FINANCIAL AND ECONOMIC SITUATION

HC Deb 31 January 1952 vol 495 cc371-496

Order read for resuming adjourned debate on Question [30th January]: That this House, recognising the peril to the security and economic stability of the country caused by the continuing fall in the central reserves of gold and dollars, which results from the adverse balance of payments, agrees that measures adequate to halt the downward trend and to rebuild those reserves must be urgently taken in all matters where action would benefit, directly or indirectly, our overseas balance and the strength of sterling."—[Mr. R. A. Butler.]

Question again proposed.

3.44 p.m.

Mr. Richard Fort (Clitheroe)

When we adjourned last night, I was correcting some of the mis-statements and false claims which hon. Gentlemen on the other side of the House had been making about the social services. I do not think I need continue with that. I think that the right hon. Gentleman the Leader of the Opposition, who will be following me in a few minutes, will remember the fairness with which he treated responsibility for the social services when he broadcast in July, 1948, on the eve of the introduction of the National Insurance and National Assistance Bills.

I shall now proceed to refer to the state of the textile industry, which is of such great concern to Lancashire and other parts of the country which are engaged in spinning and weaving. Some of my friends are out of work and many others are engaged in short time working. The reasons which brought about this state of affairs are complicated, but certainly one of the most important has been the present working of the Purchase Tax. This has been well recognised, not only by my right hon. Friends the Chancellor of the Exchequer and the President of the Board of Trade, but by right hon. Gentlemen who occupied those positions in the previous Government. The effect which the Purchase Tax is undoubtedly having at the present time in this country is that people are holding off from ordering cloth, and the clothes made from the cloth. They are finding that the prices are too high, prices which have been enhanced by the heavy Purchase Tax on non-utility cloth.

The Purchase Tax also affects our exports. It is much easier to sell abroad those speciality cloths and novel cloths which are the very ones bearing the high Purchase Tax. I hope that, when the Chancellor and the President of the Board of Trade come to examine the recommendations of the Douglas Report, they will bear in mind that fact, and realise that, in order to increase textile exports they must avoid putting a high tax on those cloths which most need encouragement.

In this connection, many hon. Gentlemen on the other side, and perhaps particularly the right hon. Member for Huyton (Mr. H. Wilson), who I am sorry to see is not in his place, appear to be confused between utility cloths and standard cloths—maybe because the word "utility" has attracted a certain political sex appeal to it. Really we can devise a scheme by which the advantages of standards as acceptable as utility standards can be enjoyed without the trade suffering from the frustration and difficulties caused by the present arrangements.

If we are to overcome our difficulties as a country, we must see that everyone in it is working. All will agree with that proposition, I am glad to say, although they may disagree with some of the others. To correct the uncertain state of affairs in Lancashire, the Government must act, and act quickly, on this problem of Purchase Tax. Let them, too, set about making a quota arrangement with the Japanese, as well as with other exporters. Such an arrangement with the Japanese would not only help Lancashire, and through Lancashire, the rest of the country, but would also help to overcome the very difficult exchange situation which is growing up as a result of heavy Japanese exports to the sterling area.

Lastly, let them do what they can to place armament orders speedily in Lancashire. My hon. Friend the Member for Oldham, East (Mr. Horobin) said yesterday that the problems of the Lancashire textile industry fall upon many Departments of the Government. Let them get together, and Lancashire will be in a position to make a contribution towards overcoming our present difficult financial problems—a contribution which it is well fitted to make, by its skill and experience.

3.50 p.m.

Mr. C. R. Attlee (Walthamstow, West)

I beg to move, to leave out from "payments," to the end of the Question, and to add instead thereof: of the sterling area, and welcoming His Majesty's Government's belated admission that this is due to long standing and external causes, agrees that the United Kingdom should play its full part in correcting this adverse balance, but cannot approve the Chancellor of the Exchequer's statement containing attacks on the social services and other measures many of which are irrelevant, unnecessary and unfair; and has no confidence in a Government whose present policy is in such marked contrast to the optimistic statements on which it was returned to power. The Motion that stands on the Order Paper on behalf of the Government is drawn in extremely wide terms. I take it that it is supposed to cover mainly the statements made in the Chancellor's speech to us, but as far as I can see it would, as drafted, ask for our approval of any action whatever that would directly or indirectly benefit our overseas balance, including, I imagine, the sale of Magna Charta, the British Museum, the National Gallery and a few Colonies. It might even include sending the Prime Minister to the United States to make speeches in order to earn dollars.

But, in any case, this Motion would be unacceptable to us. It is, I take it, meant to follow up the speech of the Chancellor of the Exchequer. In our Amendment we begin by emphasising that this is a problem not of this country alone, but of the sterling area, and that is the reason for our inserting the words "sterling area." Then, being desirous to have as much national unity as we can, we put in a note of welcome to the Chancellor's statement, because it is in very marked contrast to the speeches which right hon. Gentlemen opposite have made on this problem during the last six years.

The Chancellor stated quite rightly that the economic position of this country had been deteriorating for 50 years, and, of course, the main factor has been the effect of two world wars. But for the last six years, with a few honourable exceptions, there has been a steady attempt to say that all the difficulties were due to the Labour Government, and no one has done that more than the Prime Minister. Over and over again he has attributed all our difficulties to Socialist policy or Socialist ineptitude. [HON. MEMBERS: "Hear, hear."] Apparently he still has a few followers who have not really thought about the matter and have not listened to the Chancellor.

But there has been an examination of this problem, not only by experts in this country, but by world experts, people well known, who have put down what are the true factors in this present position, and tribute has been paid to the way in which this country has overcome them in the last six years. I will quote only one: The very gallant and successful fight which Great Britain has put up to build up her exports and hold down imports and thus achieve financial stability is one which commands the admiration of the world. That was said by Mr. Paul Hoffman in 1948, and about the same time the Prime Minister said: We are in a far worse case than when the last shot was fired. Of course, he was technically quite accurate, because when the last shot was fired we were enjoying Lease-Lend from the United States of America, and the real trouble with our position was masked by Lease-Lend. The Government, in 1945, faced with that sudden withdrawal of Lease-Lend, found themselves with an economy which, in alliance with our American ally and others, had been directed solely to carrying on the war. We had, therefore, changed over to war production; we had lost our overseas connections, and we were, as a matter of fact, in a far worse position in 1945 than we are today.

I stated that in Manchester the other day, and I do not know why I should have been so belaboured for doing so. I did not attempt to suggest that there was not a crisis now, but I did say that one had to face this crisis in the spirit in which we had faced a crisis for six years. We had faced far worse conditions and we had to face them under a constant stream of factious opposition from the Conservatives.

I have not forgotten—I do not think hon. Members have forgotten — the attacks that were made on Sir Stafford Cripps, the ridiculing of "Austerity Cripps," talk of "austerity for austerity's sake," and all those kinds of helpful remarks. I have not forgotten that during all that time the Opposition were constantly demanding that we should increase our overseas indebtedness by more and more purchases of every kind of thing from dollar sources. I can remember the campaigns for more newsprint—naturally taken up enthusiastically in the Press—for timber, petrol, feeding-stuffs and food.

Alternatively, we were accused of reckless and extravagant spending, of living beyond our means, and all our difficulties were exploited and exaggerated for party ends. There was no talk then of a cessation of political strife. Apparently that is all right when there is a Conservative Prime Minister and when he happens to be the present Prime Minister. Then it is the patriotic thing for all citizens to rally round; but to denigrate their own country for the rest of the time when the other side is in is all right by the Conservative Government.

Therefore, I welcome very much the fact that we have had this frank confession of the difficulties, and it is well to look at these for a moment or two. I am not going far into the general analysis; it is unnecessary after the speech yesterday of my right hon. Friend the Member for Leeds, South (Mr. Gaitskell). But the fact is that the right hon. Gentleman is quite right in saying that this has been a continuing problem for years, and I am doubtful whether the Government yet realise to the full the difficulties.

The fact is that we have been trying to run an immense organisation, the sterling area, on very insufficient reserves, and the result of that is that comparatively quite slight things upset a very delicate equilibrium. A slight recession in America has an enormous effect on our exchange position. In the past, when these things happened no one noticed them very much. Even in 1938 there was a bigger outflow from our reserves than there is at the present time, but we had reserves, and in due course the matter righted itself. In our present crisis, as my right hon. Friend the Member for Leeds, South, pointed out, while some of our difficulties are long-standing others are really temporary, and over a period of years will straighten out.

But when there is an insufficient reserve there is no time to straighten out. A cry at once rises of a danger to the reserves and that in itself tends to promote a crisis. Thus one had that sudden change last year. At the beginning of the year we were going on very well and were even in surplus, and then there came a sudden change. That was due, not to changes in the inherent economic position in this country, but to changes in prices of raw materials and certain changes in American action.

The fact is that we shall not get over this problem until we can see a far greater co-operation in the world to keep economic affairs on an even keel. Today the United States of America, due to her immense size, has an altogether disproportionate influence on the economic affairs of the world. In the 19th century we held something of the same position but we, being a country dependent mainly on exports, were particularly sensitive in dealing with these difficulties. The United States of America, whose exports are a comparatively small part of her economy, is quite apt to take actions, or not to take actions, which have immense repercussions throughout the whole world.

Therefore, when I saw the report of the Commonwealth Conference—and in fact I had talks with our Commonwealth representatives on these matters—I was a little surprised at the rather hopeful suggestion that soon, apparently, we might work to get back to convertibility. I do not think we shall get back to convertibility until we have a better position in regard to world reserves. One important factor is the immense amount of gold lying in America which ought to be backing currencies all over the world.

I suggest, therefore, that we have to look at this crisis as one of the recurring crises, and a crisis that will recur with a Conservative Government, because it is not due fundamentally to domestic policies here—[Laughter.]—Why laugh? Another one has not listened to the Chancellor of the Exchequer.

Mrs. E. M. Braddock (Liverpool, Exchange)

The hon. Member for Orpington (Sir Waldron Smithers).

Mr. Attlee

Oh, well, the hon. Member for Orpington is still well back in the 19th century.

Unless measures are taken for some kind of world planning of reserves, these crises will recur again, and whatever Government are in power they will have to face them just as we had to face them. It is all very well to say that the Commonwealth has great potential wealth. It has. The trouble is that it cannot be mobilised to deal with these immediate crises. Therefore, we have to consider seriously the long-term aspect.

The next point we make is that we agree that we should play our full part in correcting this adverse balance. We have said that we ourselves would have had to take action to this effect, and we do not offer objections to some of these proposals. But there are proposals injected here which, in our view, have no real relevance to this question of the balance of payments. Before I come to that, let me say one word about some of the devices that are being adopted.

One of them is drawing on stocks. I can recall debates in this House not very long ago when hon. Members having great business experience assured us that it was just as good to hold stocks of raw materials as to have dollars or sterling. We were begged again and again to do it; we were told that we were quite wrong, and that in 1950 we ought to put all our surpluses into building up stocks here. Supposing we had done that, right hon. and hon. Gentlemen would have said, "Look at this enormous gap due to an improvident Labour Government. Instead of keeping their reserve to meet this crisis, they spent it on stocks." Therefore, this is at best a very doubtful expedient.

It is also an extremely curious thing to do when part of our problem is caused by American stockpiling, which is part of the provision against the danger of war. It was very largely American stockpiling that rocketed prices against us. We are engaged in building up armaments, and the essential part of building up the security of this country is the maintenance of stocks. Therefore, it is illogical at the same time as one is building up armaments and armed manpower to run down those stocks which are of vital importance to the security of the country in the event of war.

I now come to some of these various proposals. The proposals to which we object are mainly irrelevant to the issue which faces us. As a matter of fact, they are budgetary adjustments which ought to be brought forward in a Budget where they can be considered with regard to other expenditure and also with regard to revenue.

There is, for instance, the cut in the Civil Service by 10,000 men. If those men are doing no useful work, it is a very good thing to get rid of them, but the assumption seems to be that if one dismisses 10,000 men from the Civil Service, one is somehow reducing the demand for goods and services, whereas one only does that if one puts them on the unemployed list, and that is part of the outworn policy we have always opposed—that of meeting these things by unemployment.

If, on the other hand, these men are to be employed, it all depends on what employment they are to be engaged in. If someone usefully employed in the Government service is transferred to Little-wood's Pools at the same salary, one does not lessen the demand for goods; one simply transfers the man from useful work to harmful work, in my view. Therefore, all these matters of economies in the Civil Service depend on a just estimate of the value of the work. One cannot assume that these men are to be turned over to the export trade or defence work. This, again, is one of the irrelevant considerations that have been brought into these proposals.

The next proposal is one relating to the restriction on certain goods. If one does not want certain goods made, the right way to achieve that is by a physical restriction and not by monetary methods. It may well be that it is right that we should be producing at this time fewer television sets, fewer washing machines and the rest—and fewer motor cars. I notice also the inclusion of bicycles. Bicycles are not purely things of pleasure—they may be things of pain—they are a means of locomotion for many workers.

It may be necessary to restrict their production, but why specially restrict the use of these things among the poorer sections? That is the effect of cutting off the hire-purchase system. What it means is that the people who have money to spend, or the people who can borrow from the banks or somewhere else, can get these things, but the people who most need them, the humblest people who pay by the method of hire-purchase, will be debarred from doing so. Therefore, this is a very vicious piece of class legislation.

I know there are some people who think there is some kind of special inflationary evil about hire-purchase. It is possible it may be done in excess, but this sort of method of paying by instalments is one that is adopted by almost everybody. Insurance is partly based on that, because it is based on an actuarial calculation of what we pay over a term of years, and we get the treatment and so on before we have paid the full amount. In the case of advances from the bank, there again it is said "You are living beyond your means."

But there is this kind of illusion being spread about that there is something particularly vicious in this hire-purchase system. I suggest that the Government had better drop this proposal, which is clearly a class proposal. The Prime Minister has often said that he thinks one of the greatest evils we suffer from is this kind of class warfare, and I am sure he would not like to indulge in it.

I confess that I am anxious about the rather vague words used by the President of the Board of Trade concerning utility schemes, because there again there are a great many ranges of goods 85 per cent. of which are used in utility schemes. These schemes have kept prices down; they have also ensured standards; and there is a great danger that, under some specious plea of assisting overseas trade, we shall have utility schemes swept away. There again, the Government in effect would be favouring the wealthy against the less wealthy.

I come to the cuts in the social services. These are quite irrelevant, and no one suggests that these amounts in themselves are very large in relation to the balance of payments. Of course, the Government try to base this on a comparison with the action that we took when we were a Government. We were facing certain budgetary difficulties. We had to consider how best to spread out the money available. We were actually at the time increasing the amount going to the social services. In the amount that went to the Health Service, we desired to spend more on hospitals and less on some other things, and the other things suggested were these dental appliances. It was not really a question of raising revenue. There was, first of all, a question of restraining abuse, because there was some abuse both as regards spectacles and dentures, and there was also the question of getting a balance, because in every estimate one must have some kind of a ceiling. It fell on people who were in good health, except for dentistry.

This is an entirely different thing. Here it is intended to cut at the efficiency of the dental service by deterring people from doing what all dentists ask us to do and what we so seldom do ourselves, and that is to go regularly to the dentist every few months. There is a surprising confusion of thought in this, because we hear, first of all, that there is to be a switch-over and that there will be more dentists available for schoolchildren and fewer for adults, which is a switch, and at the same time there is to be a saving of several million pounds. Perhaps we shall have that explained a little later.

Then we have the prescription question. We went into that, and there was an undoubted case of abuse of prescriptions. People were taking up the time of doctors who ought to be better employed and were getting all kinds of things which were not strictly curative things, and therefore we brought forward that proposal. But we found that this was not the effective way of doing it. First of all, we found that it would mean a great deal of work for the doctors; secondly, we found that in certain circumstances there were a whole number of people entitled to free medicine who would not benefit; and thirdly—and most important—we found another way of doing it.

My right hon. Friend the Member for Ebbw Vale (Mr. Bevan) set up a special committee—the Cohen Committee, as it was called—and they managed to restrict from the drugs which could be prescribed a great many things which were not drugs. We did get a closer hand on it. This measure is introduced today not as a matter of correcting abuses in the Health Service, and not even as a matter of correcting a balance between various parts of the social services, but, for some extraordinary reason as a means of dealing with our overseas payments. That is, surely, utterly fantastic.

Perhaps we shall hear something more about the education proposals in the course of today, because at present no one seems to be quite clear what really is happening with regard to education. It may be that there are certain things which are to be cut down, but we should be very ill advised to cheesepare on education, because if we want to hold our position in the industrial world today we have got to have a well-educated population. Then there is another thing—the cutting off of expenditure on blitzed cities. That needs very careful watching.

What I am disturbed at is that later—a good deal earlier than usual, but still later—we are to have a Budget, and that Budget is to contain still more unpleasant things. I think that these proposals, which go out of their way to introduce into a question of balance of payments a number of purely budgetary matters, may be a mere forerunner of what we are to expect in the Budget. We could not get a clear answer yesterday on the question of food subsidies, and we have found by experience that it is very ominous when we do not get clear answers.

Therefore, we object to this Motion. We are perfectly seized of the gravity of the situation and we are prepared to support, as we have supported, those measures which are necessary; and we shall not go round the country saying "It is all due to the Conservative Government." I took a great deal of trouble to inform our people at the last Election and during previous Elections what the position was with regard to the balance of payments.

I am afraid we shall find that people will tend to put it down to the Government. I found the same. It is what I am told happened. Housewives who were so much incited by hon. Gentlemen opposite to attack the Socialist Government are now finding that they have exhausted almost all the epithets, which they want to use much more on the Conservative Government. We do not take that line. We are supporting what is necessary in the interests of this country, but we shall reject, and object to, entirely extraneous matters that have no relation whatever to this financial position, which are brought in for unknown reasons by the Government and which all have a definite tendency of a class nature.

Finally, in our Amendment, we challenge the Government because the actions they are taking today are contradictions of the statements they made when they went to the electorate. It is no good saying this kind of thing: "We never knew that things were so bad." [An HON. MEMBER: "You knew."] Oh. yes, and we told all about it. The Prime Minister, with all the resources of Lord Cherwell, apparently never realised what the position was. I suppose he had not been following it closely, or something, although the fact was that everybody had had a very full description time and again of what the position was.

The Prime Minister (Mr. Winston Churchill)

We realised that it was very bad, but we did not realise how bad it was until we saw the reports, on which no doubt the right hon. Gentleman determined the date of the Election.

Mr. Attlee

The right hon. Gentleman is quite wrong, because he has not taken the trouble to follow the course of events. We were well aware of a certain trend, and I may say that the late Chancellor of the Exchequer gave a very full account of it at the Mansion House. We saw that trend and we stated what that trend was. If the right hon. Gentleman did realise it was serious, it is all the worse that he and his friends went round making optimistic speeches. If the right hon. Gentleman did know, why did he allow Lord Woolton to go round the country?

The fact is that from hoarding after hoarding and from speech after speech the people were led to believe that their sufferings were due to the Socialist Government and that it would be all put right when a Conservative Government came in with their policy of more and better food, lower prices—prices have gone up—and sweeping away controls. What has happened to that wonderful theory constantly put forward from the benches opposite: "If only we got rid of all these controls, everything would be all right." "Set the people free" has gone now. The fact is that the Prime Minister knows quite well that the present Government got into power on false pretences.

4.25 p.m.

The Financial Secretary to the Treasury (Mr. John Boyd-Carpenter)

I have far too high a regard for the long and distinguished services which the Leader of the Opposition has rendered to the State to desire to enter into any degree of personal polemics with him. I think it would be inappropriate for me to do so, and in that respect, at least, I am happy about an adverse balance of payments. But I did think that he was not being particularly generous when he gave us an undertaking that he would not go round the country telling the people that the problems which assail this country today were the creation of a Conservative Government.

Mrs. Braddock

They know it.

Mr. Boyd-Carpenter

After six and a quarter years of untrammelled power, the right hon. Gentleman would not succeed in convincing anybody, except apparently the hon. Member for Liverpool, Exchange (Mrs. Braddock), that the grim bequest to which the right hon. Gentleman the Member for Leeds, South (Mr. Gaitskell), referred yesterday was any responsibility of the Conservative Government. This is not our crisis. Our part in it is the responsibility for clearing it up.

I am sorry, too, as one who does hold a very sincere admiration for the right hon. Gentleman—[Interruption.]—I am sorry if hon. Gentlemen opposite do not share that admiration—[An HON. MEMBER: "Save that up for the next Election."]—that he should have tempered the support which he said he gave to the body of the proposals of my right hon. Friend the Chancellor of the Exchequer by the suggestion that there was a class element in them. I shall certainly seek to deal with that statement in the course of the remarks that I hope to make.

I am not at all clear—[HON. MEMBERS: "Hear, hear."]—hon. Gentlemen had better restrain their applause until they learn the cause of the difficulty—whether the Opposition's case is that what we have done is too much or too little. The right hon. Member for Leeds, South, did seek to emulate the agility of a former Secretary of State for Scotland and base it on both grounds yesterday, when he said—and he also used the expression which hon. Members have just found so amusing: I must say that I am not clear why we are going quite as far as this. Only four columns later he went on to say: Last year, in fact, we did very much the same thing."—[OFFICIAL REPORT, 30th January, 1952; Vol. 495, c. 222 and 226.] It is a little disingenuous for a right hon. Gentleman who has held the office of Chancellor of the Exchequer to indulge in such a width of criticism inside the somewhat narrow margin of four columns of the OFFICIAL REPORT.

Mr. Hugh Gaitskell (Leeds, South)

I think that if the Financial Secretary, even in his office, goes on like this, he will not have much chance of becoming a Chancellor of the Exchequer. He knows perfectly well that my criticism yesterday was that, in relation to the dollar problem, I doubted whether the action decided upon at the Conference was sufficiently urgent to deal with the situation, whereas, on the contrary, when dealing with United Kingdom proposals, I expressed the view, on the basis of the information available, that probably the cuts which the Chancellor proposed were rather excessive. That is a perfectly logical point of view, and really the hon. Gentleman, as I say, should not descend to this kind of thing.

Mr. Boyd-Carpenter

Any suggestion that the office of Chancellor of the Exchequer demanded very clear qualities of thought has, I think, been dissipated a little by what the right hon. Gentleman has just said. Let me recall his attention to the actual passage of his speech to which I referred: Next, I turn to the most controversial part of the Chancellor's statement—the proposed cuts in the social services. On Government expenditure generally the Chancellor told us remarkably little. He said he was holding civil expenditure at its present level. I am bound to say that that is not such a tremendous achievement, in the light of the promises of the sweeping cuts which were going to be made. If we count in all the semi-military items, I think he will find that last year, in fact, we did very much the same thing"—

Mr. Gaitskell

Yes, we did.

Mr. Boyd-Carpenter

The right hon. Gentleman went on— when we were also faced with a rise in wages and prices and other costs."—[OFFICIAL REPORT, 30th January, 1952; Vol. 495, c. 226.] The point should be apparent to the hon. Member for Wellingborough (Mr. Lindgren). The point is this—

Mr. Ivor Owen Thomas (The Wrekin)

What is the hon. Member trying to do?

Mr. Boyd-Carpenter

The position is that in the very—

Mr. Gaitskell

If the hon. Member will allow me—

Mr. Boyd-Carpenter

I shall certainly extend to the right hon. Gentleman the habitual courtesies just as soon as his hon. Friends are prepared to give and take; and I think it will facilitate any further interpolations which the right hon. Gentleman desires to make if I make the point without interruption.

The point is that in the very sector of my right hon. Friend's proposals to which the Leader of the Opposition took exception this afternoon—in the very sector, not in the broader context of control of dollar exchange but in this particular sector—the right hon. Member for Leeds, South, went out of his way to express the view that last year he did the same thing. Does the right hon. Gentleman desire to make an interpolation?

Mr. Gaitskell

I must say that it takes a very long time to induce the hon. Gentleman merely to read three more lines from HANSARD. What we do say, however, is this:"— I am continuing from where he left off— we secured a net reduction in the civil expenditure apart from social services and we increased the social service expenditure."—[OFFICIAL REPORT, 30th January, 1952; Vol. 495, c. 226.]

Mr. Boyd-Carpenter

The right hon. Gentleman is not going to be allowed to elude the issue. Those are his words in column 226 of the OFFICIAL REPORT. He said he was holding civil expenditure at its present level. I am bound to say that that is not such a tremendous achievement, in the light of the promises of the sweeping cuts which were going to be made. [Interruption.] Apparently the hon. Gentlemen have not taken it in. If we count in all the semi-military items"— I am reading on, as the right hon. Gentleman desired— I think he will find that last year, in fact, we did very much the same thing when we were also faced with a rise in wages and prices and other costs. Therefore, I ask the Leader of the Opposition to bear in mind what his right hon. Friend has said on this particular issue, to which he directed a very large part of his speech. The Leader of the Opposition referred to the speech which he himself made at Manchester, and I think that speech does throw some light upon the attitude which the Opposition are adopting to the present emergency. As reported in the "Manchester Guardian" of 21st January, the right hon. Gentleman said that when tackling the problem of overseas payments, the Labour Government did not whine like the Conservatives were doing, but got on with the job—[HON. MEMBERS: "Hear, hear"]—I hope hon. Gentlemen will cheer the next sentence.

[HON. MEMBERS: "Hear, hear."]— I do not say we solved it"— but the position which the Conservatives are making such a song about is far simpler than we had to face six years ago. I wonder what they make such a song about. Against the background of the figures which my right hon. Friend gave to the House on Tuesday—figures which show that the rate of loss of the dollar and gold reserves, if continued unchecked, would see the exhaustion of those reserves by early September—I am bound to say that a speech of that kind from a right hon. Gentleman so respected as is the Leader of the Opposition, does not give to the people of this country a clear picture of the emergency which will face us.

Mr. Attlee

Perhaps the right hon. Gentleman does not know what the position was in 1945 that we had to face.

Mr. Boyd-Carpenter

"I did not say there was not a crisis." That is not good enough. He did not say there was; he did not tell them.

Mr. Attlee

What I said was—and here is a quotation from the "Manchester Guardian": "The Economic situation is serious." That is exactly contrary to what the right hon. Gentleman said that I said. I did say so. I pointed that out.

Mr. Boyd-Carpenter

With respect, that is not the same thing at all. That the economic situation is serious has been said by every Minister for the last six years. What the right hon. Gentleman did not tell the people of Manchester, or this country, is that there was a crisis. Indeed, it was the whole essence, tone and theme of his speech that this was a matter which had been grossly exaggerated. The right hon. Gentleman cannot come to that Box and say that he warned the people of this country of the gravity of the crisis.

The right hon. Member for Leeds, South, takes credit for having warned, I think, the Lord Mayor of London and certain bankers on 3rd October. [HON. MEMBERS: "Oh."] It is to his credit that he did so, but what is significant is that that is a clear indication that, during the days of the late Government, at least the right hon. Member for Leeds, South, knew what the situation was. [HON. MEMBERS: "He said it."]

It is a curious commentary, therefore, on his view of the responsibilities of his office, that, if he understood the situation, he took no action about it, and that during that critical month of October, when, as the right hon. Member for Leeds, South, knows perfectly well, the gold and dollar reserves of the sterling area were running out at an accelerating rate, he took no steps whatever to stop them, but indulged in the more agreeable activities of electioneering, at the moment when his own political neighbour, the right hon. and gallant Member for Leeds, South-East (Major Milner)—as he then was—was telling the citizens of Leeds that this country had never been so prosperous.

But the right hon. Gentleman who is now the Leader of the Opposition did take action. He decided to dissolve Parliament. Well, that is not, apparently, disputed, and, indeed—

Mr. Attlee

The Prime Minister does not dissolve Parliament. He only gives advice on it.

Mr. Boyd-Carpenter

I am much obliged. The right hon. Gentleman's reaction to the situation, of which, at any rate, the right hon. Member for Leeds, South, knew, was to advise the dissolution of Parliament. It does not very well become an Opposition whose reaction to the gathering storm was to seek to be relieved of their responsibilities—[Interruption.] Well, I do not suppose that the most optimistic hon. Gentleman opposite thought they were going to win the last Election. [HON. MEMBERS: "Count the votes."] It surely does not lie in their mouths, when their reaction to this emergency was to abandon their responsibilities—[HON. MEMBERS: "Nonsense."]—to criticise the proposals put forward by a Government which have the courage and sense of responsibility to make them.

Mr. Attlee

Does the hon. Gentleman think, then, that when a Prime Minister goes to the country he is evading responsibility or seeking responsibility? I did exactly the same as the right hon. Gentleman opposite did in 1945. He went to seek a mandate from the country to deal with a difficult situation.

Mr. Boyd-Carpenter

The right hon. Gentleman overlooks one factor. The Parliament which my right hon. Friend advised His Majesty to dissolve had been in existence for 10 years; the late Parliament had been in existence for 18 months.

Mr. Attlee

And at the first moment of it the hon. Gentleman's right hon. Friend said we must have a decision from the country and not go on with eternal bickering and a small majority; and, when I accepted what the right hon. Gentleman wanted, the hon. Gentleman now says I ought not to have done it.

Mr. Deputy-Speaker (Colonel Sir Charles MacAndrew)

Order. I think this argument is going a little wide of the Amendment.

Mr. Boyd-Carpenter

The right hon. Gentleman sought to suggest that there had been a breach of election pledges. It is really a remarkable theory which the right hon. Gentleman has put forward—that election pledges require to be redeemed within three months of taking office. It is a curious commentary on the system of quinquennial Parliaments, and the right hon. Gentleman knows perfectly well that nobody in this country expected the proposals which my right hon. Friend has put forward to be implemented within three months. The right hon. Gentleman knows that my right hon. Friend warned the people of this country that difficult and harsh tasks had to be accomplished, and we have never contended that those pledges could be carried out in a matter of months.

What we said then, and what we say now, is that time is required to do the tasks which fall upon this Government, and we shall be content to be judged, not by the immediate reaction to measures taken in the first few months, but by the sum total of the results of our efforts. And I do not think that the right hon. Gentleman really expects any British Government to be deterred from doing the things that they believe to be necessary because in the first few months of office they do not succeed in carrying out all the pledges—[HON. MEMBERS: "Not any."]—which they gave in relation to a five-year Parliament.

The right hon. Gentleman has put into his Amendment rather curious words. He describes my right hon. Friend's measures, or some of them, as "irrelevant, unnecessary and unfair." Well, let me take one or two of them. The import of tobacco is to be cut by £22 million. In the case of a country and of a system whose gold and dollar reserves, if unchecked, will be exhausted in December, is it irrelevant, unnecessary or unfair to bring in less tobacco for the people to smoke?

Mr. A. C. Manuel (Central Ayrshire)

The saving is out of stocks.

Mr. Boyd-Carpenter

All right. Is it contended that, at a time when the position is so acute, the stocks of tobacco must be sacrosanct? Is that irrelevant, unnecessary or unfair?

Mr. Douglas Jay (Battersea, North)

This is an interesting point. May I ask the hon. Gentleman whether the Government are going to take any complementary steps to reduce the consumption of tobacco?

Mr. Boyd-Carpenter

The step which we have announced is the reduction of the import of tobacco with direct relevance to the balance of payments position, as the right hon. Gentleman knows perfectly well. And I gather that it is not contended that that, at any rate, is irrelevant, unnecessary or unfair. What about the cut in the tourist allowance, which saves £12,500,000 a year? Is it asserted that that is irrelevant, unnecessary or unfair—[HON. MEMBERS: "No."]—or that it is an indication of class favouritism?

Mr. C. R. Hobson (Keighley)

Yes.

Mr. Boyd-Carpenter

The hon. Member says so, but his right hon. Friends are silent about that. Is the cessation of the imports of coal regarded as irrelevant, unnecessary or unfair? [An HON. MEMBER: "Thank the miners."] My right hon. Friend has already done so.

I come to the reduction in the Civil Service, to which the right hon. Gentleman referred, with its saving of £5 million a year and of 10,000 people. The right hon. Gentleman seemed to assume that the redundant civil servant would be unable to find suitable employment, but it is, of course, a fact—and right hon. Gentlemen opposite know it—that many vital industries are desperately short of manpower and womanpower. It is surely, therefore, a proposal which the right hon. Gentleman should welcome, to lighten alike the calls on money and manpower made in the government of the country.

Then the right hon. Gentleman referred to Health Service expenditure, and to the fact—he did not refer to it, but it is the fact—that a ceiling of £400 million had been placed on that. Is that irrelevant, unnecessary or unfair? If it is, why should the right hon. Gentleman's own Government have done it? If it is irrelevant, unnecessary and unfair to impose a charge upon prescriptions, why did the right hon. Gentleman's own Government take steps to pass an Act of Parliament to enable the Government to do just that? The right hon. Member for Ebbw Vale (Mr. Bevan) has told us that he was never sincere about it; that it was a manœuvre. Is it the contention that this was a manuœvre in which all right hon. Gentlemen opposite were involved; that they were simply making a fool of the House of Commons?

Is it irrelevant, unnecessary and unfair to suggest to local education authorities cuts in their educational expenditure. [HON. MEMBERS: "Yes."] If it is, I am bound to ask right hon. Gentlemen opposite why on 28th October, 1949, the then Minister of Education sent our Circular 210 which asked for a number of specified economies.

Mr. Percy Wells (Faversham)

Which we could afford.

Hon. Members

Specify them.

Mr. Boyd-Carpenter

I will specify them. I note also the observation that they were economies which it was known could have been well afforded. What were they? Administration and inspection were to be reduced in cost; the charge for school dinners was to be raised; capital expenditure was to be limited; recreation and social and physical training estimates were to be cut; transport was to be cut; fees were to be charged in evening classes; and it was essential that authorities should give immediate attention to the measures indicated above. It really will not do for hon. and right hon. Members opposite to come forward now with immense indignation to suggest that it is irrelevant, unnecessary and unfair to do the very things which they themselves did when encountering similar difficulties.

The Leader of the Opposition indicated that he could not see any connection between cuts of this nature and the necessary readjustment of manpower and resources to defence and exports. It is a pity, if I may say so, that the right hon. Gentleman did not listen to the Budget speech of his own Chancellor of the Exchequer last year, when the right hon. Member for Leeds, South, said: The task of the Budget in this situation is to ensure as far as possible that the necessary transfer of resources from producing for consumption to producing for defence and exports takes place swiftly and smoothly. As I pointed out in my speech during the defence debate, fiscal and monetary policy alone is not sufficient to achieve this transfer, and physical controls are also needed. But these physical controls will not be nearly so effective if they are working against the tide, and they must therefore be accompanied by a strict fiscal and monetary policy to restrain civilian expenditure."—[OFFICIAL REPORT, 10th April, 1951; Vol. 486. c. 828.] It is the essence of this problem which requires my right hon. Friend to propose to use both the direct physical controls to which the Leader of the Opposition referred and the economic and fiscal measures which have been referred to, for the very good reason which the right hon. Member for Leeds, South, so clearly gave last year, that these controls find it so much easier to work effectively if they are working with the tide and not having banked up against them a vast volume of purchasing power which, if it becomes vast enough, will seep and percolate through every physical control that the ingenuity of the Administration can contrive. That is why my right hon. Friend is using both methods, and I really feel that it was an unfair criticism of the right hon. Gentleman to suggest that my right hon. Friend should be compelled to tackle this emergency in one way only.

The proposals which we have put forward are, I fully appreciate, matters of legitimate controversy. The right hon. Member for Leeds, South, knows perfectly well from his own official and administrative experience that against any particular proposal for an economy it is painfully easy to bring forward arguments against achieving it. Anyone who has held the office which he held knows that. I am perfectly certain that my right hon. Friends do no take amiss suggestions that the emphasis should be one way rather than another.

But the whole body of their proposals is designed to achieve the single and simple end of ensuring that this country is able, within the very narrow margin of time allotted to us, to secure its solvency and its economic independence in the world. There is very little time available to us to take these measures, as the House knows; and it is, therefore, desperately important that those measures should be adequate.

At one stage the right hon. Gentleman indicated that he thought that we went too far. Let me remind him of the wise words of a predecessor, Sir Stafford Cripps, at his Press conference on 19th September, 1949: We have been trying to deal with the situation by a series of temporary expedients which have led to a series of crises. Now we have recognised that this is not enough. It is this recognition and the full agreement about the next steps that are the real achievement. The gravity of the position, as Sir Stafford admitted so frankly, has been underestimated in the past. Against the background of the time factor it would be dangerously wrong to under-estimate it in the present. We cannot contemplate a situation of chronic economic crises puctuated by biennial economic emergencies. It really is necessary, if this country is to have its independence in the world as well as its capacity to live in the world, to secure that this country is able to earn its living, to pay its way, to earn its keep. His Majesty's Government regard it as their duty to carry through all measures that are necessary for achieving that end. That is the task which we see before us.

We shall do our duty. We cannot do less than our duty in this emergency. We shall be content to be judged by our fellow countrymen when the time has elapsed for our measures to take effect, and we have sufficient respect for the good sense and the good judgment of our fellow countrymen to know that they at least will respect a Government which was not afraid to court unpopularity in order to do its duty.

5.0 p.m.

Mr. Aneurin Bevan (Ebbw Vale)

I must say that what the Financial Secretary said at the conclusion of his speech found an echo in my own heart—that we are facing a very serious situation, an extremely serious situation—and we are glad to hear that the Government are prepared to face up to their responsibilities.

I am bound to say at once, however, to follow that up, that it frightens me to think that these responsibilities are in the hands of persons like himself. Although we had a number of generalisations and "smart Alec" debating points, we received from him and, indeed, from the Chancellor of the Exchequer when he made his statement the other day, not one single contribution to deal with the underlying reasons for the economic crisis.

I could quote, but I do not wish to burden the House, from the speech that I made to the House last year on the occasion of my resignation, in which I warned the House and the country that there were underlying economic reasons, not financial but economic, which made our re-armament programme impracticable, and that those economic reasons would work themselves out in this country and in Western Europe by unemployment, by under-employment and by rising prices.

The Prime Minister, in what I thought was a most unworthy remark, said that we were right by accident and that our action was not taken for any very reputable reasons—a remark which was not only out of order at the time but which was a shameful remark for a right hon. Gentleman to make about another right hon. Gentleman who had seen fit, in the interest of the country, to put his resignation in the hands of the Prime Minister—[Interruption.] When hon. Members opposite jeer like that they should have read the American newspapers immediately afterwards and learned that a great deal of raw material reached us as a direct consequence of the alarm caused in America because of the British crisis.

I made on that occasion a statement to the House, and it was this: I said that, in my opinion—and when I say this I am not making any reflection upon the personality of the Chancellor of the Exchequer or of any of his colleagues—the responsibility for economic and industrial planning should be taken away from the Treasury. I wish to develop that point because I think that it is of underlying importance.

I hope that the Prime Minister will not be out of the Chamber all the time because I have a few observations to make which are strictly relevant to his functions. I am not myself going to argue today whether the arms programme is primarily responsible for our situation or whether it is not. I have never argued that the arms programme by itself was responsible for our situation. I agree with what many hon. Members have said, and that is that the arms programme of such intensity and on such a scale aggravates our economic situation; but, nevertheless, it is idle discussion, which some of my own colleagues also carry on, as to what extent the arms programme has aggravated the situation.

It reminds me of what used to happen quite frequently when I was a miner and had to represent the miners in the courts about workmen's compensation. When miners suddenly died of heart failure in the pits, the employers used to argue, and the lawyers, of course, on their behalf, with the utmost skill, that death was due not to exertion but to a weak heart. If it was a weak heart, no compensation: if it was exertion, compensation. We ultimately decided, in the words of a wise judge, that it was both—unnecessary and unprecedented impracticable exertion on a weak constitution. That is exactly what is happening in Europe at the present time. These physical facts reflect themselves quite naturally in the physical ill-balance between our own economy and that of the United States of America.

When I said in my speech that we were influenced by the lurchings of the American economy, I was derided by hon. Members opposite—[An HON. MEMBER: "And by your own side."]—but the Chancellor of the Exchequer used a much less elegant metaphor when he said, "The giant moves uneasily in bed." I said then, and I say now, that there is not only an ill-balance in the British economy, but there is a dangerous ill-balance between the economy of the United States and the economy of the Western world.

The physical consequences of these underlying economic facts express themselves in terms of the annual balance sheet, and then the Chancellor of the Exchequer makes a series of hysterical attempts to put the balance sheet right, leaving the underlying economic facts alone. That is why we have had financial crisis after financial crisis in the last six-and-a-half years. We had financial crises before the war, only the financial crises were not on the Floor of the House but in the domestic budgets of 2,000,000 unemployed.

All that happened before the war was that the underlying ill-health of the British economy was masked by the semi-starvation of millions of British people. What happened? I speak polemically and, therefore, I do not resent it when I am attacked—but these are irrefutable facts which have nothing to do with political party manifestos. The Conservative Party has to deal with them today; we had to deal with them yesterday; but it is to be said for the party to which I belong that in the six-and-a-half years in which we were in office we were bringing about a rectification of the physical ill-balance: that is the difference.

When the Leader of the Opposition complained today, as he so rightly did, about the Prime Minister's behaviour, he was quite justified. The party opposite inherits the balance of payments crisis; of course it does. It may say that it inherited it from us, but it inherited it from the British capitalist system. We were not in charge of the British economy; it was the F.B.I. [Laughter.] Oh, yes. I will do much worse than make the charge; I will prove it. I have some very interesting things to say to hon. Gentlemen opposite.

It is true, therefore, that they inherited the crisis, and it appears to them now as a financial crisis, but if we had not taken the steps that we did we should today be facing not a financial crisis of £450 million or £500 million on our balance of payments but stark, physical ruin. In the course of the last six and a half years, how many power stations did we build? The British industry is now consuming more than twice the current it did before the war. How many factories did we build? [HON. MEMBERS: "How many houses?"] Yes, and how many houses? According to the observations and comments of people in other countries, we have had a better housing programme than any other country in the world. I shall come to housing later.

If we go round the development areas of Great Britain, we see there millions of people having the physical means of production which they had been denied for 20 years. These figures are undeniable, and they are figures which were being registered at the time that the right hon. Gentleman the Prime Minister was making his frivolous speeches in the country about "Weary Willies" and "Tired Tims."

We were setting aside every year, for capital development, a higher proportion of the British production than had ever been known in British history, and the party opposite inherits that. Hon. Members opposite say that they inherit a deficit of £450 million on the balance of payments account, but they inherit a British physical economy in a more wholesome condition than it has been since the middle of the 19th century.

I know that the Prime Minister does not understand this. He does not understand also—hon. Members opposite must face this—that if we had not taken steps to drive the coal owners out we should not now be able to dispense with purchases of American coal. Hon. Members know that too, and these facts must be faced. We know, and they know, that if we had been able since 1945 to export from this country 30 million to 40 million tons of coal every year, not only would our economy have been healthy but our diplomacy would have been strong. Does anybody deny that?

But we cannot repair the past in a day. I remember going on deputation after deputation to coal owners begging them not to dismiss boys of 20 years of age from the pits. They used the boys from 14 to 20 and then sacked them. Miners leaders warned Sir Evan Williams, who was a bigger disaster to British industry than Hitler was, that it was undermining the roots of British industry and that the mining industry could not recruit manpower unless the young men were guaranteed continuity of employment. Is not that true? What is the result? The reputation of the mining industry was so blackened among the workers of Great Britain that we now have a mining force inadequate to the purpose, although, with men of a greater age we are producing more per head than before the war and are the only country in Europe doing that.

In other words, the party opposite has been rescued from utter ruin and political oblivion by the application by us of Socialist principles. If they are able to sit where they do today and enjoy the precarious sweets of office, it is because we have been able to repair some of the mischief which they did.

Those are some of the physical facts to which right hon. Gentleman opposite must have regard, but there are some others, and that is why I am not in favour of leaving economic planning to the Chancellor of the Exchequer. He is preoccupied with annual arithmetic, and not only that, for he is also preoccupied with a recurrent crisis; and then he comes along, like other Chancellors of the Exchequer—[Laughter.] Oh, yes, he is bound to do it; he is bound to get the figures right even if the facts are wrong.

In this country we have an annual Budget. Every year the figures are totted up and every year they have to balance. Why? Because we are still carrying on, in an industrial community, the conventions of a pastoral society. Just because the harvest occurs every year in an agricultural community, we must have an annual Budget, although in a modern industrial society the annual crops are an insignificant proportion of total production and no balance sheet today corresponds with the actual facts.

That is the reason why my right hon. Friend—I do not blame him for this; he was the inheritor of the convention, although he followed it with conspicuous enthusiasm—[Laughter.]—tried to push into one annual statement of accounts for 1951–52 machine tools which will not arrive until 1953. That is a fact, because the statement of accounts bears no relationship at all to the rhythm of industrial production.

So what will happen? The Chancellor will have about £100 million to spare this year. Where will it go? To reduce the National Debt. And just at the moment that the goods will be arriving and will have to be paid for, we shall have to increase the Debt again or increase taxa- tion. It is a criminally silly situation. Our annual balance sheet ought now to be adjusted to objective economic facts, and we ought not to have this business all the while of trying to balance so narrowly every year.

Let us take another illustration. The Prime Minister has stated that he proposes to give the steel industry back to private ownership. The steel industry of Great Britain is a monument of capitalist inefficiency. A steel works cannot be built overnight. Why is it that at the present time we are so short of steel in Great Britain? Because those in charge of the steel industry had not the nous to see that a time would arrive very shortly when German scrap would not be available, and, therefore, more pig iron production ought to have been arranged.

What is the result? We have to go begging to the American Government in order to try to repair the stupidity of the British steel masters. As a matter of fact, all this should have been done before the war. I will give the party opposite another figure. As far back as 1934, if we had been consuming steel at that time by as much per head as the United States of America, we ought to have been consuming 19 million tons. What were we consuming? Between nine and 10 million tons. In fact, successive Governments before the war—Conservative Governments—presided over a continuing decline of British industry.

When we came into power in 1945 we had to deal with this situation. Now it is even more critical than the right hon. Gentleman has told the House. As a consequence of the monster expansion of the American steel industry, the whole world is being starved of steel. In fact, American steel production today is at the expense of the production of Western Europe. It is not a total addition to production; it merely means the transfer of production from Europe to the United States. Even now the United States cannot maintain full production in their plants, because they have not got the raw materials.

There has just been an allocation of sulphur. We have got a very small bit from our Ally. The allocation is two million tons short of industrial requirements. That among other reasons is why our production this year is less than last year. What on earth is the good of right hon. and hon. Gentlemen opposite and chairmen of the banks getting up and preaching homilies to the British worker to work harder if he has got nothing to work with?

What is the use of asking the engineers for more production if they cannot get the raw materials to do it with? This is partly the result of not having a continuous economic concentration on the underlying facts, but merely spasmodic statements from Chancellors of the Exchequer who economically go to sleep when there is no crisis on.

That is the reason why I would take economic planning away from the Chancellor of the Exchequer and would immediately appoint a Minister of Production. I would not do it because the Chancellor of the Exchequer is not an extremely able man. We all know that he is, but the greatest possible ability cannot prevail against the myopia of the Treasury. That was why at the end of the last Cabinet my right hon. Friend, the then Prime Minister, appointed a Minister of Raw Materials. I thought then it was inadequate and entirely the wrong kind of appointment.

I apologise for taking up the time of the House for so long. [HON. MEMBERS: "Go on."] In this small island, dependent as we are on raw materials from all parts of the world, we have not yet made a geophysical survey of our own resources. I am sure if the Chancellor of the Exchequer had it suggested to him he would say, "Oh, no, it is too expensive. It would unbalance the Budget." We have been paying in this country on overseas account £3 million, £4 million and £5 million every year for potash, and even so we have consumed the least potash per acre than in any part of the Continent of Europe. Our farmers need potash badly. We all know that it is now elemental that the more we can send up our food production the healthier our economy would be.

We had made no surveys for potash in Great Britain but it has been discovered on the north-east coast by accident. Now we are informed that there is enough potash from that to last us 200 years. Once it is properly extracted—I.C.I. ought to get a move on as quickly as possible; it is too bureaucratic to move fast—we shall not be dependent upon supplies of potash from abroad. We shall have plenty for our own purpose and we might be able to export.

The same thing is true of Cornwall. Just because the Phoenicians scraped lead and tin from Cornwall, the superficial conclusion has been reached that there is not much tungsten and tin in Cornwall. Why do we not have proper surveys made? We have borings made by the Minister of Fuel and Power, who is continually discovering more coal than he can produce. Almost every week a new coalfield is being discovered. No new miners have been discovered.

I would have thought that the first thing to be done would be an exhaustive survey by modern methods of the raw material possibilities of Britain. It has not been done. [Interruption.] I am not making a party political speech at all. [Laughter.] If I am and if it shows signs of a party complexion, it is because the facts are so ominous.

What we have done is to leave these things in the hands of adventurous private enterprise. We have left this to right hon. and hon. Gentlemen opposite, and what have they done? They have gone to the four corners of the earth to get raw materials. Now they cannot get them because the native populations are rising against their past iniquities. We have not even surveyed our own resources at all. I am not saying that they are there. Some of them have been discovered; others ought to be sought for. Furthermore, a concentrated effort ought to be made to try to get these raw materials where they exist in our Dominions and in our Colonies overseas—a concentrated effort. But why does not private enterprise do it? Why is it that—

Mr. Bernard Braine (Essex, Billericay)

The House is interested in what the right hon. Gentleman has said. I am sure the House will be equally interested to know when he discovered the truth of all this.

Mr. Bevan

We discovered so many truths. We were pre-occupied with a large number of truths. After all, we could not be expected to clean up the Augean Stables overnight. The difficulty lay here: in the meantime we had to build up the capital resources of Great Britain before we had them to export to the Colonies. Indeed, we had to face difficulty after difficulty arising out of the archaic character of private enterprise.

The Chancellor of the Exchequer took credit to himself the other day for a figure about commercial vehicles. He said he intended to cut down the number of cars and commercial vehicles for the home market by about 40 to 50 per cent. and to put them on the export market. We tried that. My good friend and colleague Sir Stafford Cripps, than whom there has never been a better Chancellor of the Exchequer, took credit in the capital investment account for about £70 million for that. Industry produced them and then said they could not sell them on the markets of the world—and asked what they were to do with them. They dumped them on the British market.

We got the unnecessary vehicles and Sir Stafford did not get his figures. Why? Because private enterprise in commercial vehicles were not interested in the balance of trade; they were interested in their own balance sheet. What was the result? The British economy was distorted by having a large number of unnecessary vehicles on the British roads and a heavy deficit on the railways, and so frivolous, so careless, are the Party opposite about the physical facts of the British economy that they are prepared to encourage redundant, heavy road transport in Britain at the expense of the main railway system.

In other words, the Party opposite are primarily concerned with politics. What is going to happen now? The right hon. Gentleman is still Minister of Defence. He heard his right hon. Friend say the other day that he proposed to run down the stocks in this country in order to balance his accounts so that by the end of this year industrial stocks will be lower than they were at the end of last year. As Minister of Defence, does he support that?

The Prime Minister

As Minister of Defence and as Prime Minister I entirely endorse the course taken by the Chancellor of the Exchequer.

Mr. Bevan

Then the right hon. Gentleman is not fit for his Office.

The Prime Minister

I am afraid the right hon. Gentleman is endeavouring to make a somewhat belated repayment to me of the remark I made when I said that in the war he was a "squalid nuisance."

Mr. Bevan

I must say to the right hon. Gentleman that I thought I had repaid that account pretty often. He had better get his balance sheet right. Let me ask the right hon. Gentleman—against whom are we supposed to be re-arming? What country menaces Britain? What country menaces the peace of the world?

Captain L. P. S. Orr (Down, South)

Ask Tito.

Mr. Bevan

The Soviet Union? That is what is being said, so do not let us pretend it is not. What we have been told by the generals and the admirals is that one of the most dangerous weapons possessed by the Soviet Union is 400 to 500 submarines; and then this Minister of Defence proposes to run the industrial stocks and other stocks of Great Britain down at the beginning of a year which Eisenhower says is the year of peril. This is the right hon. Gentleman's Ruritanian politics.

What does the right hon. Gentleman do? Here we are, this year, engaged in a great, all-out armaments effort. We are a small island dependent absolutely for food and raw materials upon free passageways over the oceans. We have always known that the attack upon us is most deadly in the first year or two of the war. If the war occurs and submarines come, it will be some time before the ripost is made. In these circumstances, that Minister of Defence and that Party balance their accounts by running down their stocks.

Captain Richard Pilkington (Poole)

rose—

Mr. Bevan

I am already delaying the House too long.

Hon. Members

No.

Captain Pilkington

I thank the right hon. Gentleman for giving way. Will he not say that his contribution to this situation was to resign because of his own party's re-armament programme?

Mr. Bevan

That has been answered over and over again. Hon. Gentlemen should not abuse the right of interruption merely in order to carry on the debate. That is not the purpose of interruption. The purpose of interruption is to clarify a point. [Laughter.] I must say that whatever complaint may be found in me, I thought I was being clear. I say to the Prime Minister: He says in the war he called me a "squalid nuisance." [HON. MEMBERS: "You were."] I say that the right hon. Gentleman is now betraying his trust and that there is no justification for this action. These two things cannot be added together; we cannot add together the feared imminence of war and the running down of British stocks.

Mr. Walter Fletcher (Bury and Radcliffe)

rose—

Hon. Members

Sit down.

Mr. Deputy-Speaker

If the right hon. Gentleman does not give way, the hon. Member for Bury and Radcliffe (Mr. W. Fletcher) must resume his seat.

Mr. Bevan

I beg the hon. Member's pardon, but I must turn to a part of my speech which I consider I am entitled to make, and that concerns the matter of Health Service charges. I have finished with the other point. It is no use—

Mr. W. Fletcher

rose—

Hon. Members

Sit down.

Mr. Bevan

The Chancellor of the Exchequer says that he is not running down stocks dangerously. That is no use. [Interruption.] The Chancellor of the Exchequer will not get his money from tobacco alone. It is over £100 million. We should like to know what it is. Of all the mean and contemptible things to do the attack on the Health Service is the worst.

The right hon. Gentleman thanked the miners the other day for the effort they are making. How does he reward them? How does he reward the industrial workers? He does it by rotting their teeth. That is how he rewards them. A book has just been written by two hon. Members opposite about the increase in the number of persons now seeking public assistance. The Chancellor of the Exchequer is adding to them, because he says that any person who cannot afford to pay the £1 can go to the Assistance Board and prove it.

That means more staff, more interrogation, more humiliation, and more means tests everywhere. And what for? For the miserable number of pounds that the Chancellor is saving. I admit that he can say it was done here—but it was done here reluctantly. But on the other side of the House it was done enthusiastically. The party opposite always hated the National Health Service. They fought it, and now they are trying to destroy it. Fancy trying to charge £1 for an old person who goes for an aural aid. What mean people are the party opposite.

The National Health Service, especially in these categories, has brought relief to hundreds of thousands of people, far in excess of the cost involved. Why are the party opposite trying to undermine it now? If I was Stalin I would select the right hon. Gentleman to be the Prime Minister. He is a better recruiter for the Communist Party than Stalin. There is nothing whatever in the internal financial situation that justifies these charges. The National Health Service is now being crippled, not only by the direct charges, but at the same time by preventing it from having its normal expansion and by not being able to raise the ceiling where the cost of living is going up. What, therefore, happens? We get more and more overheads, with less and less service to the patient. All the apparatus and medicine will be kept and will be used less and less.

The party opposite should not tell us that they are supporting the school dental service. That really was bordering on dishonesty. As my right hon. Friend said, they cannot take credit for the financial savings and at the same time expect that the children will get it; they cannot do it twice. At the same time, remember that large numbers of children are treated in the general service. Indeed, it was always the intention that the general health service should absorb the school dental service, because the general health service is more competent and brings a wider experience to bear on the matter than the narrow confined experiences of the school dental services.

I was going to say one or two more things, but I have talked too long. [HON. MEMBERS: "Go on."] The right hon. Gentleman said to me just now that I took power from the House to put on charges for prescriptions, and that I manœuvred out of it. Let hon. Members read HANSARD. When I took the power from the House, I said frankly that I doubted whether it would be a practicable step. Will the Prime Minister make me a promise? Will he promise to bring before the House immediately Orders for which he has power in every statute? Does he not know—he has been in office long enough—that very often statutes give power to make Orders that are never made. Will he promise to make them all? Why, therefore, say that the Order is made because the statutory power is conferred?

What we found was this. It was estimated by Sir Stafford Cripps that he would get £10 million. When he went into it, we found that we could only do that by charging for medicines, for the first time since 1910. In other words, the right hon. Gentleman now, in his advanced years, is varying the one good thing he ever helped to do. Is the Chancellor of the Exchequer going to make ex-Service men pay?

Mr. Cyril Osborne (Louth)

It would not apply to you.

Mr. Bevan

That is an unworthy remark. All I can say to the hon. Member is that the ex-Service men in my constituency have more confidence in me than they have in him. I certainly look after their interests better than he and his colleagues.

I should like to know from the Chancellor whether he is going to make ex-Service men pay the prescription charge and the other charges. [HON MEMBERS: "Answer."] Answer, one of you. We know what the answer is, of course. We know that the party opposite have managed to solve the problems that we were faced with by putting them on the backs of the poor. We found that the exemptions that ought to be made reduced the figure to de minimis proportions, and therefore it was not worth having all the expensive administrative machinery in order to do it. We kept the Health Service, therefore, intact.

I beg and pray the Government to reconsider what they are doing. They are producing in the country a wave of hostility. They have no mandate for it. [HON. MEMBERS: "Hear, hear."] We know that the Prime Minister does not care about mandates, because he told us in the last Parliament that, after all, it was not necessary to carry out everything that was put in an election manifesto. He told us that over steel. Therefore, people cannot accuse the right hon. Gentleman of going back on his word, because he told the country beforehand that he might deceive them.

I say to the right hon. Gentleman that he should reconsider this matter. There are certain disciplines, certain sacrifices, that the country is prepared to make until its economy is put on a wholesome basis, but these charges are cruel, unnecessary, mean and unjust, and there is no mandate for them. They ought to be withdrawn, or the Government should go to the country and ask the country what to do about it.

5.50 p.m.

Lieut.-Colonel Walter Elliot (Glasgow, Kelvingrove)

The right hon. Gentleman has spoken at length, and at some points in a most interesting fashion. It is quite true that at the beginning and at the end of his remarks he lapsed rather from the high range of generalities in which he interested us all so much during the middle portion of his speech. At the end, in fact, he did make certain remarks which it is very necessary should be dealt with at once.

He said in, I think, a very ungenerous way to my right hon. Friend the Prime Minister that he gave warning to the people of the country that he might deceive them. The right hon. Gentleman came before the House and admitted that he had deceived the House. It was he who introduced these proposals in another place. It was he who commended them to the House of Commons, and it was he who gave the full authority to the Under-Secretary to move and who himself supported this in a Division. Then, long afterwards, he said, "By manoeuvre I succeeded in maintaining the 25,000 houses and not putting into force the charge for prescriptions." He said of the regulations which were brought in that they were not meant to be acted upon in every case. He said that regulations are not always intended to be drafted. Let him read HANSARD—

Mr. Bevan

I will.

Lieut.-Colonel Elliot

Wait a moment. As we have just learned from the right hon. Gentleman, the purpose of interruption is to clarify a point; let me, therefore, make the point before he attempts to clarify it. Let me refer him to proceedings in another place where the Government spokesman was introducing this charge into our legislation for the first time. Let him read there what the answer was to the question about what moneys would be obtained from this. He will see that Lord Shepherd said: A certain amount of it will be this year. If the right hon. Gentleman looks he will see that that was on 17th November, 1949. A certain amount of it will be this year and we hope to get the full fruits in a full year. These were the terms upon which it was introduced into the legislation of this country.

Mr. Bevan

Will the right hon. and gallant Gentleman now allow me to clarify the point? The right hon. and gallant Gentlemen claims that I have a guilty conscience, but HANSARD is full of the guilty conscience of the right hon. and gallant Gentleman. I said this in Committee: We have had that argument raised and the newspapers supporting the Opposition have been carrying headlines for almost 15 months on this particular matter. When we come to make a distinction and go from the easy realm of abstract principle to that of practical discriminations all kinds of administrative problems arise. I can see that, in some instances, the cost of administration would exceed the economy. …"—[OFFICIAL REPORT, 9th December, 1949; Vol. 470, c. 2260.]

Lieut.-Colonel Elliot

If that is the right hon. Gentleman's idea of clarifying a point, all I can say is that I wish him luck in the next London fog. There is the statement made by the Government spokesman. The money is intended to be obtained this year—1949, some of it—and the rest in the full year. The right hon. Gentleman, of course, said that he anticipated administrative difficulties. He said that repeatedly when he commended the proposal to the House. He put on the Government Whips, and put it in the Bill which then became an Act, for which he now says we have no mandate—no mandate to administer the legislation he himself introduced.

But we do not need to go as far as that because the mandate was discussed very fully, not so much by the Opposition as by his opponents in his own party. It is one of the interesting features of any debate in which the right hon. Gentleman takes part that there is a vigorous internicine struggle as an inseparable part of it. The vehement assault on the Chancellor of the Exchequer which he carried out before our eyes this afternoon is an example of it and the damaging attack he made on Sir Stafford Cripps by saying he was the best Chancellor of the Exchequer he had ever known—which in his mouth is a word of commination.

We had one of his hon. Friends who listened to his speech and then made some most blistering remarks on the right hon. Gentleman. In a somewhat unworthy part of his speech, the right hon. Gentleman spoke of the smart-aleck phrases used by the Financial Secretary to the Treasury. His hon. Friend went further than that. He said on 9th December, 1949: I recall what people so often say, if a lawyer makes a speech like that. They say: 'He is only a clever lawyer.' If a layman makes a speech like that they say, 'What a success he would have made at the Bar.' I do not suppose the right hon. Gentleman would like me to say that he would have made a success at the Bar and having listened to his speech, quite frankly I do not think he would …if a solicitor's clerk had to face that question on a summons he would know better. That goes perhaps to help balance the payments of which there was mention earlier. It is quite true we borrowed this one, but we proceed now to pay it back. The right hon. Gentleman explained that these things had nothing to do with the crisis, and that these proposals were unworthy, mean and paltry and an assault on the Health Service. His hon. Friend said of his attitude at that time: I thought the right hon. Gentleman was really too ingenious for anything … in dissociating the whole of this Amendment almost entirely from any notion that there has been a financial crisis or a devaluation or a cut. It is only a coincidence that these medical abuses were discovered about the same time that we had one of the crises of the capitalist system. I do not think anyone will believe the right hon. Gentleman on this point."—[OFFICIAL REPORT, 9th December, 1949, Vol. 470, c. 2268–9.] That was the testimony to his credibility by a supporter at the time. [HON. MEMBERS: "Who was it?"] He was a former hon. and learned Member, Mr. D. N. Pritt, who was a close associate in many ways—[An HON. MEMBER: "Not a supporter."] He used to support the right hon. Gentleman and he got in on their ticket. We said then, and we say again, that the fundamental danger to the social services is the evaporation of the pound.

The right hon. Gentleman attempted to make great capital of the running down of stocks—that we should smoke a few cigarettes fewer from imports and a few more from stocks. Really the danger before this country is not being able to buy its very bread—or its bread and meat, if hon. Members like to say so. The right hon. Gentleman asked why we did not further develop the resources of this country and the resources of the Empire. I remember when I was Minister of Agriculture trying to grow more sugar beet in this country and the party opposite time after time marched into the Lobby against it. During the war every ounce of the domestic ration of sugar was brought from our own soil under measures introduced on this side of the House and voted against consistently by the Opposition.

Mr. Frederick Peart (Workington)

The right hon. and gallant Gentleman talks of the record of himself and his party in agriculture, but between the two wars, under the Tories, three million acres went out of cultivation.

Lieut.-Colonel Elliot

We put every ounce of power we had into developing agriculture in the teeth of the Opposition. We increased the production of agriculture by the pigs scheme, the sugar beet scheme, the milk scheme, and we increased the wheat acreage. Do not talk to us about increasing agricultural production. We were doing it when hon. Members opposite were opposing it at every step, and that goes for the right hon. Gentleman, too.

The right hon. Gentleman spoke of teeth. We put the milk-in-schools scheme on the Statute Book—against whom? Against the Leader of the Opposition, against Sir Stafford Cripps who moved the Motion for its rejection. That was the foundation for the necessary dental treatment in this country.

I shall not go into the whole wide sweep which the right hon. Gentleman covered. It would take too long. It was an ambitious task he set himself—that of explaining away the United States of America, a formidable task; the U.S.A., the great giant whose lurchings had, he said, set all our economy awry—that giant created and maintained by private enterprise.

Mr. Bevan

And ruined by private enterprise.

Lieut.-Colonel Elliot

Ruined to such an extent that we, after six and half years of Socialism, have to come before them as suppliants for a million tons of steel.

I am not going further into that enormous question now, because to do the right hon. Gentleman justice, in the middle of his speech he cast aside his prejudices and argued in a most interesting way. He argued of the dangers and difficulties that lay before us in our economic life. He spoke of the steps taken in the last six years to modify the extremes of wealth and poverty in this land. That is no new process. It is one which had gone on for many years before.

The right hon. Gentleman spoke of building new power stations. Who built the first power stations? Who built the factories originally? We in this country built these things. They certainly needed a further expansion, which they got, but do not let hon. Gentlemen believe that all the industrialisation of this island began on the day that they came to the House and sang the "Red Flag" on the Floor of the House. It was a long process.

I would say to the right hon. Gentleman that the power of his speech, of his eloquence, is enormous, as is his power of drawing on facts and figures, which he supports from time to time with an imaginary flight which is the privilege of his race. It was said of a great Chancellor of the Exchequer, another great Welshman, David Lloyd George, "After all, our Chancellor uses figures merely as illustrations." The right hon. Gentleman was a little anxious that we should have an imaginative approach to the Budget. It is not the first time that there has been an imaginative approach to the Budget. It is not always successful.

Mr. Emrys Hughes (South Ayrshire)

That is an attack on a race.

Lieut.-Colonel Elliot

It is not an attack on a race to say that they are powerful, rhetorical, and that they use facts and figures and add imagination to them. I am praising the right hon. Gentleman on his speech in respect of the parts in which he transcended narrow party bounds, the tramlines on which he started to run at the beginning of his speech and to which he reverted at the end.

The right hon. Gentleman came back to the proposition with which all of us will agree, that this country is faced with a grave and terrible crisis. As has so often been said, we cannot get through it if we are to use one half of the nation to attack the other. The arguments we have on the Floor of the House are transcended altogether by the greater agreement which exists outside. We have spoken, and properly so, of the enormous efforts of the miners, we have all paid tribute to them, to the dockers, the firemen, the rank and file of the workers of this country, who in an Election vote 50–50 for hon. Members opposite and for ourselves on this side.

Surely hon. Members do not suppose that that great part of the electorate which votes Tory are the idle rich. If that were the case, it would mean that there are more idle rich in the country than anybody has ever dreamed of. That is not so in Glasgow; it is not so in Kelvingrove; it is not so in Anderston. I say that we on this side of the House are sent here by working-class votes. We are indeed, or how should we be here? We would certainly not be on this side of the House, even with a slender majority, if that were not so, and we intend to keep faith with those people who put us here.

We agree with the right hon. Gentleman in his diagnosis that there is a grave crisis. We agree with the underlying spirit expressed in the middle of his speech that only by a forward-looking policy planned over many years shall we ever get out of our difficulties. We disagree with the right hon. Gentleman bitterly when he thinks that the best way to do that is to enter into violent controversy with those with whom one disagrees and to use words, which I will not use again—they have often been quoted—which are certainly not calculated to promote co-operation between one section of the community and another.

Let the right hon. Gentleman use his great powers, his powers of eloquence, his powers of imagination, in the sense of the middle part of his speech, and he will do great service to the country. But if he uses them in the way in which he opened and closed his speech, he will do his country the worst dis-service in his power.

6.7 p.m.

Miss Margaret Herbison (Lanarkshire, North)

In listening to the right hon. and gallant Member for Kelvingrove (Lieut-Colonel Elliot), I was amazed when he accused anyone on this side of the House of trying to foster a class division in the country. It is all the more amazing coming from him when we realise how, in Scotland, time and time again the right hon. and gallant Gentleman and his colleagues who sit on that side of the House have never missed one opportunity in the last six and a half years of deriding the then Labour Government and doing the very thing that he suggests today we ought to be public-spirited enough not to do now that the Tories are in opposition.

Lieut.-Colonel Elliot

We are, in fact, in power.

Miss Herbison

That is a mere detail. The right hon. and gallant Gentleman knew very well what I meant.

It is also strange that not only hon. and right hon. Members opposite but much of the Press today expects from the Members on this side of the House a much greater attention to the real needs of the nation and the need to have unity than they ever expected or got from those who are today the Government. I was also amazed with the right hon. and gallant Gentleman's statement that they would keep faith with the people. When Scottish and British people read that in HANSARD or elsewhere, if it is reported tomorrow, it will be treated with the scorn that it deserves.

We find an astounding contrast between the promises made in the speeches of those who are now on the benches opposite before and during the Election and what has happened through their deeds and actions since they became the Government of this country. That contrast has clearly shown to our people that we have as a Government today a party that has sunk lower in political dishonesty than any other party ever did or even their own party did at any other time.

The people of Britain are inherently honest, and just because of that their dismay is all the greater and the shock is all the more severe when they find Minister after Minister of this Government standing at that Box, each statement they make breaking a further promise that they made a few short months ago to the people of this country. The people do not like it. But there is something far more important than their not liking it. They have been brought up very forcibly against the fact that this Tory Party in Great Britain is no different than it ever was in its attitude to the great majority of people and their needs.

It is quite true that the present Chancellor has made no attempt at any time to hide behind that cloak of assumed ignorance about the economic situation behind which some of his friends hide. He has been absolutely truthful in saying that no one could doubt the seriousness of our situation. But the Financial Secretary takes the opposite line. He suggests that it was only when they became the Government of this country that they really discovered the serious economic situation that we were in. I suggest to the Financial Secretary that if, perhaps, he had paid more attention to studying the economic situation of the country, rather than bringing up Prayer after Prayer on many unimportant things, he might not have found it such a surprise when he became Financial Secretary to discover that we were in a serious economic situation.

But a good many of them now show in their speeches that this financial crisis is not something new, that it is, as the Leader of the Opposition said today, something which has been happening over 50 years. The speech of the ex-Chancellor of the Exchequer during the election campaign showed quite clearly how serious was our position. But did the leaders of this Government, did even any of their least known candidates, tell the people during the Election that, because of our economic situation, there would be further deprivations for our people? Not a bit of it.

Let us look at any of the propaganda which came from the Tory Central Office. Let us look at the election addresses which came into homes in North Lanark, or into the homes of any part of Britain. There we find very clearly the Tories doing what they have done for six years, telling the people of this country that all their difficulties all their deprivations, were due to the inept, incompetent Labour Government—no hint whatever that whatever Government were returned to power there would have to be measures taken to help to solve the economic situation. There was no suggestion of that at all.

In many speeches, broadcast and from platforms, they said that our food supplies would be safeguarded; that we would have more food; that the cost of living would go down. What a farce that is now. What has happened since the General Election? Bacon up 10d. a lb.; chees up 10d.—not up 1d.—and these are two of the important things in the cost of living of every worker in this country. Yet these were the promises on which the present Government was returned to power.

The slogan of the whole of their campaign was, "It is time for a change." We saw it on the hoardings and in the literature that came in our doors. It was time for a change. They told us that the social service would be maintained. I remember quite clearly what I described as a comic strip which came from the Tory Central Office during the election. On the front page there was a series of pictures, each one depicting different groups of people telling us it was time for a change and all the wonderful things that would happen immediately the Tories came to power. The Financial Secretary tried to plead today that they did not say they could do all that in three months. No, they did not say to our people an old Scotch saying, Live auld horse, and ye'll get corn. But that is what the Financial Secretary is trying to tell the people today. It is time for a change, forsooth. Without much propaganda from our people on these benches the people of Britain are today crying, and crying loudly, that already it is time for a change of Government, from a Tory Government to a Labour Government. And they are doing that crying exactly because His Majesty's Government today have dishonoured almost every promise they ever made.

It is quite clear from the measures which the Chancellor of the Exchequer has announced to deal with this crisis that the main aim of the Tories on returning to power is the aim they have always had in this country—to ensure that the interests of a privileged few would be safeguarded. And the only way of safeguarding the interests of a privileged few today is the same as it has always been—by taking from the essentials of life of the majority of the people of this country.

In that comic strip, to which I have made reference, there were a few young people. They were saying, in the copy that came into my home during the Election, that the Unionists—and, for those who do not know, I would say that is the name the Scottish Tories take, since they seem to be ashamed of, or at least they seem to shy away from the name "Conservative" or the name "Tory," but that, of course, is by the way—they were saying the Unionists would give young people their chance. Poor young people, if any of them were deluded by that bit in that comic strip.

What is to happen in education? The Financial Secretary felt he had scored a great point when he read out a circular which had been sent to local authorities when we were the Government of the day. But the point that we have made ever since that 5 per cent. cut was announced is that at this present moment, because the education authorities had had to cut previously, there is no chance whatever of their cutting in education at all without ruining the fabric of our education. Yesterday the Chancellor seemed to make very light of this 5 per cent. He said: The Minister of Education has been accused of dreadful things on the score of her recent request to local education authorities to reduce their forecasts for next year by about 5 per cent. overall. Watching, listening and reading of the hue and cry which has been going on, I have wondered at the lack of faith of many of my own educational friends. This Government has always believed with Disraeli that, to use his words, 'Upon the education of the people of this country the fate of this country depends.' What this Government have done with this 5 per cent. cut has given the lie to this claim that they make, using the words of Disraeli to back it up. The Chancellor went on: The Minister of Education and the Secretary of State for Scotland will maintain the essential fabric of education."—[OFFICIAL REPORT, 29th January, 1952; Vol. 495, c. 53.] I want to show clearly that if we insist on this 5 per cent. cut, grave damage will be done to education in this country. We find, from circulars and so on, that it is not intended to cut teachers' salaries. I began to teach in 1930, and in 1931 along came the economy axe and the Government of that day, which was mainly a Tory Government, told each education authority that it must have a 10 per cent. cut. But that 10 per cent. cut also applied to teachers' salaries. This 5 per cent. cut does not apply to teachers' salaries.

In most education authorities the expenditure on teachers' salaries alone is roughly 50 per cent. of the total spending. Some authorities spend over 50 per cent. and others spend just under 50 per cent. on this item. The 5 per cent. cut is not to touch that. There was a suggestion from the Ministry that books, stationery and materials ought to be adequate and should not be cut. Again, that takes up another percentage.

I could give all the points where it would be impossible to make any cut. When we add together those parts of our educational system in which it is impossible to make any cut, we find that they account for about 80 per cent. of the expenditure of any education authority. That means that a little under 20 per cent. will have to bear the full 5 per cent. cut on the whole expenditure on education.

I am seriously perturbed at the fact that grants to school children over 15 years of age and grants to those going to universities come into that 20 per cent. section. We, as the Labour Government and as a Labour Party, were intensely proud that for the first time in the history of Great Britain we had made equality of opportunity a living thing in education. If this 5 per cent. cut is insisted on, can the Financial Secretary tell me where it will be made if it cannot be made on the 80 per cent. and if one of the bigger parts of the 20 per cent. covers these grants? If these grants are affected it will do a great deal to ruin the fabric of our educational system as we know it today.

I do not expect to get support from Members of His Majesty's Government for the justice of equality of opportunity in education. I have always realised as a student and a teacher that it was impossible to expect a Tory Government or a Tory Party to support the idea of equality of opportunity in education. The one point I want to make is that that 5 per cent. cut will not affect the education of one child of a Member sitting opposite. I am certain that that 5 per cent. cut will affect precious few of the people whose interests they really serve in this House of Commons.

Mr. William Hamilton (Fife, West)

I agree with what my hon. Friend is saying. Is she aware that in the county of Shropshire, which has a Tory-controlled council, they are cutting the education of handicapped children who normally have a teacher for one and a half days a week? That period is to be cut to one day. In effect, that means that they are cutting the education of handicapped children by 33⅓ per cent.

Miss Herbison

I am very glad that my hon. Friend has made that statement. I intended to deal later with the effect that this cut will have on handicapped children. The training and the teaching of handicapped children comes into this 20 per cent. of what is left if we discount those parts of the service which it is suggested we should leave alone. It is not very difficult to find people who are ready to legislate and make cuts in education knowing full well that those cuts will not in any way affect their own children or the children of their friends. It is because of that that I say that I do not expect support from hon. Gentlemen opposite for the idea of equality in education. That is an idea which, as I have said time and again, is the birthright of every child.

But I should expect support from another point of view. I should expect support from every British citizen, including every hon. Member opposite, for the contention that if there are cuts in education and in the educational grant, many of these children from working-class homes, and some from middle-class homes, will not be able to stay at school after reaching the age of 15. Many of them who perhaps are able to stay a little longer will be unable to go to the higher technical institutions, and we have too few there even now.

This small island of ours with a population of about 50 million depends on imports for almost all its raw materials. In balancing our overseas payments we have to depend on what we are able to export, and we have come to realise that competition on the overseas market is very keen. That competition will become progressively keener. The only way in which we can meet that competition, the only way in which we can export our goods in the necessary numbers and of the high quality that they must be, is to have inside our country workers and technicians who are fully trained.

That will be impossible—and I speak from my knowledge of teaching—if the Chancellor of the Exchequer and the Minister of Education insist on this 5 per cent. cut. It is for that reason that I appeal to the Financial Secretary and to all Members of the Government to think again about this proposed cut which will certainly interfere greatly with the fabric of our education and which will do great damage to any attempt that we may make to get a proper balancing of overseas payment.

My hon. Friend the Member for Fife, West (Mr. Hamilton), mentioned handicapped children who from the very beginning of their lives suffer handicap. It is important that everything possible should be done for them both from the educational and from the psychological point of view to ensure that, for their own sakes, they become good citizens who will be able to contribute their share to the general well-being of the community.

We already have this example. It is not the only one. In many places there have been suggestions that one way of getting this 5 per cent. cut, which all local authorities are finding the greatest difficulty in imposing, is to attack the education of handicapped children. That is mean. That is despicable. It is like so many of the actions taken in the last few months by this Tory Government.

I want to spend my last few minutes on the cuts in the Health Service. The right hon. and gallant Member for Kelvingrove made great play with quotations from HANSARD about my right hon. Friend the Member for Ebbw Vale (Mr. Bevan), and his attempt to introduce the shilling prescription, but, when it came to the end of the day, the Labour Government decided not to impose a shilling charge for prescriptions. That is the important thing, so far as the people of this country are concerned. This shilling prescription is going to make a big difference to people who, even before we had our National Health Service, could obtain their medicine free of charge, because they are now to go into the category of people who will have to pay for it.

I am thinking particularly of a great number of the constituents whom I represent, many of whom are miners, and I know, from moving about among the miners, how difficult it will be to attract to that industry the people we must attract if we are to obtain the coal we need, both for our own manufacturers and for export. These miners, my own father included, paid 6d. per week, which provided medical attention for the miner's wife and family until the family started to work, in our own case until my two brothers and I were over 20 and had left the university.

These are the very people whom we are asking to go into the mining industry in order that the nation may produce more, but we say to these people that something which they have known for about two generations is to be filched from them, and that they will now have to pay for it. That will be received very hardly, not only by the miners of this country but by all other workers who had schemes similar to that of the miners.

Then there is this charge for abdominal belts. Who ever heard of anyone who did not need it going to a doctor to get an abdominal belt? I know of no workers who would do that, although it may be that certain gentlemen did have abdominal belts for the sake of their appearance. That is something that we do not find the miners, the engineers or any other workers doing. The only people in that category who got abdominal belts were the people who really needed them for health reasons, and these are the people whom the Government of the day are now going to compel to pay at least part of the cost.

On the question of dental treatment, we as a nation have often been criticised, particularly by the Americans, for our bad teeth. They used to say that they knew the people from the old country because almost everyone arrived there wearing dentures. Our dental service was beginning to cure that. In these last few years, people were beginning to go regularly to the dentist for preventive treatment. This charge is going to make it impossible for many of these people to have that preventive treatment. Reverting to the question of production, if there is not that preventive treatment, any doctor will tell us how serious illnesses can come from neglected teeth, and the result will be that, in trying to save this miserable sum of money, we shall be piling up disease and illness in the future with a resultant loss in production, besides imposing hardship on many of our people.

There are many other points, both on education and the Health Service, with which I should have liked to deal, but I know that many of my hon. Friends wish to speak. I say now, as I said in the beginning, that the people of Britain have realised in a very short time that the only way of saving the economic wellbeing of this country, and doing it in such a way that there will be social justice for all our people, and not for just a few, is by getting rid of the present Government and returning a Government of a Labour complexion.

6.35 p.m.

Mr. Denys Bullard (Norfolk, South-West)

This is the first occasion on which I have had the opportunity of addressing the House, and, as I come from one of the most rural of constituencies, may I vary the usual formula with which it is customary to open a maiden speech and ask that the House will overlook any kinks in the furrow which I am going to plough? I think it is traditional that, provided that the depth is there and and that one does not plough right across another man's work, one is forgiven a certain amount of raggedness.

I want to refer to something which is implicit in every sentence of the Chancellor's speech of Tuesday and has been implied throughout this Debate, though it was not actually mentioned until a short time ago, and that is the need for increased food production from our home land, and the contribution which that land can make to the problems which we are discussing today. We rightly hear a very great deal about what could be done with extra tons of coal, both for home consumption and for export. Perhaps it might be that extra tons of home- grown food would not be so spectacular, but I believe that that contribution would still be a very real one and that it could still be made.

This is not an agricultural debate, and I do not propose to go into any of the technicalities of the matter, but it is a most alarming thing that, at this moment when the balance of the country's trade is in such a precarious position, the amount of food which we produce here at home is actually, if not declining, then hovering. The crop acreages are down, although I know that in some respects that may be due to the weather. Cattle numbers, for the first time, are also down, and I must say—and I think the House will agree with me—that the present need is to reverse those very untoward tendencies. We have to make the whole of our agriculture more intensive. It is not only a question of basic foods—bread, potatoes and meat—but we also require a great variety of products from the fruit and vegetable industries, especially when foreign importations have had to be reduced.

We have heard a good deal in the past about "feather-bedding" and about "deck-chair farming," but, even where opinion is better informed, there may be still the idea that agriculture has had time to accumulate the necessary machinery and build up its capital re-sources, and that it is possible, through the mechanisation that has taken place, for agriculture, at this precarious time for the country, to spare workers for other industries. It is with these two measures—capital investment in agriculture and the number of workers—that I want particularly to deal.

I can testify from close experience to the intense wish of the farming community still further to improve its efficiency. I do not believe that there is any industry in which there is more discussion on technical points and in which the whole question of increased efficiency is given greater study. But there can be efficiency at various levels of production.

It has been proved in the past that high farming is no remedy for low prices, and equally it is not the remedy for high costs. At the moment farmers are being forced to go over from a system which is intensive to one which is extensive; they are being forced to drop a department rather than to take on another. To put it another way, we depend for the volume of our food on a two-storeyed system in agriculture—livestock built upon crops and crops built upon stock. The old ties concerned with the fertility of the land are not so binding as they were. People are going in for a more extensive form of farming, the very reverse of what we want to see. In Norfolk, my own county, which was the cradle of one of the most celebrated of all the mixed-farming systems ever practised in this country, cattle numbers are falling, but there is ample opportunity there for building a great beef industry upon the arable system.

I want to mention the matter of mechanisation and steel supplies for agriculture because, although we have been told that there are to be no direct cuts in this respect, it is most essential that our agricultural machinery industry, which has made such great strides, should continue, and that the home farmer should have a fair share of the products of that industry. I am convinced that it is on the lines of still further use of machines that intensification of our agriculture will be made possible. For instance, I am sure that, in regard to potatoes, where production has fallen by half a million acres since 1948, production of that basic foodstuff, which was of such great value to us in the feeding of our people during the war, could be extended. But the extension of the present acreage depends on mechanisation, and the same applies to the sugar beet and other industries.

On the livestock side, development in the dairying industry is being held up by the cessation of the extension of electricity into the rural areas. This was a most unfortunate step that was taken last summer, and I believe that for the continuation of the dairying industry and also in order to provide amenities for workers in that industry, it is essential that there should be a resumption of rural electrification.

It may be thought that because of all the mechanisation which has gone on in farming, labour could be spared for other industries. Indeed, there has been a very considerable fall during the last year or two in the number of people working on the land. We know that the transfer of labour from less essential to more essential industries is one of the features of the plan which the Government have announced, but I wonder whether it is realised that when a new industry is developed in the small industrial towns of this country, or when a small engineering firm connected with exports or armaments is expanded, the first drain on labour is from that on the farms.

I know from experience, that in the towns round about me, buses go into all the villages and into the most remote parts collecting workers for factories connected with armament and the export industries. I believe that one of the greatest obstacles to the expansion of home agriculture at the present time is the farmers' fear of not getting the work done. Therefore, I hope that every encouragement will be given to housing in the rural areas, and, as I have said, to the extension of electricity supplies, factors vital to this aspect of the matter.

The most significant part of the Chancellor's speech on Tuesday was his emphasis on the need for expansion. Cuts, as he said, are no remedy, and the expansion of home food production is a sphere which demands the most urgent and immediate attention from the Government. I urge the Government to come forward immediately with a bold plan of expansion. It is needed in every part of our agricultural system.

The extension of livestock farming on the hill and marginal lands, of which we have seen most notable examples, such as that cattle ranching scheme on the Great Glen of Western Scotland, and which, though miles from me, I have watched with great interest and respect, should be encouraged. There is also need to intensify the farming of our own better lands, both on the larger farms and on the smallholdings, and even on the allotments and gardens. In view of our present food situation it is very depressing to see so many of the allotments and gardens which were cultivated during the war going out of cultivation at the present time.

I agree that the job lies with the occupiers of the land, but there is need for a lead from the Government, and I hope that before long we shall hear proposals from the Minister of Agriculture which will really meet the needs of the country and of the agricultural industry which desires, as it can do, to make its great contribution to the matters which this House has had under discussion during the last two days.

6.46 p.m.

Mr. Anthony Crosland (Gloucestershire, South)

The House has just listened with great interest and enjoyment to a maiden speech by the hon. Member for Norfolk, South-West (Mr. Bullard), and it falls to me, although myself very little more experienced than he is, to congratulate him on behalf of the whole House.

The hon. Member spoke on a subject of great importance to the country and one which he evidently knew himself in great detail. For that reason he was listened to with equally great attention from both sides of the House. If he goes on making speeches of so much greater relevance than those of his own Front Bench it is safe to say that, if merit gets anything in this world, he will move rapidly down from the back to the Front Bench. But whether he next speaks from the back benches or from the Front Bench, I can assure him that both sides will listen with the greatest interest to what he says.

We have had a very wide ranging debate today, but I want to come back to the central problem of the present balance of payments crisis, and to discuss some of the causes, and the remedies suggested by the Government. I think that the end of January is always a bad season in which to discuss any economic problem because it is just the time when we have those interminable statements from bank chairmen, what Lord Keynes once called the fashion parade put out by the banks. I must say, with respect, that their statements do not get better as the years go by.

My right hon. Friend the Member for Ebbw Vale (Mr. Bevan) has taken a strong dislike to economists as a class, but I should have thought they were a model of charm and common sense compared with bank chairmen. The theme which has run through all their speeches, and also through the speeches from hon. Members opposite—yesterday in particular—has been that this balance of payments crisis and all the ones we have suffered from since the war have been basically due to one cause, the effect of inflation. It has been said that we have been consistently living above our means, and that if we could get rid of inflation everything would be all right.

It seems to me that if we look at the facts and causes in detail there is no possible evidence for this supposition. After all, as the House knows, we had a balance of payments crisis for several years before the war, despite the fact that our situation was so little inflationary that we had an average of one and a half million unemployed. Therefore, we were bound to run into a serious and recurrent balance of payments crisis after the war merely by the fact of full employment. If all these people were put to work and began earning higher wages, clearly our buying from abroad was bound to grow, and, therefore, our situation was bound to become more difficult.

That being so, the mere fact of having full employment was certain to create a balance of payments crisis. If we add on top the fact that we had this crisis before the war while we still had our foreign investments intact, while the price of gold was still high, while invisible earnings were still considerable and while the terms of trade were strongly in our favour, and bearing in mind that none of these things is true today—adding these facts together, it was inevitable that we should have great balance of payment difficulties in the whole of the post-war period. Inflation or no inflation, these facts made it absolutely inevitable.

If we are going to sustain the argument that since 1945 the whole trouble in every crisis was just inflation, then we have got to show one of two things. We have got to show either that inflation has been responsible for great increases in our imports as compared with before the war; or we would have to show that it has been responsible for a great reduction in our exports as compared with before the war. If inflation were going to have an effect at all, it was bound to be from one or other of those two things.

But the plain fact is that our imports in volume are lower than they were before the war, despite the fact of full employment, and our exports are two-thirds to three-quarters higher in volume than they were before the war. If we take the fact of lower imports and higher exports, it does not begin to make sense, with all due respect to the bank chairmen, to say that our post-war difficulties are in some way due to inflation and excessive purchasing power. If hon. Members opposite—and the hon. Member for Oldham, East (Mr. Horobin), put this clearly yesterday—believe that inflation is the cause of the trouble, how far do they now intend to take deflation in order to cure the crisis? Our imports are held down by physical controls, and they will have to make people a good deal poorer to persuade them to buy only the imports that are physically controlled. They would have to make them even poorer still to persuade them to buy fewer imports than they do today.

If it is a fact that with one and a half million unemployed before the war we still had a balance of payments difficulty, how much deflation would really solve the crisis? As soon as we put it in those terms, and bearing in mind the loss of foreign investments in the war and the worsened terms of trade, we can see that if we want to cure our present crisis by deflation we will really need to have not one and a half million unemployed but three or four million unemployed. To my mind it is quite misleading to pretend that inflation is the main cause of our difficulties, or that deflation can conceivably be the main remedy. That applies as far as I can see to the whole of the post-war period, and the same is true of the present crisis.

It has been said again and again that the present crisis is due to too much purchasing power in Great Britain and only by getting rid of inflation can it be solved. But that is not true. We want to look at the changes that have taken place in the last year. It is not true that the British people consumed more in 1951 than in 1950. In the first half of that year they consumed a good deal more, but in the second part of the year they consumed a great deal less. Taking 1951 as a whole, it brought no increase in home consumption and purchasing power. It is true that there was a rise of imports in 1951 as compared with 1950, but that was almost entirely due to the replenishment of stocks by industry as a whole. The rise in imports was not due to an inflationary rise in consumption.

To say—as I sometimes hear people say—that the whole of our present crisis is due to the fact that the workers are going round with their pockets bulging with money and buying canned hams is completely ludicrous, even ignoring the question whether it is the workers who for the most part buy these hams. The increase in food imports from Europe was balanced by a sharp decrease in food imports from the whole of the rest of the world. It is not true that our food imports or imports of consumer goods as a whole have increased; nor is it true that these suddenly went up in 1951. It is, therefore, not true that inflation or excess consumption is the main cause of the present crisis.

I personally agree with my right hon. Friend the Member for Leeds, South (Mr. Gaitskell), and my right hon. Friend the Member for Huyton (Mr. H. Wilson) that inflation was not the main cause, and that, therefore, the attempt to reduce the social services was utterly irrelevant in solving the present balance of payments crisis.

It is quite true that the former Chancellor of the Exchequer consistently said that some reduction in home consumption would be necessary, but the reductions that he thought necessary were reductions in the consumption of cars, television sets, refrigerators, washing machines and things of that sort. These are not things that are mostly bought by the people on whom these cuts are going to fall. These expensive engineering products will not be any the less bought because Health charges or education cuts are imposed. It is an extraordinary assumption, and quite impossible to sustain that, because we cut the social services, we are going to increase the export of cars, television sets, refrigerators and all the rest of it.

Mr. R. Maudling (Barnet)

But this afternoon the Leader of the Opposition, in opening the debate, said that the measures to restrict hire purchase of television sets and so on was a class measure, because it was designed to stop the purchase of these things by the beneficiaries of the social services. How does the hon. Member reconcile that statement with the one he has just made?

Mr. Crosland

My right hon. Friend the Leader of the Opposition first laid his stress on bicycles and not on these other things, and his point about these other things was surely that, though he agreed that we had to cut home consumption of these things, hire purchase was the wrong way to do it because it only cut the consumption of the working classes and not the other people. That was his point.

I should have preferred that the Chancellor of the Exchequer, instead of being led away as he was in part of his speech by the bogus talk about inflation as the cause of the present situation, had dealt with some of the more serious and underlying causes. I should just like to mention one or two of these in the hope that we possibly might have a reply to some of them later on, or at any rate that they will be considered.

In looking back on the history of the last few years, the history of our gold reserves and their rise and fall can be written in terms of the price of wool, tin and rubber. If we take those three materials, the history of their fluctuating prices in world markets has been the whole economic history of the sterling area. It seems to me that in the long run we will have to try and get a final and effective set of international commodity schemes.

One of the best things that my right hon. Friend the Member for Leeds, South, did when he was in Washington about a year ago was to start the conversations which led to the International Materials Allocation Committees. Those must be extended now to commodity schemes to cover these basic sterling area commodities, because if we have not that sort of stability in the price of these things, we shall have these absurd and fantastic fluctuations up and down in our gold reserves for the rest of all time.

The second point I should like to mention—I will not go into it in detail in view of the time—is the question of the European Payments Union. We entered into the European Payments Union not merely willingly, but with a good deal of enthusiasm. It was welcomed here on both sides of the House, and everybody in this country thought it was a thoroughly good thing. I think we were right to do so, although we knew at the time we were taking some risk in going into E.P.U. as we did—not just as the United Kingdom but as the United Kingdom plus the rest of the sterling area. However, I am not at all certain that the time has not come now to say that the risk was too great, and that we need an alteration here.

The present position is that the degree of convertibility, which applies to the United Kingdom as a result of the European Payments Union, also brings in the rest of the sterling area, and a consequence of having the rest of the sterling area in the Union with us is that we lose gold and dollars which otherwise we should get. I think there is a very strong case for the Government again to look in great detail at our commitments under E.P.U. to see whether we can in the present situation hold by all those commitments.

An hon. Member opposite yesterday said that the most encouraging thing about the Chancellor's statement was how quickly we were moving towards convertibility. But even now we have not got too little convertibility; we have got too much, to my mind. Considering the size of our reserves and our responsibilities, we have got too much convertibility. As for hon. Members opposite who go to Strasbourg, as they do—I do not at the moment see any on the benches opposite, but there are many who go there and do nothing but talk about linking E.P.U. and the sterling area more closely together—I do not know if they have weighed the consequences of this policy which they are urging.

The third point on which I should like some reply is a point that has been raised, and probably some hon. Members have seen it in this year's edition of the Economic Survey for Europe. This shows the extraordinary fact which, if it had been said by some rather hostile critic a week ago would never have been believed—the extraordinary fact that in the third quarter of this year one half of the fall in our gold and dollar reserves was due to speculation.

Mr. Maudling

Did it not say speculation and something else?

Mr. Crosland

Speculation and non-dollar commitments, but if one reads the rest of chapter 3 it is clear that the authors think that it is largely due to speculation. I know that my right hon. Friend the Member for Leeds, South, said something on this in his speech yesterday, and it really is impossible, whatever the difficulties for us in this country, to go on with our exchange control as loose as it is at the moment. I know there are arguments on the opposite side about tightening it up. It is said that we are restricting genuine capital movement and that sort of thing, but we cannot take the risk in this country of going on with as loose a system of control over capital movements as we have at the moment.

The last of these longer-term points which I want to mention is again a point which was mentioned by the former Chancellor, I am glad to say—because I have felt very strongly about this for a long time—and that is the price of gold. The price of gold is obviously politically an extremely difficult and awkward thing, because the Americans are known to have extremely fixed views on this subject, and it may be that the former Chancellor, and the present Chancellor as well, behind the scenes have been using all the influence they have to persuade the Americans to raise the price of gold. If that is so, I think the new Chancellor should go on pushing this point, because this is really as big a reason as any other for our post-war difficulties as compared with before the war.

The price of gold alone of all prices is still the same in terms of dollars as it was before 1939, and bearing in mind our trading position, the loss due to this unchanged price of gold is very great indeed. If the Americans are not willing to do certain other things such as to have stable commodity agreements and the rest, let them be constantly urged to make this very simple change. It is not nearly so complicated as distributing all the gold in Fort Knox or anything like that; let them agree to raise the dollar price of gold, and half the sterling area's difficulties will go overnight.

Those are four points to which I want the Chancellor to address himself. The speeches which we have heard from the Government Front Bench in this debate have been of no help to us at all. We had a purely debating speech from the Financial Secretary this afternoon which consisted of nothing but quotations from other people's speeches, and yesterday afternoon we had a speech from the President of the Board of Trade which was more easy and attractive to listen to, but which consisted of the most pious exhortations that I have ever heard, such as the fact that we ought to export more and import less and that we ought to be better people and more moral and all the rest of it. We have had from the Government Front Bench no serious analysis of the present situation and no serious discussion of these long-term measures. I hope we may have it in the reply.

My right hon. Friend the Leader of of the Opposition was accused of having played the crisis down, but the rate at which the crisis is being played up by the Government and by hon. Members opposite now is much more striking. This crisis is being played up. It is very serious, but it is being played up beyond its actual dimensions, because what hon. Members opposite will not say in their speeches is that many of the factors causing the crisis today are self-reversing factors. For instance, there is the abnormally low level of American imports; that is bound to reverse itself. Then there is the abnormally high level of imports into the sterling area due to the very high prices of wool, rubber and tin six months ago. That is bound to reverse itself. I hope we shall not have an exaggerated alarmism injected into this subject.

Our line on this side of the House is the right one, namely that it is a crisis which is bad, and that to deal with it we have got to cut imports and control the engineering trades, but I hope it will not be boosted up into a much more alarmist and more dreadful sounding thing than it is, and used as an excuse for taking all sorts of measures which have got nothing to do with the crisis whatsoever. That is the serious danger. The country really must understand that these cuts in Government expenditure which are now taking place have really no sort of relevance to the present crisis and have got nothing to do with it at all. If these cuts are a guide to the sort of Budget which we are going to have, it is a very black outlook for the country, and the only small consolation is that it will be an even blacker outlook for the Government.

7.7 p.m.

Mr. Græme Finlay (Epping)

I rise with a sense of high respect for the traditions of this House, becoming to a Member addressing it for the first time. I am deeply conscious, sitting for the Epping division of Essex, of the distinguished Parliamentary representative lineage to which I have succeeded, which includes the present Leader of the Government, the Prime Minister of England.

This debate has had a great number of acid, hard, contentious remarks made in it which I find difficult to curb myself from answering, but I shall on this occasion try to steer myself away from the perilous seas of contention into the quieter lagoons of objective argument. The Chancellor's introductory remarks on Tuesday referred to the fact that we are a nation of 50 million people living in a small island, dependent for our lives upon food supplies nearly half of which come from abroad, as do most of our raw materials and practically all our petroleum. That is something which has been touched upon by hon. Members from time to time

I want to direct my remarks to what seem to me to be the major facets which revolve around that particular proposition. We have heard a certain amount about the mines. Not long before the last General Election, I fought in a mining constituency. In fact, I fought in the constituency of the right hon. Member for Ebbw Vale (Mr. Bevan). I say this with decision: I want to see the miners become a crack coal-getting force, well paid, living in decent surroundings and getting the coal which the nation so badly needs.

I look forward to a revolution in mining technique—which has been foreshadowed in the remarks of the Chairman of the National Coal Board—assisted by all the contrivances of effective modern research, with manpower assisted by skilled technicians and with fewer men doing their work underground as technical progress proceeds. I realise that wages in the mining industry must be related to the rate of recruiting. I realise, too, that they must be related to output. These are difficult principles to reconcile.

I know there is a shortage of some vital machines, such as coal cutters, strippers and underground haulage equipment, and I hope that these shortages will be remedied. There is a need, too, for greater efficiency in coal-burning arrangements in British industry. At present there is a prodigious waste of our most precious raw materials, and my hon. Friend the Member for Kidderminster (Mr. Nabarro) has put forward some constructive suggestions on this topic to which I hope my right hon. Friend the Chancellor of the Exchequer will give attention when he is framing his Budget this year. He can do so by way of concessions in the shape of allowances for the installation of fuel-saving equipment.

Turning to the question of food, the loss of fertile acres through the land development which has been taking place is a serious matter. The President of the National Farmers' Union has drawn attention to this in grave terms. It amounts to something like 50,000 acres a year. At the present rate, in 20 years' time we shall have lost fertile land to the equivalent of half the wheat crops of this country—and all this means the loss of foodstuffs which we must import, and increases our economic difficulties. It is indeed a dangerous trend for a country as vulnerable as Britain.

I turn next to the vital issue of emigration. The fundamental strategic and economic vulnerability of the people of this island is apparent from the lack of balance in the distribution of population and of industry, when we consider the great spaces of Canada and Australia and their small populations. Dispersion is essential in order to preserve our security and our economy. The Commonwealth economic and military potential, if fully developed, is, in my submission, greater than that of the United States of America or the U.S.S.R.

The United States of America changed her whole character between 1865, when she was a country of only 30 million inhabitants, and today, when she has a great industrial population of 150 million; and I believe that the British Commonwealth can do the same. In that single factor resides hope for the future, and I welcome the initiative of His Majesty's Government in seeking a Commonwealth conference at the highest level to discuss the subject. The vulnerability of this country is dangerous, with possible atomic assault on our ports, and vulnerability, in particular, to sub-marines. We are spending vast sums on defence, and we could economise by deploying some of our strategic strength, some of our industrial strength and some of our manpower

An increasing population means an increasing dependence on food imports. We can support only something like 41 million people in this country on adequate standards of life and comfort. If large-scale emigration could be successfully accomplished, there would be no need to build new towns on good agricultural land. In my constituency there is Harlow, the largest of the designated new towns in England. On paper, 80,000 people are to occupy 6,000 acres of good fertile agricultural land. That land would not be taken if we had emigration organised on a bigger, better and more effective scale.

I realise that this is a long-term programme, but I think it is fundamental. Large-scale emigration is the best way of adjusting the British economy to the facts of British economic life. Our objective is to create the strongest and most united association of free nations in the world. The Commonwealth countries are crying out for settlers of the right type. Australia wants a population of 20 to 30 million in contrast to her present 8 to 9 million. In 1951, 42,000 sponsored emigrants left this country for Australia, and only an infinitesimal number returned because the experience did not suit them.

Not only human beings, but industry, too, should be dispersed. I appreciate the difficulties involved—the difficulties of transport, housing and loss of industrial plant; but at the same time I suggest that the circumstances demand that these problems be settled in a spirit of acute urgency by resolute and concerted action by every British Commonwealth Government, so that the result may be an effective pooling of resources and ideas.

There is a high moral issue involved in paying one's way. In this country in the past we have invariably enjoyed a sturdy, rugged spirit of independence. The other day I received in my mail—and I was delighted to receive it—an open letter addressed to the Prime Minister from a federation of independent business men of the United States of America. It was an open letter to the Prime Minister, in which they said: We greatly admire your open and brief statement that you do not intend to liquidate the British Empire. It must be just as apparently understood that independent business people of the United States do not intend that you should liquidate the United States of America. Some right hon. and hon. Gentlemen opposite have suggested that we are becoming the 49th State of the United States, but apparently we are terrifying the Americans, and that heartens me very much! I am certain we shall be able to assure our friends in America that we have no such intentions, but that we will promote by every possible means a Britain standing independent in the world with her Commonwealth of Nations, and paying her own way.

7.18 p.m.

Mr. William Blyton (Houghton-le-Spring)

It falls to my lot to congratulate the hon. Member for Epping (Mr. Finlay) on his maiden speech. We all remember making our own maiden speeches, and I am certain the House will agree with me that his was a very knowledgeable speech, made with confidence, and that he stated his case very clearly. We shall all be glad to hear him again in future debates, and I shall look forward to crossing swords with him on that part of his speech which dealt with mining.

I do not intend to speak at great length, and I shall speak on one aspect of the coal problem. In his speech the Chancellor said that we were to stop the £2½ million imports of coal. We are pleased about that. The fact is that last year the mining community produced 7.1 million tons of coal more than in 1950 and about 24 million tons more than in 1947. How did this arise last year? It arose because the then Prime Minister made an appeal because the nation was in difficulties, and, as a consequence, the men agreed to continuous working.

I put this to the Chancellor quite frankly. He cannot expect this year to get a seven million tons increase in the production of coal. In my opinion, because of the condition of the industry, we can expect in 1952 only a two million tons increase on last year. Why is this? It is specifically because of the condition of the manpower in this industry. There were only 698,000 in the industry at the end of December last year, as against 711,000 in 1947. On top of this the average age of the miner is 40½ years compared with about 28 years before the war. There are nearly 25,000 men over 65 years of age in this industry. If these men—as they are entitled to do after 50 years down a pit—declare that they are going to retire, a serious manpower problem will be aggravated in this industry.

The wastage is still the same and it must be understood by the country generally that if every miner's son went into the pit, this manpower problem could not be solved by them alone. We do not admit that the miners' sons should go into the pits while the sons of other people stay out. We believe that the rest of the community has an obligation to the nation, if the standard of life is to be maintained, and that their sons have to go into the industry just as do the miners' sons.

This brings me to the question of foreign labour in the pits. The Miners' Union during last year have been doing their best to get the local people in miners' lodges to take Italians into their districts. But it is no good thinking that you can use a bludgeon and force a mining community in a village to take Italian labour if the community does not want it. This problem can be solved only by tolerance and persuasion and in all our endeavours we have been trying persuasive measures to get the men to take the Italians, where the labour is needed.

In the midst of this balance of payments problem, one Tory Member has thrown a spanner in the works in relation to the attempts of the Miners' Union to get Italian labour. He has created in every mining village, in every district, dissension and distrust of the Conservative Party in relation to this Italian labour problem. As Members for mining communities, we are receiving letters of protest from mothers and daughters of miners, from executive committees and from the National Union, protesting at this insulting and nonsensical statement of the hon. Member for Garston (Mr. Raikes). It was not only an insulting statement; it was a disgraceful statement. He stated, according to the Press, that the miners will not take Italians in the villages because they are afraid of the Italians' sex appeal. [Laughter.] Hon. Members opposite may laugh but we, as miners, think that the morals of our women and our daughters are as good as those of anyone on that side of the House.

Mr. Victor Raikes (Liverpool, Garston)

Will the hon. Member forgive me for interrupting? He told me that he intended to raise this point and, with the permission of the House, I should like to say just one word upon it. First of all, I should like to say that if any statement that I made has caused any pain to any persons within the mining area, I should be—as indeed I am—the first to regret it; but I want to have justice.

When making that speech—which was a long and rather serious speech, from which one phrase was taken—I did feel that, in view of the difficulties which we had seen during the war in every area where there was a concentration of young fellows, there was a danger that such a concentration—[HON. MEMBERS: "No, nonsense."] I think I am entitled to say what I think. There was a danger that without safeguards the same problem might again appear; but I note that the Federation of Mineworkers in South Wales has stated that that problem does not exist.

I am quite prepared to accept the view laid down that, whatever may be the charms of Italians and other foreign workers, their sex appeal is non-existent in the mining valleys. I accept that and I only hope that, as a result of that, a reasonable increase, at any rate, in Italian and other labour will in fact take place.

Mr. Blyton

I gave way to the hon. Member because I thought he would at least have got up and withdrawn his statement and apologised, and withdrawn the implications of the speech he made in relation to the morals of our womenfolk in the mining villages. He has not given any handsome withdrawal but has sought to justify the statement he made.

I want to say this to the Chancellor. We have to face this task of getting the maximum production of coal, and we shall do our best to get it in relation to the balance of payments problem, no matter how much we disagree with the cuts he has imposed. But our position is going to be hard. The position of the Miners' Union is going to be difficult if the Government do not repudiate the slanderous statement that the hon. Member for Garston made against the women and daughters in the mining communities and villages.

Where is the man in the mining village who is going to stand anyone saying that he could not trust his wife or his daughter with any Italian who comes into a mining village? I suggest to the hon. Member that if he will take a pick and shovel and work in the pits, we shall not be frightened of his sex appeal. That is asking not too much. I say to the Chancellor of the Exchequer that this is a difficult problem which has been aggravated beyond a point which we can see, because in every mining village now, when they have to face the problem, they will determine their action by the insulting remarks of the hon. Member for Garston. It will take months to persuade the men to take Italians in the face of that remark. I advise the hon. Member for Garston, in the interests of his own Government, to get up, to be a man, and to withdraw the slur that he has put upon a community that is doing its best to produce all the coal that it can.

Having said that, may I say that I believe that the Chancellor is making a fatal mistake in relation to these cuts in the Health Service. Considering that the incidence of serious accidents is higher in the mining industry than in any other industry, we want to know whether the miner is to be paid for any surgical appliances which he needs as a result of an accident in his employment. The National Insurance (Industrial Injuries) Act makes provision whereby the Minister can provide for surgical appliances out of the fund under the Act, but these powers have not been used because of the operation of the National Health Service Act.

Are we to understand, now that the Chancellor intends to cut benefits under the National Health Service Act, that our men and women in industry who need medical appliances will receive them free under the Industrial Injuries Act? If not, we shall have to say to the miner who is injured and loses both legs in an explosion, and after we have passed votes of condolences to him, "After you come out of hospital you will have to pay your share of the cost of your two artificial legs." Or we shall have to say to an engineer, if he loses an arm, "Although you have been making capital goods for export, and although you have lost an arm, you have to pay for the cost of your artificial arm." We should like to have an answer on this particular point, because the mining trade union and the whole community of the mining areas are very concerned about this owing to the high rate of serious accidents in our industry.

As to the charge for prescriptions, I should like to know this. If a man is run down through ill health and has boils and goes to the doctor and gets a medicine for his blood and an ointment for his boils, and if the doctor puts both prescriptions on one note, is that one prescription, or is it two? We should like to know that, because if it is two prescriptions that means 2s. payment instead of 1s. We think that to charge people when they are sick, to take their money at a time when they have most need of it, is bad, and that it will have a psychological effect on the producers in this country—that they should be asked to produce more while at the same time they find essential services for maintaining their health being taken away from them.

Then, what about the aged poor? Has the question of need to be determined in respect of a person in receipt of National Assistance? If so, what about the man who has two guineas a week pension and a small pension from a superannuation fund into which he has paid and who receives no National Assistance? Are we to divide the old age pensioners into those who do and those who do not have medicine free? Under the old Poor Law, which we were pleased to abolish, a person who was in receipt of relief got the services of the parish doctor and got medicine free. It seems to me that in this case we are to have a means test applied to the aged poor in deciding whether they should receive free the medicine they need.

My last point is this. I think the Chancellor has made a mistake about the hire-purchase proposals. There are many of us on this side of the House who started our married life and built up our homes on hire-purchase. I lost mine in the 1921 strike because I was back with payments. However, the fact is that 80 per cent. of the working class set up their homes on the hire-purchase basis. These proposed restrictions on hire-purchase will make it difficult for young men and young women of the working class to start setting up their homes in the way that that is done in ordinary working-class life.

I ask the Chancellor to look at all these matters, particularly the health matters and the question about the arti- ficial limbs. I ask him to look at these things from the point of view of production, and I ask him not to take away from the men in the factories and workshops safeguards which they have in their work. I shall vote for the Amendment tonight, believing that these cuts are unnecessary and that it is wrong that men who have been under National Insurance since 1910 should have to pay for their medicine when they go to the doctor for the first time

7.36 p.m.

Mr. Richard Law (Hull, Haltemprice)

I shall not follow the hon. Member for Houghton-le-Spring (Mr. Blyton) in the more specialised parts of the speech, but with regard to that part of the speech where he came more to the general theme we have been discussing tonight and yesterday I should like, with all deference, to say this to him. What he said about the National Health Service, his objection to the cuts in the National Health Service, his objection to the restrictions on the hire purchase, and his own experience in that regard, I can understand, and I can see he said it from deep conviction; but I do not agree with him. I think that that difference illustrates one of the facts that we have got to recognise.

In our calmer moments I think we would, all of us, admit, on whichever side of the House we sit, that our opponents do have the best interests of the country and of the people at heart. The difficulty is that our view of this problem that faces us is diametrically opposed.

We on this side hold that the crisis has been caused by inflation and will not be resolved unless inflation is checked. Hon. Members opposite, as we heard from the right hon. Gentleman the Member for Leeds, South (Mr. Gaitskell) and the hon. Member for Gloucestershire, South (Mr. Crosland), believe that inflation has little, if anything, to do with the problem. We believe that in the long term we can solve the problem only by providing incentives, by letting the money mechanisms have more freedom than they have had in the past. Hon. Members opposite believe that all the necessary incentives are present and that physical controls by themselves can solve the problem.

Finally, there is this possibly even greater difference, that hon. Members opposite recognise that there is a problem but do not recognise it with any undue seriousness; while on our side we believe, quite genuinely and quite sincerely, that unless we can solve this problem in a matter of months disasters of a kind the people of this country have never experienced will await them; and we hold that we have got to solve them whatever the cost by checking inflation, by providing incentives, and by allowing more economic freedom.

Our case has got to be proved. Our diagnosis has got to be proved. At least we can say that the case and the diagnosis of hon. Members opposite has been disproved by six years of bitter experience. We have been faced with this problem ever since the war ended, and I was astounded when I read that the former Prime Minister had said that they had solved the greater crisis of 1945 and the greater crisis of 1939. He did not solve the crisis at all. If the Government of the day had solved it we should not be faced with this crisis today. It is just because it has not been solved that we are faced with it now.

All that has happened in the economic field since the war is that, at one point and another, feverish attempts have been made to stop the leak and plug the hole, but the vessel has never been seaworthy except for a few moments when the sea was exceptionally calm; the moment there was any disturbance in the water our troubles began again. We must make a more radical approach of the kind suggested by my right hon. Friend in his statement.

Mr. Percy Shurmer (Birmingham, Sparkbrook)

The right hon. Gentleman has referred to hon. Members on this side holding certain convictions on the cuts to be made and their effect on surgical instruments, medical supplies and hire purchase. Does he not agree that the poorer sections of the community will have to bear the brunt, whilst the few will be able to buy their things without hire purchase, as they always have done, and be able to pay for their medical and surgical supplies so that they will feel no hardship? It is just class warfare.

Mr. Law

No, Sir, I certainly do not agree with the implications of that remark. If we do not solve this problem, if the ship goes down—[Interruption.] Hon. Members opposite are just banging the old drum of class hatred—

Mrs. Braddock

The right hon. Gentleman is doing that.

Mr. Law

If we do not solve this problem the people who will be hurt will be, above all, the poor. We shall all bear the consequences, but the poor will be hurt most.

Mr. Shurmer

Because the party opposite do not want to share it fairly.

Mr. Law

It is disagreeable to many hon. Members on this side of the House that these charges should be made on the Health Service. It is disagreeable that difficulties should arise out of the restrictions on hire purchase. It is disagreeable that there should be import cuts. But in our view the alternative is that the Health Service will effectively disappear, not by the malice of a Tory Government but by the harsh facts of the world which for six years a Socialist Government refused to recognise. They had six years in which to solve the problem, but they did not succeed.

I should like to conclude by making a few observations to my right hon. Friend the Chancellor. If he will allow me to say so, I thought that his statement the other day was the most powerful and the most convincing that I have ever heard from him. In the past few years we have heard a lot of similar statements from Sir Stafford Cripps and from the right hon. Member for Leeds, South, from time to time, but I think that my right hon. Friend's statement surpassed them all in that, however eloquent previous Chancellors of the Exchequer have been since the war, and however clearly they have put before the House and before the country the difficulties we had to solve, they always blunted the fine edge of their exhortations because with half their minds they were thinking of votes in the country at the next General Election.

Mr. Shurmer

No.

Mr. Law

I defy the hon. Member to find any crisis statement of Sir Stafford Cripps or of the right hon. Member for Leeds, South, in which there was not, with all its apparent realism and its exhortation, a kind of sly, underlying suggestion that the real trouble was the wicked Tories of the past, and the real danger the possibility of defeat by the Tories in the next election.

My right hon. Friend's statement was very remarkable because he gave full credit to his opponents and did not try, as I thought, to make any party capital. If he continues in the same spirit and forgets the next election for the next three or four years, not only will we come through our difficulties, but more will be added unto him and he will find himself once again in a Conservative Government elected with an even greater majority. The people of this country realise, for the first time in six years, that this is a real crisis. If they get the kind of leadership that this Government has begun to give them, I think that they will respond and will realise in the end that we have pulled through an immensely critical period.

7.46 p.m.

Mr. A. G. Bottomley (Rochester and Chatham)

The Chancellor of the Exchequer quite rightly said that we were all agreed upon one thing, and that was the maintenance of our common heritage. The right hon. Member for Haltemprice (Mr. Law) says that where we disagree is on how to maintain our heritage. If there is any cause for our weakness in maintaining that heritage it is a cause imposed by the party opposite as a result of years and years of misgovernment. We on this side of the House did not achieve office with power until 1945.

The Chancellor referred to the deterioration that set in over 50 years ago, but we know what started the rot. We were the first industrial power in the world, harnessing our resources of coal and iron ore, thereby producing manufactured goods which the rest of the world wanted. We were showered with all the food and raw materials we required, but because the profit motive was the way in which our economy was measured, and because only profit counted we neglected industry. Today many textile mills and factories all over the country are the same as they were to begin with.

The coal-mining industry about which we have heard something during the last two or three speeches was substantially the same as it was at the beginning of this century. The coal-mining industry has only been improved over the last six years, and I should like to know from the Chancellor whether it is intended to carry on the policy of the Labour Government, which, in order to make sure that we got the coal we so vitally need, laid down a programme under which by 1964 250 pits were to be reconstructed and 20 mines were to be sunk. I hope that programme will be carried out, because as a result we should get about 20 per cent. more coal with 80,000 fewer miners; and if we had that coal today we should not have a crisis.

The Chancellor said he was going to make cuts in capital plant and equipment. We know that hon. Members opposite have not much sympathy for the nationalised services, and I should like to be assured that if there are to be cuts in capital plant and equipment vital industries such as the coal-mining industry will not suffer.

The Chancellor of the Exchequer (Mr. R. A. Butler)

I think I ought to say, speaking from memory, that I did mention at least once, and I believe twice, in my statement that fuel and power were especially important. I did that on purpose.

Mr. Bottomley

That is implying that no cuts will be made. May I recognise at once that those responsible for building up our economy saw the value of exports by which we were able to have overseas investments upon which we lived for so long. Of course, there could be dispute as to whether the development was done in the right way. If much of the resources sunk in other countries not so friendly had gone to the Colonies and other parts of the Commonwealth, we might not be in our present economic difficulties.

Everyone expected at the end of the war that there would be a let up and that things would be more plentiful, but in 1945 and 1946 the Government of the day recognised that there were going to be extraordinary economic difficulties, and, in that year, we took only two-thirds of the imports as compared with the imports into this country in 1938. In doing that, we were criticised and told that it was the wrong thing to do. If the Opposition had given support and the country had been encouraged to follow the lead of the Government of the day, we would not have been in such great difficulties today. It was mainly a dollar problem. We made cuts in petrol, tobacco and films, which was better than cutting food and some of the vital services which would enable the country to become more economically viable.

The value of exports was also recognised at that time. In 1945 Sir Stafford Cripps, speaking at the dinner of the Society of Motor Manufacturers and Traders, said that we must export more cars and there must be fewer on the home market. There were objections and criticisms. Fortunately, the leaders of that great industry, very responsible people, co-operated with the Government, and they did a magnificent job in exporting cars. Some other industries have not done so well. [HON. MEMBERS: "Why not?"] Because the present Prime Minister talked about austerity and accused Sir Stafford Cripps of trying to get strength through misery, with the result that industry did not co-operate as it might have done if those who had most sway with industry had played their patriotic part in co-operating with the Government of the day.

Major Sydney Markham (Buckingham)

Surely the right hon. Gentleman ought to give facts to support such a wide and untrue statement. He has not given an example of any leading industry in this country which has not co-operated in the export trade during the last Government.

Mr. Bottomley

I said that one particular industry has done exceedingly well and others, though co-operating, had not done so well. I said that if the Opposition had pleaded with industry, as we did, for co-operation, the result would have been much better.

Major Markham

They did co-operate.

Mr. Bottomley

In talking of exports, I shall not compare pre-war exports with those of today. We all know that they are well up. Let me deal only with the period when I was in office as Secretary for Overseas Trade. Taking the figure in 1947 as 100, in 1949 exports had gone up by 40 per cent., and in 1950 by 62 per cent. At least it must be admitted that that was the work of a Government in pushing through a policy which they thought was right and which the Opposition often opposed. Let me say also that just as exports are vital so is production, and in the field of production, I think we on this side have a better appeal to the workers than hon. Members opposite. The production figures speak for themselves. Again I will not go back to the pre-war period, but taking 1946 as 100, in 1949 our production went up to 129 per cent., and in 1950 it went up to 140 per cent.

In spite of what hon. Members opposite may say, the facts speak for themselves. There is one daily newspaper that in between elections gives news. It behaves like a propaganda pamphlet at election time. Let me quote from it. It pays tribute to what the Labour Government did. On May 25th, 1950, the "Daily Express" had this news headlined: Britain's business is booming. It went on to say: Never before had so many goods rolled off the production lines in the factories. It stated that exports were higher, and that never before had so many of the people been in work, which also applied to agriculture. In other words, the policy of the Labour Government was justified to the hilt and the Korean war has caused our difficulties. It is a great pity that there has been a change of Government so that that policy cannot be continued. It was said that the Labour Government soaked the rich. I think that it could in truth be said that this Government has attempted to get solvency by soaking the poor.

I do not want to deal with matters upon which I have views which have already been mentioned this afternoon, but I do strongly object to economies in education. The Chancellor of the Exchequer quoted Disraeli when he said that upon the education of this country the fate of this country depends. In my own constituency education is controlled largely by the county of Kent. These are some of the questions which had to be considered at the county council meeting this week. If the Minister of Education wants any information, I have documents here which she can have. These are some of the questions: Is it more important for classes to be kept as small as possible or for schools to have sufficient supplies of books, materials and apparatus if in the class room cleanliness or warmth has to be partly sacrificed, which should be retained? Is it more important to send a subnormal child to a school where he can receive suitable education or to send a bright lad or girl to a university? Is drabness of school buildings less serious than out of date science apparatus? Hon. Members will know that many boys in my constituency were recently killed in a bus accident, and one of the meanest economy proposals is that the school patrol system should be done away with. Is that the way to inspire workers to increase production and play their part—by causing unnecessary fears for the safety of children? I hope that the Minister of Education will withdraw this Circular 242.

Mr. Charles Pannell (Leeds, West)

Surely that does not only apply to Chatham. Is it not a fact that the County of Kent Education Committee are recommending the abolition of road safety patrols for school children and that in spite of what the Chancellor of the Exchequer said they are not appointing any more school dentists. Perhaps the hon. Gentleman who represents that constituency will try to stop that.

Mr. Bottomley

The hon. Gentleman was a member of the Kent County Council and has more knowledge about these matters than I have, and I accept what he says. There are no frills in the education service. The amount of Government revenue spent on education is 7.7 per cent. It is in connection with production and exports particularly that we want the best education. Technical skill and "know-how" is all important for increasing production and exports. In Canada at the moment, a fast developing country, they want all the technicians they can get. The same is true of India and Pakistan and other parts of the Commonwealth, to say nothing of the fact that in the days to come we have to compete with other industrial countries and only best quality goods will sell. It is only technical knowledge and skill that will provide those goods and to make economies in education is quite wrong.

I think that the Government's policy is like that followed in Western Germany. In Western Germany they have a sound currency and favourable trade balance, but they also have one and three quarter million unemployed. They have no red meat, and coffee, cocoa and cakes are luxuries.

Mr. Beverley Baxter (Southgate)

What percentage of West German unemployed are dispossessed persons?

Mr. Bottomley

What I have been saying is on good authority and if the hon. Gentleman wants further information he should read a contribution in the "New York Times" which supports a great deal of what I have said.

There are many others who want to speak, and I shall not take up the time of the House now except to say one word on tourism. I dealt with that subject as a Minister. I am sorry that a cut is being made because there are some people who can afford long holidays in the Bahamas and that will not be stopped. It is now again the workers who suffer. I think that it is essential for education as well as for holidays that people should travel on the Continent, and we ought not to deprive them of the opportunity to go overseas. In November last the Board of Trade, on behalf of His Majesty's Government, signed a convention whereby a sum of £50 was fixed as an allowance for this summer. In reducing the allowance there will probably be retaliation by other countries. Not only will good relationships be impaired, but we shall also lose foreign currency. I ask the Government to reconsider the matter.

I conclude by quoting an extract from a Canadian newspaper because I believe the views to be those held not only by my hon. Friends but by people throughout this country and the world. The newspaper says some unpleasant and pleasant things about the present Prime Minister, but I will not go into that. What it says here expresses my sentiments: … the defeat of Clement Attlee is the worst thing to happen to Great Britain since the outbreak of the war. … It's my profound belief that Britain will regret the day it wondered how things might be with the other fellow.

Mr. Baxter

The right hon. Gentleman should hear what Canada says.

8.0 p.m.

Mr. William Shepherd (Cheadle)

I congratulate the right hon. Member for Rochester and Chatham (Mr. Bottomley) upon becoming a Privy Councillor. I am afraid I canont carry those congratulations into the wider field of his remarks, because I felt that he had at last thrown away the responsibilities of office and was indulging in an intellectual binge. I was surprised that he took the view that there was no refugee problem in Germany. In view of the seven million refugees seeking employment there, the German figure of unemployed is on the whole remarkably low. When we criticise the German economy, we should have regard to that very salient fact.

As to his criticism of my right hon. Friend the Chancellor of the Exchequer for reducing the tourist allowance, if my right hon. Friend had paid attention to all the objections raised yesterday and today he would have made no reductions at all, and we should be going on in precisely the same way as we were a few months ago. The right hon. Gentleman knows quite well that there was an escape clause in the convention which depended on the balance of our trade. We are taking a legitimate step which is not open to France, Belgium and other countries who might like to retaliate, and therefore there is nothing wrong in what the Chancellor has done.

Yesterday the right hon. Member for Leeds, South (Mr. Gaitskell), tried to throw all the blame for what has happened—

Mr. Pannell

My right hon. Friend succeeded.

Mr. Shepherd

The hon. Member is entitled to that opinion—upon the Conservative administration, and also made great play with some apparent deviations between election promises and present performance. That is not a legitimate exercise at present. I have no doubt that in reverse we should be employing somewhat similar tactics—

Mr. E. Fernyhough (Jarrow)

Hon. Members opposite have been doing it for six years.

Mr. Shepherd

I can continue my speech without the aid of such interruptions.

Mr. Fernyhough

I will let the hon. Member do so.

Mr. Shepherd

However, it is unfair to turn to the Government within three months of their coming into office and say that they have failed to carry out their Election promises. The public will not believe that, in the present state of the country, within a period of three months their larders ought to be bulging with meat and all the wonderful things of life should have come to pass. Hon. Gentlemen opposite are doing themselves a disservice and are detracting from the value which such tactics might have later on if there is any justification for them.

The right hon. Member for Leeds, South succeeded in giving away the show. He was trying to blame the Conservative administration and said that the remarkable thing about the crisis was the speed with which it had arisen and the extent of its nature. He said, in other words, that the speed and magnitude of the crisis were unexpected. My right hon. Friend the Chancellor of the Exchequer inherited a very difficult situation indeed and I do not believe that even now the right hon. Gentleman the Member for Leeds, South really appreciates what is necessary in order to get the country out of its difficulties.

The reference by the right hon. Member for Leeds, South to convertibility demonstrated that he does not think deeply enough upon the issue of the state of the country. He blamed the Chancellor for breathing the word "convertibility."

Mr. Jay

Hear, hear.

Mr. Shepherd

I note that the ex-Financial Secretary to the Treasury says, "Hear, hear." The Chancellor of the Exchequer said that this was a determination by the Finance Ministers of the sterling area. I wonder whether the right hon. Member for Leeds, South realised the implication of the statement issued by the Finance Ministers of the sterling area. It is that the members of the sterling area as such want to see convertibility, and the inference which the right hon. Member for Leeds, South ought to have drawn, but did not draw, was that there may well come a time when it will be much more difficult than on the last occasion to call together a meeting of the Finance Ministers of the sterling area and get agreement.

When all the members of the sterling area are "in the red," we can get agreement upon cuts, but later on if, for instance, the United Kingdom alone were "in the red" and called together the sterling area countries and asked for sacrifices, would it then be so easy to get results? Even the ex-Chancellor of the Exchequer has not considered this question in all its gravity. A much graver issue confronts us than people have so far appreciated.

We have had some extraordinary speeches. The right hon. Member for Ebbw Vale (Mr. Bevan) said that millions of people were employed in development area factories. What nonsense that is! He said that the F.B.I., and not the Government, ran the country. Sheer nonsense! He said that our mining output was the only one in Europe which was above the pre-war figure.

Mr. Jay

My right hon. Friend said that ours was the only output per man-shift which was above the pre-war figure.

Mr. Shepherd

I am sure that the right hon. Member for Ebbw Vale will be grateful for that intervention by the ex-Financial Secretary.

Mr. Jay

That is what my right hon. Friend said.

Mr. Shepherd

It still makes the right hon. Member for Ebbw Vale wrong. In the Bulletin of Statistics issued by the United Nations in November, 1951, he will find that both France and the Saar have an output per man-shift greater than pre-war.

I welcome the steps that the Chancellor has taken in this regard. He has gone as far as he could go in many directions. He could not have cut down our imports much more without impairing our industrial efficiency or without damaging the economies of the countries of Europe. It is quite wrong to take the view that in this situation we should disregard the welfare of European countries; we must have regard to them. My right hon. Friend could not have cut down imports very much more without restricting the trade and damaging the trade balances of members of the sterling area. He has made a wise choice in the imports which he has cut.

A critical issue for hon. Members opposite is that of the alterations in the basis of the social services. There has been a great welter of criticism from them today. I am as enthusiastic for the social services as any hon. Member opposite.

Mr. Fernyhough

Why did the hon. Member vote against the Health Service?

Mr. Shepherd

For the simple reason that I disapproved of the method; and the justification for that is shown by the fact that the late Government had to introduce an amending Bill to give effect to our objections. Any undue interference with the social services ought to be condemned; but we must all realise the continuing gravity of the situation, and it is our duty as a Government, despite our pet beliefs or pet affections for one social service or another, to cut out waste where we believe it exists. It is even desirable to reduce the pressure on some of these services. I think the Government are doing a good thing in reducing this pressure. I am satisfied that all the reductions we now propose will have no serious effect upon the social services as such.

I wish to turn to what I consider to be the most important aspect of this debate. It is nonsense to keep talking about a crisis in the way in which many people, on both sides of the House, have talked about it. We are not facing a situation in which, having got over a crisis by a few administrative measures and cuts in imports, we shall then sail into the open, into the blue. That is the mistake we have been making for the past six years. We said that we would go along nicely; then we came up against trouble, made a few cuts and apparently get into the clear again. We said, "Now it is time to have a bit of a spree," and the pressure was reduced. Then in a short time we found ourselves in trouble.

Why is that? It is because fundamentally this country is facing an extremely difficult position which, as the Chancellor said, has been brewing up, at all events, since 1913. That is the year which I take as the turning point in our economic situation, a situation which, I say in passing, because I do not want to be unduly controversial, has been aggravated by the ineptitude of the late Government during the past six years. Although I say it has been aggravated, I do not for one moment make the pretence that the economic situation in which we find ourselves is purely the responsibility of the last Government. I have never held any view contrary to the one which I am now stating.

In these last years we have been facing a serious turn in the terms of trade. We were carried on between the wars by a most incredibly favourable turn in the balance of the terms of trade. Now we have to face the realities of our economic life, and they are indeed very serious. We have to deal with a world which is becoming increasingly competitive, in which industrial nations are one after the other increasing their power to compete with us and in which backward nations are making the goods we once made.

We have to face the prospect of Japan advancing, the prospect of a Germany more industrially powerful than ever before, the fact that the U.S.A. has now become the producer of half the goods of the world. It may well be—and I invite the attention of the right hon. Gentleman who is to reply to the debate to the possibility—that by 1953 the United States will have absorbed her great armament effort and may be free to compete in the markets of the world.

When I say that we must not speak of a crisis, I say that we must not do so in the terms of this immediate balance of payments crisis but in terms of a continuous uphill pull for Great Britain against immense difficulties and dangers, which I hope we shall survive and which I think we can survive, but which will be overcome only by immense and continual effort.

This conception of merely making a few cuts in imports and stepping up our exports is not sufficient to attune the minds of people to the real problems ahead. We have to think in terms of 10 or 20 years' effort, whatever the Government. I hope that the right hon. Member for Leeds, South, who seems to take the view that this situation is one which can easily be put right, will think again.

Mr. Pannell

He did not say that.

Mr. Shepherd

But he did give the impression that when we overcame this immediate difficulty, we should have an easy time thereafter.

Mr. Pannell

My right hon. Friend questioned whether the steps were in certain regards drastic enough to overcome the immediate crisis. He never indicated that this was just a passing phase.

Mr. Shepherd

I know that the right hon. Gentleman queried the adequacy of certain of these steps, but only in relation to the immediate problem of putting right this present disparity. I am pointing out that we have a long-term problem and that it is useless to talk of a crisis as such because it is a long-term task that we have to fulfil. We can fulfil it only by doing a number of things of which I have no time to speak tonight, as I know other hon. Members wish to speak.

We must first take our technical efficiency to the highest possible level. We in the sterling area must certainly get together to increase as far as we possibly can our self-sufficiency. There may come a time when we cannot afford to have 80 or 90 per cent. of Virginian tobacco in our cigarettes. If we cannot afford that, we shall have to go without it. We must increase our self-sufficiency to the greatest extent. We must try to adapt ourselves more readily to new discoveries. We are very good in this country at making new discoveries and research but perhaps not quite so good in applying them vigorously and rapidly, as is done in the United States.

We must aim at increasing standardisation of our products and at an increased output from our workers. We certainly need more production per man than we have at present or we cannot possibly survive. We have also to aim always at doing all we can to develop world trade, to play our part in the development of backward areas and to play a big and vigorous part in the development of the resources of the Commonwealth and Empire.

These are the means by which, coupled with immense energy and determination, we can win at the end of this long pull. I urge the House to take the view that this is not a temporary crisis. We have had what one might describe as a series of crises because they have been part of one malady, and our main task is to address ourselves to this serious malady and to be certain that at the end of 10 or 20 years we have restored our country's position and put it on a firm and proper basis.

Mr. S. S. Awbery (Bristol, Central)

Did not my right hon. Friend the Member for Ebbw Vale (Mr. Bevan) tell us that we have had a series of repeating crises?

8.18 p.m.

Mr. C. R. Hobson (Keighley)

It is seldom in six years' membership of this House that I have found myself so much in agreement as I have tonight with the hon. Member for Cheadle (Mr. Shepherd). As the debate has progressed, we have all been finding ourselves more or less in agreement on some matters. For one thing, I think that the announcement of the cuts came somewhat as an anti-climax. We were all expecting far more.

Right hon. Gentlemen have certainly been building up a position whereby they could have announced far more vicious cuts than have already been announced. They must certainly have disappointed certain sections of the millionaire Press with whom the association of the party opposite is, to say the least, far from being tenuous.

We have learned that the late Socialist Government was not responsible for the crisis. That has been proved beyond peradventure in debate and also by the announcement of the Chancellor of the Exchequer himself. As the hon. Member for Cheadle said, this position has been overtaking the country for many years. Between 1936 and 1939, for example, there was an overall deficit in the balance of payments of £127 million, even taking account of the revenue we received from invisible exports. Of course, that deficit of £127 million had to be met either by the sale of securities or the drawing on gold. So even if there had been no second World War we should sooner or later, unless there had been a complete reorientation in the economic views of hon. Gentlemen opposite, have been arriving at a very serious economic crisis.

As I see it, the problem is that in terms of wealth this nation is a poor country. We have only coal and china clay in abundance. We produce only enough food for one-third of our population. I was pleased to hear that we now hope to be self-sufficient in phosphorous. It is a credit to the ex-Chancellor of the Exchequer that when he was Minister of Fuel and Power he did inaugurate a geological survey of this country which resulted in the finding of that very valuable raw material.

Our only other asset is the skill of our own people. I am very doubtful as to the intentions of hon. Gentlemen opposite regarding education. If they cut down on the technical school development they will strike a blow at the efficiency and skill of our work-people.

During the General Election, whatever they may or may not say now, hon. Gentlemen opposite certainly did promise the people an easy time if they were returned to power—[HON. MEMBERS: "Nonsense."] Oh yes, we had statements over the radio about more red meat and reductions in taxation, and that the shortage of food was due entirely to the stupidity of the late Government. One thing has been proved by this debate and by the announcement of the cuts, and that is that one cannot fool all the people all the time—[HON. MEMBERS: "Hear, hear."]—and hon. Gentlemen opposite will find that out very quickly when the next by-elections take place, and when the next General Election comes.

We have had to face these crises. We had to face them in 1945 and we faced them in 1947 and 1949. We had to effect cuts very similar to those that the Chancellor has announced today. We cut tobacco and petrol, and we cut films and canned foods. The only thing we did not do was to cut the Social Services.

Squadron Leader A. E. Cooper (Ilford, South)

Nonsense, what about the school meal service?

Mr. Hobson

So far as the social service cuts are concerned they have no relation whatsoever to our economic difficulties with regard to the adverse balance of payments. What the Chancellor has sought to do by his cuts is first of all to try to effect a balance in our overseas payments. We are all agreed that that had to be done whatever Government was in power if this country is to maintain a decent standard of living and our people remain at work. But he has also done something else. Over the period of the last few months he has restored the power of the bankers in this country, first by the increase in the bank rate, and secondly by giving them greater power over capital issues.

The Chancellor of the Exchequer was particularly vague in his references to what happened at the Commonwealth Conference, and I think we are entitled to know a little more about that. What we want to know, for instance, is whether there will be an attempt made to control the price of wool, rubber and tin; because the high prices we are having to pay for those raw materials is certainly affecting our economy very considerably at the present time, particularly in view of the competition we are now meeting.

There is also this decrease in the trade with the sterling area. Is there to be any cut in food? Are egg supplies from Denmark to be cut, or cheese from Holland? Or is it to be wines and spirits from France? We are entitled to know the intentions of hon. Gentlemen opposite, particularly in view of the fact that they did give some sort of guarantee that they would endeavour to maintain the present ration.

Regarding the cut of £22 million in tobacco, I think the House will be generally agreed that that is to come from the stocks of tobacco. There will come a time, if consumption remains at the present rate, when those stocks will have to be renewed. Will they be renewed, or will there be an allocation of the reduced amounts of the tobacco available, or an attempt on 4th March to ration by a further increase in the price of cigarettes? Certainly we cannot go on depleting our stock and have consumption at the same level without causing a grave shortage. We are in agreement with the cut in films, and it may have the advantage of putting our own industry on its feet.

I now come to the vexed question of petrol. My own view is that petrol ought to have been rationed. I am not at all convinced that because it would cost £1 million to administer we should not ration petrol. On the Chancellor's own admission there would be a saving of £8 million a year. That it would cost money to bring about rationing and to build up an administrative machine is an argument which could be advanced against all forms of rationing. I think that at the present time, in view of the serious situation, and the dollar content of petrol imports, there should definitely be petrol rationing rather than the cutting down of the food of our people.

Now we come to the reduction of the tourist allowance to £25. Why has that been delayed until now? Why was it not announced on 7th November when the cuts were announced by the Chancellor? There would have been a considerable saving of exchange if that had been done. I am constrained to the opinion that it is because of the class bias of hon. Gentlemen opposite. It is not the lower middle-income group, or the working-class people, who go to Switzerland and France for the winter sports. It is the friends, supporters and associates of hon. and right hon. Gentlemen opposite.

There could have been a very considerable saving in foreign currency if that cut had been announced on 7th November, and that ties up with their class bias vis-à-vis their restricting hire purchase. Persons with the money can buy a motor car, a motor cycle or bicycle provided they pay cash, and therefore I think this is a general indication of the class interest which hon. and right hon. Gentlemen opposite always serve.

I would ask the Chancellor of the Exchequer and the Financial Secretary if at this late stage they would consider the poor man's form of locomotion, namely, the bicycle. Miners, railwaymen and engineers use bicycles to go to work. Surely there is no need to do away with the hire purchase system which makes it possible for them to get machines on easy terms. I do not know whether this is being done because it is alleged that a lot of steel is used in the manufacture of bicycles. Today I weighed an old-fashioned machine of mine. It weighs 24 1b. and the amount of steel in it is small. I hope that this action will be reconsidered.

Where is it proposed to impose the cut of 10,000 in the Civil Service? In the Post Office? If they do that then we shall have slower deliveries. What Department will be cut? So far all we know is that there will be a cut in the Ministry of Pensions. I will tell the Financial Secretary where to look for economy in manpower. My right hon. Friend the Member for Ebbw Vale (Mr. Bevan), sent a circular to all local authorities on the need for economy in manpower in local government. It is there that there is a waste of manpower. Local authorities are building up their staffs even though they are operating fewer services. I hope that the Government will take at least that leaf out of the book of my right hon. Friend and ensure that the local authorities take some regard of the serious position which we face in the use of manpower.

On the question of the positive programme to be adopted we must do everything we can—and we on this side of the House, certainly in the trade union movement, are doing our part—to encourage increased productivity. That is important. We must produce more and we must produce it more cheaply. But I warn hon. Gentlemen opposite that they will not do that if they do not couple with their effort some form of dividend limitation. That is an absolute and vital essential. Nothing takes the heart out of the worker when he has put everything into his effort for more production than to find that the profits of the undertaking have risen by a very large amount.

Also we must pay attention to the type of goods we manufacture. The time has passed when we had a market for cars and commercial vehicles in the dollar area; but there are certain engineering products for which there will be a market for many years, particularly for heavy engineering equipment. Lord Bearsted used to say that there is one thing which British people can do and that is to sail ships and to build them. We must ensure that our shipyards are modernised and kept up to date. There is also a large market of a permanent nature in the dollar area for turbines and water tube boilers. That is particularly true of South America.

I think that the same is true of aircraft. We lead the world at present. I hope that the Ministry of Supply will do everything possible to ensure that some of the firms who are not producing types which are of real value should be compelled to make those types of aircraft which have proven themselves throughout the world.

Finally, if, as has been said, these cuts are adequate, then it is obvious that the crisis has been over-emphasised. If they are not adequate, hon. Gentlemen opposite will have to come to this House with further cuts. It may be that they contemplate doing that in the Budget. I do not know, but I am most suspicious about that because the cuts in the social services, which I do not want to stress for they have been dealt with already, have no relation to the present situation.

They lead one to believe that the sole object is to economise so that there will be a reduction in taxation which will benefit largely the people who support the party opposite. I hope that we shall not continue to hear of these actions which have an ulterior motive. It is up to hon. Gentlemen opposite to come clean in this matter and to let us know precisely what their intentions are. I, and many of my hon. Friends, have strong suspicions they are bad.

8.34 p.m.

Mr. Harold Watkinson (Woking)

I think that perhaps you, Mr. Deputy-Speaker, selected the wrong man to follow the hon. Member for Keighley (Mr. Hobson), who referred to all the comments we were supposed to have made during the election campaign to disguise the facts. I based my election campaign on the fact that at the end of this year we should be £1,000 million on the wrong side. But it is apparent that I under-estimated the capacity of the late Government. They did a little better than that and they finished up, according to my understanding, about £1,200 million on the wrong side. My conscience is clear on that point, as is the conscience of most of my hon. Friends.

However, I want to come to a rather astonishing omission from all the speeches that have been made from the other side of the House during this debate, though the hon. Member for Keighley did touch upon it, even if only very briefly. It is the fact that we are all going to fail to get through our present situation, or whatever we like to call it, if we do not have a steep rise in industrial efficiency and output. Surely, there is no difference between the two sides of the House on that particular point.

If that is so, let us consider the tenor of this debate and the speeches made from the other side on what is to be done or not done in order to encourage that desirable objective, because I would say that, speaking as a member of the engineering industry, there is still a considerable reserve of capacity. Despite all our difficulties, the shortage of steel and everything else, we can still squeeze out a bit more without much new plant—we shall not get it, anyway—merely by sharing our "know-how" more and more and getting a better team spirit in industry.

I think that a very great responsibility rests on the shoulders of hon. and right hon. Gentlemen opposite who have spoken in this debate, who, in my view—and I am not saying that they have done it deliberately—have distorted the facts of our present situation for what they think to be their political advantage. Personally, I think they are quite wrong in believing that, because people in this country are just not going to believe that the whole situation of this country can turn topsy-turvy in three months, and that a new Government, which has been in power only for a few months, can suddenly become saddled with all sorts of problems built up over the past five or six years.

Mr. James Griffiths (Llanelly)

Fifty years.

Mr. Watkinson

The right hon. Gentleman says 50 years. I do not think so. Let us look at what we have done, let us look at what the engineering industries have done in putting up their output; and let us see how output in industry has gone up by 40 per cent. I am glad we are in agreement on that. Will the right hon. Gentleman who is to wind up for the Opposition tell me how it is that we have been running faster and faster all these years, first to a standstill, and now to a state of slipping back? How is it, when we have done so much better in exports and all these other things, that we are now faced at the end of this year with well over £1,000 million on the wrong side of the ledger?

Mr. Lee

Will the hon. Gentleman allow me to intervene? Like himself. I was an engineer, and I suggest to him that one of the principal reasons we have had such a big increase in our production in engineering is that, for the first time in this century, apart from war periods, the engineers knew that they could face the future without fear of being thrown on the scrap-heap.

Mr. Watkinson

I was not disputing the increase in productivity, but merely pointing out that, after all that effort on the part of management and men, we are today facing the most serious crisis this country has ever faced. I do not think hon. Gentleman opposite will disagree with me when I say that it is about time that we in this House faced the hard facts and got down to brass tacks, and it is also time that somebody said it on the other side of the House. It is time that organised labour and management in industry realised what now lies ahead. It is a case of progress or perish—increase our efficiency and output or starve.

I come back to what I said at the beginning, which is that, if we are to avoid that harsh alternative of starvation, we in industry have got to build up that output this year and next year. It is no use now relying on long-term plans that could not come into effect for another five or 10 years. We have got to do it now, and I say that the whole attitude of the Opposition in this debate—I will not say designedly—has been directed towards the idea of creating a feeling in the country that this is a "phoney" crisis. They have backed up the speech made in Manchester by the late Prime Minister when he swept the thing aside as being in some way "phoney" and not as urgent as in 1945. That is a very grave and disturbing thing to say at this time, because I believe that the Chancellor has set before us in fair and, I think everybody must agree, nonpartisan terms the extent of our task and the framework within which the Government hope to achieve it.

But, however brilliant my right hon. Friend may be in his planning and however well the Commonwealth may combine, there is only one thing that can get this country out of its present danger, and that is an immediate increase in efficiency and output in industry. That is our main salvation, and something which I believe we can do for ourselves without more plant and without an increase in raw materials.

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

That is just the kind of speech that my right hon. Friend the Leader of the Opposition was making in the Free Trade Hall.

Mr. Watkinson

It was not as I read it. Perhaps the hon. Gentleman was there and heard it. It was certainly not as reported in the Press, and it has certainly not been contradicted in any speech made from the benches opposite, because in every speech so far made in this debate the Opposition have tried to make out that in reality this is not a true crisis.

I now come to one or two practical things which I think we could do to ease the present situation, but they all depend on all of us recognising that at this time there is a greater loyalty before us all—the saving of our country and getting it through the difficult years that lie ahead. I do not mean that we should not fight as hard as we can about Measures going through this House, but I hope that the right hon. Gentleman who is to wind up for the Opposition, and whose sincerity I respect, will recognise that there is this greater loyalty. I believe it should stand far above party political shifting or shuffling. If we start from that point of view, what could we not do?

Let us start with the employers first. Supposing we were prepared, as I believe we are, to share our "know-how" among our own industries—certainly my own industry is doing it—so that we might bring up the less efficient firms to the standard of the most efficient, then we should have made a start. We should always remember that the most efficient firms in this country are often the most efficient ones in the whole world. Our difficulty is that the general level of efficiency in industry is not high enough. As I have said, if we on the employers' side were to get down to that—and in this I am sure we can depend on the co-operation of the trade unions—then we should have made a beginning.

I think the Government have made a good start. They have set out quite clearly the framework within which they hope the country will be able to gear itself up to meet a situation in which we can only save ourselves.

Let us now look at what organised labour can do in this direction. An hon. Member who is not in the Chamber at the moment seemed extremely worried earlier in this debate about relations in the coalmining industry. I do not propose to enter into a private battle which he had with an hon. Friend of mine, but I would say that I have recently spoken on public platforms and on television with trade unionists in the coalmining industry and in the shoe trade. We have never compared our notes beforehand, but we have said to one another afterwards that we did not disagree with anything that the other had said. In other words, we both saw quite clearly the answer to this problem.

I hope that the conduct of the Opposition is not going to break that team spirit and is not going to put a brake on that extra bit of effort which we in this country can still make if we know that it is really worth while and that our salvation will be the result of doing it.

This plan is a courageous attempt on the part of the Chancellor of the Exchequer to apply a permanent solution. Why we have suffered from recurring crises since 1945 is because, as Sir Stafford Cripps himself said, we always applied temporary expedients to each crisis. We never tried to employ a permanent solution. That is what we are trying to do now. It will be a very strange thing if history marks the turning point in the industrial and social fortunes of this country by saying that this House of Commons spent most of its time in discussing whether or not a shilling should be charged for medical prescriptions instead of facing up to the hard facts of the situation. That would be a somewhat melancholy demise for what was once the greatest Empire in the world.

I hope that in the remaining portion of this debate, and particularly in the winding-up speech of the right hon. Gentleman the Member for Llanelly (Mr. J. Griffiths), both sides of the House will agree that, if we will, we can pull ourselves out of this difficulty, if we in industry will work together as a team, forgetting class hatred and divisions but realising that if we fail in this we shall all fail, whatever party label we tie around our necks. If we can all get together on this subject of production and efficiency in industry and keep it away from the political arena—after all, both sides have pledged themselves time and time again to increased productivity—then I think we shall be able in industry to play our part within the framework set by the Government, and do something to get our country through its difficulties, helping it to attain that position in which we deserve to be through our efforts during the war and from our background of technical efficiency.

We deserve to be one of the leading nations of the world, perhaps the leading industrial nation in certain provinces. We shall never be that again unless we bring a new approach to our problems in industry and in technical efficiency. We shall not bring that new approach if His Majesty's Opposition play the party game, and try to turn things to what they believe to be their immediate political advantage, instead of recognising a greater loyalty.

Mr. Awbery

Is not the hon. Gentleman aware that the trade union movement has played a very important part during the past six years in increasing production in industry, and that if it had not been for the co-operation of the trade union movement, we should not have reached the position we are in today?

Mr. Watkinson

I quite agree, and I have paid my tribute to the trade unions, who have behaved with great statesmanship over the whole period. We do not expect them in any way to put any brake on further development. They are as keen about development as we are. I was not referring to the trade union movement, but to His Majesty's Opposition. Let us hope that in the closing stages of this debate we can recognise that greater loyalty which I believe will lead to that greater production which can get us through our difficulties.

8.49 p.m.

Mr. James Griffiths (Llanelly)

In the closing hours of this debate I want to emphasise some of the reasons why we shall carry our Amendment to a Division. I would first of all refer to the party political aspects of this question we have been discussing, to which the hon. Member for Woking (Mr. Watkinson) referred.

For some years before I was privileged to become a Member of this House it was my very great pleasure several times in the course of a year to attend miners' conferences. That was a rich experience. Not the least pleasant part about it was to hear the rich and varied dialects of this country, to which should be added the spice of a Scottish or Welsh accent, and also the quaint homely sayings characteristic of so many of the coalfields of this country. I can recall one occasion—I think it was almost one of the first miners' conferences I attended—when I made a speech which was probably a flamboyant one. A young man can be forgiven for making flamboyant speeches; it is when old men make flamboyant speeches that we cannot forgive them. William Straker, bless his memory, who was the President of the Northumberland miners, replying to me, pointed at me and said, "Young man, be very careful or you will meet yourself coming back." May I say to hon. Members opposite that they are meeting themselves coming back.

The gravamen of our charge against them is that by their conduct whilst in opposition in the House, by their speeches in the country, in their broadcasts and during the two General Elections in 1950 and 1951, they deliberately sought to create an impression in this country, and the impression which they deliberately sought to create was that all the difficulties with which this country was beset, many of which we have been discussing during these last two days, all the shortages and all the problems, were due to the wicked Socialist Government—

Colonel Leonard Ropner (Barkston Ash)

Not all, but some.

Mr. Griffiths

—and that if the Socialist Government were turned out and a Tory Government were returned, then everything would be all right. I say this to hon. Members opposite: they know that is the impression they created, and they know that it was in that bogus way that they were returned to power.

The Financial Secretary said that it was unfair to tax the Government with not having fulfilled their pledges in three months. That is not what we charge them with. What we charge them with is that within three months they have discarded all the promises they made, they have broken all the pledges they gave, and there is now amongst their supporters in the country—many millions of them—disillusionment and bitterness, too. Indeed, this weekend I was told that there is now silence on what has been for some time one of the main sources of Conservative propaganda. They say there is now silence amongst the Tory women, and men, too. The housewives are quiet. They are all quiet. That is our charge. The performance of the Government since they came into power three months ago is in complete contradistinction to all the promises they made to the country at the General Election and before.

Before I come to deal with some of the points I want to emphasise, there are one or two matters that have been raised in the course of this debate with which I do not propose to deal in detail but which are, I think, of such cardinal importance that we have a right to expect that the right hon. Gentleman when he comes to reply will deal with them. One was referred to by my right hon. Friend the Member for Leeds, South (Mr. Gaitskell) yesterday, by my right hon. Friend the Member for Walthamstow, West (Mr. Attlee) when he moved our Amendment this afternoon, and by my right hon. Friend the Member for Ebbw Vale (Mr. Bevan).

Brigadier Christopher Peto (Devon, North)

Where is he?

Mr. Griffiths

He will be here.

I want to refer to this point, because when this debate is read I think it will be found to be one of the matters about which there will be deep concern. It is the proposal, which we have not had explained to us in any detail, that among the measures to be taken in the year 1952—which has been described by some of those competent to speak as one of the years of peril—the Government propose to run down stocks—stocks of what we do not know and have not been told. That is a very serious matter indeed, and no adequate reply has been given on the point. Indeed, no attempt at a reply was made by the President of the Board of Trade yesterday or the Financial Secretary this afternoon. I think we are entitled to a reply.

I want to refer to only one other matter in the external aspects of this problem to which reference has been made in the debate and, indeed, to which reference is made in our Amendment. I would underline a sentence or two used by my right hon. Friend the Member for Leeds, South, for it points to one of the gravest problems which confront the world. In analysing the causes for this immediate situation with which we are dealing, my right hon. Friend ascribed part of the responsibility for it to the fact that during a period last year American imports fell by 15 per cent.

He said it was a serious matter that at this stage in the world, when the American economy—as has been said by so many of my hon. Friends in the debate —is so preponderantly more powerful than the rest of the world, a drop in imports of 15 per cent. should have such wide and serious repercussions upon the Sterling Area and the whole of the world. Indeed, during my period of 20 months as Colonial Secretary—all too short, from my point of view, if I may say so—I learned something of the problems from the standpoint of Malaya and the Far East.

I therefore ask the House seriously to consider this problem. We hope that the re-armament of the free world will serve the purpose for which we support it—and we support it because we believe that from that strength we can negotiate a settlement and avoid a third world war. When that re-armament comes to an end, and particularly when it reaches its conclusion in the United States of America, what then? If a 15 per cent. cut in American imports has had these wide, serious repercussions all over the world, then it is time the United Nations began to consider the problem which will arise at that time, when re-armament comes to an end. One of my hon. Friends, the hon. Member for Birmingham, Northfield (Mr. Chapman), dealt with the problem in a recent debate, and I emphasise that the problem which has emerged deserves the attention of this House and the Government and merits a reply from the right hon. Gentleman who is to wind up for the Government.

We propose to carry this Amendment to a Division, but not because we do not realise the gravity of the economic and financial situation, not because we will not play our part as citizens in this country in taking all the steps which we think are necessary, desirable, fair and equitable to avoid disaster. Let me put the reason in my own words.

We intend to carry this Amendment to a Division because we fear and believe that many of the proposals in the Chancellor's statement, coupled with some of the speeches made in recent days in the country—notably the speeches of the bank chairmen—coupled with the fact that yesterday we could get no assurances about subsidies, for example, and about other matters from the Chancellor of the Exchequer, mark the beginning of the return to the old Tory policy in two respects. First, there is the increased emphasis and reliance on monetary remedies. If monetary remedies are a remedy, South Wales should have been a paradise, instead of which it may be a cemetery. Secondly, the attack upon the social services.

Yesterday the President of the Board of Trade, the only Minister who has spoken in this debate who has some responsibility for production Departments—we have not seen the Minister of Fuel and Power in this debate at all, nor the Minister of Supply, nor the Minister of Transport or the Minister of Agriculture; as if the economic situation had nothing to do with them—in what, I thought, having regard to his responsibilities, was a completely inadequate speech, said something I want to use as part of my text this evening. He was referring to the second stage of this battle, if that is the right way to refer to it—there is an immediate one which the plan for development is designed to cure by September, and there is a longer one to which several hon. Members have referred.

The right hon. Gentleman said: the battle for sterling will in no small measure be fought out on the coal faces of this country."—[OFFICIAL REPORT, 30th January, 1952; Vol. 495, c. 241.] Indeed, it will. It will finally be won or lost on the fields, in the mills, in the factories, in the workshops and in the homes of the people of this country.

So it is relevant—indeed it is very relevant—to this debate, not only that we should consider what we have said in the course of this debate but remember that this debate is taking place outside this House—on the fields, in the mines, in the factories, in the workshops and in the homes. It is relevant, therefore, for us to consider what those outside are thinking of this problem and what they think of these proposals, for if they are convinced that the burdens in this battle are being fairly shared, they will play their part. They have played their part since 1945, in a magnificent effort by the people of this country towards recovery.

It is very interesting indeed, as has been referred to in Questions this afternoon, that when the Prime Minister spoke to Congress the other day he used the achievements in Britain under a Labour Government to brag about this country. I wish hon. Members opposite had bragged about it when the Labour Government were in power. It is therefore of very great importance that the people upon whom will depend success or failure in this battle should be convinced that in this grave economic and financial situation the methods that are being adopted to overcome it are right and fair and that the burdens are being fairly shared. If they are not convinced of that the Chancellor may win his first battle by September and lose it afterwards.

I draw upon my memory—and I make no apology for drawing upon my memory and upon my experience—of a crisis in which wrong, stupid, panicky methods were used that did untold damage to this country, and from which we are still suffering. I refer to my memory of 1931. In 1931, in a mood of panic, we cut—[Interruption.] It is no good hon. Members laughing at this. This is true. I speak of a period now when I was privileged—and it was a privilege—to be a leader of men who were among the salt of the earth—[An HON. MEMBER: "They still are."]—who believed, and who still believe, that the 1931 crisis was used to attack them and lower their standard of life. [Interruption.]

Miss Irene Ward (Tynemouth)

rose—

Mr. Deputy-Speaker (Mr. Hopkin Morris)

Order. If the right hon. Gentleman does not give way he must be allowed to continue his speech.

Miss Ward

On a point of order. I wanted only to apologise. I thought the right hon. Gentleman was giving way.

Mr. Griffiths

1931 left scars on this country which are still deeply felt.

Squadron Leader Cooper

There were three million unemployed.

Mr. Griffiths

It is of interest that the right hon. Member for Gainsborough (Mr. Crookshank), who is to reply to the debate, was one who at the time had to bear some of the Ministerial burden for that. [HON. MEMBERS: "No. It was a Labour Government."] Not in 1931, but afterwards. The first time I met the right hon. Gentleman was when he was Minister of Mines. Perhaps he will not mind my reminding him of the mission upon which we came to see him. I came with my colleagues in 1935—

Miss Ward

There was a Conservative Government.

Mr. Griffiths

Yes, there was a Conservative Government when the right hon. Gentleman was Minister for Mines, and when the mining industry of this country and the coal miners of this country—not alone—were suffering from the consequences of 1931. [Interruption.]

Mr. I. Mikardo (Reading, South)

Do not be such a lot of baboons.

Mr. Griffiths

We met the right hon. Gentleman. The occasion was when we were asking him and the Government of which he was a Minister to grant the miners 2s. a day extra. He turned us down.

Major W. Hicks Beach (Cheltenham)

Who was the Chancellor of the Exchequer?

Mr. Griffiths

I do not know, but the right hon. Gentleman was the Minister for Mines. He turned us down. We warned him then that the consequences would be serious for the industry and for the country, and I hope that the right hon. Gentleman can find time to say a word about it now. What would he not do now to have the hundreds of pits that were closed and the half-million miners who were lost? What would he not do now for a mining industry completely free from the memory of those days? I therefore think it is immensely important for us to look at this problem and at the remedies proposed from that standpoint, as I propose to do now. Let us contrast some of these cuts, for the contrast will be illuminating.

Mr. W. F. Deedes (Ashford)

Face the future.

Mr. Griffiths

I am coming to the future. We have been doing more than facing the future: we have been working for it for the last six years much more than hon. Gentlemen opposite.

Look at the proposals in the field of social services, and at the cuts generally, then contrast their effect. Some people will have to wait a little longer for a new car; but those who could own cars are certainly not amongst the poorer sections of the community. What kind of a burden is that compared with the deaf poor who have to pay for their hearing aids? It is true that there are those, perhaps large in number in these days—and I welcome it—among the workers who will not be able to stay as long in a foreign country because of the cut in the foreign currency allowance. But what is that burden compared with the burden of the afflicted who will have to pay for their medical appliances? Is there any Member of Parliament who does not agree that one of the greatest boons that has ever been brought to this country has been the boon brought under the National Health Service Act in the last few years of appliances of various kinds for the afflicted? Where is the equality of sacrifice there?

Last night, in a very thinly attended House, we had a very interesting speech from the hon. Member for Morecambe and Lonsdale (Sir I. Fraser), to which I should like to call attention, because those who did not hear it ought to read it, and the country ought to know about it. Our main charge is that there is clear evidence that, in facing this crisis and in seeking remedies to overcome it, both now and, we fear, when the Budget comes, and in the future, this Government is departing from the principle that has stood this nation well in the last six years of ensuring fair shares and an equitable sharing of burdens.

Last night the hon. Member for Morecambe and Lonsdale, to whom we always listen with respect, said that the Chancellor should have no fear—I am paraphrasing his speech, but I do not think I am doing an injustice to what he said—that there would be an election for two or three years; "Do not bother," he said, "whether all the remedies are equalitarian or not." That is the thing we fear, that we are beginning to have a radical, fundamental departure from the policy of the Labour Government from 1945, which in the recent election brought more votes to us than were obtained by the party opposite which is now in power. It is upon this charge that we shall ask the House to divide tonight, and shall ask our supporters to join us in the Division Lobby, that the main burden of these cuts falls upon the poorer sections of the community.

Late last night, too, unfortunately to an almost equally thin House, we had what I thought was a very striking speech from my hon. Friend the Member for Workington (Mr. Peart). He had available to him, and quoted for the benefit of the House, a survey of the cuts already agreed upon by a large number of local education authorities in response to the request that they should cut their estimates by 5 per cent. I should like to repeat some of his quotations from that survey. They include cuts in scholarship aids, and I ask hon. Members who represent agricultural divisions to note that they include cuts in scholarship aids to boys who go to agricultural institutes and colleges.

Then there are to be cuts in the nursery schools. Is that educationally or in any other way the right thing to do now? Does the Minister of Labour agree with that proposal? He is definitely short of labour, and part of his job should be to seek to induce women to go to work in order to fill some of the vacancies which are pressing and of which he has spoken. If there are to be fewer nursery schools, it will be more difficult for women to go to work.

Then there are to be cuts in technical education. I should like the right hon. Gentleman to deal with this point. It is strictly relevant at the present time to the problem which we are now discussing; indeed, it is of vast importance for the future. I agree that we have to get increased productivity. If we are to wage this battle successfully, every industry in this country will need more technical skill, and both from the educational point of view and the need of the country in the economic field this is, indeed, a stupid economy.

Mr. R. A. Butler

To which economy is the right hon. Gentleman referring? I understand that these economies have not been approved by the Minister of Education, and when he makes wild charges he should substantiate them.

Mr. Griffiths

I am not making wild charges. The hon. Member for Workington quoted last night from a document which is a survey of the cuts agreed to by the local education authorities of this country in response to the request of the Government. I want the Chancellor of the Exchequer to hear the last one to which my hon. Friend referred. I was not aware that he heard his speech, but the other day the Chancellor expressed himself as being shocked by the discovery of the poverty of the dentists available in the school medical service. I am sure that he will be equally shocked to find that in response to this request for a 5 per cent. cut, four counties propose to cut the school dental service.

It is quite true that this 5 per cent. cut which the education authorities have to make is bound to affect seriously the educational services of this country. I will only say one word further about that. I discussed this with an old friend of mine who serves on an educational authority in South Wales, and who told me these figures, which are not generally known. He said that their educational estimate for next year was £7 million, and people might be under the impression that a 5 per cent. cut was not very much, but £5¾ million of that sum was estimated for expenditure which could not be cut at all. The cut, therefore, was 5 per cent. of £1¼ million. We cannot do that without it seriously impairing the educational service of the country.

I now come to the Health Service. The right hon. Member for Ebbw Vale (Mr. Bevan), said that the major difference between the modifications which were to be made in the Health Service was that the late Government proposed them reluctantly, whereas the present Government were making them enthusiastically. I was one of those who agreed with the modifications in the Health Service very reluctantly. I confess that I agreed most reluctantly to the first modification which we considered, which was the 1s. prescription charge. [Interruption.] I did so reluctantly and in the end we abandoned it; now the Government are resurrecting it.

I will tell the House why at that time, as Minister of National Insurance, I reluctantly agreed to it. It would have been —and so it will be if the Government carry the proposal out now—the first time since 1911 that contributors to the National Insurance Scheme have paid for prescriptions. I knew that and that was part of my reluctance. I felt that one of its inevitable effects would be the beginning once more of provision outside the scheme for a service of this kind.

From the beginning we contemplated that there would be exemption, but I understand that there will now be no exemptions. I understand that pensioners, men who are on sickness benefit and men who have compensation will have to pay. So, presumably, will the man who is suffering from pneumoconiosis who goes to the doctor for a prescription for the medicine to help him over the first two or three terrifying hours every morning when he struggles for life.

Perhaps the right hon. Gentleman who is to reply will tell us, with the assistance of the Minister of National Insurance who is sitting beside him, whether these people will have to pay for appliances. What does "appliances" cover? Does it cover artificial limbs? Will anyone injured in the course of his employment as a consequence of an industrial accident have to pay for the limb supplied to him? Will disabled ex-Service men have to pay? The National Insurance (Industrial Injuries) Act authorises provision for such appliances to be made from that Fund, as it ought to be, as part of it was the responsibility of the employers before. The proposal which the Government have made goes back on that.

I could go through all the proposals in this manner. The major proposals and cuts will fall heaviest on the workers and their families, and for that reason we believe that they will induce in the minds of the people fears which I do not wish to return. In the last six and a half years—I say this not as a party matter but because of its intense importance—in most of our industries we have begun to develop a new spirit and a new relationship. I know it best in the case of my own industry. In 1945 the coal mining industry had been almost bankrupted by 20 years of mismanagement and technical inefficiency and, worse than that, the human relationships in the industry were poisoned to the roots. We began a new chapter for the industry.

I fear that we are beginning to see a return to the old Tory remedies, the monetary remedies, deflation, and cuts in the social services. I should have thought that it was clear to everyone, that they did not solve our economic problems in the '30's but only aggravated everyone. One of the greatest services the Socialist Party has rendered to the country since 1945 is in beginning a new chapter in every field of industrial history in this country.

The Government are now discarding their pledges. They made promises which they are now throwing aside. The proposals they have brought before us bear all the mark of what we knew of the Tories in the 30's. For all those reasons they will create fears in the minds of millions of people in this country, as in mine. For those reasons we beg the House to vote for our Amendment.

9.25 p.m.

The Minister of Health (Mr. Harry Crookshank)

We have heard a very eloquent speech from the right hon. Member for Llanelly (Mr. J. Griffiths), but of course we have strayed rather a long way from the fundamental cause of this debate, which is the grave economic situation in which we are.

Before I continue with my remarks, I am sure it would be everybody's desire that I should congratulate the two hon. Gentlemen who have taken the plunge today and made their maiden speeches. I am sorry that I did not hear my hon. Friend the Member for Norfolk, South-West (Mr. Bullard), because I had the privilege of hearing him in his constituency in the late campaign, and from the way he spoke there I have every confidence in believing that he will be a good contributor to our debates in the House. My hon. Friend the Member for Epping (Mr. Finlay) has also partaken for the first time of the pleasures of discussion in this House. He sits for a constituency the name of which became famous until Woodford superseded it. I have no doubt that he will see that its high traditions are maintained.

We had hoped that this two-day debate would have indicated an agreed approach to our troubles, because the situation is so obviously a serious one, and hon. Gentlemen who have taken part in the debate have at times accepted that fact, but not throughout. It is, therefore, a matter for regret that there is to be, as apparently there will be, a Division tonight on an official Opposition Amendment.

What is the objective of the Chancellor? It is that, as part of a great effort by the Commonwealth countries, we should take our own share in restoring the confidence of the world in sterling. This is a joint undertaking with the Commonwealth countries stemming from the recent conference. It is our joint objective to restore confidence in our money and to pay our way in the world. The speech which my right hon. Friend made on Tuesday contained his proposals which were to be this country's contribution to this great and vitally necessary undertaking.

In order to restore confidence in us, we must prove that we are putting our own house in order by living within our means; and "means" in that context, I would say, refers to the necessity of using our resources to the best purpose in order that, as a result, we may pay for the food and raw materials which we need and without which in full measure we would physically and industrially decay.

The right hon. Member for Leeds, South (Mr. Gaitskell), in a most interesting part of his speech yesterday, was discussing how it was that we had got into this position. It is a nice problem and I should have thought that he knew some of the reasons. But the world outside, whose confidence we must try to regain, is not so much interested in our deficit as in knowing how we are to deal with it. That is the background of the Chancellor's speech, and the short answer is, of course, just four words—buy less, sell more. In order to do this, we have to influence our man-power and our raw materials into making what we need first of all for our own defence, and secondly, into the most profitable lines to develop our export trade.

So there are three stages. The first stage was when we found this crisis on our doorstep in November, when taking over from right hon. Gentlemen opposite. The first step which we took then was the tremendous cuts in imports which were made and the changes in monetary policy which followed. It is true that the effects of what happened in November are by no means apparent in this country, but as the weeks go by they will, alas, inevitably follow more and more. That was the first step.

Then came January and what we are doing now. Further cuts have had to be made in a still deteriorating position and simultaneously, as is shown by the exposition of my right hon. Friend, active steps have had to be taken to re-direct our industrial output and to help our man-power in that direction in order to increase our exports. But that is not the end, because involved in that were what the right hon. Gentleman has largely been discussing—some cuts in Government home expenditure, all devoted to the same purpose of restoring the confidence of the world in the determination of this country to pay its way.

But in March there will be the third step; first November, then January, and then March, because a Budget is necessary to round off the whole picture. Only after that shall be we able to see the thing as a whole, because obviously what has been done in November and what is being done now does raise budgetary issues. It is for that reason that my right hon. Friend proposes to take the very unusual step of advancing the date of his Budget statement in order that the world and our own country may see exactly the path we have to tread in the coming months.

I make no recriminations. I am not dealing with any party issues at the moment, although perhaps one could. I make no comment as to why we are in this position. I merely note the fact that the causative period was long before the Government of my right hon. Friend had any responsibility for the administration. Faced with the situation in which we now are in the last day of January, 1952, any Government which was in office would have had to take either these or very similar steps to deal with it.

I remember someone once using the phrase that we must pay for history. Well, the history of the last six years has been written by right hon. Gentlemen opposite, and we may find ourselves now, all of us, having to pay for it. I did notice this morning a comment in the Labour newspaper that we had no mandate for what we were doing. I would say in return that we certainly have no mandate to sit here and see the country slip into bankruptcy. We are convinced that the sort of action which is necessary now, and which we are about to take, is needed to stop that drift.

It is necessary to turn to what the Amendment calls the "attacks on the social services" or what, after the right hon. Gentleman's speech, we would not any longer call cuts but modifications. It is no pleasure to call upon people to make sacrifices or to bear additional burdens, and only a consciousness that those sacrifices and those burdens are necessary to avert far greater sacrifices and burdens makes my task tolerable."—[OFFICIAL REPORT, 10th September, 1931; Vol. 256, c. 297.] Those words were used from this Box 21 years ago, and they are equally true now. Nobody wants to exact sacrifices or to place burdens, but the country was warned that this might be necessary. This morning I re-read the broadcast speech which my right hon. Friend the Prime Minister made in opening the recent election campaign. "We make no promises" said the right hon. Gentleman—[Interruption.] I am quoting the right hon. Gentleman's broadcast. He said: We make no promises of easier conditions in the immediate future. And certainly January is the immediate future from the last week in October. Too much money has been spent to avoid another financial crisis. That is the situation. As usual, my right hon. Friend was right, but it is possible so to make inevitable modifications—I was going to say cuts—and economies as to make a more coherent theme in the social services affected. That is true of some of our proposals.

The Amendment talks about "attacks on the social services." What is the argument? Is it that never must a figure of expenditure which has once been reached in this field be either held or reduced? Is that the argument? No, of course it is not, because the Labour Party did it themselves. They put a ceiling on the Health Service. We are keeping that ceiling and, what is more, the right hon. Gentleman the Member for Ebbw Vale (Mr. Bevan) accepted that ceiling.

Mr. Bevan

That is not correct. I accepted the estimate. [Interruption.] Hon. Gentlemen must learn to distinguish between a ceiling and an estimate. An estimate is a figure that one does not exceed within the existing financial year. A ceiling includes several financial years. I never accepted that.

Mr. Crookshank

The House can make its own deductions out of that manoeuvre. Is the argument, then, that every year the cost to the State must go up?

Mr. Bevan

Yes.

Mr. Crookshank

The only standard is the total of the money spent; never must an economy be made; and, if there is, it is an attack. Is that the argument? Of course, it is not, because the party opposite put a ceiling on. They put charges on, and they passed legislation to enable them—them, not us, though we may have to take advantage of the legislative provision provided for us—to do that.

Surely that is carrying the argument very much too far. After all, no vast scheme like the Health Scheme could be expected to be perfect and right in all its parts from the very beginning. Of course not. Well, let us take as an instance the dental part of the scheme. Right hon. Gentlemen opposite, of course, made the best estimates that they could at that time, but they were entering into a completely uncharted field. They had no idea how many people would come forward to require treatment, whether the arrangements which had been made for paying the dentists were right or not, and, in the out-turn, they had no fewer than three times to change the remuneration of the dentists, and, on top of that, had to put on charges. So they stand condenmed, if I may use that phrase in this connection, out of their own mouths.

We know, incidentally, that by putting on charges we shall, in fact, get a better balanced scheme, and, if it happens to be cheaper, it is not necessarily bad on that account. What we are trying to do is to get the priorities right, and, at the Election, it was specifically stated that we held ourselves free to review and alter the present system of charges in order to establish proper priorities. It was the right hon. Gentleman himself who, in his Second Reading speech in 1946, said that it was necessary to give priority treatment to certain classes—expectant and nursing mothers, children, school children in particular."—[OFFICIAL REPORT, 30th April, 1946; Vol. 422, c. 45.] This new scheme has gone awry, and I am very happy that my colleagues have assented to these proposals, because I want to see—

Mr. John Baird (Wolverhampton, North-East)

rose—

Mr. Crookshank

When the right hon. Gentleman the Member for Llanelly yields to an hon. Lady behind me, I will yield to an hon. Gentleman opposite.

It is desirable to get the priorities right, and I am surprised to hear criticism coming from the Front Bench opposite on this subject, because I recollect that the right hon. Member for Ebbw Vale is on record as having said, at the Blackpool Labour Party Conference in 1949: The language of priorities is the religion of Socialism. Here, Sir, "I am holier than thou." The right hon. Gentleman the Leader of the Opposition said he could not quite understand how there would be any savings on this issue if, as a result, it diverted more of the children back to the school dental service. The answer to that is—[Interruption.] Well, we are going to have a Bill introduced and a Second Reading next week, when this matter can be argued in far greater detail. At the moment, I am just answering, out of courtesy to the House, some of the points raised in this debate.

Under the general scheme, dentists are paid fees for every session, but, under the school or local authority priority system, the system of payment is by salary and fees.

Mr. Baird

That is completely wrong.

Mr. Crookshank

There seems to be universal agreement that children can be dealt with more efficiently in the school system—

Mr. Baird

That is not true, either. The right hon. Gentleman does not know his job.

Mr. Crookshank

In passing, may I now deal with one of the points which the right hon. Gentleman repeated—that four county councils, or so it was reported, had already abolished the dental service.

Mr. Baird

On a point of order. The right hon. Gentleman is quite obviously—

Mr. Speaker

Does the hon. Gentleman rise to a point of order?

Mr. Baird

Yes, Sir.

Mr. Speaker

What is the point of order?

Mr. Baird

The right hon. Gentleman is obviously giving false information to the House—

Mr. Speaker

That is not a point of order.

Mr. Crookshank

The statement that these counties—Northumberland, Cornwall, Buckinghamshire and Somerset— are cutting down these services is completely untrue in all cases. I have it here that Cornwall at the moment is in fact advertising for more dentists. I also have a telegram from Somerset—

Mr. Peart

I think the Leader of the House is wrongly informed. I have here information to the effect that Buckinghamshire have decided to cut down by £5,000 and Somerset—[An HON. MEMBER: "It is untrue."] It is not untrue. I have here the actual minutes approved by the Kent Education Committee cutting down the school dental service by £6,500. My facts are quite correct.

Mr. Crookshank

I imagine that this is a case of early estimating because the dentists are not available at the moment, but the fact still remains, and I will say a word on that—[HON. MEMBERS: "Withdraw."] I have a lot to say, but I am prepared to postpone all of it. I pass now to the question—[HON. MEMBERS: "Withdraw."]

Mr. Speaker

Order. I ask the House to listen to the right hon. Gentleman. There are bound to be differences of opinion on this matter, but that is no reason why we should not extend proper courtesy to one another.

Mr. Crookshank

I was asked about the question of prescriptions.

Mr. Peart

On a point of order. Surely, Mr. Speaker, it is the custom of this House and a matter of courtesy that, if an hon. Member challenges a point and submits information proving that the point made is wrong, the hon. or right hon. Member giving the wrong information withdraws his remark.

Mr. Speaker

I think the Rule is that if an hon. Member makes an imputation which is proved to be false or denied, it is his duty to withdraw it, but on these matters of information there can be two different sources of information. If all information coming to each side were the same, there would be no quarrels.

Mr. Crookshank

I have no reason—

Hon. Members

Withdraw.

Mr. Peart

Further to that point of order. Surely, Mr. Speaker, it is in order for a Minister whose information has been challenged either to withdraw it or to substantiate it? I am prepared to submit to the right hon. Gentleman the official minutes of the Kent County Council.

Mr. Speaker

There seems to be a difference of opinion on what are the ascertained facts. That is a matter of debate. I have heard nothing said by the right hon. Gentleman that merits a withdrawal.

Mr. Crookshank

Anyhow, I have no reason to suppose that my sources of information are incorrect. In any case, I was not referring to the County of Kent, because that was not mentioned last night; I was dealing with what was mentioned last night.

Now just one word about prescriptions. The fact remains that the consumption of medicine has risen enormously. Even the right hon. Gentleman the Leader of the Opposition said this afternoon that there were undoubted cases of abuse. [An HON. MEMBER: "By the doctors."] The right hon. Gentleman said that, and I just want to put these figures before the House so that hon. Members can think them over. In 1947, when, of course, it was only the insured population that could be referred to statistically, the number of prescriptions per person per annum was three and a half. Now that the whole population is included, the average number of prescriptions per person per year is five. In the last three years the numbers of prescriptions have gone up from 202 million to 207 million and now to 229 million, and the total bill for prescriptions is over £50 million a year. Therefore, we think this is one of the fields in which some modification might be made.

I want to say one word about the proposals of my right hon. Friend the Minister of Education. I must emphasise that there is nothing in the circular which she issued which is intended to impair the essential fabric of education. Indeed, if hon. Members like to study it, in the first paragraph there are references made to certain directions in which savings should not be made. That includes the dental service and, for the benefit of the right hon. Member for Llanelly, essential facilities for technical training and preparation for industry and commerce. In general, may I say that education authorities are not tied by their first estimates. The final ones do not come till April and the revised estimates come in October. My right hon. Friend will be consulting them all along about their proposals, to which she has to give her assent before grants are made. Therefore, it is obvious that the whole policy must be to discourage modifications being made in a wholesale or indiscriminate manner.

May I say a few words on the financial points which were raised by the right hon. Gentleman? There is a question about whether the time within which exports should be paid for should be reduced from six months. We have looked into that matter very carefully, and have not been able to find any evidence that a proposed shortening of the period would substantially affect our difficulties. After all, in the long run it is the man at the other end who is going to pay, and time must be given for the transport of goods sometimes to a very far destination. Some hon. Members had in mind the question of British citizens and companies holding on to dollars. All I would say is that that is a separate matter. Anyone receiving dollars is obliged to surrender them without delay unless he has permission to keep a dollar account. The Bank of England keeps a very strict eye to see that no more than a working balance is kept.

A word about stocks. The right hon. Member for Ebbw Vale and others have said how iniquitous it is to run down stocks. That brings to my mind some of the discussions in the last Parliament, when some of my hon. Friends were pressing the then Government to build up their stocks after devaluation when things were cheap, but they did not do it then. If in the present circumstances, as my right hon. Friend the Chancellor said, there will inevitably be some using up of these stocks, the House can take it that nothing essential will be sacrificed. The Prime Minister as Minister of Defence reassured hon. Members in an intervention this afternoon.

We feel that this has got to be done in an attempt to halt the drain on our gold reserves, and because we must keep our production at the highest possible level. Anyhow, the reduction is expected to be only a fraction of what it was in 1950 and at the end of this year the position will probably still be better than it was in 1950.

Yesterday it was suggested that perhaps the measures we were taking were inadequate to stem the drain on our gold and dollar reserves. We must recognise that it is a very grave situation and it is still potentially dangerous. All is not over after today's debate.—[Interruption.] —Hon. Members opposite do not always seem to have appreciated how grave it is, from what I have heard in their speeches today and yesterday. But provided nothing goes wrong—and the Chancellor will watch the situation from day to day to see whether further steps be necessary—the whole situation is timed in the hope that, with the measures suggested by ourselves and by the other Commonwealth countries, we shall get into balance and stop the drain by the end of the second part of this year.

But, of course, the dangers are still there. The Leader of the Opposition, to whose speech, of course, I listened with great attention—and I think he really had great sympathy with the difficulties with which we are faced—made use of one phrase which surprised me in criticising the hire-purchase proposal of my right hon. Friend. The hire-purchase proposal, he said, would hit the poorest and was a class proposal. I find that very hard to reconcile with what my right hon. Friend said, because he was speaking in this connection—and it can be read at column 59 of the OFFICIAL REPORT— … an order will come into force this week to restrict hire-purchase on such things as motor vehicles, bicycles, radio and television sets and electric appliances."—[OFFICIAL REPORT, 29th January, 1952; Vol. 495, c. 59.] I find that very hard to describe as a class proposal. This proposal is made in the context in his speech of what we are trying to do in order to lighten the burden of the load on the engineering industries. That is the object there of selecting those particular articles for restriction in the hire-purchase field. After all, the purpose of saving these metals in this,

that and the other direction is in order to concentrate them more and more into the manufacture of exports. That is all part of the proposals on which we are working, because that is the most valuable field into which we can expand.

On the services for which I am responsible, there is to be a Bill and there will be further discussions when all the details can be thrashed out. But on the grave issue with which we are faced today there is just this to say. It is, indeed, unprecedentedly serious. The Opposition in their Amendment accuse us of attacking the social services, a point with which I have dealt. They say they have no confidence in a Government—[HON. MEMBERS: "Hear, hear."] Really, one does not expect the Opposition to have much confidence. They refer to optimistic statements. Let me remind them of this. We said at the Election that we must carry out the rearmament programme necessary for survival … sacrifices by all are inevitable. Unless our security is assured, these sacrifices must be made and hopes of higher standards postponed. … There are no easy times ahead for anyone. … Confidence in the £ at home and abroad must be restored. Waste and extravagance in Government spending must be eliminated. … Confidence at home and abroad will be attained by expanding production by the means set out above, by making obvious our intention as a nation to live within our income, by sound monetary policy and by good management of our national finances.

Those words are extracted from our manifesto. Those are the things we were standing for in the Election.

Perhaps I may close by reminding hon. Members of the words of one who was a great champion of the people, when he said: You cannot strengthen the weak by weakening the strong. You cannot help the wage earner by pulling down the wage payer. You cannot further the brotherhood of man by encouraging class hatred.

Question put, "That the words proposed to be left out stand part of the Question."

The House divided: Ayes, 309; Noes, 278.

Division No. 28.]	AYES	[10.0 p.m.
Aitken, W. T.	Arbuthnot, John	Baldock, Lt.-Cmdr. J M
Allan, R. A. (Paddington, S.)	Ashton, H. (Chelmsford)	Baldwin, A. E.
Alport, C. J. M.	Assheton, Rt. Hon. R. (Blackburn, W.)	Banks, Col. C.
Amery, Julian (Preston, N.)	Astor, Hon. J. J. (Plymouth, Sutton)	Barber, A. P. L.
Amory, Heathcoat (Tiverton)	Astor, Hon. W. W. (Bucks, Wycombe)	Barlow, Sir John
Anstruther-Gray, Major W. J.	Baker, P. A. D.	Baxter, A. B.
Beamish, Maj. Tufton	Gomme-Duncan, Col. A.	Maitland, Comdr, J. F. W. (Horncastle)
Bell, Philip (Bolton, E.)	Gough, C. F. H.	Maitland, Patrick (Lanark)
Bell, R. M. (Bucks, S.)	Gower, H. R.	Manningham-Buller, Sir R. E.
Bennett, F. M. (Reading, N.)	Graham, Sir Fegus	Markham, Major S. F.
Bennett, Sir Peter (Edgbaston)	Gridley, Sir Arnold	Marlowe, A. A. H.
Bennett, Dr. Reginald (Gosport)	Grimond, J.	Marples, A. E.
Bennett, William (Woodside)	Grimston, Hon. John (St. Albans)	Marshall, Douglas (Bodmin)
Bevins, J. R. (Toxteth)	Grimston, Robert (Westbury)	Marshall, Sidney (Sutton)
Birch, Nigel	Harden, J. R. E.	Maude, Angus
Bishop, F. P.	Hare, Hon. J. H.	Maudling, R.
Black, C. W.	Harris, Frederic (Croydon, N.)	Maydon, Lt.-Cmdr. S. L. C.
Boothby, R. J. G	Harris, Reader (Heston)	Medlicott, Brig, F.
Bossom, A. C.	Harrison, Lt.-Col. J. H. (Eye)	Mellor, Sir John
Bowen, E. R.	Harvey, Air Cdre. A. V. (Macclesfield)	Molson, A. H. E.
Boyd-Carpenter, J. A.	Harvey, Ian (Harrow, E.)	Monckton, Rt. Hon. Sir Walter
Boyle, Sir Edward	Harvie-Watt, Sir George	Moore, Lt.-Col. Sir Thomas
Braine, B. R.	Hay, John	Morrison, John (Salisbury)
Braithwaite, Sir Albert (Harrow, W.)	Head, Rt. Hon. A. H.	Mott-Radclyffe, C. E.
Braithwaite, Lt.-Cdr, G. (Bristol, N.W.)	Heald, Sir Lionel	Nabarro, G. D. N.
Bromley-Davenport, Lt.-Col. W. H.	Heath, Edward	Nicholls, Harmar
Brooke, Henry (Hampstead)	Hicks-Beach, Maj. W. W.	Nicholson, G.
Brooman-White, R. C.	Higgs, J. M. C.	Nield, Basil (Chester)
Browne, Jack (Govan)	Hill, Dr. Charles (Luton)	Noble, Cmdr. A. H. P.
Buchan-Hepburn, Rt. Hon. P. G. T.	Hill, Mrs. E. (Wythenshawe)	Nugent, G. R. H.
Bullard, D. G.	Hinchingbrooke, Viscount	Nutting, Anthony
Bullock, Capt. M.	Hirst, Geoffrey	Oakshott, H. D.
Bullus, Wing Commander E. E.	Holland-Martin, C. J.	Odey, G. W.
Burden, F. F. A.	Hollis, M. C.	Ormsby-Gore, Hon. W. D.
Butler, Rt. Hon. R. A. (Saffron Walden)	Holt, A. F.	Orr, Capt. L. P. S.
Carr, Robert (Mitcham)	Hopkinson, Henry	Orr-Ewing, Ian L. (Weston-super-Mare)
Carson, Hon. E.	Hornsby-Smith, Miss M. P.	Osborne, C.
Cary, Sir R.	Horobin, I. M.	Partridge, E.
Channon, H.	Horsbrugh, Rt. Hon. Florence	Peake, Rt. Hon. O.
Churchill, Rt. Hon. W. S.	Howard, Gerald (Cambridgeshire)	Perkins, W. R. D.
Clarke, Col. Ralph (East Grinstead)	Howard, Greville (St. Ives)	Peto, Brig. C. H. M.
Clyde, Rt. Hon. J. L.	Hudson, Sir Austin (Lewisham, N.)	Peyton, J. W. W.
Cole, Norman	Hudson, W. R. A. (Hull, N.)	Pickthorn, K. W. M.
Colegate, W. A.	Hulbert, Wing Cmdr. N. J.	Pilkington, Capt. R. A.
Conant, Maj. R. J. E.	Hurd, A. R.	Pitman, I. J.
Cooper, Sqn. Ldr. Albert	Hutchinson, Geoffrey (Ilford, N.)	Powell, J. Enoch
Cooper-Key, E. M.	Hutchison, Lt.-Com. Clark (E'b'rgh W.)	Price, Henry (Lewisham, W.)
Craddock, Beresford (Spelthorne)	Hutchison, James (Scotstoun)	Prior-Palmer, Brig. O. L.
Cranborne, Viscount	Hyde, Lt.-Col. H. M.	Profumo, J. D.
Crookshank, Capt. Rt. Hon. H. F. C.	Hylton-Foster, H. B. H.	Raikes, H. V.
Crosthwaite-Eyre, Col. O. E.	Jenkins, R. C. D. (Dulwich)	Rayner, Brig. R.
Crouch, R. F.	Jennings, R.	Redmayne, M.
Crowder, John E. (Finchley)	Johnson, Eric (Blackley)	Remnant, Hon. P.
Crowder, Petre (Ruislip—Northwood)	Johnson, Howard (Kemptown)	Renton, D. L. M.
Cuthbert, W. N.	Jones, A. (Hall Green)	Roberts, Maj. Peter (Heeley)
Darling, Sir William (Edinburgh, S.)	Joynson-Hicks, Hon. L. W.	Robertson, Sir David
Davidson, Viscountess	Kaberry, D.	Robinson, Roland (Blackpool, S.)
Davies, Rt. Hn. Clement (Montgomery)	Keeling, E. H.	Robson-Brown, W
De la Bère, R.	Kerr, H. W. (Cambridge)	Rodgers, John (Sevenoaks)
Deedes, W. F.	Lambert, Hon. G.	Roper, Sir Harold
Digby, S. Wingfield	Lambton, Viscount	Ropner, Col. L.
Dodds-Parker, A. D.	Langford-Holt, J. A.	Russell, R. S.
Donaldson, Comdr. C. E. McA.	Law, Rt. Hon. R. K.	Ryder, Capt. R. E. D.
Donner, P. W.	Leather, E. H. C.	Salter, Rt. Hon. Sir Arthur
Doughty, C. J. A.	Legge-Bourke, Maj. E. A. H.	Sandys, Rt. Hon. D.
Douglas-Hamilton, Lord Malcolm	Legh, P. R. (Petersfield)	Savory, Prof. D. L.
Drayson, G. B.	Lennox-Boyd, Rt. Hon. A. T.	Schofield, Lt.-Col. W. (Rochdale)
Drewe, C.	Lindsay, Martin	Scott-Miller, Cmdr. R.
Dugdale, Maj. Rt. Hn. Sir T. (Richmond)	Linstead, H. N.	Shepherd, William
Duncan, Capt. J. A. L.	Lloyd, Rt. Hon. G. (King's Norton)	Simon, J. E. S. (Middlesbrough, W.)
Duthie, W. S.	Lloyd, Maj. Guy (Renfrew, E.)	Smiles, Lt.-Col. Sir Walter
Eccles, Rt. Hon. D. M.	Lloyd, Rt. Hon. Selwyn (Wirral)	Smithers, Peter (Winchester)
Eden, Rt. Hon. A.	Lockwood, Lt.-Col. J. C.	Smithers, Sir Waldron (Orpington)
Elliot, Rt. Hon. W. E.	Longden, Gilbert (Herts, S.W.)	Smyth, Brig. J. G. (Norwood)
Fell, A.	Low, A. R. W.	Snadden, W. McN.
Finlay, Graeme	Lucas, Sir Jocelyn (Portsmouth, S.)	Soames, Capt. C.
Fisher, Nigel	Lucas, P. B. (Brentford)	Spearman, A. C. M.
Fletcher, Walter (Bury)	Lucas-Tooth, Sir Hugh	Speir, R. M.
Fletcher-Cooke, C.	Lyttelton, Rt. Hon. O.	Spence, H. R. (Aberdeenshire, W.)
Foster, John	McAdden, S. J.	Spens, Sir Patrick (Kensington, S.)
Fraser, Hon. Hugh (Stone)	McCallum, Major D.	Stanley, Capt. Hon. Richard
Fraser, Sir Ian (Morecambe & Lonsdale)	McCorquodale, Rt. Hon. M. S.	Stevens, G. P.
Fyfe, Rt. Hon. Sir David Maxwell	Macdonald, Sir Peter (I. of Wight)	Steward, W. A. (Woolwich, W.)
Gage, C. H.	McKibbin, A. J.	Stewart, Henderson (Fife, E.)
Galbraith, Cmdr. T. D. (Pollok)	McKie, J. H. (Galloway)	Stoddart-Scott, Col. M.
Galbraith, T. G. D. (Hillhead)	Maclay, Hon. John	Storey, S.
Gammans, L. D.	Maclean, Fitzroy	Strauss, Henry (Norwich, S.)
Garner-Evans, E. H.	MacLeod, Iain (Enfield, W.)	Stuart, Rt. Hon. James (Moray)
George, Rt. Hon. Maj. G. Lloyd	MacLeod, John (Ross and Cromarty)	Studholme, H. G.
Glyn, Sir Ralph	Macmillan, Rt. Hon. Harold (Bromley)	Summers, G. S.
Godber, J. B.	Macpherson, Maj. Niall (Dumfries)	Sutcliffe, H.

Taylor, Charles (Eastbourne)	Tweedsmuir, Lady	Wellwood, W.
Taylor, William (Bradford, N.)	Vane, W. M. F.	White, Baker (Canterbury)
Teeling, W.	Vaughan-Morgan, J. K.	Williams, Charles (Torquay)
Thomas, Rt. Hon. J. P. L. (Hereford)	Vosper, D. F.	Williams, Gerald (Tonbridge)
Thomas, P. J. M. (Conway)	Wade, D. W.	Williams, Sir Herbert (Croydon, E.)
Thompson, Kenneth Pugh (Walton)	Wakefield, Edward (Derbyshire, W.)	Williams, R. Dudley (Exeter)
Thompson, Lt.-Cdr. R. (Croydon, W.)	Wakefield, Sir Wavell (Marylebone)	Wills, G.
Thorneycroft, R. Hn. Peter (Monmouth)	Walker-Smith, D. C.	Wilson, Geoffrey (Truro)
Thornton-Kemsley, Col. C. N.	Ward, Hon. George (Worcester)	Wood, Hon. R.
Tilney, John	Ward, Miss I. (Tynemouth)	York, C.
Touche, G. C.	Waterhouse, Capt. Rt. Hon. C.
Turner, H. F. L.	Watkinson, H. A.	TELLERS FOR THE AYES:
Turton, R. H.	Webbe, Sir H. (London & Westminster)	Brigadier Mackeson and
		Mr. Butcher
NOES
Acland, Sir Richard	Ede, Rt. Hon. J. C.	King, Dr. H. M.
Adams, Richard	Edwards, John (Brighouse)	Kinley, J.
Albu, A. H.	Edwards, Rt. Hon. Ness (Caerphilly)	Lee, Frederick (Newton)
Allen, Arthur (Bosworth)	Edwards, W. J. (Stepney)	Lee, Miss Jennie (Cannock)
Allen, Scholefield (Crewe)	Evans, Albert (Islington, S.W.)	Lever, Leslie (Ardwick)
Anderson, Alexander (Motherwell)	Evans, Edward (Lowestoft)	Lewis, Arthur
Anderson, Frank (Whitehaven)	Evans, Stanley (Wednesbury)	Lindgren, G. S.
Attlee, Rt. Hon. C. R.	Ewart, R.	Lipton, Lt.-Col. M.
Awbery, S. S.	Fernyhough, E.	Longden, Fred (Small Heath)
Ayles, W. H.	Field, Capt. W. J.	MacColl, J. E.
Bacon, Miss Alice	Fienburgh, W.	McGhee, H. G.
Baird, J.	Finch, H. J.	McInnes, J.
Balfour, A.	Fletcher, Eric (Islington, E.)	McKay, John (Wallsend)
Barnes, Rt. Hon. A. J.	Follick, M.	McLeavy, F.
Bartley, P.	Foot, M. M.	MacMillan, M. K. (Western Isles)
Bellenger, Rt. Hon. F. J.	Forman, J. C.	MacPherson, Malcolm (Stirling)
Bence, C. R.	Fraser, Thomas (Hamilton)	Mainwaring, W. H.
Benn, Wedgwood	Freeman, John (Watford)	Mallalieu, E. L. (Brigg)
Benson, G.	Freeman, Peter (Newport)	Mallalieu, J. P. W. (Huddersfield, E.)
Beswick, F.	Gaitskell, Rt. Hon. H. T. N.	Mann, Mrs. Jean
Bevan, Rt. Hon. A. (Ebbw Vale)	Gibson, C. W.	Manuel, A. C.
Bing, G. H. C.	Glanville, James	Marquand, Rt. Hon. H. A.
Blackburn, F.	Gooch, E. G.	Mayhew, C. P.
Blenkinsop, A.	Gordon-Walker, Rt. Hon. P. C.	Mellish, R. J.
Blyton, W. R.	Greenwood, Anthony (Rossendale)	Messer, F.
Boardman, H.	Greenwood, Rt. Hon. Arthur (Wakefield)	Mikardo, Ian
Bottomley, A. G.	Grenfell, Rt. Hon. D. R.	Mitchison, G. R.
Bowden, H. W.	Grey, C. F.	Monslow, W.
Bowles, F. G.	Griffiths, David (Rother Valley)	Moody, A. S.
Braddock, Mrs. Elizabeth	Griffiths, Rt. Hon. James (Llanelly)	Morgan, Dr. H. B. W.
Brockway, A. F.	Griffiths, William (Exchange)	Morley, R.
Brook, Dryden (Halifax)	Hale, Leslie (Oldham. W.)	Morris, Percy (Swansea, W.)
Broughton, Dr. A. D. D.	Hall, John (Gateshead, W.)	Morrison, Rt. Hon. H. (Lewisham, S.)
Brown, Rt. Hon. George (Belper)	Hamilton, W. W.	Mert, D. L.
Brown, Thomas (Ince)	Hannan, W.	Moyle, A.
Burke, W. A.	Hardy E. A.	Mulley, F. W.
Burton, Miss F. E.	Hargreaves, A.	Murray, J. D.
Butler, Herbert (Hackney, S.)	Harrison, J. (Nottingham, E.)	Nally, W.
Callaghan, L. J.	Hastings, S.	Neal, Harold (Bolsover)
Carmichael, J.	Hayman, F. H.	Noel-Baker, Rt. Hon. P. J.
Castle, Mrs. B. A.	Henderson, Rt. Hon. A. (Rowley Regis)	O'Brien, T.
Champien, A. J.	Herbison, Miss M.	Oldfield, W. H.
Chapman, W. D.	Hewitson, Capt. M.	Oliver, G. H.
Chetwynd, G. R.	Hobson, C. R.	Orbach, M.
Clunie, J.	Holman, P.	Oswald, T.
Cocks, F. S.	Houghton, Douglas	Padley, W. E.
Coldrick, W.	Hoy, J. H.	Paget, R. T.
Collick, P. H.	Hubbard, T. F.	Paling, Rt. Hon. W. (Dearne Valley)
Cook, T. F.	Hudson, James (Ealing, N.)	Paling, Will T. (Dewsbury)
Corbet, Mrs. Freda	Hughes, Cledwyn (Anglesey)	Pannell, Charles
Cove, W. G.	Hughes, Emrys (S. Ayrshire)	Pargiter, G. A.
Craddock, George (Bradford, S.)	Hughes, Hector (Aberdeen, N.)	Parker, J.
Crosland, C. A. R.	Hynd, H. (Accrington)	Paton, J.
Crossman, R. H. S.	Hynd, J. B. (Attercliffe)	Peart, T. F.
Cullen, Mrs. A.	Irvine, A. J. (Edge Hill)	Plummer, Sir Leslie
Davies, P.	Irvine, W. J. (Wood Green)	Poole, C. C.
Dalton, Rt. Hon. H.	Isaacs. Rt. Hon. G. A.	Popplewell, E.
Darling, George (Hillsborough)	Janner, B.	Porter, G.
Davies, A. Edward (Stoke, N.)	Jay, D. P. T.	Price, Joseph T. (Westhoughton)
Davies, Ernest (Enfield, E.)	Jeger, George (Goole)	Price, Philips (Gloucestershire, W.)
Davies, Harold (Leek)	Jenkins, R. H. (Stechford)	Proctor, W. T.
Davies, Stephen (Merthyr)	Johnson, James (Rugby)	Pryde, D. J.
de Freitas, Geoffrey	Johnston, Douglas (Paisley)	Pursey, Cmdr. H.
Deer, G.	Jones, David (Hartlepool)	Rankin, John
Delargy, H. J.	Jones, Frederick Elwyn (West Ham, S.)	Reeves, J.
Dodds, N. N.	Jones, Jack (Rotherham)	Reid, Thomas (Swindon)
Donnelly, D. L.	Jones, T. W. (Merioneth)	Reid, William (Camlachie)
Driberg, T. E. N.	Key, Rt. Hon. C. W.	Rhodes, H.

Robens, Rt. Hon. A.	Stross, Dr. Barnett	Wheatley, Rt. Hon. John
Roberts, Albert (Normanton)	Summerskill, Rt. Hon. Edith	White, Mrs. Eirene (E. Flint)
Roberts, Goronwy (Caernarvonshire)	Swingler, S. T.	White, Henry (Derbyshire, N.E.)
Robinson, Kenneth (St. Pancras, N.)	Sylvester, G. O.	Whileley, Rt. Hon. W.
Rogers, George (Kensington, N.)	Taylor, Bernard (Mansfield)	Wigg, G. E. C.
Ross, William	Taylor, John (West Lothian)	Wilcock, Group Capt. C. A. B.
Royle, C.	Taylor, Robert (Morpeth)	Wilkins, W. A.
Schofield, S. (Barnsley)	Thomas, David (Aberdare)	Willey, Frederick (Sunderland, N.)
Shackleton, E. A. A.	Thomas, George (Cardiff)	Willey, Octavius (Cleveland)
Shinwell, Rt. Hon. E.	Thomas, Iorwerth (Rhondda, W.)	Williams, David (Neath)
Short, E. W.	Thomas, Ivor Owen (Wrekin)	Williams, Rev. Llywelyn (Abertillery)
Shurmer, P. L. E.	Thurtle, Ernest	Williams, Ronald (Wigan)
Silverman, Julius (Erdington)	Timmons, J.	Williams, Rt. Hon. Thomas (Don V'll'y)
Silverman, Sydney (Nelson)	Tomlinson, Rt. Hon. G	Williams, W. R. (Droylsden)
Simmons, C. J. (Brierley Hill)	Tomney, F.	Williams, W. T. (Hammersmith, S.)
Slater, J.	Turner-Samuels, M.	Wilson, Rt. Hon Harold (Huyton)
Smith, Ellis (Stoke, S.)	Ungoed-Thomas, Sir Lynn	Winterbottom, Ian (Nottingham, C.)
Smith, Norman (Nottingham, S.)	Usborne, H. C.	Winterbottom, Richard (Brightside)
Snow, J. W.	Viant, S. P.	Woodburn, Rt. Hon. A.
Sorensen, R. W.	Wallace, H. W.	Wyatt, W. L.
Soskice, Rt. Hon. Sir Frank	Watkins, T. E.	Yates, V. F.
Sparks, J. A.	Webb, Rt. Hon. M. (Bradford C.)	Younger, Rt. Hon. K
Steele, T.	Weitzman, D.
Stewart, Michael (Fulham, E.)	Wells, Percy (Faversham)	TELLERS FOR THE NOES:
Strachey, Rt. Hon. J.	Wells, William (Walsall)	Mr. Arthur Pearson and
Strauss, Rt. Hon. George (Vauxhall)	West, D. G.	Mr. Horace Holmes.

Main Question put:

Division No. 29.]	AYES	[10.14 p.m.
Aitken, W. T.	Churchill, Rt. Hon. W S.	Gough, C. F. H
Allan, R. A. (Paddington, S.)	Clarke, Col. Ralph (East Grinstead)	Gower, H. R.
Alport, C. J. M.	Cole, Norman	Graham, Sir Fegus
Amery, Julian (Preston, N.)	Colegate, W. A.	Gridley, Sir Arnold
Amory, Heathcoat (Tiverton)	Conant, Maj. R. J. E.	Grimond, J
Anstruther-Gray, Major W. J.	Cooper, Sqn. Ldr. Albert	Grimston, Hon. John (St. Albans)
Arbuthnot, John	Cooper-Key, E. M.	Grimston, Robert (Westbury)
Ashton, H. (Chelmsford)	Craddock, Beresford (Spelthorne)	Harden, J. R E.
Assheton, Rt. Hon. R. (Blackburn, W.)	Cranborne, Viscount	Hare, Hon, J. H
Astor, Hon. J. J. (Plymouth, Sutton)	Crookshank, Capt. Rt. Hon. H. F. C	Harris, Frederic (Croydon, N.)
Astor, Hon. W. W. (Bucks, Wycombe)	Crosthwaite-Eyre, Col. O. E.	Harris, Reader (Heston)
Baker, P. A. D.	Crouch, R. F.	Harrison, Lt.-Col. J. H. (Eye)
Baldock, Lt.-Cmdr. J. M	Crowder, John E. (Finchley)	Harvey. Air Cdre. A. V. (Macclesfield)
Baldwin, A. E.	Crowder, Petre (Ruislip—Northwood)	Harvey, Ian (Harrow, E.)
Banks, Col. C.	Cuthbert, W. N.	Harvie-Watt, Sir George
Barber, A. P. L.	Darling, Sir William (Edinburgh, S.)	Hay, John
Barlow, Sir John	Davidson, Viscountess	Head, Rt. Hon. A. H.
Baxter, A. B.	Davies, Rt. Hn. Clement (Montgomery)	Heald, Sir Lionel
Beamish, Maj. Tufton	De la Bère, R.	Heath, Edward
Bell, Philip (Bolton, E.)	Deedes, W. F.	Hicks-Beach, Maj. W. W.
Bell, R. M. (Bucks, S.)	Digby, S. Wingfield	Higgs, J. M. C.
Bennett, F. M. (Reading, N.)	Dodds-Parker, A. D	Hill, Dr Charles (Luton)
Bennett, Sir Peter (Edgbaston)	Donaldson, Comdr. C. E. McA.	Hill, Mrs. E. (Wythenshawe)
Bennett, Dr. Reginald (Gosport)	Doughty, C. J. A.	Hichingbrooke. Viscount
Bennett, William (Woodside)	Douglas-Hamilton, Lord Malcolm	Hirst, Geoffrey
Bevins, J. R. (Toxteth)	Drayson, G. B.	Holland-Martin,C J
Birch, Nigel	Drewe, C.	Hollis, M. C.
Bishop, F. P.	Dugdale, Maj. Rt. Hn. Sir T. (Richmond)	Holt, A. F.
Black, C. W.	Duncan, Capt. J A. L.	Hopkinson, Henry
Boothby, R. J. G.	Duthie, W. S.	Hornsby-Smith, Miss M. P.
Bossom, A. C.	Eccles, Rt. Hon. D. M.	Horobin, I. M.
Bowen, E. R.	Eden, Rt. Hon. A.	Horsbrugh, Rt. Hon. Florence
Boyd-Carpenter, J. A.	Elliot, Rt. Hon. W. E	Howard, Gerald (Cambridgeshire)
Boyle, Sir Edward	Fell, A	Howard, Greville (St. Ives)
Braine, B. R.	Finlay, Graeme	Hudson, Sir Austin (Lewisham, N.)
Braithwaite, Sir Albert (Harrow, W.)	Fisher, Nigel	Hudson, W. R. A. (Hull, N.)
Braithwaite, Lt.-Cdr, G. (Bristol, N.W.)	Fletcher, Walter (Bury)	Hulbert, Wing Cmdr. N. J.
Bromley-Davenport, Lt.-Col. W. H.	Fletcher-Cooke, C.	Hurd, A. R.
Brooke, Henry (Hampstead)	Foster, John	Hutchinson, Geoffrey (Ilford, N.)
Brooman-White, R. C.	Fraser, Hon. Hugh (Stone)	Hutchison, Lt.-Com. Clark (E'b'rgh W.)
Browne, Jack (Govan)	Fraser, Sir I. (Morecambe & Lonsdale)	Hutchison, James (Scotstoun)
Buchan-Hepburn, Rt. Hon. P. G. T.	Fyfe, Rt. Hon. Sir David Maxwell	Hyde, Lt.-Col. H. M.
Bullard, D. G.	Gage, C. H.	Hylton-Foster, H. B. H.
Bullock, Capt. M.	Galbraith, Cmdr. T. D. (Pollok)	Jenkins, R. C. D. (Dulwich)
Bullus, Wing Commander E. E	Galbraith, T. G. D (Hillhead)	Jennings, R.
Burden, F. F. A.	Gammans, L. D	Johnson, Eric (Blackley)
Butler, Rt. Hon. R. A. (Saffron Walden)	Garner-Evans, E. H.	Johnson, Howard (Kemptown)
Carr, Robert (Milcham)	George, Rt. Hon. Maj. G. Lloyd	Jones, A. (Hall Green)
Carson, Hon. E.	Glyn, Sir Ralph	Joynson-Hicks, Hon. L. W.
Cary, Sir R.	Godber, J. B.	Kaberry, D.
Channon, H.	Gomme-Duncan, Col A.	Keeling, E. H

The House divided: Ayes, 306; Nose, 275.

Kerr, H. W. (Cambridge)	Nicholson, G.	Spens, Sir Patrick (Kensington, S)
Lambert, Hon. G.	Nield, Basil (Chester)	Stanley, Capt. Hon. Richard
Lambton, Viscount	Noble, Cmdr. A. H. P.	Stevens, G. P.
Langford-Holt, J. A.	Nugent, G. R. H.	Steward, W. A. (Woolwich, W.)
Law, Rt. Hon. R. K.	Nutting, Anthony	Stewart, Henderson (Fife, E.)
Leather, E. H. C.	Oakshott, H. D.	Stoddart-Scott, Col. M.
Legge-Bourke, Maj. E. A. H.	Odey, G. W.	Storey, S.
Legh, P. R. (Petersfield)	Ormsby-Gore, Hon. W. D.	Strauss, Henry (Norwich, S.)
Lennox-Boyd, Rt. Hon. A. T.	Orr, Capt. L. P. S.	Stuart, Rt. Hon. James (Moray)
Lindsay, Martin	Orr-Ewing, Ian L. (Weston-super-Mare)	Studholme, H. G.
Linstead, H. N.	Osborne, C.	Summers, G. S
Lloyd, Rt. Hon. G. (King's Norton)	Partridge, E.	Sutcliffe, H.
Lloyd, Maj. Guy (Renfrew, E.)	Peake, Rt. Hon. O	Taylor, Charles (Eastbourne)
Lloyd, Rt. Hon. Selwyn (Wirral)	Perkins, W. R. D.	Taylor, William (Bradford, N.)
Lockwood, Lt.-Col. J. C.	Peto, Brig. C. H. M.	Teeling, W.
Longden, Gilbert (Herts, S. W.)	Peyton, J. W. W.	Thomas, Rt. Hon. J. P. L. (Hereford)
Low, A. R. W.	Pickthorn, K. W. M.	Thomas, P. J. M. (Conway)
Lucas, Sir Jocelyn (Portsmouth, S.)	Pilkington, Capt. R. A.	Thompson, Kenneth Pugh (Walton)
Lucas, P. B. (Brentford)	Pitman, I. J.	Thompson, Lt.-Cdr. R. (Croydon, W.)
Lucas-Tooth, Sir Hugh	Powell, J. Enoch	Thorneycroft, R. Hn. Peter (Monmouth)
Lyttelton, Rt. Hon. O.	Price, Henry (Lewisham, W.)	Thornton-Kemsley, Col C. N
McAdden, S. J.	Prior-Palmer, Brig. O. L.	Tilney, John
McCallum, Major D.	Profumo, J. D.	Touche, G. C.
McCorquodale, Rt. Hon. M. S.	Raikes, H. V.	Turner, H. F. L.
Macdonald, Sir Peter (I. of Wight)	Rayner, Brig. R.	Turton, R. H.
McKibbin, A. J.	Redmayne, M.	Tweedsmuir, Lady
McKie, J. H. (Galloway)	Remnant, Hon. P.	Vane, W. M. F
Maclay, Hon. John	Renton, D. L. M.	Vaughan-Morgan, J K
Maclean, Fitzroy	Roberts, Maj. Peter (Heeley)	Vosper, D. F.
MacLeod, Iain (Enfield, W.)	Robertson, Sir David	Wade, D. W.
MacLeod, John (Ross and Cromarty)	Robinson, Roland (Blackpool, S)	Wakefield, Edward (Derbyshire, W)
Macmillan, Rt. Hon. Harold (Bromley)	Robson-Brown, W.	Wakefield, Sir Wavell (Marylebone)
Macpherson, Maj. Niall (Dumfries)	Rodgers, John (Sevenoaks)	Walker-Smith, D. C.
Maitland, Comdr J. F. W. (Horncastle)	Roper, Sir Harold	Ward, Hon. George (Worcester)
Maitland, Patrick (Lanark)	Ropner, Col. L.	Ward, Miss I. (Tynemouth)
Manningham-Buller, Sir R. E.	Russell, R. S.	Waterhouse, Capt. Rt. Hon. C.
Markham, Major S. F	Ryder, Capt. R. E. D	Watkinson, H. A.
Marlowe, A. A. H.	Salter, Rt. Hon. Sir Arthur	Webbe, Sir H. (London & Westminster)
Marples, A. E.	Sandys, Rt. Hon. D.	Wellwood, W.
Marshall, Douglas (Bodmin)	Savory, Prof. D. L.	White, Baker (Canterbury)
Marshall, Sidney (Sutton)	Schofield, Lt.-Col. W. (Rochdale)	Williams, Charles (Torquay)
Maude, Angus	Scott-Miller, Cmdr. R.	Williams, Gerald (Tonbridge)
Maudling, R.	Shepherd, William	Williams, Sir Herbert (Croydon, E.)
Maydon, Lt.-Comdr. S. L. C.	Simon, J. E. S. (Middlesbrough, W.)	Williams. R. Dudley (Exeter)
Medlicott, Brig. F.	Smiles, Lt.-Col. Sir Walter	Wills, G.
Mellor, Sir John	Smithers, Peter (Winchester)	Wilson, Geoffrey (Truro)
Molson, A. H. E.	Smithers, Sir Waldron (Orpington)	Wood, Hon. R.
Monckton, Rt. Hon. Sir Walter	Smyth, Brig. J. G. (Norwood)	York, C.
Moore, Lt.-Cot. Sir Thomas	Snadden, W. McN.
Morrison, John (Salisbury)	Soames, Capt. C.	TELLERS FOR THE AYES:
Mott-Radclyffe, C. E.	Spearman. A. C. M.	Brigadier Mackeson and
Nabarro, G. D. N	Speir, R. M.	Mr. Butcher.
Nicholls, Harmar

NOES
Acland, Sir Richard	Braddock, Mrs. Elizabeth	Davies, A. Edward (Stoke, N)
Adams, Richard	Brockway, A. F.	Davies, Ernest (Enfield, E.)
Albu, A. H.	Brook, Dryden (Halifax)	Davies, Harold (Leek)
Allen, Arthur (Bosworth)	Broughton. Dr. A. D. D.	Davies, Stephen (Merthyr)
Allen, Scholefield (Crewe)	Brown, Rt. Hon. George (Belper)	de Freitas, Geoffrey
Anderson, Alexander (Motherwell)	Brown, Thomas (Ince)	Deer, G.
Anderson, Frank (Whitehaven)	Burke, W. A.	Delargy, H J.
Attlee, Rt. Hon. C. R.	Burton, Miss F. E.	Dodds. N. N
Awbery, S. S.	Butler, Herbert (Hackney, S.)	Donnelly, D L.
Ayles, W. H.	Callaghan, L J.	Driberg, T.E N
Bacon, Miss Alice	Carmichael, J.	Ede, Rt Hon J C
Baird, J.	Castle, Mrs. B. A	Edwards, John (Brighouse)
Balfour, A.	Champion, A. J	Edwards, Rt. Hon. Ness (Caerphilly)
Barnes, Rt. Hon. A. J.	Chapman, W. D	Edwards, W J. (Stepney)
Bartley, P.	Chetwynd, G. R	Evans, Albert (Islington, S.W)
Bellenger, Rt. Hon. F. J	Clunie, J.	Evans, Edward (Lowestoft)
Bence, C. R.	Cocks. F. S	Evans, Stanley (Wednesbury)
Benn, Wedgwood	Coldrick, W	Ewart, R.
Benson, G.	Collick, P. H	Fernyhough, E.
Beswick, F.	Cook, T. F.	Field, Capt. W. J.
Bevan, Rt. Hon. A. (Ebbw Vale)	Corbet, Mrs. Freda	Fienburgh, W
Bing, G. H. C.	Cove, W. G.	Finch, H. J.
Blackburn, F.	Craddock, George (Bradford, S.)	Fletcher, Eric (Islington. E.)
Blenkinsop, A.	Crosland, C. A. R.	Follick, M.
Blyton, W. R	Crossman, R. H. S	Foot, M. M.
Boardman, H.	Cullen, Mrs. A.	Forman, J. C.
Bottomley, A. G	Daines, P.	Fraser, Thomas (Hamilton)
Bowden, H. W.	Dalton, Rt. Hon. H.	Freeman, John (Watford)
Bowles, F. G.	Darling, George (Hillsborough)	Freeman, Peter (Newport)

Gaitskell, Rt. Hon. H. T. N.	MacPherson, Malcolm (Stirling)	Shurmer, P. L. E.
Gibson, C. W.	Mainwaring, W. H.	Silverman, Julius (Erdington)
Glanville, James	Mallalieu, E. L. (Brigg)	Silverman, Sydney (Nelson)
Gooch, E. G.	Mailalieu, J. P. W. (Huddersfield, E.)	Simmons, C. J. (Brierley Hill)
Gordon-Walker, Rt. Hon. P. C.	Mann, Mrs. Jean	Slater, J.
Greenwood, Anthony (Rossendale)	Manuel, A. C.	Smith, Ellis (Stoke, S.)
Greenwood, Rt. Hon. Arthur (Wakefield)	Marquand, Rt. Hon. H. A.	Smith, Norman (Nottingham, S.)
Grenfell, Rt. Hon. D. R.	Mayhew, C. P.	Snow, J. W.
Grey, C F.	Mellish, R. J.	Sorensen, R. W.
Griffiths, David (Rother Valley)	Messer, F.	Soskice, Rt. Hon. Sir Frank
Griffiths, Rt. Hon. James (Llanelly)	Mikardo, Ian	Sparks, J. A.
Griffiths, William (Exchange)	Mitchison, G. R.	Steele, T.
Hale, Leslie (Oldham, W.)	Monslow, W.	Stewart, Michael (Fulham, E.)
Hall, John (Gateshead, W.)	Moody, A. S.	Strachey, Rt. Hon. J.
Hamilton, W. W.	Morgan, Dr. H. B. W.	Strauss, Rt. Hon. George (Vauxhall)
Hannan, W.	Morley, R.	Stress, Dr. Barnett
Hardy, E. A.	Morris, Percy (Swansea, W.)	Summerskill, Rt. Hon. Edith
Hargreaves, A	Morrison, Rt. Hon. H. (Lewisham, S.)	Swingler, S. T.
Harrison, J. (Nottingham, E.)	Mort, D. L.	Sylvester, G. O.
Hastings, S.	Moyle, A.	Taylor, Bernard (Mansfield)
Hayman, F. H.	Mulley, F. W.	Taylor, John (West Lothian)
Henderson, Rt. Hon. A. (Rowley Regis)	Murray, J. D.	Taylor, Robert (Morpeth)
Herbison, Miss M	Nally, W.	Thomas, David (Aberdare)
Hewitson, Capt. M.	Neal, Harold (Bolsover)	Thomas, George (Cardiff)
Hobson, C. R.	Noel-Baker, Rt. Hon. P. J.	Thomas, Iorwerth (Rhondda, W.)
Holman, P.	O'Brien, T.	Thomas, Ivor Owen (Wrekin)
Houghton, Douglas	Oldfield, W. H.	Thurtle, Ernest
Hoy, J. H.	Oliver, G. H.	Timmons, J.
Hubbard, T. F.	Orbach, M.	Tomlinson, Rt. Hon. G.
Hudson, James (Ealing, N.)	Oswald, T.	Tomney, F.
Hughes, Cledwyn (Anglesey)	Padley, W. E.	Turner-Samuels, M.
Hughes, Emrys (S. Ayrshire)	Paget, R. T.	Ungoed-Thomas, Sir Lynn
Hughes, Hector (Aberdeen, N.)	Paling, Rt. Hon. W. (Dearne Valley)	Usborne, H. C.
Hynd, H. (Accrington)	Paling, Will T. (Dewsbury)	Viant, S. P.
Hynd, J. B. (Attercliffe)	Pannell, Charles	Wallace, H. W.
Irvine, A. J. (Edge Hill)	Pargiter, G. A.	Watkins, T. E.
Irving, W. J. (Wood Green)	Parker, J.	Webb, Rt. Hon. M. (Bradford, C.)
Isaacs, Rt. Hon. G. A.	Paton, J.	Weitzman, D.
Janner, B.	Peart, T. F.	Wells, William (Walsall)
Jay, D. P. T.	Plummer, Sir Leslie	West, D. G.
Jeger, George (Goole)	Poole, C. C.	White, Mrs. Eirene (E. Flint)
Jenkins, R. H. (Stechford)	Popplewell, E.	White, Henry (Derbyshire, N.E.)
Johnson, James (Rugby)	Porter, G.	Whiteley, Rt. Hon. W.
Johnston, Douglas (Paisley)	Price, Joseph T. (Westhoughton)	Wigg, G. E. C.
Jones, David (Hartlepool)	Price, Philips (Gloucestershire, W.)	Wilcock, Group Capt. C. A. B.
Jones, Frederick Elwyn (West Ham, S.)	Proctor, W. T.	Wilkins, W. A.
Jones, Jack (Rotherham)	Pryde, D. J.	Willey, Frederick (Sunderland, N.)
Jones, T. W. (Merioneth)	Pursey, Cmdr. H.	Willey, Octavius (Cleveland)
Key, Rt. Hon. C. W.	Rankin, John	Williams, David (Neath)
King, Dr. H. M.	Reeves, J.	Williams, Rev. Llywelyn (Abertillery)
Kinley, J.	Reid, Thomas (Swindon)	Williams, Ronald (Wigan)
Lee, Frederick (Newton)	Reid, William (Camlachie)	Williams, Rt. Hon. Thomas(Don V'll'y)
Lee, Miss Jennie (Cannock)	Rhodes, H.	Williams, W. R. (Droylsden)
Lever, Leslie (Ardwick)	Robens, Rt. Hon. A.	Williams, W. T. (Hammersmith, S.)
Lewis, Arthur	Roberts, Albert (Normanton)	Wilson, Rt. Hon. Harold (Huyton)
Lindgren, G. S.	Roberts, Goronwy (Caernarvonshire)	Winterbottm, Ian (Nottingham, C.)
Lipton, Lt.-Col. M.	Robinson, Kenneth (St. Pancras, N.)	Winterbottom, Richard (Brightside)
Longden, Fred (Small Heath)	Rogers, George (Kensington, N.)	Wyatt, W. L.
MacColl, J. E.	Ross, William	Yates, V. F.
McGhee, H. G.	Royle, C.	Younger, Rt. Hon. K.
McInnes, J.	Schofield, S. (Barnsley)
McKay, John (Wallsend)	Shackleton, E. A. A.	TELLERS FOR THE NOES:
McLeavy, F.	Shinwell, Rt. Hon. E.	Mr. Arthur Pearson and
MacMillan, M. K. (Western Isles)	Short, E. W.	Mr. Horace Holmes.

Resolved: That this House, recognising the peril to the security and economic stability of the country caused by the continuing fall in the central reserves of gold and dollars, which results from the adverse balance of payments, agrees that measures adequate to halt the downward trend and to rebuild those reserves must be urgently taken in all matters where action would benefit, directly or indirectly, our overseas balance and the strength of sterling.