HC Deb 21 February 1952 vol 496 cc501-6

Motion made, and Question proposed, That a Supplementary sum, not exceeding £1,788,000, be granted to Her Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1952, for expenditure of the Ministry of Supply on trading services, scrap metal recovery and assistance to industry.

Mr. Sandys

Since this is a much smaller Supplementary Estimate, and since it covers a wide variety of subjects, I do not propose, as I did on the previous Vote, to speak at the beginning. I shall be only too glad, however, to give any information or explanations which may be asked for by hon. Members which may be asked for during the discussion.

Mr. Edelman

Arising out of this Estimate and with reference to A.1 on page 73, I want to ask the right hon. Gentleman whether the additional provision required for Import Duty is concerned in any way with the recent purchase of steel from America by the Prime Minister. It seems to me that if that is the case this provision is inadequate, because—

The Deputy-Chairman

Order. The hon. Member is making a suggestion that the sum should be increased, and that would be out of order.

Mr. Edelman

In that case, may I ask for information? May I ask whether this amount which is being made available is for steel which will be coming forward from the United States? There has for a long time been a substantial quantity of sheet steel outstanding from the United States. Only last year there was a plea of force majeure and, on the strength of that plea, deliveries of sheet steel which should have been made were not made. Therefore the simple question which I put to the right hon. Gentleman is whether this provision for Import Duty covers those outstanding contracts and, if it does not, what action has the right hon. Gentleman taken to obtain the sheet steel which is so necessary for the industry?

7.15 p.m.

Mr. Peter Roberts (Sheffield, Heeley)

May I ask three questions for the purposes of information? I refer first to A.1—Iron and Steel—on page 73, where there is the additional provision to which the hon. Member for Coventry, North (Mr. Edelman), has just referred. There is a subtraction for additional net receipts on production at agency factories amounting to £220,000. Can we have some explanation of these agency factories? I understand that during the war and for some time afterwards the Ministry purchased some undertakings, particularly up at Barrow and other places. Does this subtraction cover that form of agency factory? If it does, it would be interesting to know how we get the net receipts—

The Deputy-Chairman

Order. The hon. Gentleman is not now discussing expenditure, is he?

Mr. Roberts

No, I want to find out about the net receipts on production.

The Deputy-Chairman

It would be out of order to discuss receipts.

Mr. Roberts

But the Supplementary Estimate says "Less—Additional Net receipts" and there is a figure of £220,000.

The Deputy-Chairman

The hon. Member can discuss the additional sum asked for, which is £315,000. The sum of £220,000 is for receipts, and it would be out of order to discuss that sum.

Mr. Roberts

I should like assistance on this. We have a figure of £535,000, which is the money required to be set off against Import Duty and which we are asked to approve. If there had not been a set-off against that, we should be asked to approve £535,000, but that has been reduced by £220,000, which is the result of operations in agency factories.

The Deputy-Chairman

We are not asked to discuss the sum of £535,000. The sum that can be discussed is the additional sum required. The Committee is only asked to vote the additional sum of £315,000.

Mr. Roberts

Again I appreciate that, but surely I am allowed-to ask how that £315,000 is made up? Apparently it is made up of one sum for Import Duty from which a subtraction is made. Obviously the amount of £315,000 might be greater or less as a result of the agency factories that have been operating throughout the area. I submit that I am in order on this.

The Deputy-Chairman

No, the sum of £315,000 may have been anything, but the actual figure asked for is £315,000 and the hon. Member must direct his observations to the additional sum asked for, which is £315,000.

Mr. Roberts

I will try to do so by asking whether the sum, in fact, could not be reduced further by a greater deduction of receipts on production at agency factories. The point I am trying to make is that I feel we should know how this £315,000 is arrived at by reason of the deduction. There is an obvious implication that if the receipts from these agency factories had been higher, then the sum we are asked to approve would be less because the amount of the deduction would depend on the amount of the receipts obtained by the agency factories. I do not want to go any further than that and, if that is improper, I shall not pursue it any further. It appears to me, however, that assuming the agency factories had made no money whatever, we should have been asked to provide £315,000.

Mr. Deputy-Chairman

The hon. Member would be perfectly in Order in discussing that the £315,000 asked for is too much, but he cannot direct his remarks to the sum which has been saved.

Mr. Roberts

But I cannot say it is too much until I get the answer to the question I am asking.

The Deputy-Chairman

The hon. Member must not conduct out-of-order fishing inquiries.

Mr. Roberts

If the amount of money coming from the agency factories was higher as a result of putting up the price of the production at these factories, then the amount which we should have to provide would be less. That is the only point that I am making, and I hope, if I may leave it at that, that it will be in order for a reply to be given to that question.

Mr. Jack Jones

Perhaps I may help the hon. Member. The answer is quite simple. For war purposes the Government had to continue to keep in being obsolete, inefficient high production plants which have been kept on since, and we have had to subsidise them.

Mr. Roberts

The amount of money obtained from the production at these inefficient factories results in the £220,000 which is the subtraction figure to which I am referring.

Mr. Jones

They were improved under Socialism.

Mr. Roberts

The second question, which I hope I shall be able to raise more easily, is that of assistance to industry. This is more or less a straightforward provision of £894,000, which is shown on page 73 as being "Additional provision required for iron and steel (mainly import duty on semi-finished steel and pig iron)."

I should like to ask whether any of this refers to pig iron and semifinished steel coming from Spain. In other words, is the additional iron and steel to which this item refers the result of increased production from Spain, or does it come from the Dominions? I should like to draw the Minister's attention to work which is now going on in Africa and Newfoundland in the production of pig iron, and I should like to know whether any of this additional production is coming from Dominion sources or from the Continent.

My third point relates to iron and steel scrap recovery. This is the more important of the three items, I suggest. This relates to the question of recovery of scrap from surplus ships. The way in which it is set out is rather difficult to follow, in that in D (3) we find the words "Additional provision required for breakdown of Government surplus ships…"

Does that mean it is merely the increased cost of demolition, or does it mean that more ships have been broken up? If it is the latter, one would have thought there would have been a resulting receipt from the scrap which was sold.

That brings me to the question whether the Minister can say—again I do not want to go too far into the future in this —that it is possible to look forward to increased scrap supplies from Government surplus ships, or whether the Minister thinks that at the moment we have got about the greatest amount that we can get. The need for scrap is very great. We find that the sum which is required to be spent is £237,000 but there seems to be no set-off for the scrap iron which is thereby produced. If, of course, it is merely a matter of increased charges I think one would like to know that, and how they arise.

Those are my three main points—the first one, which the Minister may find some difficulty in answering and keeping in order, relating to the agency factories; the second one dealing with assistance to industry and the importation of pig iron and semi-finished steel, and thirdly the question of scrap from ships.

Mr. Sandys

The hon. Member for Coventry, North (Mr. Edelman) asked me a very simple question, which was whether the additional steel for which there will be extra charges in respect of Import Duty and other costs which are provided for under this Supplementary Estimate, included any of the additional steel which has resulted from the recent negotiations in Washington by the Prime Minister. The answer is "No." Additional steel over and above what was already estimated for will not be coming in until after the end of the financial year. Therefore, these Supplementary Estimates do not relate to the steel obtained as a result of those negotiations.

My hon. Friend the Member for Heeley (Mr. P. Roberts) asked me three questions. The first related to agency factories, and it was ruled out of order by the Chair. Therefore, I shall not attempt to reply to it in this debate, but I will gladly send the information to my hon. Friend.

The second point raised by my hon. Friend was whether any additional pig iron imported under Sub-head B came from Spain. It is very hard to answer that question, because these Supplementary Estimates provide for an additional quantity of imports of raw materials and semi-finished steel, and it is hard to say which particular bit of pig iron we are dealing with—that is to say, whether the pig iron from Spain was already provided for under the original Estimate, or whether it is provided for under the Supplementary Estimate. But I can assure my hon. Friend that we are importing materials from Spain and from North Africa, which he also mentioned.

My hon. Friend went on to ask for son-le further explanation of the additional expenditure under Sub-head D, which relates to iron and steel scrap recovery. This arises from expenditure on scrap recovered from Germany and also from the increased transport charges on iron and steel scrap resulting from the breaking up of surplus Government ships. It arises also from the increased costs of ship-breaking. I can assure my hon. Friend that we are doing everything we can to lay our hands on every possible supply of scrap, including, of course, any ships which are available for breaking up.

Mr. Roberts

Do I understand that this extra money is a charge on labour and expense involved in getting the scrap, or have we broken up more ships than was estimated in the first place?

Mr. Sandys

This arises from additional costs. My hon. Friend asked me also why there was not a saving resulting from the money obtained through the sales of the scrap recovered. The answer is simple. It is that this money, like so many of these payments, goes direct into the Treasury and does not pass through the accounts of the Ministry of Supply. I think I have answered all the points which have been raised.

Question put, and agreed to.

Resolved, That a Supplementary sum, not exceeding £1,788,000, be granted to Her Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1952, for expenditure of the Ministry of Supply on trading services, scrap metal recovery and assistance to industry.