Gibson, C. W.	McInnes, J.
Blenkinsop, A.	Gilzean, A.	Mack, J. D.
Boardman, H.	Glanville, James (Consett)	McKay, John (Wallsend)
Booth, A.	Gooch, E. G.	Mackay, R. W. G. (Reading, N.)
Bottomley, A. G.	Gordon-Walker, Rt. Hon. P. C.	McLeavy, F.
Bowden, H. W.	Greenwood, Anthony (Rossendale)	MacMillan, Malcolm (Western Isles)
Bowen, E. R.	Greenwood, Rt. Hon. Arthur (Wakefield)	McNeil, Rt. Hon. H.
Bowles, F. G. (Nuneaton)	Grenfell, D. R.	MacPherson, Malcolm (Stirling)
Braddock, Mrs. Elizabeth	Grey, C. F.	Mallalieu, E. L. (Brigg)
Brook, Dryden (Halifax)	Griffiths, David (Rother Valley)	Mallalieu, J. P. W. (Huddersfield, E.)
Brooks, T. J. (Normanton)	Griffiths, Rt. Hon. James (Llanelly)	Mann, Mrs. Jean
Broughton, Dr. A. D. D.	Griffiths, W. D. (Exchange)	Manuel, A. C.
Brown, Rt. Hon. George (Belper)	Grimond, J.	Marquand, Rt. Hon. H. A.
Brown, Thomas (Ince)	Gunter, R. J.	Mathers, Rt. Hon. G.
Burke, W. A.	Hale, Joseph (Rochdale)	Mellish, R. J.
Burton, Miss. E.	Hall, John (Galeshead, W.)	Messer, F.
Butler, Herbert (Hackney, S.)	Hall, Rt. Hon. Glenvil (Colne Valley)	Middleton, Mrs. L.
Callaghan, L. J.	Hamilton, W. W.	Mikardo, Ian
Carmichael, J.	Hannan, W.	Mitchison, G. R.
Castle, Mrs. B. A.	Hardy, E. A.	Moeran, E. W.
Champion, A. J.	Hargreaves, A.	Monslow, W.
Chetwynd, G. R.	Hastings, S.	Moody, A. S.
Clunie, J.	Hayman, F. H.	Morgan, Dr. H. B.
Cocks, F. S.	Henderson, Rt. Hon. Arthur (Tipton)	Morley, R.
Coldrick, W.	Herbison, Miss. M.	Morris, Percy (Swansea, W.)
Collindridge, F.	Hewitson, Capt. M.	Mort, D. L.
Cook, T. F.	Hobson, C. R.	Moyle, A.
Cooper, Geoffrey (Middlesbrough, W.)	Holman, P.	Mulley, F. W.
Cooper, John (Deptford)	Holmes, Horace (Hemsworth)	Murray, J. D.
Corbet, Mrs. Freda (Peckham)	Houghton, D.	Nally, W.
Cove, W. G.	Hoy, J.	Neal, Harold (Bolsover)
Craddock, George (Bradford, S.)	Hubbard, T.	Noel-Baker, Rt. Hon. P. J.
Crawley, A.	Hudson, James (Ealing, N.)	O'Brien, T.
Crosland, C. A. R.	Hughes, Emrys (S. Ayrshire)	Oldfield, W. H.
Crossman, R. H. S.	Hughes, Hector (Aberdeen, N.)	Oliver, G. H.
Cullen, Mrs. A.	Hynd, H. (Accrington)	Orbach, M.
Daines, P.	Hynd, J. B. (Attercliffe)	Padley, W. E.
Dalton, Rt. Hon. H.	Irvine, A. J. (Edge Hill)	Paling, Rt. Hon. Wilfred (Dearne V'lly)
Darling, George (Hillsborough)	Irving, W. J. (Wood Green)	Paling, Will T. (Dewsbury)
Davies, A. Edward (Stoke, N.)	Isaacs, Rt. Hon. G. A.	Pannell, T. C.
Davies, Harold (Leek)	Janner, B.	Pargiter, G. A.
de Freitas, Geoffrey	Jay, D. P. T.	Parker, J.
Deer, G.	Jeger, George (Goole)	Paton, J.
Delargy, H. J.	Jeger, Dr. Santo (St. Pancras, S.)	Peart, T. F.
Dodds, N. N.	Jenkins, R. H.	Popplewell, E.
Donnelly, D.	Johnson, James (Rugby)	Porter, G.
Driberg, T. E. N.	Johnston, Douglas (Paisley)	Price, Philips (Gloucestershire, W.)
Dugdale, Rt. Hon. John (W. Bromwich)	Jones, David (Hartlepool)	Proctor, W. T.
Dye, S.	Jones, Frederick Elwyn (West Ham, S.)	Pryde, D. J.
Ede, Rt. Hon. J. C.	Jones, Jack (Rotherham)	Pursey, Cmdr. H.
Rankin, J.	Stewart, Michael (Fulham, E.)	Wells, Percy (Faversham)
Rees, Mrs. D.	Stokes, Rt. Hon. R. R.	Wells, William (Walsall)
Reeves, J.	Strachey, Rt. Hon. J.	West, D. G.
Reid, Thomas (Swindon)	Strauss, Rt. Hon. George (Vauxhall)	Wheatley, Rt. Hon. J. (Edinb'gh, E.)
Reid, William (Camlachie)	Stross, Dr. Barnett	While, Mrs. Eirene (E. Flint)
Rhodes, H.	Summerskill, Rt. Hon. Edith	White, Henry (Derbyshire, N. E.)
Richards, R.	Sylvester, G. D.	Whiteley, Rt. Hon. W.
Robens, Rt. Hon. A.	Taylor, Bernard (Mansfield)	Wilcock, Group Capt. C. A. B.
Roberts, Goronwy (Caernarvonshire)	Taylor, Robert (Morpeth)	Wilkins, W. A.
Robertson, J. J. (Berwick)	Thomas, David (Aberdare)	Willey, Frederick (Sunderland)
Robinson, Kenneth (St. Pancras, N.)	Thomas, George (Cardiff)	Willey, Octavius (Cleveland)
Rogers, George (Kensington, N.)	Thomas, Iorwerth (Rhondda, W.)	Williams, David (Neath)
Ross, William (Kilmarnock)	Thomas, Ivor Owen (Wrekin)	Williams, Rev. Llywelyn (Abertillery)
Shawcross, Rt. Hon. Sir Hartley	Thorneycroft, Harry (Clayton)	Williams, Ronald (Wigan)
Shinwell, Rt. Hon. E.	Thurtle, Ernest	Williams, Rt. Hon. Thomas (Don V'lly)
Shurmer, P. L. E.	Timmons, J.	Wilson, Rt. Hon. Harold (Huyton)
Silverman, Julius (Erdington)	Tomney, F.	Winterbottom, Ian (Nottingham, C.)
Silverman, Sydney (Nelson)	Turner-Samuels, M.	Winterbottom, Richard (Brightside)
Simmons, C. J.	Ungoed-Thomas, Sir Lynn	Wise, F. J.
Slater, J.	Usborne, H.	Woodburn, Rt. Hon. A.
Smith, Ellis (Stoke, S.)	Vernon, W. F.	Wyatt, W. L.
Smith, Norman (Nottingham, S.)	Viant, S. P.	Yates, V. F.
Sorensen, R. W.	Wallace, H. W.	Younger, Hon. K.
Soskice, Rt. Hon. Sir Frank	Watkins, T. E.	TELLERS FOR THE AYES:
Sparks, J. A.	Webb, Rt. Hon. M. (Bradford, C.)	Mr. Pearson and Mr. Royle.
Steele, T.	Weitzman, D.
NOES
Aitken, W. T.	Cundiff, F. W.	Hornsby-Smith, Miss. P.
Alport, C. J. M.	Cuthbert, W. N.	Horsbrugh, Rt. Hon. Florence
Amery, Julian (Preston, N.)	Darling, Sir William (Edinburgh, S.)	Howard, Gerald (Cambridgeshire)
Amory, Heathcoat (Tiverton)	Davidson, Viscountess	Howard, Greville (St. Iver)
Arbuthnot, John	Davies, Nigel (Epping)	Hudson, Sir Austin (Lewisham, N.)
Ashton, H. (Chelmsford)	de Chair, Somerset	Hudson, Rt. Hon. Robert (Southport)
Assheton, Rt. Hon. R. (Blackburn, W.)	De la Bère, R.	Hudson, W. R. A. (Hull, N.)
Astor, Hon. M. L.	Deedes, W. F.	Hutchinson, Geoffrey (Ilford, N.)
Baker, P. A. D.	Digby, S. W.	Hutchison, Lt.-Com. Clark (E'b'rgh W.)
Baldock, Lt.-Cmdr. J. M.	Dodds-Parker, A. D.	Hutchison, Colonel James
Baldwin, A. E.	Donner, P. W.	Hylton-Foster, H. B.
Banks, Col. C.	Douglas-Hamilton, Lord Malcolm	Jennings, R.
Baxter, A. B.	Drayson, G. B.	Johnson, Major Howard (Kemptown)
Beamish, Major Tufton	Dugdale, Maj. Sir Thomas (Richmond)	Jones, A. (Hall Green)
Bell, R. M.	Duncan, Capt. J. A. L.	Joynson-Hicks, Hon. L. W.
Bennett, Sir Peter (Edgbaston)	Dunglass, Lord	Kaberry, D.
Bennett, Dr. Reginald (Gosport)	Duthie, W. S.	Kerr, H. W. (Cambridge)
Bennett, William (Woodside)	Eccles, D. M.	Kingsmill, Lt.-Col. W. H.
Bevins, J. R. (Liverpool, Toxteth)	Eden, Rt. Hon. A.	Lambert, Hon. G.
Birch, Nigel	Elliot, Rt. Hon. W. E.	Lancaster, Col. C. G.
Bishop, F. P.	Erroll, F. J.	Langford-Holt, J.
Black, C. W.	Fisher, Nigel	Law, Rt. Hon. R. K.
Boles, Lt.-Col. D. C. (Wells)	Fort, R.	Leather, E. H. C.
Boothby, R.	Fraser, Hon. Hugh (Stone)	Legge-Bourke, Maj. E. A. R.
Bossom, A. C.	Fraser, Sir I. (Morecambe & Lonsdale)	Lennox-Boyd, A. T.
Boyd-Carpenter, J. A.	Fyfe, Rt. Hon. Sir David Maxwell	Lindsay, Martin
Boyle, Sir Edward	Gage, C. H.	Linstead, H. N.
Bracken, Rt. Hon. B.	Galbraith, Cmdr. T. D. (Pollok)	Llewellyn, D.
Braine, B. R.	Garner-Evans, E. H. (Denbigh)	Lloyd, Rt. Hn. Geoffrey (King's Norton)
Braithwaite, Sir Albert (Harrow, W.)	Gates, Maj. E. E.	Lloyd, Maj. Guy (Renfrew, E.)
Braithwaite, Lt.-Cr. G. (Bristol, N. W.)	Gomme-Duncan, Col. A.	Lloyd, Selwyn (Wirral)
Bromley-Davenport, Lt.-Col. W.	Gridley, Sir Arnold	Lockwood, Lt.-Col. J. C.
Brooke, Henry (Hampstead)	Grimston, Hon. John (St. Albans)	Longden, Gilbert (Herts, S. W.)
Browne, Jack (Govan)	Grimston, Robert (Westbury)	Low, A. R. W.
Buchan-Hepburn, P. G. T.	Harden, J. R. E.	Lucas, Sir Jocelyn (Portsmouth, S.)
Bullus, Wing Commander E. E.	Hare, Hon. J. H. (Woodbridge)
Burden, F. A.	Harris, Frederic (Croydon, N.)	Lucas, P. B. (Brentford)
Butcher, H. W.	Harris, Reader (Heston)	Lucas-Tooth, Sir Hugh
Butter, Rt. Hn. R. A. (Saffron Walden)	Harvey, Air-Codre. A. V. (Macclesfield)	Lyttelton, Rt. Hon. O.
Carr, Robert (Mitcham)	Harvey, Ian (Harrow, E.)	McAdden, S. J.
Carson, Hon. E.	Harvie-Watt, Sir George	McCorquodale, Rt. Hon. M. S.
Channon, H.	Hay, John	Macdonald, Sir Peter (I. of Wight)
Churchill, Rt. Hon. W. S.	Head, Brig. A. H.	Mackeson, Brig. H. R.
Clarke, Col. Ralph (East Grinstead)	Headlam, Lt.-Col. Rt. Hon. Sir C.	McKibbin, A.
Clarke, Brig. Terence (Portsmouth, W.)	Heald, Lionel	McKie, J. H. (Galloway)
Colegate, A.	Heath, Edward	Maclay, Hon. John
Conant, Maj. R. J. E.	Henderson, John (Cathcart)	Maclean, Fitzroy
Cooper, Sqn. Ldr. Albert (Ilford, S.)	Hicks-Beach, Maj. W. W.	MacLeod, Iain (Enfield, W.)
Cooper-Key, E. M.	Higgs, J. M. C.	MacLeod, John (Ross and Cromarty)
Corbett, Lt.-Col. Uvedale (Ludlow)	Hill, Mrs. E. (Wythenshawe)	Macmillan, Rt. Hon. Harold (Bromley)
Craddock, Beresford (Spelthorne)	Hill, Dr. Charles (Luton)	Macpherson, Major Niall (Dumfries)
Cranborne, Viscount	Hinchingbrooke, Viscount	Maitland, Cmdr. J. W.
Crookshank, Capt. Rt. Hon. H. F. C.	Hirst, Geoffrey	Manningham-Buller, R. E.
Crosthwaite-Eyre, Col. O. E.	Holmes, Sir Stanley (Harwich)	Marlowe, A. A. H.
Crouch, R. F.	Hope, Lord John	Marples, A. E.
Crowder, Capt. John (Finchley)	Hopkinson, Henry	Marshall, Douglas (Bodmin)

Marshall, Sidney (Sutton)	Rayner, Brig. R.	Teevan, T. L.
Maude, Angus (Ealing, S.)	Redmayne, M.	Thomas, J. P. L. (Hereford)
Maudling R.	Remnant, Hon. P.	Thompson, Kenneth Pugh (Walton)
Medlicott, Brig. F.	Renton, D. L. M.	Thompson, Lt.-Cmdr. R. (Croyden, W.)
Mellor, Sir John	Roberts, Major Peter (Heeley)	Thorneycroft, Peter (Monmouth)
Molson, A. H. E.	Robertson, Sir David (Caithness)	Thornton-Kemsley, Col. C. N.
Monckton, Sir Walter	Robinson, Roland (Blackpool, S.)	Thorp, Brig. R. A. F.
Moore, Lt.-Col., Sir Thomas	Robson-Brown, W.	Tilney, John
Morrison, John (Salisbury)	Rodgers, John (Sevenoaks)	Turner, H. F. L.
Morrison, Rt. Hon. W. S. (Cirencester)	Roper, Sir Harold	Turton, R. H.
Mott-Radclyffe, C. E.	Ropner, Col. L.	Tweedsmuir, Lady
Nabarro, G.	Russell, R. S.	Vane, W. M. F.
Nicholls, Harmar	Ryder, Capt. R. E. D.	Vaughan-Morgan, J. K.
Nicholson, G.	Salter, Rt. Hon. Sir Arthur	Vosper, D. F.
Nield, Basil (Chester)	Scott, Donald	Wakefield, Edward (Derbyshire, W.)
Noble, Cmdr. A. H. R.	Shepherd, William	Wakefield, Sir Wavell (Marylebone)
Nugent, G. R. H.	Smithers, Peter (Winchester)	Walker-Smith, D. C.
Nutting, Anthony	Smyth, Brig. J. G. (Norwood)	Ward, Hon. George (Worcester)
Oakshott, H. D.	Snadden, W. McN.	Ward, Miss. I. (Tynemouth)
Odey, G. W.	Soames, Capt. C.	Waterhouse, Capt. Rt. Hon. C.
O'Neill, Rt. Hon. Sir Hugh	Spearman, A. C. M.	Watkinson, H.
Ormsby-Gore, Hon. W. D.	Spence, H. R. (Aberdeenshire, W.)	Webbe, Sir Harold
Orr, Capt. L. P. S.	Spens, Sir Patrick (Kensington, S.)	Wheatley, Major M. J. (Poole)
Orr-Ewing, Charles Ian (Hendon, N.)	Stanley, Capt. Hon. Richard (N. Fylde)	White, Baker (Canterbury)
Orr-Ewing, Ian L. (Weston-super-Mare)	Stevens, G. P.	Williams, Charles (Torquay)
Osborne, C.	Steward, W. A. (Woolwich, W.)	Williams, Gerald (Tonbridge)
Peake, Rt. Hon. O.	Stewart, Henderson (Fife, E.)	Williams, Sir Herbert (Croydon, E.)
Perkins, W. R. D.	Stoddart-Scott, Col. M.	Wills, G.
Peto, Brig. C. H. M.	Storey, S.	Wilson, Geoffrey (Truro)
Pickthorn, K.	Strauss, Henry (Norwich, S.)	Winterton, Rt. Hon. Earl
Pitman, I. J.	Stuart, Rt. Hon. James (Moray)	Wood, Hon. R.
Powell, J. Enoch	Summers, G. S.	York, C.
Price, Henry (Lewisham, W.)	Sutcliffe, H.
Prior-Palmer, Brig. O.	Taylor, Charles (Eastbourne)	TELLERS FOR THE NOES:
Profumo, J. D.	Taylor, William (Bradford, N.)	Mr. Studholme and
Raikes, H. V.	Teeling, W.	Mr. T. G. D. Galbraith.