Commons Sitting of 26 June 1952

Preamble
The House met at Half past Two o'Clock
PRAYERS
[Mr. SPEAKER in the Chair]
PRIVATE BUSINESS
  NORTH WALES HYDRO-ELECTRIC POWER BILL (Queen's Consent, on behalf of the Crown, signified.)
  Bill read the Third time, and passed.
ORAL ANSWERS TO QUESTIONS
  EDUCATION

    Local Authorities (Circular 242)
    Mr. G. Thomasasked the Minister of Education whether she will now publish in the OFFICIAL REPORT the names of the 81 local education authorities to which she has written concerning the insufficiency of their cuts in estimated expenditure.
    The Minister of Education (Miss Florence Horsbrugh): Yes, Sir.
    Mr. Thomas: While thanking the Minister for that reply, may I ask her whether she is aware that Dr. Alexander, the secretary of the Association of Education Committees of England and Wales, and the National Union of Teachers, have both expressed alarm at this approach which she has made? Will she give the House an assurance that she has now reached rock bottom in her economy attack upon education?
    Miss Horsbrugh: Perhaps the hon. Gentleman would like to know that the number of letters which I have written has now gone up from 81 to 94.
    Mr. Ede: Inasmuch as 81 is more than half the number of local education committees, may I ask what proportion of the school population is now represented by 94?
    Miss Horsbrugh: I could not say the proportion of the school population, but
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    perhaps, if he had read the letters, or any one of them, the right hon. Gentleman would realise that the letters were not asking the education authorities to make further cuts but for a further explanation about the estimates.
    Following are the names of the local authorities referred to:

    ENGLAND

    Counties

    County Boroughs—

    Bedfordshire

    continued

    Cambridgeshire

    Coventry

    Cheshire

    Derby

    Cumberland

    Dewsbury

    Dorset

    Dudley

    Essex

    Eastbourne

    Gloucestershire

    Exeter

    Hampshire

    Gateshead

    Herefordshire

    Gloucester

    Huntingdonshire

    Grimsby

    Isle of Ely

    Halifax

    Isle of Wight

    Hastings

    Lancashire

    Huddersfield

    Leicestershire

    Kingston-on-Hull

    Norfolk

    Leeds

    Northumberland

    Leicester

    Nottinghamshire

    Lincoln

    Rutland

    Liverpool

    Somerset

    Middlesbrough

    Staffordshire

    Newcastle-on-Tyne

    Suffolk, West

    Northampton

    Sussex, East

    Norwich

    Westmorland

    Oldham

    Wiltshire

    Plymouth

    Worcestershire

    Preston

    Yorks, East Riding

    Rochdale

    Yorks North Riding

    Rotherham

    St. Helens

    County Boroughs

    Sheffield

    Barnsley

    Smethwick

    Barrow-in-Furness

    Southampton

    Bath

    South Shields

    Birkenhead

    Stoke-on-Trent

    Birmingham

    Sunderland

    Bolton

    Tynemouth

    Bournemouth

    Wallasey

    Bradford

    Walsall

    Brighton

    West Bromwich

    Burnley

    West Ham

    Bury

    West Hartlepool

    Canterbury

    Wigan

    Carlisle

    WALES

    Counties

    Counties—continued

    Anglesey

    Montgomeryshire

    Breconshire

    Pembrokeshire

    Caernarvonshire

    Radnorshire

    Cardiganshire

    Denbighshire

    County Boroughs

    Flintshire

    Cardiff

    Merionethshire

    Newport (Mon.)

    Monmouthshire

    Swansea

    Mr. Sorensenasked the Minister of Education what modifications have now been made by the Essex County Council in respect of previous decisions on educational economies; whether these have been accepted by her; and what financial expenditure is involved.
    Miss Horsbrugh: I understand that the local education authority desire to rescind as from the beginning of the autumn term the measures previously adopted for reducing expenditure on the transport of senior school children. I asked the authority for particulars of their revised proposals, which have now been received and are under consideration. The sum involved would be £29,370 in this financial year.
    Mr. Sorensen: Does not the Minister agree that the previous economies were most deplorable and that it is greatly encouraging that the new council are deciding to try to abolish these economies?
    Miss Horsbrugh: As the hon. Member knows, certain statutory limits are laid down in the Act as to distance and that if a child lives beyond a certain distance transport should be provided. In this case, transport was being provided for children living at a shorter distance.
    Mr. Shinwell: Did I understand the right hon. Lady to say that she was writing to Essex County Council asking for particulars? Does that mean that she proposes to interfere? If so, why does she not interfere in other cases?
    Miss Horsbrugh: Perhaps the right hon. Gentleman did not hear me. I said I have written and they have replied to me.
    Mr. Shinwell: What was the purpose of writing? What was the intention of the right hon. Lady?
    Miss Horsbrugh: To find out what their proposals were. They have now informed me that it is the transport of the senior school children and that the sum involved is £29,370. I now have that information.
    Lieut-Colonel Lipton: Can the right hon. Lady give an assurance that, in accordance with her regular policy of non-intervention, she did not bring any pressure to bear on Essex County Council to improve their educational services?
    Miss Horsbrugh: I asked Essex County Council for this information, which they have now given me, and on 25th June I received a request from them that I should receive a deputation to discuss the matter. [HON. MEMBERS: "Why?"]
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    I do not know why. Essex County Council gave me the information, but I did not send them any further letter. They have now asked for a deputation to be received. I shall consider that before I send a reply.
    Mr. Fernyhoughasked the Minister of Education what instructions she proposes to give to the Chester City Education Authority, whose cut in educational expenditure is on a percentage basis the highest in the country and in excess of that asked for in Circular 242.
    Miss Horsbrugh: None, Sir. It was recognised in paragraph 2 of Circular 242 that some authorities might find it practicable, within the policy of the Circular, to make a reduction of more than 5 per cent. on the forecast which they submitted last autumn.
    Mr. Fernyhough: Does not the right hon. Lady think that at a time of rising prices and increasing costs a cut of this magnitude is bound to undermine the fabric of this essential service? Will she instruct this Tory dominated council to have another look at this matter with a view to safeguarding defenceless children from a selfish attack?
    Miss Horsbrugh: I think that before making statements of that sort the hon. Member would be well advised to look at the list of the returns made, which has already been presented to Parliament, because there were other authorities which have not done perhaps quite so much as 7.4 per cent., but some local authorities are well over 6 per cent. I think that if the hon. Member looks at the names of the authorities he will not think his accusation about a particular authority being a Tory authority, and therefore cutting down, is quite accurate.
    Mr. Fernyhough: Does not the right hon. Lady realise that many citizens and many in the teaching profession in this city are up in arms on this matter and feel she is neglecting her duty in allowing cuts of this magnitude without doing anything about it?
    Miss Horsbrugh: I think the hon. Member would be well advised to look at that list. It is quite clear, apart from anything to do with the political views of the various authorities, that the estimates of some were probably not very accurately

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    prepared. It is difficult to prepare the estimates, and whereas we know a great many authorities when asked to look at their accounts again showed an increase, certain other authorities showed varying degrees of decrease.

    School Meals (Holiday Periods)
    Mr. G. Thomasasked the Minister of Education whether paragraph 15 of her Circular 250, concerning the stopping of the provision of meals at schools during holidays and on Saturdays, applies to free meals granted in necessitous cases.
    Miss Horsbrugh: The paragraph was intended to apply to holiday and Saturday meals without distinction whether they were being provided free or on payment. If an authority are satisfied that the meals cannot be stopped without hardship to the children it is open to them to continue the arrangements.
    Mr. Thomas: Is the Minister aware that it is quite impossible to stop free meals for necessitous children without hardship being created? Will she ensure that the disastrous effect that her circular may have on these children will be modified by another letter to the local authorities?
    Miss Horsbrugh: Perhaps the hon. Gentleman will study the paragraph to which he refers. It may interest him to know that the majority of children who are taking meals during holidays and on Saturdays are those who pay for them.
    Mr. Thomas: While the majority may be so covered, the minority must receive the protection both of this House and of the Minister.

    Training College Entrants (Qualifications)
    Mr. G. Thomasasked the Minister of Education what steps she is taking to ensure that persons not in possession of qualifications equivalent to those given in Schedule II of the Training of Teachers Regulations are not admitted to the training colleges.
    Miss Horsbrugh: Under the Regulations which the hon. Member mentions, it is open to area training organisations to allow exceptions to the general rule restricting admission to candidates possess-
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    ing one of the qualifications listed in Schedule II, and I see no reason to deprive them of this discretion.
    Mr. Thomas: Will the Minister give an assurance that, despite the very serious problem that faces her of obtaining sufficient recruits to the teaching profession, she will not seek to solve this problem by lowering the standards of entry to the profession?
    Miss Horsbrugh: Certainly. As the hon. Gentleman knows, the area training organisations, who make the exceptions, have representatives of university training colleges, local education committees and representatives of members of the teaching profession. I think the hon. Member can leave it to them.
    Mr. Thomas: May I thank the right hon. Lady for the most pleasant answer she has given me for a very long time?
    Sir W. Smithers: Is it not a fact that, owing to the unbelievable mess left by the Socialist Government, the first social service must be food? What is the good of having pupils and teachers in schools if they have nothing to eat?
    Miss Horsbrugh: I hope that we shall have schools, teachers, and food.

    Denominational Schools
    Mr. Edeasked the Minister of Education if it is proposed to include Clauses dealing with the financial position of denominational schools in the promised Education (Miscellaneous Provisions) Bill.
    Mr. Haleasked the Minister of Education what progress has been made with regard to Her Majesty's Government's proposals with reference to the denominational schools; and when she expects to be in a position to announce these proposals in detail and introduce any necessary Measure.
    Mr. Slaterasked the Minister of Education if she has now reached agreement with the representatives from denominational schools on the question of further assistance.
    Miss Horsbrugh: I would ask the hon. Members to await the text of the Bill.
    Mr. Ede: Will the Bill be introduced this Session?
    Miss Horsbrugh: I think so. I should like to see it introduced as soon as possible, but, as the right hon. Gentleman will understand. I cannot give a definite date at this moment.
    Mr. Ede: May I assure the right hon. Lady that this Bill will receive a much warmer reception than some of the stuff we have been seeing?
    Mr. Hale: Is it not a fact that the Bill is in print and is available and, if that is so, and in view of the fact that it embodies the proposals of my right hon. Friend the Member for South Shields (Mr. Ede) and my right hon. Friend the Member for Farnworth (Mr. Tomlinson), why not produce it, because we shall support it?
    Miss Horsbrugh: If there is another Bill which the hon. Gentleman knows is in print, I shall be happy to see it. The Bill to which I am referring is being drafted at the moment.
    Mr. Slater: Is the right hon. Lady not aware that talks were practically concluded with representatives of the various denominational schools some time ago, and since in the period of seven or eight months since the General Election nothing has yet been done in regard to them, will she speed up the matter?
    Miss Horsbrugh: Consultations have taken place with certain denominations but no definite consultations on the propositions have taken place with the National Union of Teachers, the local education authorities and various other people who are interested.
    Miss Ward: Is it not a fact that if there had not been a change of Government, there would not have been the money to meet the new demands?
    Major Beamish: When the right hon. Gentleman says that the legislation will receive a warm reception, does he mean that it will receive a hot reception or a cool reception?

    New Schools
    Mr. Swinglerasked the Minister of Education how many new schools, stating primary and secondary schools separately, are at present being built in Staffordshire, compared with the number being built on 31st December, 1951.
    Miss Horsbrugh: On 30th April last there were 19 primary and one secondary schools under construction in Staffordshire. The comparable figures for 31st December were 23 and one, respectively.
    Mr. Swingler: Is the Minister satisfied with the progress being made in Staffordshire, and is she thoroughly assured that her limited, revised building programme will be achieved this year?
    Miss Horsbrugh: Yes, I think it ought to be. More schools were completed at the date to which the hon. Member has referred, and I have no reason to think that the number of places which the programme was calculated to provide will not be provided.
    Mr. Swinglerasked the Minister of Education how many new schools, stating primary and secondary schools separately, are at present being built in England and Wales; how these figures compare with those for 31st December, 1951; and if she is satisfied with the progress of the building programme.
    Miss Horsbrugh: At the end of 1951, 854 new primary and 276 new secondary schools were under construction. The comparable figures for the end of April were 804 and 275. I am satisfied that at the present rate of progress the 1,150,000 places needed by the end of 1953 will be available.
    Mr. Swingler: Is the Minister aware that the progress made during the past nine months is only one-fifth of what was done in the previous nine months? Is she further aware, having regard to the proposed recruitment, that, on her own figures, her programme is at least 200,000 short of the required places?
    Miss Horsbrugh: No, I am not aware that the programme is fully 200,000 short. If the hon. Gentleman would care to see me at any time, or write to me explaining how he bases his figures, I shall be glad to look into them. However, when we are here talking of schools under construction, I would point out that I am more anxious to see that the building programme is not overloaded and to get the schools quickly than to have too many under construction and too few completed.
    Mr. Swingler: Is the Minister not aware that she has told me in answers

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    to Questions that the increase in the number of children on the school rolls by the end of next year will be 1,350,000 and not 1,150,000, and that therefore her figure for the new places to be provided by the building programme must be at least 200,000 short?
    Miss Horsbrugh: No, if the hon. Gentleman will look at this, he will see that it is not nearly as simple as that. We have to take into account both the new schools to be provided in the new housing areas, where there are no schools, and the places that are left in the schools from which the children have to come. It is a very complicated matter, and I am willing to explain to him how the calculation is made. The calculation is exactly the same as that made by my precedessor. It works out at 1,150,000 places required, and under this programme we should have them.

    Classes
    Lieut-Colonel Liptonasked the Minister of Education how many primary and secondary school classes there now are with over 60 pupils; where these schools are situated; and what special steps are being taken to reduce the numbers in those classes.
    Mr. J. Johnsonasked the Minister of Education how many classes containing over 60 children there are in primary and secondary schools; and what steps she is taking to abolish these.
    Miss Horsbrugh: Full statistics for 1952 are not yet available, but of the 15 classes recorded as having more than 60 children on the register in January, 1951, only four remained of this size in January, 1952, and the children in them were grouped for registration purposes only. They were actually taught in much smaller groups.
    Lieut-Colonel Lipton: Does that mean that there are no classes now with more than 60 pupils being taught by one teacher? If that is so, it will mean that a horrible blot has been removed from our educational system.
    Miss Horsbrugh: I hope that more blots will be removed shortly.
    Mr. Johnson: Is the Minister aware of the intense feeling at all teachers' conferences about the size of classes, and
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    will she, as a gesture, issue one of her now famous circulars outlawing any class of over 60 under any circumstances whatever?
    Miss Horsbrugh: All the figures I have given on the subject of the number of teachers and the size of classes, as the hon. Gentleman knows, refer to the time when my predecessors were in office. The figures I have quoted about the training of teachers come from the report of the National Advisory Committee. I have only given the suggestions of those who are carrying on this work and the figures that were produced by my predecessors. If the hon. Gentleman knows any way of doing what he suggests without outlawing the children from the schools, I shall be very glad to hear about it.

    Development Plans
    Mr. J. Johnsonasked the Minister of Education the aggregate amount to be expended in the development plans of the local education authorities of England and Wales.
    Miss Horsbrugh: I regret that this information is not readily available.
    Mr. Johnson: Is the Minister aware that the amounts, if not available, are astronomical, and that all teachers are sceptical that these monies will ever be spent? Can she give the House some idea of her feelings on the future of these development plans?
    Miss Horsbrugh: I have never before been asked to give any idea of my feelings, but I am very willing to do so. I am confident that the plans in regard to the building programme and the teachers, which I have announced in this House, are based on good schemes, and I am extremely optimistic that some day I may have praise from the hon. Gentleman for having fulfilled them.

    Technical Colleges (Enrolments)
    Mr. J. Johnsonasked the Minister of Education the numbers of part-time and full-time students, respectively, in technical colleges for the session 1951–52; and what are the estimated numbers for the session beginning September, 1952.
    Miss Horsbrugh: This information is not yet available.
    Mr. Johnson: Is the Minister aware that teachers in technical colleges,

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    particularly in the London area, are much disturbed about the falling off in development so far, and that they are blaming the diminution of enrolment on her circular No. 242 which has increased the fees for courses beginning in September of this year?

    Nursery Schools
    Mr. Lewisasked the Minister of Education if she is aware that nursery classes at four West Ham primary schools are to be closed down temporarily in September because of the shortage of teachers; and, in view of the concern felt by the parents affected, what action she proposes to take to rectify this position.
    Miss Horsbrugh: On my present information I do not regard it as unreasonable that the authority should close nursery classes in order to provide more teachers for children of school age.
    Mr. Lewis: But is the Minister aware of the fact that there is difficulty in West Ham in getting teachers for this type of class because of West Ham being bombed out and housing accommodation not being available? If the local education authority can get extra teachers to undertake this important work, will the Minister agree to allow the increased allocation for that purpose?
    Miss Horsbrugh: There is another Question dealing with teachers which I will answer later. At the present time, if there is a shortage of teachers for children of five years of age, I think the authority must be allowed to close nursery classes in order to deal with them, but I am told that there will still be four nursery schools and three day nurseries.
    Mr. Morleyasked the Minister of Education whether she has completed her consideration of the proposals of Shropshire County Council to close three of their six nursery schools; and if so, what is her decision on the proposals.
    Mr. I. O. Thomasasked the Minister of Education if she has completed her consideration of the further information she has received from the Shropshire County Council in regard to the authority's proposals to close three of its six nursery schools; and, if so, what conclusions she has arrived at thereon.
    Miss Horsbrugh: Yes, I have decided that I should not be justified in intervening in the authority's exercise of their discretion.
    Mr. Morley: On what grounds does the Minister think she would not be justified in intervening?
    Miss Horsbrugh: In two cases, the authority consider that the accommodation is needed for children of statutory school age, to whom their first obligation lies. In another case, I find that 17 out of the 25 children who were going to the nursery school were travelling six miles a day.
    Mr. Thomas: Was the Minister replying to my Question, which appears later on the Order Paper? If so, I did not catch her reply to it. Would she be kind enough to indicate what decision she has arrived at?
    Miss Horsbrugh: I have arrived at the conclusion that I should not interfere with the local authority's decision.
    Mr. Thomas: Does that mean that the Minister is in agreement with the education authority in closing three out of only six existing nursery schools in the county, and with the fact that one of the three which it is proposed to close is in the northern part of the county, which would leave that part of the county in future without any nursery school whatever? Does she consider that she is fulfilling her obligations and duties under the Education Act by sanctioning such a proposal?
    Miss Horsbrugh: Yes, because under the Education Act the statutory age at which a child should go to school is five years. In two cases, as I have said, the authority consider that the accommodation is needed for the children of statutory school age, to whom their first obligation lies.

    Teachers, West Ham
    Mr. Lewisasked the Minister of Education why she reduced the allocation of teachers for West Ham for the current year from 581 to 577, in view of the education committee's desire to extend this figure to 617; and whether, in view of the difficulties confronting this authority, she will reconsider the borough education committee's request for an additional allocation.
    Miss Horsbrugh: As the supply of women teachers is inadequate to meet the needs of all authorities, my Department, on the advice of the National Advisory Council on the Training and Supply of Teachers, fixes maximum establishments for each authority so as to secure fair distribution of the teachers available. West Ham's quota for the current year is 581, but the authority have not been able to recruit up to this figure. The revised figure of 577 for the next school year will permit the authority to employ more women teachers than they have at present.
    Mr. Lewis: While thanking the Minister for that reply, may I ask whether, if the council are by some means or other able to get additional teachers—the Minister agrees that there is a national shortage of this type of teacher—she would then agree to review the council's application to have the quota extended to their original figure of 617?
    Miss Horsbrugh: At present, I am told, their number is 572 and the suggested quota is 577. They have not got the 577, and I think, therefore, that at the moment I can say no more on the subject.
    Mr. Lewis: The right hon. Lady has perhaps misunderstood my question. If the council reach the quota of 577 that she has now given, will she then further review their need to put up the number to 617? In other words, may I take it that she has not finally rejected their request for the 617?
    Miss Horsbrugh: I am working on the advice of the National Advisory Council on this scheme. I do not say that the number need never be altered, but at present it is only fair that we should keep to this distribution scheme.

    Swimming Instruction
    Mr. Morleyasked the Minister of Education the names of the local authorities who have decided to abolish instruction in swimming or to cut it down in the coming year.
    Miss Horsbrugh: I have no comprehensive information on this matter.
    Mr. Morley: Is the Minister aware that Warwickshire and Dorset have completely abolished swimming instruction
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    and that the wealthy borough of Bournemouth has cut it down by 50 per cent.? Would she not agree that physical training is part of the essential fabric of education and that swimming instruction is an essential part of physical training? Will she rebuke and restrain these naughty authorities for cutting their instruction in swimming?
    Miss Horsbrugh: I do not think it is for me to rebuke or to restrain. The authority is given the power to make these arrangements. That authority, as the hon. Member knows, is the authority that decides the curriculum. I do not think it is for me to interfere in everything that the authority does or to rebuke and restrain.
    Mr. Hector Hughes: Is the right hon. Lady aware that this anti-swimming policy in which she persists is damaging, not only to the large number of qualified teachers of swimming, but also to the children? Will she therefore, in the public interest, reverse this policy?
    Miss Horsbrugh: This is not my policy. Under local government arrangements, it is left to the local education authorities to decide.
    Mr. Chapman: But the Minister has to approve.
    Miss Horsbrugh: I do not have to approve one way or the other. There was one matter in which I was asked why I was interferring. This matter is left to the local education authorities, and I suggest that the hon. Member should express his anxieties to them; it is up to them to decide.
    Mr. Ede: Will not the right hon. Lady express some regret that some local authorities have entirely eliminated this instruction?
    Miss Horsbrugh: No. I think I must leave it to the authorities to decide for themselves.

    University Awards
    Mr. Chapmanasked the Minister of Education whether she will suggest to local education authorities that they should maintain, in 1952–53, the present number of university awards as well as increasing their value; and whether she

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    will consider favourably any supplementary estimate which local education authorities now find necessary to achieve that end.
    Miss Horsbrugh: I am sending the hon. Member a copy of a circular on this matter which I issued last week.
    Mr. Chapman: Is the Minister aware that, despite several Questions to her, we still have not got policy clear on this matter? Will she state quite clearly and categorically whether it is her policy to take all necessary steps to keep up the total number of public awards for university education? She has not yet given that assurance to the House.
    Miss Horsbrugh: I have made it clear in the circular that I have only just sent out, having gone into the matter very carefully, that I have not asked for any economy whatever in the subject of awards. I do not think that it can be kept entirely by numbers, because it depends from year to year on how many people have come up to the standard at which they could profit by a university education. I think hon. Members would agree that to lay down an exact number for each education authority would not be the best way of doing it. I have asked for no economy whatsoever.

    Divisional Executive, Monmouthshire
    Rev. LI. Williamsasked the Minister of Education what her intentions are with regard to the proposals of the Monmouthshire Education Committee for interfering with the work which is being done by the Abertillery, Ebbw Vale and Nantyglo Blaina Divisional Executive.
    Miss Horsbrugh: I have not as yet received any such proposals from the Monmouthshire local education authority.

    Building Programme
    Mr. F. Willeyasked the Minister of Education the value of the educational building programme at present under con struction; and the amount for the corresponding period last year.
    Miss Horsbrugh: £106 million and £110 million, respectively.
    Mr. F. Willeyasked the Minister of Education the value of building projects approved for the training of teachers
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    for the first quarter this year; and how this compares with the amount for the first quarter last year.
    Miss Horsbrugh: £173,000 and £704,000, respectively.

    Gymnasia
    Mr. Fernyhoughasked the Minister of Education how many new schools with gymnasia have been erected since the end of the war.
    Miss Horsbrugh: One hundred and fifty-seven permanent new secondary schools were completed between the end of the war and the beginning of February last. So far as I have been able to ascertain in the time available, each of these schools has a gymnasium. Separate gymnasia are not provided in primary schools.
    Mr. Fernyhough: In view of the fact that there has been this number of new gymnasia completed since the war, will the right hon. Lady now give serious consideration to permitting the Durham education authority to finish the gymnasium at Boldon Colliery Modern School, which has been partly completed for 13 years and is an eyesore, whereby children are being denied a facility they ought to enjoy?
    Miss Horsbrugh: I will certainly look into the matter. I am very sorry it has not been completed for 13 years, but I have not been responsible for all that time.
    Mr. Fernyhough: I am quite aware that the right hon. Lady has not been responsible and do not want the answer that the previous Government were not able to complete this gymnasium in six years. I am asking if the right hon. Lady can do anything about it.
    Miss Horsbrugh: I will look into it. I could not give a reply on a particular case which I did not know about.

    Landewednack School, Cornwall (Staff)
    Mr. Haymanasked the Minister of Education whether she is aware that the staff of Landewednack County Primary School, Cornwall, which contains 106 scholars, has now been reduced to a headmaster and two women assistant teachers, the headmaster having a class of

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    38 children whose ages range from nine to 15 years; and what action she proposes to take to remedy the bad effect these numbers must have on the standard of teaching at this school.
    Miss Horsbrugh: Yes, Sir, but I do not consider that any action is called for on my part.
    Mr. Hayman: Does not the Minister consider that an economy of this sort, which results in a headmaster having a class of 38 children in the seven-year range, is something which endangers the essential fabric of education in that school? Will she ask Her Majesty's Inspectors throughout the country to provide her with information on the staffing of these all-age primary schools so that we can have a reasonable and decent standard of staffing in them?
    Miss Horsbrugh: This is no case of economy. The hon. Member will recollect that I particularly pointed out that there should be no economy in staffing. This staffing is the responsibility of the local authority. The numbers laid down as absolutely necessary were laid down in the time of my predecessor— there is no change. I quite agree that if the numbers in this school were to increase by even very few it would be absolutely necessary—and we would point the matter out—for a fourth teacher to be employed.

  OSTERLEY PARK (PUBLIC ADMISSION)
  Mr. Wyattasked the Minister of Education when she proposes to open Osterley Park, Middlesex, to the public.
  Miss Horsbrugh: I cannot at present give any definite date; the opening of the house to the public will depend on the availability of the necessary additional staff.
  Mr. Wyatt: Is the right hon. Lady aware that last night in the House the Financial Secreary said that the economies imposed by the Treasury did not require any museum or gallery to restrict any of its facilities to the public? As the house in question comes under the auspices of the Victoria and Albert Museum, will she contact the Director to ask how he proposes to keep up to the standards of efficiency and improvement
  2420
  which are required by the Financial Secretary in order to open this house, whose opening has been long delayed and was due in the summer, because the Financial Secretary says that it could be opened?
  Miss Horsbrugh: As, no doubt, the hon. Member knows, this is an extension and would need an extra number of people to look after it. I have been in touch with the Director of the Victoria and Albert Museum and it is up to him to arrange how the staff are employed in the different museums. I must leave it to him to see whether there is any staff that he could now supply for this extension. This is no cutting down, but an extension.
  Mr. K. Robinson: Will the Minister take this opportunity of correcting a rather misleading impression in her written answer of a fortnight ago, in which she declined to sell Osterley Park? Will the right hon. Lady make it clear to the House that the park is not hers to sell, but belongs to the National Trust?
  Miss Horsbrugh: The Question asked was whether I would sell, and my answer was, "No, Sir."
  Mr. Anthony Greenwood: Are we to take it from the right hon. Lady's original answer that if the original staff had been made available she would raise no objection on financial grounds?
  Miss Horsbrugh: The question of availability includes also the ability to pay for the staff.

  COMMONWEALTH RELATIONS

    Freedom of Movement
    Sir W. Smithersasked the Under-Secretary of State for Commonwealth Relations if he will consult with Commonwealth countries with a view to making reciprocal arrangements to permit the unrestricted movement of members of the British Commonwealth between Commonwealth countries.
    The Under-Secretary of State for Commonwealth Relations (Mr. John Foster): The question of restrictions on the entry of citizens of British Commonwealth countries into the territories of other members of the Commonwealth is

    2421
    a matter not for Her Majesty's Government in the United Kingdom but for the Governments of the countries concerned.
    Sir W. Smithers: In order to help the policy of Her Majesty's Government of trade, not aid, will my hon. and learned Friend do all in his power to facilitate the free movement of goods and persons all over the world?
    Mr. Foster: I have given the position in regard to the independent countries of the Commonwealth.
    Sir W. Smithers: Will my hon. and learned Friend use whatever influence he has got?
    Mr. Driberg: I could not understand whether the hon. and learned Gentleman indicated assent to the last supplementary; if so, may I ask whether that includes Seretse Khama?
    Mr. Foster: I did not indicate assent.

    Prohibited Publications
    Mr. Wyattasked the Under-Secretary of State for Commonwealth Relations whether he will propose to the Governments of the Commonwealth that they should inform each other of the censorship regulations in force within each member state, so that publishers in one part of the Commonwealth will not be put to the expense of exporting books to another part of the Commonwealth, which are then confiscated by the officials of the importing country.
    Mr. J. Foster: No, Sir. Such information is readily available in that the importation of various classes of undesirable publications is prohibited in all the countries members of the Commonwealth by legislation on the lines of Section 42 of the United Kingdom Customs Consolidation Act, 1876.
    Mr. Wyatt: Is the hon. and learned Gentleman aware that, although he is usually well informed on these matters, his answer was quite inaccurate? The Minister of the Interior in South Africa, under the Customs Act of South Africa, has arbitrary power to confiscate any book he pleases without giving any reason whatever.
    Is he further aware that 3,000 copies of a book by Mr. Solly Sachs, on being imported into South Africa, were confiscated, and after the ban had been in
    2422
    operation for three weeks it was as arbitrarily lifted as it had been imposed in the first instance? In these circumstances, how are exporters of books to this Dominion to know where they are if they have not some idea about the basis on which the books will be allowed to be imported or rejected?
    Mr. Foster: It must be a matter for the South African Government, and any information required must be sought from the appropriate South African authorities.

    Far Eastern Policy
    Mr. Cocksasked the Under-Secretary of State for Commonwealth Relations whether, in view of the problems which will continue to exist in the Far East, even after the conclusion of an armistice in Korea, he will consult with the Governments of India and Pakistan with a view to arriving at a common policy.
    Mr. J. Foster: A regular exchange of information and views is maintained at all times between the United Kingdom and all other Commonwealth countries. In the course of this exchange with India and Pakistan the objective to which the hon. Member refers is constantly borne in mind.
    Mr. Cocks: Does not the Minister agree that these countries are in a unique position to serve the cause of peace and co-operation in Asia, and that a closely worked out policy based on agreement between them and Her Majesty's Government would be likely to produce excellent results?
    Mr. Foster: We do maintain the closest consultation with them in order to achieve the objective which the hon. Member has in mind.

    Dominion Status (Consultations)
    Mr. Haleasked the Under-Secretary of State for Commonwealth Relations, in view of the present policy that the Commonwealth should be consulted before changes involving Dominion status are made, what consultations have taken place and with what result between Her Majesty's Government and the Governments of India, Pakistan and Ceylon with reference to the proposals for closer co-operation in Central Africa.
    Mr. J. Foster: The proposals (Command 8573) for the federation of Southern Rhodesia, Northern Rhodesia and Nyasaland do not involve any change creating full and independent membership of the Commonwealth. The necessity for consulting other Members of the Commonwealth has not therefore arisen.
    Mr. Hale: Would not it be a good thing to consult and find out the opinion of the Asian countries on these important changes? Is not the Under-Secretary aware that the Prime Minister said the other day that any change in the situation in West Africa would have to be submitted to the Union of South Africa for prior consideration? Has not he been made aware of the overwhelming feeling against these proposals in the kraals and in the Far East, and does he not realise that public feeling is being roused to a very considerable degree and should he not consult them before going further?
    Mr. Foster: No, Sir.

  BAMANGWATO RESERVE (TRIBAL DISPUTE)
  Mr. Dribergasked the Under-Secretary of State for Commonwealth Relations if he will make a statement on the situation in the Bamangwato tribe, following the resignation of Keaboka Kgamane from his position as senior tribal representative.
  Mr. J. Foster: I would refer the hon. Member to the statement that I made on 10th June.
  On 5th June the Resident Commissioner addressed a message to the tribe. He contemplates calling a conference of men of standing and integrity in the tribe to discuss the next steps. The Resident Commissioner has also announced that the Administration would welcome the formation of a representative council to assist the District Commissioner until a new chief has been appointed.
  Meantime, the Reserve is quiet, law and order having been effectively restored.
  Mr. Driberg: From what the hon. and learned Gentleman says, can we take it that no ill effect has followed the return of the delegation from London?
  Mr. Foster: I do not know what the hon. Member means by that. There was an ill effect of three policemen being killed.
  Mr. Driberg: I am afraid the hon. and learned Gentleman did not understand. Could he say that no ill effect has been a consequence of the delegation to the United Kingdom and the return of those delegates from London?
  Mr. Foster: As I say, there was the ill effect of three policemen being killed.
  Mr. Fenner Brockwayasked the Under-Secretary of State for Commonwealth Relations if he has received a reply to his inquiry regarding the claim of the Bamangwato delegation that the reply of the Secretary of State for Commonwealth Relations was read in full to the kgotla held in Serowe on 21st May.
  Mr. J. Foster: The tribesmen constituting the deputation were informed before they left London that my noble Friend expected them to convey in a proper fashion to the tribe the terms of his reply to their representations. On their arrival in the Protectorate they were further informed that a representative kgotla had been called for 23rd May for this purpose.
  I understand that despite these arrangements members of the deputation went straight to the kgotla ground on their arrival at Serowe and there read out the Secretary of State's reply. Only those persons who had gone to meet them were present, to the number of about 1,000. It was not a representative or properly convened kgotla and the deputation's action did not comply with or in any way fulfil the obligation which rested on its members.
  Mr. Brockway: While appreciating the fact that it is now acknowledged that the delegation did read the reply from the Minister, may I ask whether it is not the case that the tribe objected to an infringement of the custom that a kgotla should be called by the tribe and not by the officials of the Government, and that in fact the attendance of 1,000 to whom the Minister's reply was read in full on 21st May was a larger attendance than came to the kgotla on the 23rd?
  Mr. Foster: Yes, but the hon. Gentleman is probably aware that the kgotla

  2425
  on the 26th May was called at the request of the deputation in that they had asked for it to be postponed until then.
  Mr. Fenner Brockwayasked the Under-Secretary of State for Commonwealth Relations if, in view of the report on prison and transport conditions, a copy of which has been sent him, he will ensure that the members of the Bamangwato tribe, Bechuanaland, arrested on 26th May are confined and transported under humane conditions.
  Mr. J. Foster: My noble Friend is satisfied that proper and humane treatment is being given those who were arrested on 26th May. The hon. Member will appreciate that until suitable accommodation could be provided for the unusually large numbers involved, temporary arrangements had to be made.
  Mr. Brockway: While I appreciate that, may I ask if it is not a fact that, according to the report of the solicitor of the accused, 78 persons were gaoled in a motor shed 30 feet square; that women prisoners were conducted by male police into the veldt when they had to relieve nature; that two leaders of the delegation and 19 others were removed 200 miles at midnight in open motor trucks clad only in the clothes in which they were arrested; that prisoners were beaten up in the presence of European police; and that they had no food from Saturday at 6 p.m. until 12.45 on the following day; and whether he will take steps to prevent a recurrence of these incidents?
  Mr. Foster: To answer all those points I shall have to take a long time, I am afraid. They are not true. First, with regard to the point which the hon. Member raised about the police beating up the prisoners, there is no truth in that report. After the three policemen were killed the injured prisoners admitted to hospital, who consisted of two at Serowe and two at Palapye, had injuries which were caused before their arrest—they had already been injured at the time of arrest and had presumably incurred their injuries in the earlier riots.
  All persons arrested were offered medical examination. Some women complained that they had been bruised by the police, and one man stated that his ribs had been bruised. Apart from the
  2426
  hospital cases to which I have referred, the medical officer found a few bruises but no serious injury. Other prisoners took advantage of the examination to get treatment of complaints of long standing unconnected with the disturbances.
  The reply to the hon. Member's Question about the gaoling of 78 persons in a motor shed is that in the emergency the authorities had to make use of whatever accommodation was available. If the rioters experienced any discomfort they were in a sense themselves to blame. The garage was open on one side but that was completely closed in by banked 44-gallon drums. It has been put to similar use on previous occasions. On 3rd June, after the despatch of 23 men to Gaberones, 15 remained in the garage. The number increased to 43 on 4th June and to 79 on the 5th June.
  On 6th June when some of the men were about to be removed, the solicitor mentioned by the hon. Member asked that the prisoners should remain at Serowe for an extra day. This was agreed to and the numbers were not reduced until 36 were sent to Gaberones on Monday, 9th June. Forty-three remained in the garage until the 14th, when they were moved to a new prison camp where they were joined on the 15th by all those in custody in Gaberones.
  In regard to the hon. Member's question about their removal in open trucks clad in the clothes in which they were arrested, the reply is that lorries were used for the transporting of prisoners between Serowe and Gaberones. Some had roofs and some had not. This is the normal means of transport by those Bechuana who can afford it. It is that used when tribesmen are brought to Serowe for kgotlas. It is correct that the prisoners wore the same clothes as when arrested. Additional clothing is not provided for prisoners under trial. The minimum temperatures at Serowe from 3rd to 14th June averaged 44.67 degrees.
  With regard to——
  Hon. Members: Oh.
  Mr. Speaker: The supplementary question was a very long one and required a long reply to answer it properly. Two reflections which cross my mind is that supplementary questions requiring such long answers should not be asked; and that if a long statement is necessary, it should be circulated.
  Mr. Brockway: On a point of order. I did supply the Under-Secretary with these facts in detail. I asked him a question on the report with which I supplied him, and it was only because in his answer he did not meet the points in that report that it was necessary for me to put my supplementary question.
  Mr. Foster: Further to that point of order. It would, I think, be unfortunate if the idea got abroad in the country that there was any truth whatever in these allegations. I have only one more point to answer, and I should like your indulgence, Mr. Speaker, to do so.
  With regard to the hon. Gentleman's question about the conducting of the women by male escorts when they had to relieve nature, I would explain that there is only one female wardress employed at Serowe. When it is necessary to take women prisoners into the open, as for example for identification parades, or other purposes, the wardress is accompanied by a police guard. She is so accompanied when she takes them into the open for purposes of nature. On these occasions the male escort remains within calling distance but out of sight of the place used by the women. In Serowe, which covers a large area, there are no public conveniences except in some of their tribal institutions.
  Mr. Bellenger: Would not it be fair to hon. Members, who also have in mind important Questions which they wish to ask, that important statements like this to be made by the Minister should be made at the end of Questions?
  Mr. Speaker: On the other hand, the right hon. Gentleman will see that it is difficult for the Minister, when a number of allegations are made, to allow them to go uncontradicted.
  Mr. Brockway: May I say I do not——
  Hon. Members: No.
  Mr. Speaker: Order. I think we ought to pass on.
  Mr. Brockwayasked the Under-Secretary of State for Commonwealth Relations how many persons have been arrested in connection with the recent disturbances among the Bamangwato tribe in Bechuanaland; how many of the members of the recent delegation to London
  2428
  are included among them; and who are the members of the Bamangwato tribe with whom negotiations have been opened for the appointment of a new chief.
  Mr. J. Foster: One hundred and sixty-seven persons were arrested of whom two persons were later released. Those arrested included Keaboka and Peto Sekgoma who were members of the recent deputation.
  The Administration have not yet begun to discuss with the tribe the appointment of a new chief. But in a message addressed to the whole tribe, which has been widely distributed throughout the Reserve, the Resident Commissioner has stated that well known men of standing and integrity will be called to a conference to discuss the best means of carrying out the policy embodied in the recent Order in Council.
  Mr. Brockway: May I ask the hon. and learned Gentleman whether one of the arrested members of the deputation was the senior tribal representative, and should there not be a representative to keep contact between the tribe and the Government officials?
  Mr. Foster: Until the conference takes place the District Commissioner will have to administer the tribe.
  Mr. Sorensenasked the Under-Secretary of State for Commonwealth Relations what further steps have been taken to consult and inform the Bamangwato people in respect of the chieftainship and of any progress towards administrative and governmental revision.
  Mr. J. Foster: In accordance with the message of the Resident Commissioner to the Bamangwato tribe on 5th June, well known men of standing and integrity will be called to a conference to discuss the best means of carrying out the policy embodied in the recent Order in Council which was designed to put an end to the present emergency and to ensure that the Bamangwato tribe should be restored to unity under a new chief.
  Mr. Sorensen: Can the hon. and learned Gentleman be a little more specific in his reply to the latter part of my Question regarding any progress towards administrative and governmental revision.

  2429
  particularly in view of the fact that this was at one time promised? I should like to know whether anything has been done.
  Mr. Foster: Since the riots we have to await the conference. The Reserve is a big one and the message has to go out. The court proceedings must, I think, at least begin before that can be done.
  Mr. Sorensen: Could the hon. and learned Gentleman say approximately when a further meeting will be called for the purpose mentioned in the last part of my Question?
  Mr. Foster: We must leave that to the local administration.
  Mr. Hector Hughesasked the Under-Secretary of State for Commonwealth Relations whether the charges against the 165 members of the Baman-gwato tribe, now in custody and awaiting trial, have now been formulated and published; what are those charges; what provision has been made for the defence of the accused persons by qualified lawyers; and when, and where, the actual trials will take place.
  Mr. J. Foster: A preparatory examination is at present being conducted into the charges against these persons. This is the normal procedure in the Protectorate in cases involving serious charges.
  Those taken into custody at Serowe are at present charged with sedition and for in the alternative public violence; those at Palapye with public violence and/or in the alternative obstructing the police in the performance of their duty. The result of the preparatory examination will determine the offences with which they are finally charged and the courts in which they are to be tried.
  I am obtaining from the High Commissioner information about the arrangements for the defence of the accused persons and will communicate it to the hon. Member.
  Mr. Hughes: May I take it that these men will not be brought to trial without having proper legal advice? Is the Minister aware that the Government handling of the causes which led to these arrests are contrary to the best interests of the tribe and the British Commonwealth, and of the relations of coloured
  2430
  people with the British people; and will he take steps, other than by petty police court proceedings, to remove the causes which led to this disturbance?
  Mr. Foster: I am not aware of those facts. In fact, I think the opposite is the case. I am finding about the events.
  Mr. Gordon Walker: Can the hon. and learned Gentleman give any idea when the trial is likely to take place?
  Mr. Foster: I have to find that out.
  Mr. Baldwin: In formulating any charges against these 165 members of the Bamangwato tribe, will the Minister consider formulating similar charges against that tribe in this country who are always stirring up trouble in the minds of primitive people, which eventually leads to death?

  TRADE AND COMMERCE

    Textile and Clothing Standards
    Mr. W. T. Williamsasked the President of the Board of Trade when he will be in a position to announce the qualitative specifications which he intends to replace the former Utility specifications.
    The President of the Board of Trade (Mr. Peter Thorneycroft): During the past three months the industries concerned, in association with the British Standards Institution, have made considerable progress towards the establishment of new textile and clothing standards. As the statement of progress to date is rather long, I propose, with the hon. Member's permission, to circulate it in the OFFICIAL REPORT.
    Mr. Williams: While thanking the Minister for that reply, may I remind him that already there are large quantities of shoddy goods on sale? Is he taking any action to prevent the sale of such goods?
    Mr. Thorneycroft: I would say in answer that the British public today can get better value for money in the shops than at any time since the war. [HON. MEMBERS: "But they have not the money."]
    Following is the statement:
    ESTABLISHMENT OF TEXTILE AND CLOTHING STANDARDS
    1. Work completed.
    All concerned have agreed specifications, which will be published shortly, for:

    Mattresses, pillows and bolsters.

    Safety boots and shoes (with reinforced toe caps) for miners and other industrial workers.

    Infants and girls' light outerwear—play overalls, buster suits, rompers, blouses and gym tunics. (There has been a B.S.I. Standard for children's dresses since 1950.)

    2. Standards in draft and under discussion.
    Specifications for the following articles have been prepared and the British Standards Institution is obtaining views about them from manufacturers, distributors, users and consumers:

    Cotton apparel cloths.

    Cotton household textiles—sheets, towels, pillow cases, table cloths.

    Rayon apparel cloths (woven).

    wool cloths—standard descriptions of fibre content.

    Rubber-proofed cloths and clothing.

    Industrial overalls.

    Children's shoes.

    Rubber footwear.

    Dressing gowns for women and children.

    Berets of knitted wool.

    3. Standards proposed by industry but not yet circulated for discussion.

    Wool cloths—strength of cloths for children's wear; showerproofing of gabardine cloths

    Hosiery and knitwear.

    Rayon warp-knitted cloths.

    Braces.

    Cotton apparel cloths—certain types not covered by standards already circulated (see para. 2 above).

    Resale Price Maintenance Agreements
    Mr. W. T. Williamsasked the President of the Board of Trade if he will now take action to prevent resale price maintenance agreements unless they are approved by some suitable tribunal such as the Monopolies Commission.
    Mr. P. Thorneycroft: This would require legislation; and, as the hon. Member was informed on 29th April, I do not propose to introduce this Session legislation on this subject. I will, however, bear the hon. Member's suggestion in mind.
    Mr. Williams: In view of the fact that opposition to resale price maintenance has at last spread even to his own benches, will the Minister be persuaded by the views of right hon. and hon.
    2432
    Members opposite to end the grievous disadvantages of the practice of resale price maintenance?

    Russian Film Exhibition
    Mr. R. Harrisasked the President of the Board of Trade, in view of the public interest in the Soviet film, "The Fall of Berlin," what reciprocal arrangements are in force for showing British films in the Union of Soviet Socialist Republics.
    Mr. P. Thorneycroft: I would refer my hon. Friend to the reply which I gave to my hon. Friend the Member for Orpington (Sir W. Smithers) on 19th June.
    Mr. Harris: Is it not possible to inform the Soviet Government that while we are always glad to see Russian films in this country, we would expect the Russian Government to take steps to see that British films are shown in Russia, not necessarily of a propaganda nature, but those which show English life at its best?
    Mr. Emrys Hughes: Is it not a fact that the most popular play in Moscow at the present time is Bernard Shaw's "Pygmalion"?
    Mr. Bottomley: Would not the Minister agree that the showing of the film "The Fall of Berlin" should be encouraged as a means of stopping the growth of Stalinism?

    Radio and Television Sales
    Mr. W. T. Williamsasked the President of the Board of Trade to what extent sales of radio and television have dropped during March to May over the preceding three months.
    Mr. P. Thorneycroft: No separate figures are available of retail sales of radio and television sets but, with the hon. Member's permission, I will circulate in the OFFICIAL REPORT, figures of manufacturers' deliveries. These show that in the three months, February to April of this year, deliveries of radio sets to the home market fell by 21 per cent. compared with the preceding three months, and that the comparable reduction in all deliveries of television sets was 4 per cent.
    Mr. Williams: In view of the fact that production, particularly in relation to television sets, has fallen very little, is

    2433
    it not obvious to the Minister that what is really happening is that the Regulations with regard to television credit sales are being evaded in a wholesale fashion? Would not the Minister be prepared either to bring in new Regulations to prevent this abuse of the intention of his earlier Regulations, or to put an end to these Regulations which merely injure the lawful trader as against the illegal trader?
    Mr. Thorneycroft: If the hon. Gentleman will study the answer he will see that the figures show that the policy of Her Majesty's Government with regard to these Regulations in this field is proving quite effective.
    Following are the figures:

    —

    Domestic Radio Sets

    Television Sets(a)

    Total

    Home Market

    '000

    '000

    '000

    1951

    November

    158

    102

    74

    December

    127

    74

    65

    1952

    January

    140

    80

    64

    February

    127

    72

    70

    March

    138

    80

    71

    April (provisional)

    89

    50

    53

    (a) Deliveries are at present almost entirely for the home market.

    Film Quota Defaults
    Mr. Swinglerasked the President of the Board of Trade what advice he has received from the Cinematograph Films Council concerning the quota defaults of the Empire Cinema, Leicester Square; and what action he proposes to take.
    Mr. Wyattasked the President of the Board of Trade whether he can now say what prosecutions have been decided on for breaches of the Quota Act, 1948, for the quota year ended September, 1951, as a result of his recent consultations with the Films Council; and in particular, whether he has now decided to institute a prosecution against the Empire Cinema. Leicester Square.
    Mr. P. Thorneycroft: As a general rule, I do not think it would be appropriate for me to comment on the cases of
    2434
    individual theatres, but I am prepared to do so in this case because the hon. Member for Aston (Mr. Wyatt) has put down his Question at my invitation. After full consideration of the case of the Empire Cinema, Leicester Square, and of the advice tendered to me by the Cinematograph Films Council upon it, I have decided not to institute a prosecution in this case. On the question of prosecutions generally, I would refer the hon. Member to the reply which I gave on 10th June to the hon. Member for Newcastle-under-Lyme (Mr. Swingler).
    Mr. Swingler: Would the Minister care to explain to the House how it is that his advisers have recommended to him that the most flagrant violator of the film quota should not be prosecuted? Does this not show that his advisers have a complete contempt for the law, and, therefore, will he not do something to get a better set of advisers?
    Mr. Thorneycroft: I take my advice from the Films Council set up under legislation introduced and passed by the Government which the hon. Gentleman supported.
    Mr. Wyatt: Is it not a fact that Mr. Sam Eckman, a United States citizen, is a member of the British Films Council, is managing director of the Metro-Goldwyn-Mayer company, which runs the Empire Cinema, Leicester Square, and was called upon, in his capacity as a member of the Films Council, to give advice that he, an American citizen controlling a British cinema, should not be prosecuted under British law? Is this not an absolutely fantastic state of affairs, and is it not time that the Minister looked into the whole question of prosecutions under the Quota Act, which, with the connivance of his officials, are not being undertaken when they should be?
    Mr. Thorneycroft: The procedure under which these questions of breach of quota are examined is that introduced by legislation brought into effect by the previous Government. I am, in fact, following that procedure, as I am bound to do under the statute, and I have followed it in this case.
    Mr. H. Morrison: Why does the right hon. Gentleman evade the factual information put by my hon. Friend? Why

    2435
    does he try to rest on an Act of Parliament which was passed by a previous Parliament? Surely, the Minister has the responsibility of answering the factual allegations of my hon. Friend to the effect that a gentleman who was an offender against the law is retained as an adviser on how breaches of the law should be dealt with?
    Mr. Thorneycroft: In fact, the advice came to me from the Films Council, as such, of which the gentleman referred to is no doubt a member. The advice to which I am bound to pay attention is the advice of the Films Council as existing under this legislation.

BUSINESS OF THE HOUSE
Mr. Attlee: May I ask the Leader of the House if he will state the business for next week?
The Lord Privy Seal (Mr. Harry Crookshank): Yes, Sir. The business for next week will be as follows:
MONDAY, 30TH JUNE—Supply (16th Allotted Day)—Committee.
Debate on the cost of living with particular reference to food.
Considerations of Motions to approve the Draft Fertilisers (England, Wales and Scotland) Scheme; the Draft Fertilisers (Northern Ireland) Scheme; and the Agriculture (Field Drainage and Water Supplies) Continuation of Grants Order.
TUESDAY, 1ST JULY—Supply (17th Allotted Day)—Committee.
Debate on the Far East.
Consideration of the Motion to approve the Draft Pneumoconiosis and Byssinosis Benefit (Amendment) Scheme.
WEDNESDAY, 2ND JULY—Consideration in Committee of the Motion for an Address to Her Majesty for the erection of a Memorial to Field Marshal Smuts.
Committee stage:
Post Office (Amendment) Bill; and, if agreeable to the House, the remaining stages by about 5.30 p.m., to enable the Opposition Prayers relating to the National Health Service Regulations to be moved at an early hour.
THURSDAY, 3RD JULY—Report stage:
Motion for an Address to Her Majesty for the erection of a Memorial to Field Marshal Smuts.
Second Reading:
Housing (Scotland) Bill, and Committee stage of the necessary Money Resolution.
Report and Third Reading:
Rating and Valuation (Scotland) Bill.
Report stage:
Navy, Army and Air Expenditure, 1950–51.
FRIDAY, 4TH JULY—Consideration of Private Members' Motions.
Mr. Attlee: With regard to Tuesday's business, we should propose to take the business of Supply formally, in order to have a debate on a Motion, which will be put down, relative to the Far East.
Mr. Crookshank: As Tuesday is a Supply Day, we can meet that. It will be convenient.
Mr, H. Morrison: Is the right hon. Gentleman yet in a position to give the House any indication as to the dates with regard to the Summer Recess, or whatever arrangements might be made for the summer holidays? It might meet the convenience of the House generally to know what he has in mind.
Mr. Crookshank: I recognise that it is to the great advantage of hon. Members to know as soon as possible, but I am afraid I am not in a position to say anything today. I will make a statement as soon as I possibly can. We have a lot of business to get through, and the date does depend on the speed or slowness with which business is transacted.
Mr. Crossman: Can the right hon. Gentleman say when we shall be debating the German Contractual Agreement?
Mr. Crookshank: My right hon. Friend did refer to the matter in his speech earlier this month, but it is really very much in the hands of the Opposition, because they were offered certain dates and preferred to have it postponed.
Major Beamish: While debates on the Far East are always of the greatest importance, is it not rather a pity that the

2437
two wings of the party opposite should have a row in public in two successive weeks?
Mr. Attlee: May I remind the Leader of the House that there was an old Conservative practice at this time of the year called "The Massacre of the Innocents," in which a number of Bills dropped——
The Prime Minister: You are not an innocent.
Mr. Attlee: I suggest that there are a number of Bills which are not particularly innocent, but which might very well be dropped, some of which are not yet produced, but are threatened.
Mr. Godfrey Nicholson: Can my right hon. Friend give us the date of the termination of the Recess?
Mr. Crookshank: That is really looking rather far ahead.
Mr. J. Paton: May I ask the Leader of the House whether the promised statements by the two Ministers on their return from the Far East will be given before the debate on Tuesday?
Mr. Crookshank: We want to consult the convenience of the House, but it had been intended that they should be taken as normal statements after Questions. I dare say that, if there are any great reasons to the contrary, the matter could be discussed through the usual channels.
Sir H. Williams: Normally, statements at the end of Questions take up a lot of time, and that time is subtracted from the time of back benchers who wish to speak in the debate. Is it not very undesirable that the time of back benchers should be taken up by these statements?
Mr. Crookshank: On this particular matter, the statement deals with the same subject which has been put down for debate that day.
Mr. Harold Davies: Would not the Leader of the House consider issuing these statements in the form of White Papers for the convenience of the House?
Mr. Crookshank: I will take note of what the hon. Gentleman has said, but these are not matters for me; I am not making a statement.
Mr. Shinwell: May I ask the right hon. Gentleman whether I am correct in assuming that the statement to be made by the Minister of State in this House, and the similar statement to be made by the Minister of Defence in another place, are on the narrow point of a report on their visit to Korea, and not on the general situation in the Far East? As it might be undesirable to have a statement on that narrow point preceding the debate on the general question affecting the Far East, is there not something to be said for issuing a White Paper, so that hon. Members may examine it, and perhaps ask Questions about it on various occasions?
Mr. Crookshank: I can go no further than say that I have noted what I think was roughly the same question from the hon. Gentleman below the Gangway.
Mr. Bing: While the whole House appreciates that the constitutional position of the right hon. Gentleman prevents him from making a statement on a matter of any importance, could he not use the influence which he has with his more important right hon. Friends to see if such a statement can be issued, so that hon. Members are in a position to debate the matter with knowledge in their possession when it comes up on Tuesday?
Mr. Crookshank: I did not decide that it should be discussed on Tuesday. It is the Opposition who have chosen that subject for debate on that day.
Mr. Shinwell: I think it is desirable that there should be some elucidation in order that there may be no misunderstanding. The question of the debate on the Far East on a Supply Day is, I understand, entirely a matter for the Opposition to raise, and the Government accept that. But the reports we were to receive were on the visit to Korea of two Ministers. In view of the debate on the general issue emerging on Tuesday, will not the right hon. Gentleman consider issuing a White Paper?
Mr. Crookshank: It was announced several days ago that the statement on my right hon. Friend's visit was to be made on Tuesday, and that was within the knowledge of the Opposition when they selected the subject for the Supply Day.

BILL PRESENTED
  AGRICULTURE (CALF SUBSIDIES) BILL
  "to make provision for the payment of subsidies in respect of calves and for purposes connected therewith," presented by Sir Thomas Dugdale; supported by Mr. Boyd-Carpenter, Sir Hugh Lucas-Tooth, Mr. Nugent, and Mr. Snadden; read the First time; to be read a Second time upon Monday next, and to be printed. [Bill 124.]
  BUSINESS OF THE HOUSE
  Proceedings on Government Business exempted, at this day's Sitting, from the provisions of Standing Order No. 1 (Sittings of the House).—[The Prime Minister.]

MEMORIAL TO FIELD MARSHAL SMUTS
The Prime Minister (Mr. Winston Churchill): I beg to move,
That this House will, on Wednesday, 2nd July, resolve itself into a Committee to consider an humble Address to Her Majesty praying that Her Majesty will give directions that a monument be erected at the public charge to the memory of the late Feld Marshal Smuts as an expression of the admiration of this House for his illustrious career and its gratitude for his devoted service to the Commonwealth.
It is a year ago since the Leader of the Opposition, then the Prime Minister, proposed with the unanimous and cordial assent of the House that a suitable memorial should be erected in this country to Field Marshal Smuts. There is a rule—or at least a convention, and I think a salutary convention—that monuments to British Parliamentary figures should not be erected until 10 years after their death. It is better that the dust and stir and controversy which their active careers may have excited should come to rest, and that an after-view of their work should be taken by those among whom they lived and strove.
But this does not apply to monuments of great men outside this country from whose life's work the British people have gained precious aid, and towards whom our judgment has already been formed and about whom our gratitude is felt by all. They stand above the ebb and flow of daily life. The monument to President Roosevelt was unveiled three years after his death, and that to Marshal Foch after about the same interval. The precedents therefore fully justify us in acting in the case of Jan Smuts with the promptitude which our hearts desire.
I am proud that it falls to me to submit this Motion to the House. During 50 years I got to know him well, and he was in an ever-increasing degree my dear and cherished friend. I have on more than one occasion paid my tributes to his work and also to his memory, and I will not attempt today to repeat in a compressed or varied form all that is so well known about him in every part of the House.
His valiant fight under desperate conditions, galloping with commandos hard pressed month after month, for the independence of the Transvaal Republic of

2441
which he was a citizen; his faithful adherence to the famous act of statecraft and magnanimity which began with the Treaty of Vereeniging; his long and responsible leadership of the South African Union—those things are always in our minds. He was the man who raised the name of South Africa, with all its special, and in some respect unique, problems, to the highest rank of respect in peace and war among the freedom-loving nations of the world.
But, of course, my most vital and most intimate contacts with him were in the last Great War. My colleagues who served with me through those years, on both sides of the House, can testify how much we were helped by the profound wisdom and strategic grasp which he showed. In all their largest decisions and in all their best thoughts the British War Cabinet found themselves fortified by the spontaneous accord and advice of the South African Prime Minister, thinking out the whole vast and fateful problem for himself—alone, on his farm so many thousands of miles away.
It was a comfort to all of us, and above all a comfort to me, to feel that by this quite independent and commanding mind we were sustained or prompted in our judgment. I can hardly recall—and I dare say the right hon. Gentleman opposite will agree with me—any occasion when we did not reach the same conclusions by separate and simultaneous toil and travail of thought.
Jan Smuts did not belong to any single State or nation. He fought for his own country. He thought for the whole world. After our reconciliation and the Act of Union, he saw in the British Empire and Commonwealth of Nations one of the most potent instruments for the future progress of mankind. He fought for us with tireless loyalty and never lost that still broader view with which his life story, his learning and his philosophy had associated him.
Certainly it will be a fine thing for us to set up here in the heart of Westminster a monument which will proclaim to future generations his faith and our salute.
Mr. C. R. Attlee: I rise to support this Motion which originated at the time when I was Prime Minister. As the Prime Minister has said, there is something rather exceptional
2442
when we erect a statue to a distinguished statesman whose work has not been done mainly in this country. It is always a tribute to work done either for this country, for the British Commonwealth or for the world at large. That was the position with regard to the statue erected to President Roosevelt, who had been a great friend to this country and had done a great service in helping to preserve the free world.
Field Marshal Smuts was, of course, a leader in South Africa, and we consider him today in the light of a great Commonwealth statesman and a great world statesman. One's mind goes back to those early days when he fought against us. It is remarkable how, despite that long and bitter fight, he entirely put away from him all ideas of hatred. It is indeed remarkable that those enduring hatreds more often are found in those who did not actually suffer than in those who suffered. Field Marshal Smuts, like General Botha, put aside all those feelings. There is another parallel, a man now alive, in Mr. Nehru.
Then we recall the immense service done by Field Marshal Smuts in two world wars. I recall very well, as the Prime Minister said, how often, writing to us from right away in South Africa, he would give a most acute view of the whole strategic position. But I should like to say particularly that he was a great lover of the Commonwealth. He saw in the Commonwealth something new in the world, a union of free peoples; and I know how he rejoiced in the expansion of the Commonwealth and its growth, and in the position of South Africa and later of the other countries that joined the Commonwealth. That is one side of him which we should especially wish to commemorate.
There is another, too. He was a devoted supporter of the League of Nations; he was a devoted supporter of the United Nations. It was my privilege to be present with him at San Francisco in the framing of the Charter and, as is well known, the drafting of the preamble to the Charter, which set out its principles and ideals, really came from Field Marshal Smuts.
I think, therefore, that it is altogether right that here in the centre of the Commonwealth and Empire we should erect

2443
an enduring memorial to a great statesman of the Commonwealth, a great world statesman, and a great man.
Mr. Roderic Bowen: It would be presumptuous of me to attempt to add anything to the richly deserved tributes which have already been paid to the memory of Field Marshal Smuts by the Prime Minister and the Leader of the Opposition; but, if I may, I should like to say a few simple and sincere words on behalf of my colleagues to indicate that we wholeheartedly support this Motion and are proud to be associated with the noble sentiments which have already been expressed about this truly great man.
Question put, and agreed to.
Resolved:
That this House will, on Wednesday, 2nd July, resolve itself into a Committee to consider an humble Address to Her Majesty praying that Her Majesty will give directions that a monument be erected at the public charge to the memory of the late Field Marshal Smuts as an expression of the admiration of this House for his illustrious career and its gratitude for his devoted service to the Commonwealth.

ORDERS OF THE DAY

  FINANCE BILL
  Order for Third Reading read.
  3.55 p.m.
  The Chancellor of the Exchequer (Mr. R. A. Butler): I beg to move, "That the Bill be now read the Third time."
  Now that we have come to the Third Reading of the Finance Bill, I think we can legitimately look back, while remaining within the rules of order, on the progress that we have so far made. The Bill gives legislative authority to the Budget, and I think this debate should give us an opportunity of seeing the picture in perspective and as a whole. I undertake to the House to put as shortly as I can the general picture as I see it, so that other hon. and right hon. Members can take part in our short debate.
  All Finance Bills nowadays are complicated and many of them are long. Certainly the one which we have had before us for the past few weeks must be regarded as one of the longest and most complicated on record. It is, I believe, more than twice the length of the Bill introduced by the right hon. Gentleman the Member for Leeds, South (Mr. Gaitskell), my predecessor last year, occupying no fewer than 123 pages of reasoned print, which we have examined time and time again in detail day and night, as opposed to 51 pages last year.
  Moreover, it embodies not only a complete reconstruction of the Purchase Tax over a wide part of its field, but also the imposition of an entirely new tax in the Excess Profits Levy. This inevitably imposed a formidable task upon us when we came to consider the Bill in detail on the Committee and Report stages. As we approached that part of the task at the end of April, there were not wanting commentators and critics to take the part of Job's comforters and assure us that it would not be possible in a House of Commons so deeply and evenly divided to get the Bill through without severe limitation of time allowed for discussion of detail. It seemed to be the general feeling that the Closure would have to be applied more than once, as happened in past Bills.
  I remained undaunted by those observations because I have felt always that

  2445
  the method of discussion and debate across the Floor of this House, which has served this and previous generations so well for so many centuries, will always see us through any Finance Bill. I believe that we should be able to accomplish what we have done by what I shall call the discursive rather than the coercive method. Certainly we have had plenty of discursive opportunities, and in the end the method succeeded.
  I believe that there is great strength— and on this I based my calculations before the Bill was introduced—in the will of the House, satiated by repetitive speeches, to bring discussion to an end, and that if that joint will of the Chamber is used at critical times, without the coercive method, it is as firm and definite a method as any other. At any rate, my faith was justified; and it was a faith not in one side or the other but in the spirit of reasonableness and of sincere discussion which I believe can prevail on all sides of the House if given a chance.
  At any rate, this is an achievement of which I think the House as a whole can be proud and for which every hon. and right hon. Member on each side of the House should take credit; and I am certainly not trying to give more credit to one section than to the other. It is right and reasonable that I should acknowledge the help, as well as the buffeting and criticism, I have received from every side of the Chamber, both in the House and in Committee.
  I might also pay a tribute to those silent Members of our assembly who have restrained themselves from speaking on many occasions both day and night and without whose co-operation it would have been impossible to get this Bill through at all. They perhaps form the necessary army or column without which such a procedure is impossible.
  Although this Bill is twice as long as last year's and a great deal more complicated and far-reaching, we took only about three hours longer than last year to get through the Committee and Report stages; and we did not have to bring the discussion compulsorily to an end once. [An HON. MEMBER: "A responsible Opposition."] Sir William Harcourt, in 1894, adopted the same technique and obtained the same result in his Finance Bill imposing the contentious Death Duties for the first time, so it is possible
  2446
  to combine contentious measures with methods that this House and the Committee have followed for a long time.
  In the course of this year it was inevitable that amendments should be made to the Bill; and here I want to lead to another matter. The very fact that I have accepted Amendments or introduced Government Amendments to meet points made by hon. Members have been commented upon, by those who seem to be losing touch with constitutional procedure, as if it were the duty of the Chancellor of the Exchequer to turn a deaf ear to all criticisms, to steel his heart against every appeal, and to proceed on the assumption that the original proposals, just because they were the Chancellor's proposals, must necessarily be perfect in every detail. All I can say is that so arrogant an approach may be acceptable to some, but to me it seems the very negation of our Parliamentary institutions.
  I believe the Bill we have now is a better Bill than it was when it was introduced and that this is due to the processes of free discussion in the House of Commons and the contributions made by hon. and right hon. Members on both sides of the House. I certainly acknowledge in all humility that any defects in the original draft have largely been removed, and I hope that this is now a spotless document.
  Nevertheless these numerous improvements and Amendments have left the main structure of the Budget, upon which this Bill was founded, unaltered. I believe that events have shown and will further show that this is a Bill which contributes, so far as a Bill can, its proper share in reaching the objectives which are common to both sides of the House, namely, those of a sound economy and external solvency.
  As the House already knows, we have made great progress in the latter task, and I will simply remind hon. Members that our average weekly gold and dollar deficit of £26 million sterling in the last quarter of last year, including an average of £5 million for the debt repayment, was reduced to £17 million per week in the first quarter of this year, and so far in the second quarter has been very small indeed.
  It is not right for me on this occasion to pursue that any further; I would only say that it would be the greatest possible

  2447
  mistake to think that this is more than the beginning of the great task we all have before us. We are still faced with the formidable task of establishing ourselves firmly on an enduring basis so that we can live free from day-to-day anxiety, possessing sufficient reserves to enable us to meet with equanimity the ebb and flow of commerce and production in half the world's trade throughout the Commonwealth and the sterling area.
  This Bill deals, as far as a Bill can, with the internal financial policy, and our general objective has been to ensure that consumption, both public and personal, will not prevent us from meeting the over-riding need of the balance of payments which, in my last main statement to the House, I said must come first. But as I have said also, our policy must not be grimly negative. Though stern, it must be positive. I consider that the nation—and that has been part of the object of this Bill—should throw off some of the crippling load of expenditure, and that while we have been obliged to impose burdens for reasons which I have given on numerous occasions, we should make a significant start in reducing taxation.
  In Part III of this Bill we see a significant start in the realm of Income Tax in which millions of people are now seeing the benefit in their weekly pay packets, and there can be no doubt that this Bill to that extent will have a significant effect on incentives to production. Let me give a few human examples arising out of the staccato Clauses of this Bill.
  From now on a man earning £8 a week —say, a lorry driver—pays 4s. 5d. less tax if he is single, and 5s. 6d. less if he is married and has no children. I am not giving many cases, but here is another one. Another case one might take is that of an underground coal-face worker in the mines, paid at piece rates and earning £14 15s. a week. If he is married with two children, he will now pay 9s. 10d. less tax, together, of course, with the extra family allowance which is not included in this Bill.
  These tax reductions, of which I can give numerous other examples, benefit no fewer than 16 million taxpayers. About 1 million of them are not covered by the P.A.Y.E. scheme and so will not
  2448
  feel the benefit until next year, but the remaining 15 million are already benefiting, including 2 million who from now on under this Bill cease to pay Income Tax altogether. At the same time, I have done my best to see that the Budget surplus remains substantially unchanged in order to prevent consumption from increasing unduly.
  In the course of our detailed discussions, two main criticisms have emerged. One section wanted a larger surplus and thus a bigger cut in consumption, and others have alleged that by Amendments made in the Bill the original design has been altered so radically as to present a totally different Budget picture and too soft a one. So we have the hard critics and the soft critics.
  I explained at the time my reasons for rejecting the need for a bigger surplus or for turning the financial screw more cruelly than I decided to do in this Bill. Many industries were already faced with slack demand at home, with falling demand in the sterling area and with difficult selling conditions in the rest of the world. I judged, therefore, that to depress the home demand even further would not increase exports but would result in a further reduction in employment and industrial activity.
  I believe that the experience of the last few months has sufficiently confirmed my conclusion. Indeed, it has been sufficient to modify the view of "The Times" which, in a leading article last week, said:
  "There is no certainty at all that a more severe Budget as such would have made a greater contribution to national solvency."
  We have all been deeply concerned in these debates with the state of the textile industry, in particular in Lancashire and Yorkshire. The Government have recognised that special action was needed to prevent unnecessary hardship and loss of production, and therefore by adjusting certain D levels—and here I pay a tribute to right hon. and hon. Members on both sides of the House who have assisted with their advice in a novel method of achieving justice—with the aid of the House itself, and in adjusting rates of Purchase Tax, I have had the need of textiles, the boot and shoe industry, the glove industry in various parts of England and other industries before me. I

  2449
  am only sorry that I have not been able to satisfy one hon. Member opposite who took so noble a part in our debates in the cause of the hat industry. I do not propose to give a long catalogue of those industries which I have not been able to satisfy. At the same time, there are some who are more happy than when we first introduced this Bill.
  As the House knows, we have agreed to institute a committee of inquiry into two points in connection with Purchase Tax, and I shall in due course be making the announcements both as to the constitution and as to the terms of reference. I myself shall watch during the rest of the year the operation not only of the Purchase Tax but also of the Entertainments Duty in accordance with the undertakings which I have given. I do not think I need go further into the Entertainments Duty at this stage.
  To revert quite shortly to the more general economic picture, throughout a considerable range of consumer goods industries the pressure of home demand has ceased to be an obstacle in the way of achieving the maximum export effort and all that it means in the way of human or physical adjustment. Indeed, some people are now arguing that we need to stimulate home demand to prevent unemployment increasing. I think we must be very careful in flying to this opposite extreme, and I undertake that the Government will remain sensitive to the situation and ready to act where action can be effective.
  I now address myself to those who have expressed the view that the Bill in this final form is radically different in design from that in which it was originally presented. This contention has only to be examined for it to be shown to be thoroughly baseless. As far as the present year is concerned—the year with which I was dealing in the Budget—I thought it right, with the agreement of almost every hon. and right hon. Gentleman in the House, to sacrifice £10 million of revenue in general reductions of Purchase Tax over the field of the D scheme. That was a possibility I envisaged before introducing the Bill, and I was very ready to do it.
  I have sacrificed a further £2 million or £3 million—nearer the latter—in adjusting the D level on furnishing fabrics at the particular request of those who are
  2450
  interested in this aspect of trade in Lancashire, and about £¼ million in concessions to the low horse-power car, which my hon. Friend the Financial Secretary announced.
  Here I should like to pay a tribute to the team which has helped me throughout this Bill and, in particular, to the batting of the Financial Secretary, which has not only been accurate but which has shown that he has a style of his own.
  These concessions amount to a total of a little over £13 million in all, or less than one-third of I per cent. of the total revenue. That, I think, puts in perspective some of the wild observations that have been made.
  Mr. Hugh Gaitskell: Will the right hon. Gentleman give the figures for a full year?
  Mr. Butler: The figures for a full year would be about £17 million in the case of the first figure of £10 million—speaking from memory—and about £1 million more in respect of furnishing fabrics. That is for this year. The Excess Profits Levy does not take effect until next year.
  In this Third Reading debate it would be out of order to discuss aspects such as the main realm of Government expenditure. In any case it would not be until much later that we should be able to form a final judgment about the way things are going. At present it cannot be said that the general balance struck by the Budget has been upset and, in any case, aspects such as this are matters which are outside the realms of this Bill during the rest of the financial year.
  Before I conclude, I must add a word about next year. I can assure hon. Members that I am not going to give them any Budget picture for next year, as I am not in a position to do so. The revenue from the Excess Profits Levy will begin to come in during next year. That levy comes out of the rigorous drubbing in the wash tub in which I have been fully immersed and it is likely to give an additional yield of about £80 million, taking into consideration the revised rates of Profits Tax. The prospect of additional revenue of this order in 1953–54 is very welcome, although I must keep silent about next year's prospects.

  2451
  Summing up, I would say that the House has had before it a Bill which has been long and complicated and which has dealt with all the major taxes with the exception of those on beer and tobacco. This has given the House an opportunity, of which all hon. Members have fully availed themselves, for a detailed examination of the whole range of our taxation system. It has given many hon. Members—more than I have ever heard in previous debates—an opportunity of putting the point of view of their own constituencies and the districts with which they themselves are connected. I have found it a most profitable and most moving experience to hear the points of view of so many Members representing so many industries and so many parts of the country.
  After all this discussion, I maintain that not only has the basic design of the Budget been accepted but that the taxation system has in many respects been improved. It is in this spirit, and in the conviction that in the original Budget and in this Bill we have a firm basis on which to put right the mistakes of the past and look with hope to the future, that I commend the Bill, on its Third Reading, to the House.
  4.15 p.m.
  Mr. Hugh Gaitskell: Traditionally, the debate on the Third Reading of the Finance Bill can be likened to a period of calm water after the rapids and storms through which we have passed in the earlier stages of the debate. If I may drop the analogies, it is certainly an occasion to step back and look at the Bill as a whole. The Chancellor has done that and I propose to do the same, though he will find that my conclusion on it is rather different from his own.
  The Chancellor gave us—not at any great length—the usual prize-giving speech, and we were all complimented on our excellent behaviour. I hope that all hon. Members feel satisfied with the compliment. We have also been told what an admirable thing it was that the Closure did not have to be used; but in explaining that, I think the Chancellor might have pointed out that the main reason the Closure was not used this year was that the Opposition was a responsible one and, from the very start of the
  2452
  proceedings, set out to take an entirely constructive line to help the Chancellor, and in no sense to obstruct the debate as did the Opposition last year.
  I would at once agree that the fact that we had a greater number of days available and the personality of the Chancellor, as I think my hon. Friends would admit, have helped. The right hon. Gentleman has always been even-tempered and we have seen this afternoon how modest he is—at any rate, about his plans on these occasions. His description of the drubbing which he received in the wash tub during the discussion of the Excess Profits Levy made me feel rather sorry for him.
  I should like to join him in expressing appreciation to the Financial Secretary— who worked very hard and carried a great deal of the burden of the Bill—and also to the Parliamentary Secretary to the Ministry of Civil Aviation. I think it is rather an interesting innovation that we should have Ministers coming in from other Departments to help out the Treasury. Perhaps that system might be extended next year. There are all sorts of Ministers who could be brought in. There is the Minister of Fuel and Power. I do not know whether any of the Whips might be allowed to join in and explain some of these complicated matters.
  The Financial Secretary to the Treasury (Mr. John Boyd-Carpenter): They are Lords of the Treasury.
  Mr. Gaitskell: As the Financial Secretary reminds me, they are Lords of the Treasury, so it would indeed be appropriate for them to join in. I cannot help regretting that we did not hear more from the Minister of State for Economic Affairs. After all, even if he may have prolonged the proceedings on one or two occasions, he also enlivened them. Perhaps that fact could be borne in mind should the Chancellor by any chance be Chancellor next year.
  I should like also to express my own great personal appreciation to my right hon. and hon. Friends who have played such a magnificent part on behalf of the Opposition during these proceedings. I can tell the Chancellor that one of the great advantages about being a member of the Opposition during a Finance Bill is that one can spread the load very much more. I took full advantage of that and

  2453
  devolved most of the work on to other people, and they did it very well indeed. I should like to express once again my personal thanks to them, and I think that I can speak for the whole House when I say that, although they were not a large band, they put up an extremely good show.
  Having said all those nice things, I must turn to topics which are perhaps rather more controversial; but before I do so let me say that though we do not believe that this is a good Bill—it has been changed and improved, but in our view it is still a very bad Bill—we do not intend to divide the House on this Third Reading, simply because if we were to do so and we were to win, the logic would be that we should land the finances of the country in chaos and, being a responsible Opposition, we take that kind of thing into account. The right hon. Gentleman and his hon. Friends must not imagine from that that we in any way diminish our criticism of the Bill.
  I think we can, however, agree on this —that the Bill has been considerably changed. One can argue whether it is the same Bill at the end, or substantially the same Bill, or not, but the fact that the changes have been far greater this year than is usually the case cannot, I think, be questioned. It may be said that that is due to the excellent criticisms which have come from these benches, and some from the benches opposite. We can pat ourselves on the back to that extent. It may be said that it is due to the accommodating spirit and modesty shown by the Chancellor.
  I am bound to say that it seems to me that there is also evidence of a lack of foresight and planning, not only in connection with the Bill but in connection with the Budget, too. The Chancellor says it would be absurd to take the line, "I am not going to accept any Amendments." He says, "That would be most arrogant, and I am not that sort of man at all." On the other hand, he must surely accept the responsibility for thinking out a little in advance what he is going to say and what he is going to do, and when we find substantial changes made, apparently without any particular reason, I think we are legitimately entitled to criticise his approach to the Bill in the first instance.
  2454
  Let me take a few illustrations. The Chancellor referred in an off-hand manner to the Entertainments Duty. Frankly, I still do not know where we are as far as cricket is concerned. We have been told that, at any rate for this year—we know it is written in the Bill—there has been no increase in the Entertainments Duty for cricket; but what will the position be next year? After all, cricket clubs have to make their plans; and the Chancellor either means something when he says we will do nothing this year but will consider it before next year, or he does not.
  Either he meant that, on the whole, it is unlikely that cricket is ever going to pay the increased Entertainments Duty; or he did not. If it is not going to pay the increased duty, then, of course, we are in a quite untenable position because of the distinction between cricket and other sports. I am sure hon. Members will agree. If, however, cricket is not to benefit, then all I can say is that the Parliamentary Private Secretary has been most grossly deceived by his master, so much so that next year, at any rate, we shall certainly expect his resignation.
  The Chancellor may say, "After all, I had to see what the reaction was." But I cannot see that his changed attitude towards cricket is justified, despite the fact that the season began between Budget Day and the Committee stage of the Finance Bill, because that is something which the Chancellor knew in advance; even if, like me, he is not particularly good at cricket, we both know that the season starts about that time and that there would be considerable agitation coming from the cricket clubs.
  Mr. R. A. Butler: The right hon. Gentleman realises, does he not, that this applies to other sports, as well as cricket?
  Mr. Gaitskell: I do realise that, but the right hon. Gentleman will agree that cricket is the most important summer sport as far as the Entertainments Duty is concerned.
  Mr. Charles Pannell: It is the most important of all sports.
  Mr. Gaitskell: If we turn to the Purchase Tax, the concession of the reduction in the rates, welcome as part of a loaf, could easily have been made at the start. The Chancellor cannot say

  2455
  that he was unaware of the position in the textile industry. We had had two or three debates in the House before he made his decision on the matter. Everybody was perfectly well aware that the question of Purchase Tax was of burning interest in Lancashire. I think the right hon. Gentleman is particularly to blame here because, by not making these concessions until half-way through the Bill, he deliberately prolonged the doubt and uncertainty in Lancashire and in the trade generally. There again, therefore, one cannot see why there could not have been a little more forethought on his part at the very beginning.
  If we take the Excess Profits Levy, it is the same story. I do not propose to go through all the changes which have been made—there is a long list— but I will take a few of the more important. Take the introduction of the net assets standard. The Chancellor cannot say that that was a new idea. Everybody was aware that this problem existed and that if we took the capital standard and simply based it on nominal capital we should run into this difficulty. I confess that we had the same problem when we were considering dividend limitation, although, in my view, it was far less important then, because it was dividend limitation and not a tax. This problem clearly could have been foreseen in advance.
  Next, the minimum standard profits, which were raised from £2,000 to £5,000—an immensely important change, from the point of view of administration. Why did we have to wait until half-way through in order to get that? Next, the change in the standard years. Again, it was perfectly clear that this would be one of the burning issues. Two other important changes which were made were the reduction in the over-riding maximum, on the one side, and the increase in the rate of tax on distributed profits, on the other side.
  All these, it seems to me, are matters which clearly should have been thought out in advance, and a conclusion reached as to what was to be done, before the Bill was introduced. I must say, in passing, on the financial changes resulting from these concessions, that, if I am right, in the case of the whole year the total
  2456
  amount which the Chancellor has given away is very much as I said during the Report stage—about £40 million; that is between £20 million and £25 million net on the Excess Profits Levy and about £20 million—now that the furnishing fabrics concession is between £2 million and £3 million—on Purchase Tax. The loss is, in fact, about £40 million.
  Mr. Butler: The Excess Profits Levy does not apply to this year.
  Mr. Gaitskell: I am talking about a full year.
  Mr. Butler: But it is a different year.
  Mr. Gaitskell: Of course it is a different year, but it is, nevertheless, a year which has to be remembered when we are making tax changes and when we are giving away about £40 million.
  Apart from the changes which have been made indicating this lack of forethought and planning, we must consider whether the Bill is now really adequate. As I have said, we take the view that, although improved, it is still a bad Bill, particularly when linked with the policy behind it. Here I want to follow the Chancellor and to consider for a few moments what are the basic problems and the setting against which the Budget and the Finance Bill have had to be considered
  There is the balance of payments problem and there is the sterling-dollar problem; there are those problems which we, as a country and as a Commonwealth, have been facing for the past six years and which are now, I think, aggravated by the fall in demand for consumer goods throughout the world. I think that is the new feature of the situation.
  We have, therefore, to try to solve this problem in more difficult circumstances and we have at the same time, in order to cope with them, to secure some readjustment of our resources as between industries and certainly as between home and export. We have also, of course, to cope with a slight incipient inflationary situation at home, although certainly not as inflationary as it was, and we have also to try to maintain full employment.
  I do not think anybody would disagree with those aims, which are pretty much the same as those which the Chancellor mentioned. I would point out to him

  2457
  that on this side we have never argued against the Budget on the ground that it should have cut consumption more. We accepted the Chancellor's view—and I, personally, was glad that he took it—that in present circumstances it would serve no useful purpose to reduce purchasing power at home further at a time when the demand for consumer goods was already falling back.
  Indeed, I would go further than that; I would say that this year, perhaps for the first time for some considerable period, the relationship of the Budget to the balance of payments problem, and still more to the gold reserve, is much less close and much less clear than it was on previous occasions. I did not recognise the critics whom he mentioned who were saying that the Budget should have been a very much tougher one, unless he meant criticisms outside the House from various journals.
  Without going further into this, because clearly one would get out of order, I would say that I do not believe that the balance of payments situation as a whole can be handled satisfactorily on the basis of monetary policy and budgetary policy alone. We are in a situation where the use of physical controls of one kind or another is more than usually necessary. Unless we can get those controls used efficiently and well, we shall not be able to solve the problem.
  We have, above everything, to expand our engineering output so as to cope with increased exports and defence demands and also, if we can, with a high level of investment at home. The problem there is largely a problem of the shortage of steel and certain other metals, on the one hand, and the shortage of certain types of skilled labour, on the other. We shall not be able to deal with this problem simply by cutting down consumption. We shall have to have something much finer in the way of controls.
  The problems of the Budget this year are different from those in previous years. Nevertheless, the Budget can help. Here I come to certain criticisms which must be repeated. First, so far as the Purchase Tax is concerned, I have never felt that the Chancellor's decisions on that were at all convincing. His argument against our proposals—proposals supported at one time by the right hon. Gentleman
  2458
  the Member for Blackburn, West (Mr. Assheton) and some of his hon. Friends— that we should withdraw the Purchase Tax from textiles altogether was, in effect, that it was not sufficiently important. But, if that really was the argument, it is difficult to see why he made any concession at all, because the concession which cost £17 million would be even less significant; indeed, it would have no value and could not be justified.
  I have never shared that view. I think that the effects of removing the Purchase Tax at the moment would have been valuable. Although I agree with the right hon. Gentleman that one has to watch the internal demand situation, I should have thought that there was everything to be said for providing an increase in effective purchasing power at a point where the increased demand was wanted, namely, in relation to textiles.
  The Excess Profits Levy, although improved by Amendments, is still a very bad tax. In relation to the situation we are facing, it is particularly bad. After all, what we want is to induce firms and businesses to switch over to dollar exports as much as we can. We have to give them incentives to do that. By all means use the controls as much as possible but, as I think we all agree, those controls will be far more effectively used if monetary and incentive considerations are working with them.
  At this very time, the Government's policy will, discourage people from earning extra profits. The Excess Profits Levy will be a spoke in the wheel of that transition which I should have thought that we all thought was necessary. I need not elaborate the arguments about the waste of effort and manpower and the work of accountants, inside the firms as well as in the Inland Revenue, that will be necessary. The Amendments made to the Bill, valuable though they have been in other respects, will make matters far worse, because it is an immensely complicated affair now. A great deal of effort will be wasted in sorting it out.
  I turn to the Income Tax concession of which the Chancellor made so much in his speech this afternoon. Everybody would agree that Income Tax reductions are in themselves welcome. We would say, however, that we do not think that these tax reductions were fairly distributed in themselves. Incidentally, I will

  2459
  not say that they make nonsense, but they are not consistent with the Chancellor's continuous talk about the sacrifices which we have to make. There are a number of Income Tax payers who are not making any sacrifices at all, but are indeed better off. If the Chancellor appeals to the nation for greater effort and asks them to accept sacrifices, it is not consistent to hand out Income Tax concessions which, in the light of these changes, must inevitably go to people who are better off.
  We have argued against these changes that we should take into account not only the Income Tax reductions but what goes with them; namely, the rise in food prices. It is clear—the Chancellor never made any bones about it—that the cut in the food subsidies was designed to finance the reduction in Income Tax. I repeat, especially in view of the claims he has made this afternoon, that when we take into account the rise in food prices as well as all the other changes, then, on my calculation which has not been challenged, two out of every three people below £500 a year are on balance worse off, whereas of course the gain is predominantly to those over £500 a year.
  Mr. Cyril Osborne: Speaking on the Address on 8th November, did not the right hon. Gentleman say, when challenged by the leader of the Liberals, what he had repeatedly said, which was that the whole nation must be worse off? How, then, can he complain when only part of the nation has been made worse off?
  Mr. Gaitskell: I am grateful to the hon. Gentleman. It is true that at that time it seemed to me that it would be impossible to carry through the re-armament programme and achieve stability in our balance of payments without a reduction in the standard of living. I said so several times. In effect, however, the present Chancellor has decided that that is not necessary. I do not quarrel with that. The main difficulty is that of selling consumer goods abroad. Therefore, that argument for cutting down consumption at home is obviously much less strong.
  What I say, however, is that having established the fact, as the Chancellor has, that we do not need any total reduction in our standard of living, it is all the
  2460
  more intolerable that some people who are poor should have their standard of living reduced so that others who are rich should have their standard of living improved. That is the essence of our criticism of this main feature of the Budget.
  I must mention in that connection one consequence of this change—the reduction in tax and the increase in food prices —and that is the repercussion on wages. I thought that the Chancellor would say something about this in his remarks. The Press certainly had foreshadowed it, and we all know that he is in the middle of discussions with the Trades Union Congress committee. I have repeatedly stressed the danger of the wage-price spiral. I do not propose to change my mind on that because I am in opposition. Indeed, in a recent speech at Whitley Bay, which the Chancellor may have read, I emphasised the difficulties to one of our largest trade unions.
  But I must point out to the Chancellor that he carries a responsibility here as well. It really is unreasonable to go to the trade union leaders, all of them responsible men, and say, "We want wage restraint; we want to hold wages stable," and at the same time to act as he has done in the Budget and deliberately put up food prices. In passing, I must say that I have some sympathy with the Chancellor in this matter because of the extraordinary statements made by some of his colleagues on this subject in the past.
  I dare say that he is sometimes reminded by the trade union leaders of what the present Minister of Works said on the whole subject. He made a speech which was so popular with the Leader of the Conservative Party that it was ordered to be printed and circulated to candidates. He said:
  "From its earliest days I have been against the wage freeze. It is a policy for covering up inflation at the expense of the active people in the country. Bad Chancellors resort to it as drunkards cling to lamp-posts, not to light themselves on their way but to conceal their own instability."
  I dare say that the T.U.C. are asking the Chancellor what he is doing about the lamp-post now and whether he still finds it necessary to hold himself up in that way. I hope that, somehow or other, he will make it plain, if it is the case, that the policy of the Government is not

  2461
  that put forward by the Minister of Works in that speech and that the Government recognise that here is a grave and serious problem.
  Of course, the Minister of Works was not the only one. Some of the backroom boys and the brighter young men in the Conservative Party came out just before the election with a pamphlet called, "The New Approach" which had a foreword by the right hon. and learned Gentleman the Home Secretary. I am not sure it was not the foreword that got him into trouble over the trade unions, so that he did not go to the Ministry of Labour. But there were hon. Gentlemen opposite taking a most extraordinary line on this One of them was the hon. Gentleman the Member for Woking (Mr. Watkinson), who is now Parliamentary Secretary to the Ministry of Labour. He said in his pamphlet:
  "Was there ever a more ludicrous situation than trade union leaders supporting a wage freeze."
  I really think some effort should be made to clear up this muddle inside the Conservative Party, although we know it is very difficult to clear up muddles inside the Conservative Party; but this muddle is a serious one because of the effects it may have on the trade unions.
  But, of course, far more important than these outpourings from hon. Gentlemen opposite has been the fact of the food subsidy cuts. I know that it is said, "Well, after all, they only put up the cost of living by 3½ per cent." Well, that is a quite substantial increase—and, by the way, we have not had the whole of it by any means yet. I would say to the Chancellor that he cannot think of this thing entirely in quantitative terms. There is a psychological aspect to the whole situation which must not be ignored.
  If he had decided, instead of cutting the food subsidies, to say to the House— perhaps, he would have liked to have done so—that he personally felt there was a great deal to be said for cutting the food subsidies and reducing the taxation to that extent, but that in view of the repercussions on the wage situation he had decided against it, because he was so anxious to have happy and friendly relations with the unions and to work jointly with them on this extraordinarily difficult problem, what a very much better atmosphere we should have today. How much
  2462
  easier his own task would have been; and he could, I think, also have said that, while import prices are rising fast, it is extremely difficult, of course, to cope with the wage situation. Inevitably those rising import prices find their way into retail prices and the cost of living goes up, and then, of course, we get the demand, inevitably, for higher wages.
  But we are precisely at the point where the rise in import prices has slowed down. Increases in the food import prices in the first six months of the present Government have been at a much slower rate than during the previous six months or the six months before that, and I think the Chancellor had a real opportunity of saying to the unions, "We are getting through this difficult period of world inflation, and we have got to try to hold the situation as it now is." He has thrown that away, and nothing he can say and no appeals that he can make can really dissuade us from the belief that he made a most grave error in that decision to reduce the food subsidies.
  The Government, as we all know, are becoming increasingly unpopular. They are now, of course, very much aware of that, and are seeking by various desperate efforts to retrieve the situation. The more they try to do that, the worse muddle they get into. I think their fundamental mistake here is to suppose that their unpopularity is due to the economic difficulties facing the country. I do not believe that is true in the least. I believe that if the country is told that there are these economic difficulties imposed on us from outside and that certain unpleasant things have to be done, the people will face up to them, and the Government would lose no popularity in doing that.
  Their unpopularity is due to three causes: first, because, of course, of the glaring contrast between the promises and the picture painted before the Election and what is now said and done; second, because of the reversal of the fair shares policy carried out, in particular in this instance, by the reduction of the food subsidies; and third, of course, by the general muddle and incompetence and vacillation shown on every possible occasion.
  This Bill, and the Budget which preceded it, illustrate all three of these weak-

  2463
  nesses. The Bill will be a monument, first of all, to the indiscretion of the Prime Minister in putting an Excess Profits Tax into the Conservative Party manifesto. It will be a monument to the Government's failure to comprehend the real needs of the situation, and it will be a monument to a policy which is destined, I am afraid, to divide the country instead of uniting it to face the great economic difficulties which lie ahead.
  4.45 p.m.
  Mr. Ralph Assheton: I am very tempted to join issue with the right hon. Gentleman the Member for Leeds, South (Mr. Gaitskell) over the latter part of his speech. If the present Government are in any sense unpopular, their unpopularity comes from their having to pay for the sins of the Government which preceded them. That is a fact of which a great many people in this country are very well aware.
  I am one of those who occupied some of the time of the House during the course of the Bill, though on no occasion did I make a speech of any length, and now I should like to follow the right hon. Gentleman the Member for Leeds, South in congratulating the Chancellor upon— to follow his analogy—bringing this ship safely to port in spite of a number of squalls on the way, during the course of which, I am bound to say, the Chancellor handled the vessel very adroitly.
  I should like to thank him both for myself and on behalf of hon. Friends of mine who co-operated with me during the Committee stage of his unvarying courtesy throughout the whole of the proceedings, and for the great pains he took in examining, and in many cases accepting, Amendments which we moved with a view to improving the Bill. He accepted those Amendments only when he thought they were right. I entirely agree with the Chancellor that it is the work of this House, and particularly of the House in Committee on a Bill, which enables a Bill to be improved and enables the Chancellor to take advantage of such advice and criticism as he receives during the course of the Bill.
  I should like also to add my word of thanks to the Financial Secretary, who was such a very stalwart lieutenant of
  2464
  the Chancellor throughout the whole of the proceedings.
  My main criticism of the Bill is the same criticism as I have made of every Finance Bill since 1945—that is, that it is designed to raise too large a sum of money by way of taxation from the citizens of this country. Over £4,500 million in taxes is, in my opinion, more than the country can afford if our trade and commerce are to survive, much less to expand. It is, in fact, the heaviest burden of taxation which has ever been imposed by any Chancellor in this House. I feel that there is a particle of truth in a doggerel rhyme, which hon. Members may know, and which is sung to the tune of "Pop Goes the Weasel":
  "Everyone has his political views.
  And everybody backs his;
  But whether you win or whether you lose, Up go the taxes."
  The Chancellor, on the other hand, is quite justified in saying that, although the general burden of taxation has increased, he has done a great deal to reduce the burden for a very large number of citizens in this country by his reductions in Income Tax, and I hope that he will continue his good work. I do very fully appreciate the difficulties which the Chancellor is facing, and facing with great courage, but the one thing that I do want to urge upon him is my most sincere view that the total volume of taxation is too heavy, and that it is absolutely essential to reduce it for the well-being of the country. I believe that most sincerely and honestly, and I believe also that the employment of our people is threatened by high taxation, just as our financial stability is endangered by it.
  The Chancellor must remember not only the workers, but the "work providers"—a phrase which I did not invent, but which, I believe, Mr. Douglas Woodruff invented. It is a very good phrase indeed to remember. The work providers have got to be thought of as well as the workers, and unless the work providers are allowed some reduction in taxation, unless it is made more attractive to provide work and to employ people, then, I believe, the employment situation in this country will deteriorate.
  Great stress is continually being laid upon production, and, important though this is, I hope we shall never forget that in this country we live largely on the

  2465
  profits of commerce. In other words, we live on our wits. That is one of the things we have to do when we cannot grow enough food in our own country to feed ourselves; we must live on our wits. Until we have once again convertibility of sterling, we are largely prevented from using our wits and therefore living upon them, so that little can be done to achieve our ambition, which is to pay our way and gradually improve the living standards and prosperity of our people.
  We need many things: we need honest money, and we need to lower the cost of production; 6ome of us will have to work harder and spend less; and finally, we must gradually dismantle the planned economy which is hampering us and preventing us from recovering. I could not disagree more completely than I do with the passage of the speech of the right hon. Member for Leeds, South when he urged greater physical controls. Until we can dispense with physical controls and rely on the sounder financial controls, we shall never again be a truly prosperous country.
  In conclusion, I should like to say that, although this Finance Bill has had a difficult and stormy passage, there have in the course of its passage been debates which have somehow or other been a useful exchange of views and thought. I believe that there was a greater understanding of the point of view of one side of the House by the other than there has been in recent years, and in this I detect a rather happier sign for the future of our country than I had dared to hope for a few years ago.
  4.53 p.m.
  Mr. Coldrick: It is not my intention to discourse on the Budget generally, and I do not propose to follow at length the arguments adduced by the right hon. Member for Blackburn, West (Mr. Assheton). I felt one could say of his arguments, like his doggerel, "Pop goes the weasel," because at one stage he suggested that whatever we do the taxes go up, and he then proceeded to praise the Chancellor for having brought the taxes down. If we have to live on our wits, as he suggested, rather than on work, I am afraid we shall all be bankrupt before the next Budget.
  On this occasion I wish only to call attention to something arising from
  2466
  Clause 38, as amended, where I think an injustice has been done, quite inadvertently, to a large number of very small people in Co-operative societies, particularly in Lancashire, and I hope that I shall have the full support of the right hon. Member for Blackburn, West in what I have to say.
  Under this Clause provision is made whereby the standard profits will be reduced by 12 per cent. on repaid shares, with the later provision that they will be increased proportionately on increased capital when making allowances in the chargeable accounting period. Owing to the peculiar composition of the capital in the Co-operative movement, all the shares are withdrawable. Consequently it is conceivable that, when the chargeable accounting period comes, people who have put a large amount of money into Co-operative societies as shares with open membership will find in a period of recession that they are obliged to withdraw those shares.
  It should be appreciated that out of the whole of the shares in the Co-operative movement only £1 out of every £4 is engaged in trade; the great majority of the people look upon a local Co-operative society as a savings bank as much as a trading establishment. Consequently, if they meet with adversity, either through sickness, accident or unemployment, they withdraw their shares. Those shares are taken from money invested at a fixed rate of interest, so that very often we find the anomalous position that, whereas the total capital actually engaged in trade and the total surplus remain precisely the same as before, because the total withdrawable shares have been reduced those local societies will attract Excess Profits Levy in a way that we feel is wholly unjust.
  I realise that this is a very technical point, but it arises because of the peculiar composition of the capital inside the Cooperative movement. Where all other firms and companies have fixed capital with limited liability, in the Co-operative societies—and I am talking mainly about small societies at the moment—there is open membership, consequently all the shares are withdrawable shares. If for the reason I have given they are placed in a position in which, with a lower surplus, they attract Excess Profits Levy, I am sure hon. and right hon. Members would

  2467
  feel that a great injustice was being done to a lot of deserving people.
  I sincerely hope the Chancellor, the Financial Secretary and others concerned will look into this problem to see whether it is not possible on some future occasion to do something in order to prevent this difficulty arising.
  4.57 p.m.
  Lieut.-Colonel Sir Thomas Moore: I was hesitating to disturb the genial, friendly atmosphere which the Chancellor encouraged until the concluding remarks of the right hon. Member for Leeds, South (Mr. Gaitskell). I propose to answer one or two of the charges he made about the failure of the Chancellor to implement our Election promises, but I should like to say, first, that this is a record Finance Bill, for me at any rate.
  In 27 years it is the first time that I have never made a speech until the concluding stage of a Finance Bill. Secondly, it is the first Finance Bill to which I have never put down an Amendment, moved a new Clause, or added my name to an Amendment put down by some other hon. Member. Thirdly, it is a faithful and fruitful implementation of the promises and pledges which my party gave at the General Election.
  The reasons for this self-imposed restraint on my part are, I suppose, obvious. In any case, they are very sound to me. We were told, timidly I admit, by the former Chancellor, but more forth-rightly by the present Chancellor, and also of course by the Prime Minister, that our situation was perilous in the extreme and that we could only save ourselves by the most hurtful, harsh and drastic methods.
  I believed then, and I still believe, that it would be wrong to seek to alter the framework which the Government considered necessary for the structure of our recovery, and so I took no part whatsoever in trying to alter the Chancellor's views. Indeed, I feel that the Chancellor was rather over-sensitive to criticism, and that he should have held more firmly to the design which he had originally created and framed to secure our economic and financial salvation.
  Here I must put on record an impression that I gained throughout the various debates on this Bill, namely, that there
  2468
  was a certain amount of cynical shadow-boxing on the part of the Opposition. I admit that there were some useful and constructive speeches, and some excellent suggestions from both sides of the House, but, on the whole, the Opposition knew it was shadow-boxing. They knew that it was a good Budget and a good Finance Bill. They knew that it was a necessary Budget and a necessary Finance Bill. They knew that they would have to introduce a similar Budget and Finance Bill, had they the courage and honesty to do so.
  That sentence brings me back to the Election and the reasons for it. The then Prime Minister knew that he had only two alternatives—to go on and to go bankrupt, thus exposing the whole Socialist philosophy, slogans and patitudes with which they had deluded the country for a quarter of a century, as bogus, or of going to the country and hoping that we would get in, believing that we would rescue and restore the country, and thinking that the Measures that we would then have to impose would be so harsh and make us so unpopular that the Leader of the Opposition and his hon. Friends would, in a few years' time, succeed to a solvent concern.
  They took the latter course and were proved right from their point of view. Everything has come to pass as they anticipated, except the last contingency. I am convinced that when this Government has fulfilled its purpose and its mission that it will be hailed if not with hosannas, at least with gratitude by the people who will send us back for the many years that may well be necessary to restore the financial economic and moral leadership in the world which, of course, we lost through six years of Socialism.
  What does this Finance Bill do as it has finally emerged, and how does it— and here I come to the point raised by the right hon. Gentleman—tie up with our Election pledges? I am not going to refer to balance of payments or inflationary pressure, because, as Lord Kirk-wood said in another place, the other day, these phrases do not mean anything to a vast number of our people. They say, "That is something for the boss, or something for the politician; it has nothing to do with us." They do not realise that it can alter their whole way of life

  2469
  and their whole future. I am not going to use any technical phrases; I am trying to put the position as I see it from the point of view of the man in the street.
  We promised, rightly or wrongly, that we would prevent anyone engaged in the manufacture of armaments from securing thereby any undue profit. We have E.P.L. as a result. I agree with the right hon. Gentleman the former Chancellor of the Exchequer that it may not be the best method, but that can be re-adjusted in the next Budget or in some of the later Budgets which this country will be introducing.
  Secondly, we promised that we would cut Government expenditure, which, of course, had reached fantastically high proportions under the late Government, and, as a start—and although I admit it is in a small way, but it is an indication of our good intentions—the Chancellor has knocked £50 million off the Civil Estimates.
  Thirdly, we made it clear that we would not be a party to the iniquitous principle that the poorer off people should be called upon to pay increased taxation to pay for the food, or to make it cheaper for the better off people who could well afford to pay the increased costs, and so a dramatic reduction was made in the food subsidies.
  But I admit that the Government, and, I think, the Conservative Party, realised that this desirable achievement might well hurt many people, especially pensioners, the retired and those living on fixed incomes, so the Chancellor made it possible to increase the pensions of about four million people and through improved sickness benefits and insurance rates to help another 1,500,000.
  One of the main purposes of the Conservative Party was to provide incentives —a word which has been used more often than any other word in the Finance Bill discussions; but it remains a true word, a useful word and a necessary word. Our policy was to provide incentives for harder and more productive work. So as we know—and I think that this should be repeated because it should be known to the country as a whole, as well as to the supporters of the Conservative Party who have shown a little restiveness of late because of the unpopularity which many of the newspapers have sought to impose
  2470
  upon us—that something like three million people have been relieved of Income Tax altogether, while there have been considerable reductions of taxation, involving another 14 million people.
  Finally, the Prime Minister said that we would have to follow the hard road before we could undo the harm caused to our economy by six years of wasteful and reckless expenditure, so the Chancellor has arranged that £600 million shall be cut off our imports.
  That is a very brief recitation of the faithful way in which the Chancellor has fulfilled our election pledges. Surely, therefore, it is sheer hypocrisy for the Opposition to bleat about the Budget as favouring the rich. Of course, there was one substantial mistake which the Government obviously committed. They trusted the Opposition to put country before party, and hence, of course, the policy advanced last autumn by the Prime Minister who, knowing the facts, or rather having found them out, just as the previous Government knew them, conceived that it would be in the national interest to work together to restore the country irrespective of party.
  He misplaced his faith and so was proved wrong. Hence we have now the situation, so well described by Lord Kirkwood, that the cry of wolf has been made so often that the worker today no longer believes there is an economic crisis. It may be too late to remedy that mistake, and we can only try by our actions to justify the nation's confidence, even though we are temporarily unpopular in doing so.
  Despite the excellence of the Budget and of the Finance Bill, I sometimes say, "Are we going the right way towards undoing the harm that has been done during the last few years and towards putting our affairs in order?" Somehow or other, despite the integrity of our motives, I am not sure that the result of our post-war policy has been all that we hoped for. All of us seem to have become a nation of takers; giving has taken a low place in our national virtues. All of us, it seems to me, have developed into parasites—parasites on the State and, therefore, on each other—[An HON. MEMBER: "Speak for yourself."]
  I remember that in 1944 the coalition Government, which was mostly Con-

  2471
  servative, tried to create the social and industrial target of full employment. I thought that that was a noble conception, and it seemed to satisfy most of my ideals of social justice; but since then I have continuously wondered if it has had the success for which we hoped.
  I would go even further: Is it fair to the workers themselves? In the old days, the worker—and by worker I mean all of us—had the privilege, and the very important one, of selling his labour in the best market and to the highest bidder. Under full employment he has no longer that privilege because there is no competition for his talents. I do not know the answer and time alone will clear up that doubt.
  Meanwhile, I should not like to lose this opportunity of congratulating the Chancellor of the Exchequer on the tact. patience and courtesy which he has shown in guiding this Bill through its various stages.
  Mr. Ede: Surely the worker has more competition for his labour when there are more jobs than men, when there is full employment, than when large numbers of his comrades are unemployed?
  Sir T. Moore: I agree. I do not defend at all the hateful period in our history when queues formed at the employment exchanges. I am only advancing this as a doubt because it occurred to me that the worker has not the same privilege as he seemed to me to have when he could go from one employer to another to see what he was offered for his services. That may not agree with all the theories we have heard about the values of full employment but it is common sense.
  Mr. A. Woodburn: Is the hon. and gallant Gentleman referring to the time about which Burns wrote, when
  "…man was made to mourn?"
  Mr. Deputy-Speaker: We appear to be getting rather wide of the Third Reading of the Finance Bill.
  Sir T. Moore: I was about to conclude, Mr. Deputy-Speaker, by congratulating my right hon. Friend the Chancellor of the Exchequer upon his patience, for he
  2472
  has shown great patience, and also something more: he has given the country new confidence in itself and in its ability to survive as a great nation, and for that achievement alone he will have made his Budget and this Finance Bill memorable.
  5.11 p.m.
  Mr. Frederick Lee: The hon. and gallant Gentleman the Member for Ayr (Sir T. Moore) can always be relied upon to put a point of view which is different. He has based his congratulations to the Chancellor on the fact that the Conservative Party is carrying out its Election pledges. It was a little remiss of him not to ask the Chancellor to explain the speech he made when he announced the Election pledges in which he said that under existing conditions there would be no alteration in the food subsidies. It may well be that the hon. and gallant Gentleman's speech has made Lord Woolton's ears burn as a result of what he said about red meat.
  The right hon. Gentleman the Member for Blackburn, West (Mr. Assheton) trotted out the old theme that in this Finance Bill the Government have been hampered and have suffered unpopularity because of what they have had to do on succeeding the Labour Government. As we had a broadcast speech by the Minister of Works telling us the same story on the night it was announced that there was a surplus of £400 million from last year's Budget, and as we have also had a speech by the Colonial Secretary telling the country that we are now living on the stocks amassed by the Labour Government, it is time the hon. and gallant Gentleman forgot that one.
  I take no particular pleasure in saying that I believe that the greatest tragedy about the Bill will be its effect, maybe psychologically, in industry. The policy pursued since 1947, of trying to maintain the cost of living, even at a time when world prices were rising rapidly against us, had elicited from the trade unions an unwritten agreement that, so long as that was the policy of the Government of the day, they would exercise extremely responsible restraint in their demands on the national income.
  That feature in post-war industry, more than any other single feature, has enabled this country to come through its tremendous difficulties. The greatest tragedy of the Bill is that it has broken

  2473
  down the delicately balanced mechanism which allowed the trade unions to adopt that attitude.
  I have read with great interest of the meetings the Chancellor has had with members of the T.U.C. In view of his cynical disregard of the advice those men gave him before he made his Budget proposals, it is somewhat ironical now to ask them to accept the same basis as that upon which they have conducted their affairs for the last seven years when he himself throws overboard the very provisions which enabled the trade unions to do what they did. With some knowledge of industry and the trade union movement, I say that it is utterly and completely impossible for any member of the T.U.C. General Council now to give the Chancellor any such undertakings as he wants.
  The Chancellor may be able to say, as he did today, that in certain sections of our economy prices are being reduced— he mentioned textiles—but he must not claim that that is brought about by any policy in the Finance Bill. It is brought about at the cost of 100,000 unemployed in Lancashire and also by the decrease in consumer demand which makes it imperative that prices shall drop. No virtue in the Finance Bill has brought that about. I am not gloating, for I am not in the least happy about this, but I believe that the basic departure from the policies which have served us so well for seven years is the greatest tragedy this House has seen in a Finance Bill since the war.
  To turn to the subject of Purchase Tax, we have tried to impress upon the Chancellor the necessity for dispensing with the D scheme. Within the D scheme, the Chancellor has accepted the necessity to tax or to increase the tax upon textiles which were untaxed before the Finance Bill. That has worked to the detriment of millions of workingclass people whose standard of life benefited considerably from the fact that there was no Purchase Tax on a great range of textiles, on boots and shoes and on other types of consumer goods which are now taxed under the D scheme.
  My right hon. Friend the Member for Leeds, South (Mr. Gaitskell) mentioned the necessity to keep a close watch on what was happening in the areas where there is now unemployment. I have asked the Chancellor Questions about this.
  2474
  I have tried to point out to him that in industries other than textile inside the textile producing areas there is now a great slackening in demand consequent on the diminution of purchasing power. The Chancellor told me he was watching this, but that there was at present not much evidence of unemployment. I hope he will not wait until there is vast unemployment before he does something about it. It is obvious that unless we can in some way make up for the lack of purchasing power in those areas the industries there will suffer unemployment.
  I believe we are in a state that the country has never seen before. We have areas containing a deflationary pull alongside areas where there is inflation. I should have thought that in such conditions it would be right and proper for the Chancellor to use some of his budget surplus to ensure a different policy from the one he is now pursuing of a high Bank rate and credit restriction. Even if we look only at the textile industry we see that it is necessary that there should be more credit and that employers should have increased facilities for modernising their mills so that they have a chance to compete in the overseas market.
  Mr. Peter Roberts: Would the hon. Member be prepared to say whether the present deflationary tendency has greater weight than the inflationary tendency?
  Mr. Lee: I do not think the hon. Gentleman quite got my point. I do not think it matters for the purpose of my argument. There are inflationary tendencies in some parts of the country, but I am quite sure there is no such tendency in Lancashire and he would agree probably that there is none in Yorkshire. I do not think that this situation has ever been know before, and instead of conducting a policy which may be right in its outlook for some areas, the Chancellor should produce one which deals with the entire nation.
  It cannot be right to restrict credits, and have high bank rates operating in areas where we have vast unemployment and where further unemployment threatens us every day. Under those conditions I should have thought that the Chancellor would utilise his Budget surplus to grant easier credits to small employers, particularly inside the textile

  2475
  areas, who are now suffering from lack of credit. They could then bring prosperity back which is so necessary if our people are to have the opportunity to work in the near future.
  To attack the food subsidies in the way that the Chancellor has done was bad. It is now impossible for any trade union leader or, indeed, for the Chancellor himself to be able to convince the lower-paid workers that the right hon. Gentleman is trying to achieve financial stability in Britain, because he is pursuing a policy which enables him to give Income Tax rebates to the higher income groups at the expense of a reduction in the food subsidies, whilst, at the same time, he asks the lower-paid workers to pay more for their food.
  I repeat, it is totally impossible to discuss wage restraint with the T.U.C. or with trade union leaders, who are not wanting to be particularly awkward at all but would desire to be helpful in bringing economic stability and solvency to this country. They cannot possibly argue the Chancellor's case when hundreds of thousands of their members are advancing the same arguments as I am putting forward today.
  During the course of the Committee stage we asked the Chancellor to assist in greater measure than he was doing—I agree that he increased the allowance from £13 to £26—those serving apprenticeships in industry so as to encourage parents to put their children into a craft or send them to a university to study science and technology. As the Chancellor knows, there is a great gap between the way we are dealing with the university population and the way we are dealing with these younger people.
  Those of us who take an interest in industry can be under no delusions as to the tremendous crisis which faces British industry. I do not want to repeat the speeches which I have made before or to read extracts from the debate in another place on science and industry, but it is not now a question of appealing to the men and women in industry to slog a little bit harder. It is a question of trying to catch up with our competitors in science and technology. We are being left very far behind in the race. The relationship between industry and
  2476
  the universities is wide. There are less of our university people taking careers in industry than in any of the countries of our competitors, and there are not sufficient scientists or technologists on the boards of our great industrial firms.
  I submit to the Chancellor that merely to appeal for more and more increase in production is no answer to the problem at all. We all know the relative increase in production in the last 50 years in the U.S.A. and one can quote the same position in Switzerland and in Germany, where industry is fast recovering. If a Finance Bill is not couched in such a way that it can help us to get over these industrial and economic problems, then it is not a Bill germane to the conditions in which we are living. I ask the Chancellor to look at this problem with a view to encouraging our young people to invest their lives in the industries of our land. If he does so, he will be able, in some measure, to redress the wrongs that he has committed in this Bill.
  I will go further with the argument. When the Chancellor introduced his Budget he said his calculations were based upon the ability of the nation this year to increase production by 3 per cent. We have never yet had any calculations given to us as to how he is to get that increase and which industries are to give it to him. Perhaps the Financial Secretary will apply his mind to this matter before he comes to reply.
  The engineering industry has increased its production more than any other since the war and is now engaged in producing goods—I am not arguing the case for or against—which would be classified as non-wealth producing for this country. They are for the international emergency in which we find ourselves. The textile industry will not do it as the hon. Member for Oldham, East (Mr. Horobin) can tell us. It will not be able to contribute the level of last year. In many other industries we find the same sort of tendency. From what industries does the Chancellor expect to get the 3 per cent. increase in production? We should know, because unless he gets it this Finance Bill will make complete nonsense.
  I do not want to detain the House too long but I would direct the Chancellor's attention to the fact that we are seeing something in industry today which we have not seen since the end of the war.

  2477
  We are discussing this Bill against the background of a feeling of insecurity in employment. I took off a pair of overalls to come into this House in 1945, and I can remember what my reactions were to insecurity in employment. They are very much alive inside me now, and the same can be said of all my colleagues in the engineering and other industries.
  It would be the greatest calamity which could overtake this country if men and women in industry are again forced back in their own protection upon restrictive practices, the equal of which we have not seen since the end of the war. But how is it possible for these men and women to give their uttermost in the cause of their country when they know that by so doing they will work themselves on to the employment exchange the week after? I believe that the Labour Government which I supported did a great job of work in increasing investment in industry in capital equipment. It has had a great effect in producing the good levels of production we have seen since the end of the war, and an even greater effect in producing the knowledge in the oldest men and women in industry that, for the first time in their lives, they could go flat out at their job without any fear of working themselves on to the dole.
  I hope that the Chancellor will realise the enormous importance of this issue. If, throughout the whole of British industry, the feeling of insecurity and of the necessity to hold back comes again, the greatest effort at survival made by any nation in this century will have failed. I do not want to be too hard, but the right hon. Gentleman will have played some part in causing that failure.
  I am glad to see that the right hon. Member for Blackburn, West is now back in his seat. He told us he wanted to congratulate the Chancellor upon getting rid of planning and that the present Government were suffering from their predecessor. I put this to him in all seriousness: If the situation the present Government inherited was bad— I am not saying that it was rosy, by any means—would he have preferred them to inherit the situation that we took over in July, 1945?
  Mr. Assheton: I presume that the hon. Gentleman wants me to answer the question now. It is a fair question, and the answer is quite simple. In 1945, the
  2478
  country had just emerged from six years of most tremendous struggle. Six years later one would have expected there to have been six years of recovery and a financial position which would have matched it. As it was, the present Chancellor found himself faced with a disastrous financial position.
  Mr. Lee: The right hon. Gentleman has given me the answer. In July, 1945, we had, as he rightly says, emerged from six years of disastrous warfare. Half our Merchant Navy was at the bottom of the sea and millions of our workers were spread throughout the world. Our overseas trade had been thrown away, and rightly so, in our effort to defeat Nazism. There was national bankruptcy on a scale that no person living had ever seen. That was what we inherited. We did not complain, but we got on with the job.
  The right hon. Gentleman talks about national bankruptcy in 1951, but I say there had never been a six-year period when so much of the national income had been invested in industry as during the period before this Government inherited power. Production was on a scale never before dreamed of in Britain, while profits, wages and everything of that character were at a higher level than before. We had a £400 million surplus, and stocks on which we have been living ever since.
  Several Hon. Members: On a point of order.
  Mr. Deputy-Speaker (Sir Charles MacAndrew): We are getting very far from the subject of the Finance Bill.
  Mr. Beverley Baxter: I wanted to raise only one point, Mr. Deputy-Speaker. Many of us on this side have much sympathy with what the hon. Gentleman is saying, but does he realise that in 1945 this country finished the war owing no debts to America or to the outside world?
  Mr. Deputy-Speaker: That is just the very point I do not think can be discussed on the Third Reading of the present Finance Bill.
  Mr. Baxter: The hon. Gentleman made the point, Mr. Speaker, and you did not correct him. Why do you suddenly select me and say that I am out of order, when he was not out of order?
  Mr. Deputy-Speaker: I do not select anyone personally. Several Members got up on a point of order, so I thought I would get my point in first.
  Dr. Barnett Stross: I am satisfied, as the result of your Ruling, that a further interjection from me would have been out of order, and I will not make it.
  Mr. Lee: And I will not, therefore, remind hon. Members of the £3,000 million that we were in debt, or that Lend-Lease suddenly finished.
  I conclude by appealing again to the Chancellor of the Exchequer. I have criticised his Finance Bill. I believe it is a bad Bill for the reasons that I have tried to place before the House, and that it is essential we should concentrate on the aids we can give to industry to furnish itself with scientists, technologists, new capital and so on. The Bill does not do that and does not stand up to the situation in which we find ourselves today.
  I hope that the Chancellor will realise that in what he is doing in the Bill he is making it impossible for the trade unions to continue the support which they would undoubtedly give, irrespective of the colour of the Government, if only he would make it possible for them to do it. Even at this late stage I hope he will reconsider the wrong he has done and make it possible for the workers' side of industry still to continue the contribution they have made in the past, and want to continue to make, to the prosperity and wellbeing of the country.
  5.38 p.m.
  Mr. Hugh Fraser: The whole House has listened to the speech of the hon. Member for Newton (Mr. Lee) with interest, knowing full well his industrial experience. Surely one point must be quite clear to him and to most other Members of the House. It is that the background to the problems of British industry has been the value of the £ sterling in the international market. If that value were to collapse, and even if it were threatened, the result would be the automatic standing off of orders.
  It is clear that the measures which the Chancellor has taken have stabilised, and seem at the moment to have saved, the £. In relation to that matter, everything else falls into minor perspective. I
  2480
  am sure that the hon. Gentleman will also view with pleasure the plans of the present Government for the extension of technological education.
  I should like to mention, briefly, a problem which I have raised again and again in finance debates regarding relief to raw material production by British companies in the Empire and throughout the world. The importance of this matter has been high-lighted by the recent report of an official committee to President Truman on the question of probable world consumption of raw materials during the next 20 or 30 years. I am sure that the House will agree that through the production of raw materials we can go some way to bridge our gap with America, a country which is becoming more and more an importer of commodities like copper, and even of oil.
  The Chancellor is to be congratulated on some of the steps he has taken in this Bill to bring our taxation of mineral resources a little more into line with world practices. Allowances can be made for abortive exploration, for the acquisition of land by a mining or oil company, for exploration plant and for capital contributions to employers' welfare services. All these things will assist our companies abroad to retain their position in the world production of these short materials.
  The Chancellor has been wise in treating these extractive industries on a different basis from some of the industrial production inside this country, and on that he is to be congratulated. Of course, he needs to go still further. We must recognise that the production of these precious metals, oils, and other things is internationally competitive. We have also to accept the fact that we must bring our rates of taxation into line with world practice if we are to remain in the powerful position in which we should remain because of the immense territories we still possess overseas and because of the influence of the City of London. I hope, therefore, that he will go further in the Budget next year.
  To take two examples of the way in which the world is moving in these matters today, in Southern Rhodesia in the last two months a percentage depletion allowance has been given. At the same time, the Northern Rhodesia legislation is being introduced to write off all capital ex-

  2481
  penditure as and when incurred. Those are steps which will have to be taken in this country. The Chancellor has accepted a great deal of the Millard Tucker Report on this type of taxation. That is admirable but, if we are to get further ahead in the struggle for raw materials, we shall have to give even greater inducements to these companies.
  Owing to the difficulties in which we found the Exchequer on taking office, and owing to the difficulties and problems of re-armament, the amount of financial manoeuvre possible in the way of tax remissions is small. Any advances we make will have to be made on narrow and specialised fields, since we have not the money available to make vast remissions of taxes over the whole area. We shall have to pick out special subjects where a remission of tax will not only be inexpensive, but will give a huge economic return.
  We shall have to pinpoint the places where we can make remissions, and the extractive industries throughout the Empire as well as in this country are one of the points where, although the actual concession will not cost this country much, it can show a golden harvest in dividends and raw materials.
  5.44 p.m.
  Mr. William Wells: The hon. Member for Stafford and Stone (Mr. H. Fraser) will forgive me if I do not follow him on the important but narrow field of concessions to overseas companies. There is one point that was made by the hon. and gallant Member for Ayr (Sir T. Moore), who, I am sorry to see, is not in his place, which I do not think the House will have taken seriously but which will be reported outside the House and, for one reason which I will mention, I feel well qualified to controvert.
  At one time I felt almost embarrassed at taking part in what seemed to be a kind of prize giving. My own part in the Finance Bill has been confined to drafting a number of Amendments, most of which were out of order and hardly any of which were called. I therefore feel well qualified to controvert the statement of the hon. and gallant Member for Ayr that this Budget and Finance Bill have been conspicuous for what he described as the cynical shadow boxing conducted by the Opposition in the debates.
  2482
  It having been my fate since 1945 to sit up on numerous occasions right through the night, listening to points being put by the then Members of the Opposition, when perhaps one or two speakers would make serious and substantial points but would then be followed by five, six or seven speakers repeating them, no doubt for the benefit of their local papers and to prevent the House from rising while public transport was available; having listened to speeches of that character for so many years with so much tedium, and having heard this year the serious speeches made by my right hon. and hon. Friends, to which the Chancellor himself has to a large extent paid tribute, not only verbally but by the number of Amendments he has accepted, I think the observation of the hon. and gallant Member for Ayr will be taken with no seriousness by the House, but it is proper, for the benefit of those who have not heard the debates on the Committee and Report stages of the Bill, to contradict it.
  Mr. Baxter: A very long sentence.
  Mr. Wells: The sentence may be long, but I think it will be found to be grammatical and I think it will also be found to be intelligible. If hon. Members opposite are not capable of following the somewhat involved structure of a sentence while I am speaking, and they find the subject matter so interesting, they will always have the opportunity in the morning of studying it in greater detail than I myself think it deserves——
  Mr. Julian Snow: Full stop.
  Mr. Wells: —in the columns of HANSARD.
  It has not at any time been the case put forward by my right hon. and hon. Friends that this Budget and Finance Bill contains no good measures. I suppose most of us would welcome in themselves the Income Tax reliefs that were granted, the increase of marriage allowance, and so on. Yet the question which the House has to ask itself is: what is the cost of those concessions? To a large extent, in order to see the real, the social cost—not merely the financial cost—we have to look outside the Finance Bill, and that is what in a Third Reading debate one cannot do.
  My right hon. Friend the Member for Leeds, South (Mr. Gaitskell) has referred

  2483
  to the reduction of food subsidies. There is indeed sufficient evidence of the bias with which this Bill has been framed inside the framework of the Bill itself. The Entertainments Duty increases, the abolition of the Utility scheme are both measures for which in vacuo perhaps a case could be made, but they are measures designed, perhaps not deliberately, to inflict burdens on sections of the community which are not being helped very much by the financial changes in the Finance Bill and are being severely hit by the reduction of food subsidies which has been effected outside the Finance Bill.
  My right hon. Friend and other of my hon. Friends have criticised the Excess Profits Levy, which was born of a piece of electioneering on the part of the Prime Minister and is based on a false analogy between a complete war economy, in which, no doubt, an excess profits tax is proper, and an economy such as our present economy, which is influenced by partial re-armament. So far as the Finance Bill contains good things, they are good things done at the wrong time.
  Sir William Darling: Is it possible to do a good thing at the wrong time?
  Mr. Wells: Virtues, as the hon. Gentleman should know, should always be practised, but politics are always a matter of deciding, not what is desirable in the abstract, which all of us find easy to answer, but what is desirable in the context of the existing political and economic circumstances. We say, and we have said throughout these debates, that the concessions that have been made and are designed on the whole to help the more prosperous classes of the community, ill consist with measures that are designed to raise the cost of food.
  The Bill contains a number of measures, in addition to the financial measures that the Government have taken outside the Bill, to increase the cost of living and the cost of production. These measures have been partially offset by crude proposals of the opposite tendency. Other Governments at different times have made plans which have borne fruit in an industrial expansion, in a boom. Other Governments—and we have been accustomed to this from Governments provided by the party opposite—have
  2484
  made plans which have borne fruit in slumps.
  This Goverment has the melancholy distinction of being the only one the result of whose policies is to achieve higher costs based on lower commodity prices and on lower employment. That situation has been worsened by measures of the Government in this Finance Bill. The measures that have been taken in the Bill have done nothing to counteract it, but merely to aggravate it.
  5.54 p.m.
  Mr. Ian Horobin: Before I come to the few observations I wish to put before the House, I think it right that some Member on this side should make one or two observations on a most interesting and moderate speech from the hon. Member for Newton (Mr. Lee), who, I am sorry to see, is not still in his place. They referred to the difficulties which, he said, now existed, as a result of the Bill, in persuading the trade unions to exercise restraint in wage demands.
  I want to say nothing which could be at all polemical, because I do not pretend to be an expert in that field. I think, however, that somebody from this side ought to remind hon. Members opposite of one or two very simple points which did not seem to be put quite fairly in what the hon. Member said. His point was that we must now face the responsibility, as a result of the Bill, that we have so increased the cost of living that it is impossible for reasonable and moderate trade union leaders to exercise restraint.
  I only want to put three quite simple points to the House. First, it is not true, whatever may be the case later, that the cost of living is rising faster now than it was before this Government came in. There is good reason to believe that the reverse is true, but it certainly is not the case that the cost of living is now increasing much more rapidly, as the hon. Member seemed to think, and that, therefore, we must face responsibility for making it impossible for reasonable trade union leaders to continue doing their best to exercise restraint.
  Secondly—and this is in no way polemical—it is fair to remind the House and the country that if that be true, as it is, the situation is better, because the cost of living now does not represent a substantial amount of subsidy, which, of

  2485
  course, had to be paid for, and paid for not just by soaking the rich, but in taxes which, as we have heard this afternoon, were coming out of the pocket, and endangering the employment. of the ordinary working man—for example, Purchase Tax. The hon. Member took no account of the substantial reliefs of taxation. It can certainly not be denied that some, at least, of the demands for wage increases which are now before the country come from sections of society such as the miners, for instance, who on any showing have, while the cost of living is not going up faster, very materially benefited by the tax remissions of this Finance Bill.
  Thirdly, I think it fair to remind the hon. Member and those responsible trade union members who have so great a part to play in this matter, that it is really not quite fair to suggest that the whole of this restraint was working perfectly up to last October and is now collapsing. I do not want to overstate the case or to say anything that could be considered to be unhelpful, but it must be borne in mind by hon. Members opposite that already, last year, a very substantial breach had been made in anything which could fairly be called restraint, let alone wage freeze. It is not being quite fair to suggest that under Socialism we had obtained, good or bad, a perfectly stable settlement of these wage problems, which was now collapsing about our heads as a result of the Bill.
  Mr. Lee: Would the hon. Member agree that during the post-war period, perhaps the saving grace of the whole thing has been that wage advances have lagged behind the increase in production in industry, and that that has enabled the economy gradually to gather strength, whereas the possible result—I put it no higher—of the Chancellor's present Bill may well be to cause the thing to reverse and the demands for wages to go higher than the increase in production will allow?
  Mr. Horobin: If I went too much into that, I should probably be ruled out of order. All I wish to say on this section of my speech is to express the hope, with which, I am sure, the hon. Member would agree, that responsible trade union leaders will bear these sort of facts in mind and
  2486
  not give up doing their best now, as in the past, to see that while legitimate wage claims for those who have a strong case are still made—and met, we hope—they will not be made the excuse for some applications as a result, allegedly, of this Finance Bill, and for which, to put it mildly, the case is not very strong.
  This, as the Chancellor has pointed out, is the last stage of the Finance Bill, which itself is the last stage of the developing financial policy of the Government for dealing with the situation we found. I wish to say nothing about who was responsible for that situation; there it was. In the course of discussion of this Finance Bill it is true that there have been very substantial criticisms of some parts of it. I have myself ventured one or two very tentative observations from time to time.
  If two or three hon. Members could produce anything to the tune of £150 million in taxation there must be something in those suggestions. But they did not affect the main structure of this Finance Bill, let alone the main structure of the financial policy of the Government. If I may put it so, they were a criticism, not of the main structure, but of the gargoyles with which the dean and chapter had seen fit to adorn it.

  FINANCE BILL

    ROYAL ASSENT
    6.1 p.m.
    Message to attend the Lords Commissioners.
    The House went; and, having returned—
    Mr. SPEAKER reported the Royal Assent to:

    1. New Towns Act, 1952.

    2. Corneal Grafting Act, 1952.

    3. Family Allowances and National Insurance Act, 1952.

    4. Distribution of German Enemy Property Act, 1952.

    5. Cremation Act, 1952.

    6. Electricity Supply (Meters) Act, 1952.

    7.London County Council (General Powers) Act, 1952.

    8. Port of London Act, 1952.

    9. Blackpool Corporation Act, 1952.

    10. London County Council (Money) Act, 1952.

  FINANCE BILL
  Question again proposed, "That the Bill be now read the Third time."
  6.13 p.m.
  Mr. Horobin: Having been temporarily knocked out, I will now try to resume the observations which I was putting before the House. As I was saying, this is the last stage of the Finance Bill, the last preliminary stage of the Government's financial policy, and I think it right and proper that those of us who have taken an active part in its development should attempt to stand back and look at the matter as a whole and put it in perspective to ourselves and, as far as we can, to the House. That duty is especially strong on those who, like myself, have on certain sections of it taken a strong line.
  I have no doubt whatever that we are watching the development of a sound policy for which this country will have great reason to be grateful. I should like to mention, without developing them —to do so would probably be out of -order, and in any case would detain the House too long—three points in which this Finance Bill and its attendant policies mark, to my mind, a milestone on the road of the recovery of this country since the war.
  Firstly, it marks the final repudiation by this side of the House of the disastrous fallacy which more than anything else caused all the mistakes of the previous Administration, and I need hardly add that I include among them all their Finance Bills. That fallacy really rests in their having persuaded themselves, and I fear too much persuaded the country, that internal financial policy can be divorced from the problems of foreign exchange, the dollar gap, etc. Over and over again in the last few years we have had the sort of statement that "Everything is all right at home, we are doing wonderfully, but by some curious accident we happen to have a convertibility crisis" or a dollar gap or some such difficulty.
  That is a fundamentally false analysis of the situation. The Government have, in the last six months, broken with that tradition. They are trying in their policy, and in putting it before the country, to get it clearly into all our minds that it is impossible to carry out a loose and deflationary policy at home, even if it
  2488
  has all the advantages of full employment, high tax yields, etc., and expect not to have periodically these foreign payment troubles from which we have suffered for so long, and from which we are only now just beginning to rescue ourselves.
  Secondly, this financial policy, into which I cannot go in any detail, is inextricably mixed up with the dear money policy, the Bank rate policy, etc. I should like here and now to pay my tribute to the courage and tenacity of the Chancellor of the Exchequer, who in the face of a great deal of ill-informed opposition has stuck to the courageous decision which he took to go back to what has been looked upon, by far too many people—not confined only to the other side of the House—as an out-of-date and outmoded weapon in protecting our solvency. I firmly believe that in doing so my right hon. Friend has earned our gratitude.
  Thirdly, we must view the whole of this Finance Bill and the whole of the policy in which it has to be set against the absolutely fundamental decision which the Government have now placed on record of putting in the forefront of their policy of getting away from the seige economy conception with which we have been cursed ever since the war and the setting up of the convertibility of sterling in the very forefront of our policy. For all those reasons, and I could give others, I am convinced that this Finance Bill and its attendant policy thoroughly deserve the support of the country as a whole.
  I should like to draw the attention of the House briefly to one aspect of what is happening in Lancashire which I do not think has been sufficiently borne in mind on either side of the House. It is often said that the great trouble with the country at the moment is that the great bulk of the ordinary people do not really believe that there is a crisis. I am afraid that there is a certain amount of truth in that, but surely the tragedy—I hope the temporary tragedy—which has overtaken Lancashire should be a warning to all England of what is facing this country.
  There is a lot to be said for a boom if it can go on for ever, but the whole point is that booms do not go on. Nearly everybody—too many employers as well as too many workmen—always think "This boom is different from all the others."

  2489
  But booms do not go on. Ultimately they collapse under their own pressure, just as the boom in textiles had already collapsed when we came into office. I do not wish to detain the House in arguing whose was the fault; whether it was the Socialists or anybody else. The fact was there, and every honest Lancashire man knows it. The point I am making is that whenever anybody says to any of us in our constituencies, "Is there really a crisis? Is not this really a phoney business"? my own answer—and I am sure it is the right one—is,"Lancashire."
  If we cannot realise that the policy which the Chancellor has been adopting, with great skill in my submission, if we cannot get away from the inflationary boom which was the curse of this country over the last year or two—although it was pleasant in some respects while it lasted—without waiting for it to collapse like it has in Lancashire, the whole of England will rue the day, just as Lancashire now rues the day, it lived in this false fool's paradise, which should not and has not gone on.
  What the Chancellor has done so far in squeezing out a considerable amount of this inflationary pressure without running into heavy unemployment cannot be stated too often. If we take out the special textile problem the average unemployment figure during the years of Socialist administration was higher than it is today. Even total unemployment is less today than in 1947. So when we hear this story that we had six years of full employment, we should remember that unemployment today on the whole is less than in 1947; and unemployment over the country as a whole throughout the Socialist years of office was more than it is today, if we take out textiles.
  So I think my point is perfectly sound and clear; that already in Lancashire in textiles, and not only in England but all over the world, the inflationary boom had collapsed like all inflationary booms have collapsed. What the Chancellor is doing, on the whole with already great signs of success, is trying to preserve the rest of England from going on too long in that inflation, or waiting until it collapses all over England just as it has collapsed in Lancashire.
  As one of those who have made the life of the Chancellor a bit of a burden on recent occasions, I would say this to
  2490
  him. With the great burdens and responsibilities and troubles he has in his office, if such an Olympian can ever feel disappointment and perhaps depression, is it not true that he will ultimately be judged, not by the votes in this House or the arguments night by night, but when those remorseless ledgers of the Bank of England are made up recording the progress this country is making in preserving its foreign exchange position? That is where he will be tested.
  Judged by that test, how can any honest man in any part of the House deny that, while the Chancellor himself would be the first to admit that much more remains to be done, he has been remarkably successful in reducing a deficit of something like £300 million in a quarter down to £10 million? That is a very remarkable achievement after six months of taking office. It is not due to him alone, because we are all in this together. But he would take the main responsibility if a crash came, and so he is entitled to the main credit if he preserves us from it. If it be that, as a result of the Government's policy, we can feel that we have clawed our way back by a million or two and by 24 hours from the abyss, he need not fear the judgment or criticism of anyone.
  I say with all the emphasis at my command that I believe every hon. Member on this side, and a good many of those on the other side of the House, feel that we shall be doing a good job of work in passing, as we certainly shall, this Finance Bill which enshrines already so great a measure of success.
  6.25 p.m.
  Mr. Douglas Houghton: The hon. Member for Oldham, East (Mr. Horobin) always speaks with vigour and conviction, although I think it will be within the recollection of most hon. Gentlemen that his speeches are something like the weather—they are variable in their content. He alternately bestows praise and blame on his right hon. Friend the Chancellor of the Exchequer. I seem to remember in the Budget debates that he stoutly defended the Budget and roundly condemned my right hon. Friend the Member for Leeds, South (Mr. Gaitskell) and the rest of us on these benches. Then, a little later on, we heard

  2491
  him say of the Excess Profits Levy that it was a crazy nightmare of a tax.
  Mr. Horobin: So it is.
  Mr. Houghton: I think that perhaps the hon. Member added some epithets which I have forgotten. I certainly think his speeches have another quality, that of saying the unexpected thing. At the same time he has again sounded the warning note which I think must be repeated time and again in Britain—that we have perhaps the most precarious economy of any country in the world.
  There is no question as to what task confronts the people of this country. I read recently in "The Observer" a most arresting conclusion in a leading article, which said that the great challenge to the political parties in Britain at this time is to formulate a grand strategy which will enable the people of Britain, not only to live, but to live well, in a world where, to an increasing extent, countries are making for themselves what Britain has been making for them for the last 100 years. I think that is the challenge which the hon. Member is constantly throwing out to the House. There is no question, whatever Government is in power, that the fundamental weakness of our economy, and the nature of the task confronting the people of Britain, will be the same.
  But the hon. Gentleman should concede that the methods, or many of the methods, by which his right hon. Friend arrested the deterioration in our balance of payments position were the very methods which had been created and used by my right hon. Friend the Memberber for Leeds, South when he was Chancellor of the Exchequer. The present Chancellor employed the machinery at hand, created by the Labour Government for the express purpose of dealing with problems arising in the field of foreign exchange: limitation of imports; control of exports; the controls placed on production, and the ban on the use of essential raw materials for unessential purposes.
  All these things form part of the comprehensive mechanism by which our economy is held as steadily as it is. There is no difference between us on the use of those methods, and no word was said
  2492
  from these benches against the decision of the Chancellor to restrict imports and to use the machinery at his disposal. The criticism, if there could have been any, was perhaps that he took two bites at the cherry when he could have taken one.
  I rose, however, to draw the attention of the House to what I think is the fault of legislatures everywhere, even of this one, which is to ignore or to under-rate the problems of administration.
  Mr. Gerald Nabarro: Hear, hear!
  Mr. Houghton: I am fortified in making reference to this matter by the hon. Member for Kidderminster (Mr. Nabarro), and my right hon. Friend the Member for Leeds, South referred to it. The Chancellor of the Exchequer said that this is one of the longest and most complicated Finance Bills on record. Fifty-seven out of 76 Clauses, eight Schedules out of 14, and goodness knows how many pages, are devoted to problems which must now be taken over by the Inland Revenue Department. We should be making a mistake if, when we parted with this Finance Bill, we under-rated the administrative difficulties which we are now transferring to the Inland Revenue Department, as well as to company secretaries, accountants, taxation advisers and all those whose job it is to work out the Clauses of the Bill.
  I am enormously proud of the Inland Revenue. I have either been in it or with it for the last 30 years, and we all pay tribute to its resourcefulness, its resilience, skill and ability in dealing with some of the most complicated fiscal legislation which this country has ever seen. We all understand that this Bill will add to the burdens, especially of the small band of fewer than 2,000 inspectors of taxes, specially trained and skilled in these complicated matters of company taxation. To be in a predatory vocation has its trials in the easiest of times, but to be in it in a period of high taxation, with many contentious features of our fiscal system, places abnormal burdens upon those who are administering our system of taxation.
  The House may not fully appreciate that there are two Income Taxes in Britain today. One is Pay-as-You-Earn, and the other is facetiously described as

  2493
  "Pay-if-you-like"—the difference between the inexorable application of a system of tax deductions from salaries and wages, and, on the other hand, the assessment of tax on profits and gains.
  Mr. Assheton: Has the hon. Gentleman noticed the inexorable deduction of taxation from his dividends or interest?
  Mr. Houghton: That, of course, is merely another feature of our system of direct taxation, but I am not referring to taxation at the source in regard to business profits, but to the normal method of assessment under Schedule D, and the right hon. Gentleman will appreciate the difference between the two. There is quite a distinction in the degrees of closeness of administration of these two taxes, and the Inland Revenue Department were recovering from the arrears of investigation and probing into tax avoidance and evasion left behind by the war when they were confronted with this new Excess Profits Levy.
  The right hon. Gentleman may remember that, at a recent social gathering, which I believe he attended, this Excess Profits Levy was referred to as the name of the Prime Minister's horse, and its pedigree was described as "by Confusion out of Election Promises." When the Chancellor of the Exchequer referred to the drubbing which this tax had had in the wash tub, he must have been thinking, among others, of the hon. Member for Oldham, East, though I think that perhaps the plungings, the gyrations and the twistings and turnings of the "dolly," which is punched around inside the wash tub, really did the job. The hon. Member for Oldham, East has done more of that in public, though probably most of the real drubbing on this tax has been done inside and behind the scenes. However that may be, it has emerged, as my right hon. Friend the Member for Leeds, South has said, a more complicated tax than it was to begin with.
  This is the moment at which the Inland Revenue Department must utilise all its resilience to cope with this new burden of taxation at the same time as it carries forward the work already begun on the checking and overtaking of tax avoidance and evasion. Section 27 of the Finance Act, 1951, which dealt with the disclosure by banks of amounts of untaxed interest over a certain figure, adds considerably
  2494
  to the current burdens of the Department. I understand that there was astonishment at the large number of bank accounts yielding interest of more than £15 a year which had not come to the notice of the Inland Revenue before.
  This is the moment when the Inland Revenue must employ all the resources available for training the staff which is specialised in the task, and for harnessing the skill and experience of men not previously engaged on this work, in order to ensure that the disparity in closeness of administration between one tax and another is not increased. Yet at this very time the Treasury have decided on a cut of 50 per cent. in the cost of training in the public service. That, I think, is a great mistake when we are in need of more skill, greater ability and a wider field of availability of staff for the multiple tasks which modern legislation is imposing upon them.
  I sat with the right hon. Gentleman the Member for Blackburn, West (Mr. Assheton) on the Committee on training in the public service, which made recommendations which have been carried out with imagination and courage in the public service in the years since, and I think it is regrettable that the Treasury should decide to make a substantial cut in the whole of the machinery and administration of training in the public service at the present time. I hope that, as far as the Inland Revenue is concerned, the Financial Secretary to the Treasury will watch carefully to see that cuts in training do not damage the ability of the Department to cope with the additional burdens now being placed upon it.
  I pass now from problems of administration to what I think must be plain to hon. Members on both sides of the House—the shift of emphasis from direct to indirect taxation which this Bill makes. We see in this Bill additions to indirect taxation and reductions in direct taxation. A picture of that change is to be had from pages 25 and 26 of the Financial Statement which we had immediately after the Budget, in which we see that the indirect taxation on petrol is being substantially increased, while decreases in direct personal taxation are being made at the same time. Of course, we realise also that the withdrawal of the food subsidies is a form of indirect tax-

  2495
  ation, as such a step is not only accompanied by, but indeed made possible by, decreases in direct taxation.
  When the hon. and gallant Member for Ayr (Sir T. Moore), with rather bombastic optimism, declared that the nation would honour the right hon. Gentleman for his courage and for the wisdom of his policy, and that the time would come when a Conservative Government would be in office indefinitely until it had put the country to rights, and, presumably, there would not then be the need for any other kind of Government—when he is saying all that, the truth is that the present Government are more unpopular today than at any moment since they took office.
  Therefore, we have to ask ourselves whether reductions in direct taxation when accompanied by increases in indirect taxation, and by a subtle additional form of indirect taxation in the withdrawal of the food subsidies, have indeed made the Government popular after all.
  Mr. Horobin: Does the hon. Gentleman suggest that the only test of a Government's policy in a crisis is whether they are popular or not?
  Mr. Houghton: I am not suggesting that for a moment. It was only that the hon. and gallant Member for Ayr was claiming, I thought quite preposterously, that the people of Britain were about to rise and call Her Majesty's Government blessed. There is simply no evidence that they are going to do any such thing. I should say that the Government have lost more popularity over measures which send up prices than they have gained over steps which reduce the amount of direct taxation.
  One may ask whether an increase in the proportion of indirect taxation as compared with direct taxation is desirable from a social or fiscal point of view. I know that some cynics have said that the great virtue of indirect taxes is that they are all optional, and that no one need pay them if he likes to live his life in that sort of way. But we all realise that they are widely spread nowadays that it is almost impossible for anyone, however he may contrive, to steer clear of all forms of indirect taxation. I think it would even baffle my hon. Friend the
  2496
  Member for Ealing, North (Mr. J. Hudson) should he make the attempt to try and make all indirect taxes optional.
  Indirect taxation is unfair in its incidence and it may be damaging in its effect on our industrial activities. I think that the dangers of too great a reliance upon indirect taxation are to be found in the anxious position we now have with regard to the Purchase Tax, especially on textiles. I do not hold the view that the total exemption of textiles from Purchase Tax would completely solve the recession in the textile industry, though I am fully in favour——
  Mr. Osborne: Of course it would.
  Mr. Houghton: —of the total exemption of textiles from the Purchase Tax, because there is no doubt that even in its modified form the imposition of that tax on textiles is an aggravation of the position. The real causes of the recession in textiles quite obviously go deeper than that, and were alluded to in the concluding stages of the speech of the hon. Member for Oldham, East.
  I think the Chancellor will have to study more closely than he appears to have done at present the financial policy underlying the present ratio between direct and indirect taxation. There is no doubt that the effect of this Bill is to relieve many people of direct taxation while calling upon them to pay more in indirect taxation. At the same time, it has called upon many people who have received no relief whatever in direct taxation to pay more in indirect taxation. Those are, I think, significant aspects of the Bill.
  The verdict of the country on this Finance Bill will be given not in this House tonight, but in the experience which the whole community will have of the financial and social effects of the financial and fiscal policy of the Government. I do not believe that the people of this country are unaware of the existence of a crisis. Many people may under-rate its gravity, but I think it is something of an insult to the political intelligence of the great mass of the British people to say that they do not know there is a crisis. At all events, they know there is a crisis in Lancashire and in the West Riding of Yorkshire, and the hon. Member for Oldham, East quite rightly said that the rest of the country

  2497
  must take that as a warning, because it may be the first sign of the consequences of the very thing to which I referred earlier in my speech, the growing independence of other countries of British goods.
  That is a serious factor which is a challenge to us all. But it opens up much wider questions than those contained in the Bill. Had this Bill come from a Labour Government, it would have been a different kind of Bill. It would have had no Excess Profits Levy in it, it would not have been accompanied by a cut in the food subsidies, and it would certainly have retained a fair balance between direct and indirect taxation. Therefore, I think our verdict on the Bill must be that, from our point of view, it is a bad Bill, and we hope that the number of occasions on which we shall have to comment on a Finance Bill introduced by the present Government will be very few indeed.
  6.46 p.m.
  Mr. Cyril Osborne: Except for one short intervention on the Committee stage, I have been a silent brother during the long passage of this Bill, but I want today to make two points on it. But, first, I want to refer to the warning given by the hon. Member for Sowerby (Mr. Houghton) that we should make clearer to our constituents the gravity of the problem now facing the people of Lancashire and the West Riding of Yorkshire and that it may overtake the rest of the industrial population of this country. When he says that, is he prepared to tell the people that their rations may be cut in half and doubled in price and that we may go back to two million unemployed, because those are the only terms in which the matter will be understood?
  Mr. Houghton: I do not think it would be wise or true to say that we may go back to two million unemployed. I do not think we shall or need do that. What I said was that it may be necessary to make sacrifices in our standard of life in order to retain our solvency and keep our people employed.
  Mr. Osborne: If the hon. Gentleman says that the tragedy of Lancashire may overtake the whole of the country, to what extent does he think unemployment will increase?
  Mr. Houghton: I hesitate to intervene again, but I did not say that what is happening in Lancashire would overtake the rest of the country. I said it was a warning to the rest of the country.
  Mr. Osborne: A warning that it may do so is what I said, and I link that with what the hon. Member for Newton (Mr. Lee) said so wisely. He said that because of men's fear of unemployment we cannot get the extra production on which the Chancellor depends for the proper working of his Budget. The necessary production is not easy to get because of the memories of the old days, and no one who stood in the shoes of such men, as I did, can blame them for it. The greatest difficulty we have in putting over the message which the hon. Gentleman wants to give them is in overcoming the difficulty which his own colleague posed to him.
  When I intervened on the Committee stage, I asked the Chancellor if he would do something for the shopkeepers of the country by allaying their fear regarding stocks already in their shops, on which Purchase Tax had already been paid, in the event of a reduction of that tax. He promised to appoint a committee. I ask the Financial Secretary whether he will bear that in mind and announce the composition of that committee as soon as possible and so relieve the anxiety of the shopkeepers on that point.
  I am sorry to strike this discordant note, but I am disappointed with the Budget in one respect. It has been said many times that when we came into power we faced economic disaster. We were told, and the late Chancellor agreed, that we were over-spending to the extent of something over £500 million a year and that that had to be corrected. That £500 million a year represents to the people of this country nearly 25 per cent. of rationed and unrationed food which we did not earn last year. We paid for those foodstuffs out of our savings. As the previous Chancellor knows, those savings were going and therefore that situation could not be allowed to continue.
  The new Government were faced with this great crisis and the opening of the Budget was brought forward by a month to deal with it. My complaint about the Budget is that, whatever may or may not be in it, it has not struck the mind of

  2499
  the ordinary person sufficiently to emphasise the fact that this crisis does exist. To that extent the Budget has failed. The previous Socialist Chancellors failed in the same respect and I said the same thing to each in turn.
  So far, not one Budget since 1947—and we have been in a state of crisis ever since—has made the industrial worker believe that there is a crisis which would affect him and that the facts at which the hon. Member for Sowerby hinted and will not state openly may overtake him. I should like to remind the Chancellor of another figure, which I think I obtained from the former Financial Secretary.
  Mr. Pannell: The hon. Member suggested that no Chancellor since 1947 has ever hinted at a crisis or the sort of crisis which might overtake the industrial worker. Surely that cannot be true. Sir Stafford Cripps was subjected to considerable hostility and attack from the benches opposite, including the Front Bench, when he attempted to bring that home to the industrial worker. My right hon. Friend the Member for Leeds, South (Mr. Gaitskell) has already quoted from a document issued by the Conservative Party condemning the wage freeze.
  Mr. Osborne: I said that past Chancellors had been unable to make the industrial worker realise the gravity of the situation. I have always expressed in this House the greatest admiration for the integrity and ability of the late Sir Stafford Cripps. But since reference has been made to him, I might remind the House that in Cmd. 7573, paragraph 30, Sir Stafford—in what was a begging letter sent to America to say that we must have 940 million dollars to keep us afloat— confessed his inability to do the very thing which I now say my own Chancellor has failed to do.
  I want to make it abundantly clear that I am sure that the danger, which has been hinted at, that the tragedy of Lancashire will overtake the rest of the country is so real and so near to us, and yet that very few hon. Members realise it themselves. I had a letter from Chile only last week bearing on this matter. I should like to ask the previous Chancellor, as well as the present Chancellor, to listen to it—because the right hon.
  2500
  Gentleman the Member for Leeds, South may have to face this problem if he ever comes to power. Unless we can make our people realise the truth of this matter, we shall never secure the exertion which is so necessary if we are to survive.
  Mr. Jack Jones Mr. Jack Jones (Rotherham) rose——
  Mr. Osborne: No, please let me continue. The letter came from Santiago last week from an importer of British machinery—not textiles, but capital goods. He said:
  "As regards British trade here, we are feeling more and more every day competition from Germany, Italy, Austria and Belgium. Japan is coming into the picture too. All these countries' deliveries are very much better than ours and German prices are sometimes considerably cheaper.
  There are lots of complaints of the deterioration of the quality of British goods. For generations here to buy British meant to buy the best and the word ' British' was a hallmark of quality. Unfortunately this now is not so, and we have experienced it with our own machinery——…"
  Mr. Speaker: It is allowable on Third Reading of this Bill to refer generally to the economic background, but really on Third Reading one must try to confine oneself to what is in the Bill. I think that what the hon. Member was saying was really out of order.
  Mr. Osborne: I must, of course, obey your Ruling, Mr. Speaker, which I will do at once; but, if I may say so with respect, a great deal more latitude has been given on matters not so germane to the position.
  Mr. Speaker: All I am saying is that, while reference to the economic background may be necessary in order to make a speech intelligible, and I do not object to that, I hope that the hon. Member will keep those references within bounds.
  Mr. Osborne: May I just complete my quotation, Mr. Speaker? The writer went on to say:
  "There does not seem to be the pride in workmanship there used to be before the war; this is not my own opinion but that also of many competent people who have been buying machinery for years."
  The Budget estimates will not be fulfilled unless we have a 3 per cent. increase in national production. Already in certain consumer industries we are not going to obtain a 3 per cent. increase but a 3 per

  2501
  cent. or 5 per cent. decrease. My hon. Friend the Member for Kidderminster (Mr. Nabarro) has said that we shall make that up with capital goods, but those are the goods that we cannot sell.
  Mr. Nabarro: Nonsense.
  Mr. Osborne: It is useless to say "nonsense" about things on which my hon. Friend has no evidence at all. I believe that the industrial and financial situation of this country is so critical that the steps taken by the Chancellor do not meet it. I beg of him to do what he can, either in this House or on the radio or in the Press, to bring home to everyone in the country that unless there is a new attitude to the task which awaits us, each in our own sphere, we shall face the tragedy from which Lancashire is now suffering.
  6.58 p.m.
  Mr. J. Grimond: I also feel the concern which has been expressed by the hon. Member for Sowerby (Mr. Houghton) and the hon. Member for Louth (Mr. Osborne) about the future of certain industries in this country, even though at the moment some of them are enjoying an almost boom condition. I must say, however, that further appeals to the workers of this country, which appear to be the solution offered by the hon. Member for Louth, are at the moment not altogether appropriate.
  Mr. Osborne: Appeals not only to workers but to managements as well.
  Mr. Grimond: Yes, but different circumstances are developing in different industries. Some are held up by lack of material, and to appeal to the workers in those industries to work harder is beside the point. Other industries are finding it difficult to sell goods both at home and in the export market. This is a very complicated question.
  My own view is that we have not yet moved over from a condition of inflation to a condition of deflation such as would justify the Chancellor of the Exchequer in reversing his policy. But it is obvious that we shall be placed in difficulty in the matter of employment in certain industries in years to come. Management and labour in those industries must accept a higher degree of mobility and must be prepared to accept changes from one form of production to another, and
  2502
  indeed from one industry to another. Whatever Government is in power will have to rely a great deal upon management and workers in industry to accept that position. Any political party which professes to be able to guarantee full employment in the sense that a man can be certain of continuing indefinitely to do the job that he is doing now is misleading the country.
  There are certain points of detail in this Budget which I find bad. I think the increased duty on petrol is a bad increase. I think the Excess Profits Levy is a bad tax. It has all the objections which have been mentioned in Committee, and, in addition, I feel it is time that we stopped levying new taxes and, for that matter, it is time we had a holiday from legislation in general.
  This debate has been largely taken up with the more important and main points of the Finance Bill, and it is to those that I propose to direct a few words. We have heard from the Chancellor that the main purpose of the Bill is to give some incentives, to bring reality into our economy and to right the balance of payments. In all this, of course, he is dependent upon the system of private enterprise and, in a modified form at any rate, a free market. It is fair to say that that system, coupled with the welfare services and coupled with a fair amount of control, has yielded this country extremely good dividends. It is reasonable to say that the majority of people are fairly well off and few want to go back to the situation which existed 20 or 30 years ago. We have a very sound standard of living in this country. That is something to be proud of.
  At the same time, we have to realise that we are living on capital, not only in the strict sense but capital in skill and technique—the capital which has been built up under the system in which free enterprise has been working. We have to some extent been drawing on that capital. We are not developing the free enterprise system in the way which we must if this country is to survive in the difficult conditions which will face us in the future.
  To begin with, as the hon. Member for Louth mentioned, it must be realised that a free enterprise system depends upon the enterprise of management, shareholders and people who risk capital, and their sinews have become rather soft in the last five or 10 years. Secondly, we have

  2503
  to realise that free enterprise depends upon a great deal of mobility of resources and labour. It is not a system in which we can guarantee that a certain amount of our resources can be locked up in one form of production or another. To my mind, that is the only excuse for such a large amount of our resources being turned over to housing.
  Thirdly, these conditions have to be accompanied by a high level of social services. Family allowances, pensions and so on are being increased in this Budget. I doubt, however, whether they are being sufficiently increased. I do not say that in the difficult situation in which we are more could be done, but I do say that there is a good deal of substance in the criticism that this Budget gives reliefs. If not to the wealthiest people, at least not to the poorest people, and the people who are apt to suffer from this system of private enterprise are not as yet adequately safeguarded and guaranteed the minimum in life which I feel sure we should all like to see.
  Further, this system depends upon greater trade. This Budget has written into it several of the provisions which we had in the last Finance Bill and which are essentially of the siege economy to which reference has been made. Provisions on the movements of companies, for instance. It may be true to say that we have to retain these restrictions on the movement of capital and so on at this moment, but those people who believe in a system of private enterprise cannot really be content so long as this country is restricting trade in the way it is.
  We have had a great deal of lip service paid to the need for greater trade. It would be out of order to discuss now how it is to be achieved. There is possibly a need for a further Commonwealth conference. But it is certain that for a country such as this, which is so dependent upon an expanding and flourishing world trade, it is up to us to take the lead and to show in some practical way not only that we are asking other people to accept the principle of freer enterprise and trade but that we are ready to accept it ourselves.
  When I hear the importance placed on the need to bring up the standard of living in the backward areas, for instance, I wonder whether it is right to put so
  2504
  much emphasis upon putting capital into those areas and whether more emphasis should be placed upon greater trade and the sale of goods from this country to those areas.
  I feel that this Bill is in a dual position. It is an emergency Measure introduced at a critical period. On the other hand, it is intended to mark a step in a new direction. I have some difficulty in making up my mind whether we are going in a new direction or not. For instance, the Chancellor hotly denied, in answer to a question by the right hon. Member for Leeds, South (Mr. Gaitskell), that it was his intention to encourage labour to go out of the textile industries and into engineering. I do not believe that he can have thought that over because he must have expected such a transfer, but it will be within the memory of the House that he seemed very offended by that question. But that is the kind of question which we have to face.
  I want to finish by saying that it is my own view that a country such as this, which depends upon private enterprise and which will have to depend upon it for some time to come, has got to make clear to the world that this system, given decent conditions, can yield a good way of life. At the moment we are continually saying that we must all tighten our belts, and, no doubt, for the time being it is necessary, but in the longer run I believe that a country which still has enormous resources of skill and capital should yield a fairly good livelihood and can, at least, support, if not the total of its present population, at least a high population and a high position in the world.
  7.8 p.m.
  Mr. Frederick Gough: I hope the hon. Member for Orkney and Shetland (Mr. Grimond) will forgive me if I break into the general style of debate which has marked his speech and that of his predecessor. It is my desire to detain the House for a very few minutes and to discuss a rather particular topic.
  The subject I want to discuss is one about which I have had quite a little correspondence with my hon. Friend the Financial Secretary. I should hasten to say that it has to do with my own business, and in that respect I should declare an interest, although I think it will be agreed that what little knowledge I have

  2505
  of the matter will be helpful and does not have any bearing on my own personal business.
  The point I want to raise relates to the back service payments of pensions, and this is dealt with in the Ninth Schedule. I was very glad indeed that my right hon. Friend the Chancellor of the Exchequer realised, from the pitfalls in the previous Excess Profits Tax, that there was a serious loophole by which an employer could arrange either for himself in certain circumstances or for some of his staff to utilise moneys which otherwise he would have to pay by way of Excess Profits Tax to provide them with such pensions as should be provided for them.
  That is excellent, and I think that the risk has been thoroughly dealt with in this Ninth Schedule. But I venture to suggest—and I know I am supported by people who are involved in this very technical business—that the net has been drawn a little too wide. I only wanted to say that to put it on record and to ask my right hon. Friend if he will, during the course of the next 12 months, give this matter his very serious consideration.
  As this Schedule is worded at the moment, I am afraid that it may dissuade perfectly bona fide employers from taking out and arranging pensions for their employees. I am also a little frightened that it may have an effect upon perfectly good provident schemes for works employees and also for their widows and children. I am not quite sure; I think that only experience will show.
  Another aspect of the matter about which I have certain qualms was mentioned by the hon. Member for Sowerby (Mr. Houghton). It is going to be another load on the already overworked Inland Revenue. If it performs the function for which it is intended, to prevent an unscrupulous employer retaining monies that otherwise should go in Excess Profits Levies, well and good, but if experience proves that it is going to put a very heavy additional load upon the Inland Revenue and if, in addition, it is going to have a deterrent effect upon what we must realise is one of the most important constituents of savings in this country—pensions, provident schemes and so on—I would ask my right hon. Friend to give this matter further consideration and bear it in mind in 12 months' time.
  7.13 p.m.
  Mr. Jack Jones: I enter into this debate at this very late period in these very long-drawn-out Finance Bill proceedings with one intention, which is to say a word or two about the speech which was made by the hon. Member for Louth (Mr. Osborne). He is an employer of labour and I have heard him make speeches in this House which have been couched in terms which proves that he has, or did have, some knowledge and understanding of the standards of the ordinary British working man and his womenfolk.
  I am surprised that he is learning, at this late stage in his development, that the average British working man does not realise that there is a crisis and that the Chancellor of the Exchequer has failed to bring that home to him. I want to suggest that the average British working man, his wife and children above the age of 13 or 14 know full well that there is a crisis and that there always has been since the war; but they also know that that crisis has been intensified since this Government came into power.
  Mr. Osborne Mr. Osborne rose——
  Mr. Jones: I am sorry, I cannot give way. The hon. Member for Louth would not give way to me and, as we say in Lancashire, what is good to give is not bad to take. I know of no measures which the present Government could take, other than those which they have taken, to bring home well and truly to the British working man the fact that there is a crisis. There is less food today; prices are higher; there is difficulty with regard to housing; there is more difficulty with regard to the raw materials which we need to supply the factories in which he hopes the work is to be done.
  Mr. Osborne: Not in Lancashire.
  Mr. Jones: There is plenty of material but there are not the markets. The hon. Member for Louth should not try to talk to me like that. I represented Bolton for five years and know something about the textile industry. There is an unholy fear of a repetition of what happened under previous Tory Governments. One cannot eradicate the facts. Facts are very stubborn things.
  I feel sorry for the present Government. They have set about prevailing upon

  2507
  people to produce more by giving them less of the good things of the earth, less food etc., to create the strength to produce the goods which the Government want. They make agreements within the Commonwealth which say, in effect, "Everybody shall buy less, but we shall produce and export more." How we are to produce and export more to people who have made up their minds to buy less I do not know, and neither does the Government.
  I have made speeches in this House and in the country about the responsibility of the individual British working man. The problem of exporting more is one which we have to bring home at once, because, as sure as tomorrow morning dawns, the Government are not going to last very much longer. They may think that the trend of events indicates a gradual improvement and that everything in the garden is going to be lovely. That is not so. The trend shows that the country is becoming woefully dissatisfied and discontented, and a discontented community in the workshops is not going to let this Government remain in office much longer.
  The hon. Member for Kidderminster (Mr. Nabarro)—with whom I often agree —knows as well as I do that we cannot expect our workers to see diminishing raw material stocks and expect them to tighten their belts, to eat less food and to work harder in order to get shut of the remaining stocks and so put himself out of work all the sooner.
  Mr. Nabarro: The hon. Member is talking glibly about diminishing raw material stocks. The most vital of our raw material stocks is coal, which stood at 15,335,000 tons at the end of last week, which is 4 million tons higher than in the equivalent period last year.
  Mr. Jones: The hon. Member for Kidderminster should remember the speech which I made in this House—as a lone soul—advocating Saturday work for the British miners throughout Britain. I did that although it was very unpopular. I think I can claim a little credit for the scheme which has made that four million extra tons possible. That is the point which I have been advocating for six years. Coal under nationalisation has improved the same as steel production.
  The point is that if things do not alter coal stocks will also diminish. Are
  2508
  British miners going to be satisfied with the present standard of life? Does the hon. Member for Kidderminster think that all this talk about tightening his belt is going to give the miner at the coal face an incentive to produce more? If he thinks that he does not know the British miner. Does he think the furnace men making steel are satisfied to see these things happening under the present Government?
  I want to be fair and honest with the Government. I say that the approach which they have made has been psychologically wrong, in that they are telling the people to produce more, to eat less food and to pay more taxes. The hon. Member for Orkney and Shetland (Mr. Grimond) hit the nail on the head when he said that unless we have a Government who are prepared and willing and will definitely guarantee a fair standard of life to those who are responsible in the main for Britain's prosperity—the workers of the country—we are not going to get very far. The slashing of the food subsidies and the imposition of a miserable shilling on sick pensioners and diabetics have had a profound effect on the workers of this country.
  The sooner the Government realise that and set about imposing taxation where it can best be carried, and finding the food to give our people the strength to bring about what they want, the better it will be for all concerned. I want to say a word of warning to my own party. The Labour Party have an immense task before it in getting its own individual supporters to recognise the gravity of the situation; the fact that the crisis will continue to be a grievous one, and to make them realise that they must be prepared, as good patriots and citizens, to be satisfied to give that they expect to get—a fair deal.
  Throughout my industrial life, in the trade union movement and elsewhere, I have always advocated the fact that the secret is to get a contented community among the workers who matter most—the men in the steel industry, and in the foundry and workshops, and the sooner the Government set about doing that psychologically and in a practical way, and so giving people contentment, the better it will be for them. Then and only then can they expect to remain in office.
  7.20 p.m.
  Mr. Douglas Jay: My hon. Friend the Member for Rother-ham (Mr. Jack Jones) and the hon. Member for Louth (Mr. Osborne) have had a short argument as to how far the people of this country understand our economic difficulties. However that may be, I do not think there will be any dispute that Sir Stafford Cripps did more than anybody else to ensure that they should understand it.
  That brief argument brought us near to the end of the very last lap, and that last lap finds the Treasury Ministers not merely rather tattered and torn from our long debates but also, in our view, riding almost a totally different horse from the one on which they started. Indeed, we have seen a remarkable circus ride since Budget day three or four months ago. In the debates on the Bill, the Chancellor has put down more than 200 Amendments in his own name. In his speech today, in which he congratulated himself on almost everything under the sun, he took credit for the democratic spirit in which he had been listening to other people's suggestions. I notice that "The Times" took a rather different view of the Amendments a few days ago, and said:
  "A plethora of amendments is usually a sign of measures either hastily conceived, or bad in themselves, or both."
  That, I think, is probably the truer explanation.
  The Chancellor also appealed in the course of the debates to two of my hon. Friends and one of his own to help the Government out of some of their textile difficulties. He called in the Parliamentary Secretary to the Ministry of Civil Aviation to help us all to understand Income Tax; and he conscripted into the band of silent brothers, whom he complimented this afternoon, not only his own back benchers, but also the Minister of State for Economic Affairs. I have a special reason for regretting that we have heard so little from the Minister of State in these debates, because it so happens that I used to derive a lot of economic enlightenment from him back in the 1930's, when he was so forceful a critic of the Government of Mr. Neville Chamberlain, of which I think the present Chancellor of the Exchequer was then a loyal Member.
  2510
  The Financial Secretary, however, has been far from silent, and he has seemed to me to confirm a theory which I have always held, that Financial Secretaries to the Treasury ought to be lawyers and not economists. The present Financial Secretary defends a bad proposal with just as dogged good humour as the Chancellor abandons it on the following day. Nor, I think, should we forget the right hon. Member for Blackburn, West (Mr. Assheton) who marches his soldiers up the hill like the grand old Duke of York, but leads them from behind like the Duke of Plaza Toro. I should, in fairness, add that when he marches them down again he usually charges enthusiastically in the van.
  On this side, I want to pay tribute to certain hon. Ladies who showed the importance of visual appeal as a method of persuasion; to my hon. Friend the Member for Stechford (Mr. Roy Jenkins) and my hon. Friend the Member for Gloucestershire, South (Mr. Crosland), who understood the E.P.L. better than anybody outside the Officials' Gallery, until during the Report stage they were lured away to some more pressing assignation, I believe in Germany; to my hon. Friend the Member for Sowerby (Mr. Houghton), who really understands the Income Tax; to my right hon. Friend the Member for Huyton (Mr. H. Wilson), who helped the Chancellor out of his textile tangles; and to many other of my hon. Friends.
  Although the Chancellor still carries his bat after this long contest, it has had, I think, five new blades and at least ten new handles. In spite of that, we still think this is a thoroughly bad Bill, because in our view it embodies a thoroughly bad economic policy. We have all today had a look, in perspective, at the Bill and the policy, as it emerges from this final debate. In our view, the Bill is bad, first in that it imposes Purchase Tax on a whole range of new textile goods. This must, of course, raise the cost of living, which the Government were pledged to lower, and at the same time limit the public demand for textiles in the very midst of a textile depression, when a wise Government would be using every instrument to relieve that industry.
  I think the best proof that the Chancellor knows he has made a mistake in thus extending the Purchase Tax in the

  2511
  textile field is his constant attempt to suggest that the whole D scheme is somehow the responsibility of the Douglas Committee, and not of the present Government, and even to imply that the decision to put the Purchase Tax at the median level was a recommendation of that Committee.
  If the Chancellor really believed in his own proposals he would have had the courage to say plainly, from the start, that they were decisions of the Government, which the Government alone should defend. If any other evidence were needed that the Government simply accepted the D scheme, without objectively studying its economic consequences, it would be the decision to apply it to furniture as well as to textiles. Not a shred of rational argument has been advanced in favour of that, and there is everything to be said against it.
  Secondly, this Bill is disfigured by the metamorphosed but still hideous—and I use the word of the hon. Member for Oldham, East (Mr. Horobin)—"gargoyle" of the Excess Profits Levy. The Chancellor congratulated himself on the Parliamentary discussions leading to changes in the E.P.L. But I must say that it seems to me a sad commentary, not merely on the incompetence of the present Government, but also on some of our Parliamentary methods that the Chancellor should force through the House a tax which has not a single supporter either outside or inside Parliament, in industry or the general public, among laymen or among experts.
  We are all going to be made the victims of the now undisguised frivolity of the Prime Minister. To use his own words, he "stuck" this in one of his election manifestos, and so numbers of Inland Revenue officials and accountants are all to be butchered to make a Churchillian holiday for several years to come.
  The irony of it is that since the Chancellor has now admitted we cannot distinguish—as we all knew—armaments profits from other sorts of profits, this pledge could easily have been honoured by raising the Profits Tax. If only the Chancellor had said, after the Election, that extra taxation on profits in the rearmament period had been promised, and that the pledge would be filled in the way I suggest, he would have been
  2512
  honouring the pledge far more faithfully and, indeed, sensibly than in almost any other instance we have had from this Government. But apparently they fulfil their pledges only when it is plainly not in the national interest to do so.
  We on this side of the House firmly believe in moderately high rates of taxation on profits, in a mixed economy and in a period of full employment. I think experience both in this country and in the United States—where the percentage of taxation on company profits is about as high as it is here—supports this view. Such taxation has the merit of permitting a high rate of savings through a Budget surplus and also a more democratic distribution of property and incomes. But we think such taxation of profits should be levied in the most efficient, practical and simple manner, imposing the least labour on those concerned.
  We prefer to be guided on methods by the experts on taxation rather than by manifestos written in an electioneering fervour. I agree with "The Economist" of 21st May which said:
  "The Government's performance at the Committee stage of the E.P.L. will surely vie with the tangle over rail fares as a principal monument to its muddle-headedness."
  This is taxation of profits in the worst possible form. Indeed, the thinking of the party opposite about profit taxation seems to have got into an extraordinary muddle. We had heard for years all this lamentation about the terrible effect of profit taxation, on the rate at which companies could build up capital, and on incentive. But on the Report stage we had the hon. Member for Edinburgh, South (Sir W. Darling) making what I suppose was an important statement of policy for his party, and telling us that there is no exceptional difficulty for first-class competent business men in securing what capital they want at any time. At the same time, the Chancellor comes along and imposes this extraordinary new tax.
  We think that this Bill is also bad, in that it embodies reductions in incomes not only in the case of the wage earner and the average salary earner—which we approve—but in that it adds as much as £50 million in relief to those with four-figure incomes and upwards. We think that is unnecessary, and it was

  2513
  partly for the sake of this that the Chancellor made his disastrous cut in the food subsidies.
  His attempts to justify these tax concessions for those with the upper incomes on the ground of the effect on incentive, and so on the national output, are totally unconvincing. I will not repeat the arguments I set out in support of that on the Committee stage, in which I attempted to show that the effects of these tax changes on incentive are grossly exaggerated. I do not repeat them because the Government have so far given no answer to them. But it really cannot be seriously argued that that effect justified the fatal blow which the Chancellor struck at our whole internal stability through the cut in the subsidies. The Chancellor merely asserted today that the effects on incentives were "significant." but he produced no argument or evidence whatever in support of that.
  Mr. R. A. Butler: In defence I should like to say that I was under the simple impression that I could not discuss the food subsidies. They are not in the Bill. Therefore, it was not appropriate on Third Reading, but every other speaker has discussed them and I now feel at a disadvantage.
  Mr. Jay: The Chancellor misunderstood. I was saying that he gave no argument that his reduction in Income Tax, which is in the Bill, would have a major effect on incentives.
  The whole course of events since the Budget has fully justified our warnings and those of the T.U.C. of what would happen as a result of the decisions then taken. Here, of course, is the real and deep conflict between us on the two sides of this House over this issue.
  The Chancellor thought—I am sure sincerely—that by raising the Bank rate, making the cut in subsidies and the other measures in the Bill, he would perform a sort of confidence trick, which would affect the psychology of the exchange speculators, and so improve the short-term outlook for the gold reserve, as indeed in the short term it did. It is clear that the main purpose of the cut in food subsidies was to impress these exchange speculators. If it were not, there is no rhyme or reason in the Chancellor's claim that somehow it helped to "save the £."
  2514
  We said, on the other hand, that the decision to raise food prices would debase the purchasing power of the £ and let loose a spate of wage claims, which would force up our export prices and so injure our export prospects steadily as time went on. The Chancellor, strangely enough, hardly mentioned this even in his Budget speech. Yet no one would deny that what we predicted has in fact happened and that it was provoked by the Government.
  The hon. Member for Oldham, East (Mr. Horobin) maintained that the rise in the cost of living had not been faster after the Budget than before. But the relevant point is that it was provoked deliberately by the Government through their Budget decisions. Clearly, that was bound to effect the psychology of wage negotiations. What has happened? The short-term speculative gains, which I agree were real for a time, are now waning. The real adverse effects of the Budget and of this Bill are beginning to appear.
  Hon. Members opposite delude themselves if they think—I am sure sincerely —that the temporary unpleasant effects will bear pleasant fruits later on. I believe that exactly the reverse is true. Of course, food subsidies are an indirect export subsidy, and the injury to our exports is still to come. As the city editor of "The Times" put it very truly two days ago:
  "It is only now that some of the difficult practical issues raised by the Chancellor's Budget three and a half months ago are beginning to come to a head."
  Then he talked about some of the wage claims before us. The fact is that the Chancellor has been reduced to pleading for wage restraint when he has no moral authority left to do so. It was only last week that I noticed that the National Union of General and Municipal Workers, very much in the spirit of the speech of my hon. Friend the Member for Newton (Mr. Lee) this evening, passed a resolution calling on the Government to review their economic and Budget policy in order to maintain the purchasing power of wages. That is a request to the Government to show the same moderation as is shown by organised labour, and for the Government to fulfil their part in maintaining internal stability.
  What a tragedy it is that the Chancellor in his Budget showed so much less statesmanship on this issue than organised

  2515
  labour in this resolution which the "Manchester Guardian" described as an eleventh hour appeal to the Government. It is an appeal to which the Government could still respond. Many of those food price increases threatened in the Budget have not yet been made. So far as I understand the position——
  Mr. Speaker: I do not want to interrupt, but the right hon. Gentleman is talking about food subsidies, and matters like that, which are not in this Bill. The right hon. Gentleman must try to confine himself on Third Reading to what is in the Bill.
  Mr. Jay: I was following some of the speeches made by my hon. Friends and trying to reply to the debate. I agree, however, that this comes in only as part of the economic background.
  I wanted to say, following my hon. Friend the Member for Newton, that I hope that the Government even now will heed this eleventh hour appeal. We urge the Chancellor to do so, for this is, as I think the hon. Member for Louth would agree, a fatal moment to strike a gratuitous blow at our export trade. As the hon. Member for Louth has said, the position abroad is difficult. Foreign competition is now being felt and it is likely to become worse as time goes on. If export prices are to be forced up at this stage by the measures in this Bill and by the Budget, then the outlook for British exports from now on will be exceedingly bleak.
  This is at a moment when the import cuts which we were promised have still apparently not materialised. The reasons for this failure to deal with the really practical problem before us are no doubt various. It seems to me that one reason is this: that the Government have been tending in their defence of the Bill and in their public statements to use a lot of rather woolly, mystical metaphors about these problems instead of talking clearly in terms of concrete fact. Indeed, in the case of the debt interest which we were discussing on one of the Clauses of the Bill, this mumbo-jumbo and verbiage cost the taxpayer about £80 million a year—a rather expensive type of economic mysticism.
  We have heard a good deal of talk about "saving the £," about "con-
  2516
  fidence," and even—believe it or not in 1952—we heard today from the right hon. Gentleman the Member for Blackburn, West about convertibility. But we are not told, as again my hon. Friend the Member for Newton said, in concrete terms what this Bill will achieve in terms of increased production, and how that is going to affect our balance of payments. Perhaps again, one cannot expect very clear understanding and a right policy when the Prime Minister is talking about standing on trapdoors, and Lord Woolton, I see, depicts himself as
  "laboriously struggling to find a way out of a dark tunnel, and seeing, dimly in the distance, the light ahead."
  I think that all that sort of talk does a lot of harm to the understanding by the public for which the hon. Member for Louth was pleading just now.
  Surely the real road to solvency lies by way of technical progress—which has been alluded to today; higher production; concentration on the dollar problem —first and foremost; ruthless economy in imports; and rising exports. This Bill, it seems to me, contributes to hardly one of those things. For the truth is, of course, that there are really only two broad policies which can, in our hard struggle—and I am glad that the Chancellor now recognises it, as he did the other day, as a hard, uphill struggle rather than a crisis—achieve a solution. One is to use courageously every possible device of planning, of control, and restraint to build up our exports and husband scrupulously our home produced and our imported resources. That means, of course—and must mean—more and not less controls and planning. That is what, I submit, the present situation manifestly requires.
  But that, unfortunately, runs clean contrary to the doctrinaire prejudices of hon. Gentlemen opposite, about some of which we heard today from the hon. and gallant Gentleman the Member for Ayr (Sir T. Moore) and the right hon. Member for Blackburn, West. Hence, I think, the muddle and vacillation which we find enshrined in this Bill, and hence also the extraordinary discredit—or unpopularity, as it has been called today— in which this Government have fallen even with their own supporters. How disastrous it really is for the nation that at this moment we have in office a Government who are doctrinally inhibited

  2517
  from taking the measures that the situation really demands.
  For the only other alternative policy to what I have advocated is, of course, de-control and deflation, carried to the point at which the public would be so impoverished as not to be able to afford to buy, in the absence of control, more imports than the country can afford. That is the sort of policy which the hon. and gallant Member for Ayr was hinting at today when he spoke of the privilege, I think he said, of having rather higher unemployment. But, of course, getting a solution that way would probably mean a 20 per cent. Bank rate and 5 million unemployed. Is that what the hon. and gallant Gentleman or any other hon. Members opposite are really perpared to contemplate?
  For if they are not, and if they also are not in favour of our policy of thoroughgoing planning and control, if they will have neither of these, then, of course, chronic balance of payments crises are really inevitable, as long as this Government remain in office. The policy of this Bill, therefore, as it seems to me, hesitates feebly and uncertainly between those two practical alternatives. That is why we again condemn it as ineffective, unjust. irrelevant, and, in the last resource, injurious to the nation's hopes of achieving real economic independence
  7.46 p.m
  The Financial Secretary to the Treasury (Mr. John Boyd-Carpenter): From time to time this debate has rather had the atmosphere of taking leave of an old friend whom one has seen a good deal of during the last few months; indeed, there were moments when this House got into the atmosphere of obituary notices, which, perhaps, are the only occasions on which public men really say nice things about each other.
  However, I did notice that neither the right hon. Gentleman the Member for Leeds, South (Mr. Gaitskell) nor the right hon. Gentleman the Member for Batter-sea, North (Mr. Jay) was able to resist the temptation to adopt the conventional gambits which are normally played from that Front Opposition Bench at the last stage of a Finance Bill; a conventionality, perhaps not unconnected with their Wykehamist background, which induced them
  2518
  to play the perfect Opposition gambit at the final stage of the Bill.
  Either they say, here has been a brutal Chancellor who has disregarded the views of the House of Commons and driven his Measure through with ruthless disregard for the views of hon. Members; or, if the facts are so obviously against them that they cannot use that one, they say, as the right hon. Gentleman the Member for Leeds, South did, what a terrible number of Amendments have been made, to show a lack of planning and a lack of forethought at the beginning. That is the absolutely perfect dialectical Morton's Fork that Oppositions at this stage seek; and we could see the two right hon. Gentlemen thoroughly enjoying themselves in the process.
  I thought that the right hon. Gentleman the Member for Battersea, North, whose display of metaphor was really magnificent, from his five-bladed knife to the changed horses, a little overdid the changes that have, in fact, been made during the course of these debates. But it is perfectly true, as my right hon. Friend said, that, in his conduct of his Measure through the House, he has thought it right and proper to pay full attention to the views expressed by right hon. and hon. Gentlemen on both sides, which I would say is the proper and constitutional way, when dealing with this great annual Measure, to treat the House of Commons.
  It is the fact, party political considerations altogether apart, that this House does contain among its Members a very considerable number with very great practical experience and knowledge of the different aspects of our life and of economic effort, and it would be very foolish, and a neglect of opportunity, for any Government to fail to take advantage of the wisdom and experience which is to be found on both sides, which can very profitably be made use of in the discussion and in the consideration of the grave and difficult and delicate matters embodied in a Finance Bill.
  But we must not exaggerate the changes which have taken place. The right hon. Gentleman the Member for Battersea, North referred to 200 Amendments in my right hon. Friend's Bill. Knowing the right hon. Gentleman's scrupulous care for statistics, I am sure it is

  2519
  right, though I have not myself counted them; but it is equally the case that a great many of them were wafted through the Committee of the whole House and the House on Report with the aid of that magic talisman, the word "consequential," and were, in fact, of no very great significance.
  It would be a pity, too, from the point of view not so much of this House, which knows exactly what has been done, but of opinion outside, to overstate the changes financially which have taken place so far as this year's finances are concerned. It is important that the figure which my right hon. Friend gave in moving the Third Reading, that the changes so far as this year's finances are concerned total no more than £13 million, should be clearly stated.
  Other changes affect the revenues for next year—the changes with respect to Excess Profits Levy—but their effect on the picture next year must depend on what other arrangements my right hon. Friend makes at the appropriate time for dealing with the affairs of that year. It is important to realise that for this year the changes, compared with the vast figures involved in a contemporary Finance Bill, are not of a very imposing nature.
  The right hon. Gentleman, the hon. Member for Sowerby (Mr. Houghton) and my hon. Friend the Member for Horsham (Mr. Gough) referred to changes which have taken place in the Excess Profits Levy from the very practical point of view of their effect upon administration and upon the staff of the Inland Revenue who have to administer them. That is a very practical and important consideration.
  I certainly do not yield to the hon. Member for Sowerby in my admiration for the devotion and skill of those public officers upon whom, as he rightly said, this House is by passing this Bill, imposing further duties. But I think hon. Members can reassure themselves to some extent upon this point, because, while it is true that some of the Amendments which my right hon. Friend made in order to prevent the levy falling with undue hardship upon particular industries or activities will undoubtedly complicate the tax further, it is equally the fact that the concession which he made
  2520
  with respect to the minimum standard, when the figure was raised from £2,000 to £5,000, will have the effect of taking out of the scope of the levy one-third of the companies which would otherwise have been within it, therefore giving very considerable relief to the strain upon the administrative machine.
  The right hon. Member for Leeds, South touched upon an issue of great importance; that is to say, the effect of these changes upon considerations of restraint in demands for increases in wages. He knows, no one better, the importance of that matter, and I am sure he was speaking with a due sense of responsibility in what he said, but I thought he failed to give the full picture.
  It really is not perhaps the complete picture to refer in this connection to alterations of the food subsidies—which, incidentally, are not in this Bill at all— while not referring in this context to the very substantial reductions in Income Tax payable by a very large number of the people concerned. Both are part of the picture, and both, I am sure, will be given full consideration by those who have to concern themselves directly in these matters. It is important that the picture should be looked at as a whole, and it should be realised that there are very substantial increases in net earnings which the adjustments in Income Tax contained in this Bill will effect.
  Mr. Gaitskell: I did refer to both. My complaint was that the Chancellor referred only to Income Tax concessions and made no reference to the way in which the money for them was found.
  Mr. Boyd-Carpenter: Perhaps my right hon. Friend had a more punctilious regard than the right hon. Gentleman for the rules of order and was concerned with the fact that the Income Tax concessions are in this Bill whereas the adjustments to the food subsidies are not. I do not want to quarrel with the right hon. Gentleman, but he realises as well as any hon. Member that it is important that no false picture of the effect of these changes should even appear to go forth from the House.
  My right hon. Friend the Member for Blackburn, West (Mr. Assheton) spoke, as he always does, with great force and authority on the subject of the burden of contemporary taxation and of its adverse effects. No one, I think, will dis-

  2521
  pute a good deal of what he said. It would be a mistake to underrate the effect upon industry and the economic strength of our society of taxation maintained over a long period at this sort of level, and the right hon. Gentleman knows, I think, that the difficulties which arise from such a state of affairs are very much borne in mind. He equally realises the problems which face my right hon. Friend of grappling at the same time with the balance of payments difficulty and maintaining a very large re-armament programme.
  The hon. Member for Bristol, North-East (Mr. Coldrick), who I am sorry to see is not now in his place, raised a point which he was good enough also to raise with me personally. He raised the somewhat technical point of the treatment of co-operative societies for the purposes of Profits Tax. He himself described it as a technical point, and the only thing that I would have said to him were he here would be that he has already submitted to us in writing details of the point he has in mind, and we shall certainly give it the fullest and fairest consideration, because it is not our desire that this tax, or indeed any lax, should operate unfairly to any organisation or body.
  Then my hon. Friend the Member for Louth (Mr. Osborne) referred to my right hon. Friend's undertaking with respect to two committees to investigate certain aspects of Purchase Tax law. My right hon. Friend is pressing on with the arrangements for those committees. He is anxious to set them up as rapidly as possible, and as soon as the terms of reference and the membership can be settled an announcement will be made to this House.
  My hon. Friend the Member for Horsham referred to another technical point, on which he also has been good enough to communicate with me. It relates to service payments—a horrifying and complex subject which, although it is one with which the hon. Gentleman is himself wholly familiar, is not perhaps very acutely in the forward consciousness of the majority of hon. Members at this moment.
  I can certainly assure my hon. Friend that during the course of the year we will look most carefully at the point which he has been good enough to put forward since, if I may repeat what I said a moment ago, it is our desire that the
  2522
  taxation system should operate fairly, and it is not our desire that the necessary stopping up of a loophole in the Ninth Schedule should be carried too far, and carried to the point of effecting unfairness.
  The right hon. Member for Battersea, North, who I thought was thoroughly enjoying himself in the concluding moments of his speech, came back to a subject on which he has touched more than once during the course of our debates. In referring to our Income Tax concessions he was good enough to say that he welcomed them up to a point; up to a point, as I understood it, on the Income Tax level. That is to say, he welcomed it—I think I understood him aright—up to £1,000 a year but disapproved of it beyond that point.
  Well, I cannot agree with him in that view. Tax concessions of this sort, as my right hon. Friend has explained more than once, are designed to give a stimulus to the making of extra effort, the exercise of extra skill on the bearing of extra responsibility, and I cannot accept for one moment the proposition of the right hon. Gentleman that the need and the value of those incentives terminates at an income level of £1,000 a year.
  Mr. Jay: My argument was not that the incentive effect altogether terminates at that level, but that the effect produced above that level is not worth the damage that is done in other ways in order to secure the incentives. That is the argument.
  Mr. Boyd-Carpenter: I emphatically disagree. It is above that level, and perhaps at a small point above that level, that a good deal of the creative and constructive ability of this country is to be found of a section of society which has endured many things during recent years, and on which this country depends for a great deal of its necessary work, professional, administrative, skilled and technical.
  I think that it would be utterly wrong to say that incentives could rightly be provided up to £1,000, and to say to the man who by the sweat of his brow or the exercise of the skill of his brain is earning £1,000—a category which necessarily includes all hon. Members—"Your extra effort, your extra skill are not worth making tax adjustments for. "I think that such discrimination would not only

  2523
  be wrong and unfair in principle but very short-sighted from the point of view of the purpose of this adjustment and of giving to the people of this country an extra stimulus, and it is a very real stimulus, of knowing that a greater proportion of extra earnings will be retained in that way.
  One knows that there are a great many people, and one respects them, who work solely for the love of the job; but it is a fact that the appeal also of being able to earn a little more for oneself or for one's family touches a very deep fundamental human instinct, and to have ignored it at a time when the skill, industry and vigour of our people is so urgently required would have been a terribly short-sighted thing to have done.
  The right hon. Gentleman the Member for Battersea, North finally touched on another of his hobby horses. He wanted more physical controls. If I were to follow him, Mr. Deputy-Speaker, in a discourse on that curious fancy, I should, no doubt, find myself incurring your displeasure. I would say once again that the effect of this Bill is to provide that the physical controls which have to be retained are enabled in a much greater degree than has been the case in the past to work with and not against economic and monetary forces; and physical controls where they are necessary are more efficient if they are not directed to damming up the tide of economic pressure flowing in the opposite direction; and if both physical controls and economic tendencies can be arranged so that they work in the same way, that is a more practical method than that which the right hon. Gentleman appears to favour.
  During the course of our not unduly restricted debates on this Bill hon. Members have differed with sincerity and sometimes with passion as to the effectiveness or value of certain of the provisions of the Bill. I hope that I am right in saying, and I believe that I am, that although many hon. Members have differed as to the means by which this Bill seeks to achieve its end, none of us differ in desiring the end itself, and that end, as my right hon. Friend has said
  2524
  more than once, is the restoration of the strength and greatness of this country. I am sure hon. Members who have prophesied that these measures will not work to that end would be only too delighted in the event of their gloomy prognostications being falsified.
  Mr. Lee: I am sorry that the Financial Secretary has made no reference to the question of the economics of the industrial areas and especially to the textile situation.
  Mr. Boyd-Carpenter: I meant no discourtesy to the hon. Gentleman, but I think that my right hon. Friend, in moving the Second Reading, dealt very fully with that aspect of the matter. We have made it clear—and here again we are on the edges of the rules of order— that in our view one of the best ways of helping these areas is by the giving of direct Government orders. I cannot discuss that on the Third Reading of the Bill, but the fact is that within the structure of this Bill there is little more to be said on this subject. Reference has already been made to the Purchase Tax adjustments put into the Bill, and that, I think, makes it unnecessary for me to do more at this stage, but that does not mean that we are not deeply concerned with the future of these areas and doing everything that is reasonably practicable to alleviate their problems.
  The Bill itself is sincerely and honestly aimed at the ends to which I have referred—to the end of restoring the solvency and, therefore, the independence and greatness of this country. Our people have had a pretty hard and difficult time in the last 13 or 14 years, and they deserve, and we want to be able to assure for them, something of sincerity, something of serenity, something of stability and something of peace. No responsible person can suggest that that state of affairs is easy of immediate achievement, but as a step in that direction, as a solid and workmanlike instrument with which our people can themselves work in that direction. I commend this Bill to the House.
  Question put, and agreed to.
  Bill accordingly read the Third time, and passed.

  POST OFFICE AND TELEGRAPH (MONEY) BILL
  Considered in Committee. [Progress. 13th June.]
  [Mr. HOPKIN MORRIS in the Chair]

  POST OFFICE AND TELEGRAPH (MONEY) BILL

    Clause 3.—(SHORT TITLE.)
    Question again proposed, "That the Clause stand part of the Bill."
    8.6 p.m.
    Mr. C. R. Hobson: I know that it is unusual to speak on the Short Title of a Bill, and that it is very difficult to do so when the Bill has not been amended by the Committee in its scope. What I am concerned about is that this Clause is not exactly accurate in its description. It states:
    "This Act may be cited as the Post Office and Telegraph (Money) Act, 1952."
    That title has been common to all Post Office (Money) Bills that have been before this House. The reason for my suggesting that it is not accurate is that this Bill relates, so far as capital expenditure is concerned, not to telegraphs but to telephones. I am quite aware that in previous legislation telephones were telegraphs, but I am now suggesting that since the Telephone Bill, 1951, telephones are now telephones.
    The Deputy-Chairman: I do not see an Amendment down to this Clause.
    Mr. Hobson: There is no Amendment down, but I was hoping that perhaps the next time we have a Post Office Bill the word "telephone" could be included, and that was the object of my remarks.
    Question put, and agreed to.

    New Clause.—(COMMERCIAL ACCOUNT.)
    The interest charges on any sums devoted to defence purposes shall not be borne on the Post Office commercial account.—[Mr. Winterbottom.]
    Brought up, and read the First time.
    Mr. R. E. Winterbottom: I beg to move, "That the Clause be read a Second time."
    I have no doubt that the Committee, and especially the Assistant Postmaster-General, will welcome my assurance that I am not going to delay the Committee for more than a few minutes. I think it is true that almost everything that can
    2526
    be said in favour of this new Clause— and there are quite a lot of things that can be said in favour of it—in terms of foundational argument were used during the Committee stage of the Bill, and especially in respect of the Amendments which were tabled at that time and rejected. Moreover, most of the principles in Post Office accountancy to which we have taken exception and upon the foundations of which this new Clause is based were debated at length as recently as last Monday when we were discussing the increase in the poundage of postal orders.
    I would recall to the Assistant Postmaster-General the proposals which we moved a week last Friday when we sought to reduce the new allocation of capital expenditure for the Post Office from £75 million to £50 million. I suggest that our proposed Clause is the next best thing for carrying through the principle for which we have been fighting all the time. It is impossible to draw a line of demarcation between the capital allocation under the Bill and its effects in terms of interest.
    The Assistant Postmaster-General should, for the sake of brevity, accept all that we have said before, take it into consideration and reply accordingly. Our main argument is that the Post Office does the work for the State Departments, especially the Service Departments, provides the capital expenditure for the equipment which is used, and, seemingly, also has to pay the interest on the value of the capital equipment. That seems wrong to us and we should like to see a correction. We know that the real correction is in terms of a recasting of the whole of the Post Office finances, on both cash and commercial accounts, and we stress that as the only really satisfactory way of dealing with Post Office finances.
    I have three questions to put to the Assistant Postmaster-General, and I hope he will answer them and help us to determine our course of action on the Clause. Are other Departments still to get services without paying cash? Has the Post Office in its capital allocation still to carry capital development for other Departments? Has the Post Office still to pay interest and charges on the cost of capital work done for other Departments? In our debates during the last fortnight the Assistant Postmaster-General has given a clear indication that

    2527
    some consideration has been given to the problem.
    The Deputy-Chairman: The hon. Gentleman's questions go beyond the scope of this Clause, which relates to the Post Office commercial account.
    Mr. Winterbottom: I have tried to explain, Mr. Hopkin Morris, that we can hardly divorce the wider question from the narrower question of interest, and, because the Assistant Postmaster-General has indicated that consideration is being given to the problem, I wonder if he is able to make a statement now or can say when a statement will be made which will help us to determine our course of action on the Clause? I hope he will clarify the issue.
    8.15 p.m.
    The Assistant Postmaster-General (Mr. David Gammans): I am grateful to the hon. Member for Brightside (Mr. R. E. Winterbottom) for moving the Clause, because it gives me an opportunity of clearing up what is in the minds of many people inside and outside the House, and that is exactly how the Post Office finances its capital development, especially in relation to the Service Departments.
    The hon. Gentleman and his hon. Friends have noted that approximately one-third of the amount provided under the Bill will be spent on defence. Naturally, the hon. Gentleman wants to be reassured that the interest on this money should be met by the Service Departments and not by the Post Office. If that were not so the Post Office accounts would, in that sense, be distorted. It would mean that the civilian account of the Post Office would be called upon to bear expenditure on which in its civilian capacity it receives no return, or that the public were being asked to pay indirectly for increased charges on services which they do not enjoy. That is a very important point, and I am glad to have this opportunity of clearing it up, to the satisfaction, I hope, of the hon. Gentleman and his hon. Friends.
    I want to make the point which I made when we discussed this earlier, and that is the difficulty of separating defence expenditure from purely civilian expendi-
    2528
    ture. The reason for the difficulty is that a very large part of the work we are doing now primarily for the Defence Departments will ultimately be useful and essential for civilian development. All we are now doing is work that we should ultimately do in any case.
    The Deputy-Chairman: It is very difficult to associate this with the new Clause.
    Mr. Gammans: The new Clause reads:
    "The interest charges on any sums devoted to defence purposes shall not be borne on the Post Office commercial account."
    I was endeavouring to show that the capital expenditure to which the Clause refers will not ultimately be for defence purposes at all but will be used for civilian purposes. I hope I am keeping in order, because it is very difficult without accepting that basis to deal with the point which the hon. Gentleman raised.
    Mr. W. R. Williams: Seeing that the hon. Gentleman has been allowed to develop his argument so far, is it now to be assumed that he has rather shifted his ground about the amount which will ultimately be useful to the Post Office, because on Second Reading he said——
    The Deputy-Chairman: This discussion is very wide of the new Clause.
    Mr. R. E. Winterbottom: On a point of order. The problem which has been worrying us throughout our discussions on the Bill has been the relationship between the cost of defence services and the interest to be borne on the Post Office revenue account in regard to that defence expenditure. Although it is very unusual to find a Minister being defended by an Opposition back bencher, in this case I appeal to you, Mr. Hopkin Morris, to allow the Assistant Postmaster-General to continue because it is along the line of our argument in support of our new Clause.
    Mr. R. T. Paget: Further to that point of order, Mr. Hopkin Morris. When we have a new Clause saying:
    "The interest charges on any sums devoted to defence purposes shall not be borne on the Post Office commercial account,"
    surely it must be relevant to discuss which of the charges on the Post Office account

    2529
    are for defence purposes and for the Minister to make the point, which I understood him to be making, that it is sometimes difficult to differentiate between the two because there is a dual purpose?
    The Deputy-Chairman: There may be difficulty, but the differentiation should be made. What the new Clause states is:
    "The interest charges on any sums devoted to defence purposes shall not be borne on the Post Office commercial account."
    Mr. Gammans: What I am endeavouring to show is, first of all, the difficulty on the capital side of differentiating between what is spent on defence and what is spent on ordinary civilian purposes. I then want to show that the interest is received by the Post Office in a rather different way but one which I hope the Opposition will agree is equally effective for the payment of the interest. I hope that I will be allowed to develop the point that the first difficulty is to differentiate what money is spent for purely defence purposes and what ultimately' will be useful for the ordinary service of the Post Office. I want to repeat an assurance I gave a short time ago, that we are extremely anxious, if it is possible, to differentiate and, if we can, we will do so. I can give that assurance with complete sincerity.
    On the question of interest charges, I would remind the Committee that the Post Office does not get interest in the ordinary sense but is credited with full commercial rentals for the services which are provided for the defence Departments. In other words, we do not get the interest but we get the same rentals for telephones, or whatever it may be, as if those were used for ordinary civilian needs. Last year the Post Office received £8 million in rentals and other charges from the defence Departments and that sum was credited to commercial accounts.
    Mr. W. R. Williams: In this term "rentals" does the hon. Gentleman mean telephone calls as well?
    Mr. Gammans: The figure I gave includes them.
    Mr. Williams: I should like to know how that is established.
    Mr. Gammans: That is done by a sample. In parenthesis, I might say that
    2530
    from next year the three Service Departments, the Ministry of Defence, the Ministry of Supply and the Treasury are going to be charged on an annual commercial basis for the calls which they make, and that will have to be debited to their Estimates. I hope as a result of that that we will see the scheme extended generally. It is an experiment, and as that is nearly three-quarters of the expenditure it will meet the point which both sides of the Committee have in view.
    There is one other matter with which I would like to deal, and that is that we are investigating to what extent there may be some expenditure for defence purposes which is wholly for defence and expenditure which ultimately can be used for civilian purposes. We are hoping it will be possible to find a formula so that the Post Office will get direct commercial credit for that expenditure. In that way it will not in any sense affect the ordinary civilian accounts of the Post Office.
    The last point I wish to make will, I hope, satisfy the hon. Gentleman and his friends. There has been at the back of their minds a feeling that because £25 million of the £75 million was being spent on defence this year, that was likely to hold up the development plans which we all want to see put into operation. But that is not so. The limiting factor is not money, but the extent to which capital resources can be devoted to civilian ends. The handicap on us is that which is on British Railways, the Coal Board and on large civilian companies as well. If it were not for that I would have no hesitation in coming and asking for a further sum of money perhaps earlier than one would come.
    I hope I have dealt with the points that the hon. Gentleman raised and also with the misgivings which not only hon. Gentlemen opposite, but hon. Members in all parts of the Committee, have on this point. So far as the interest or income is concerned, the Post Office is not affected in any way. As I have said just now, we are trying to see to what extent it is possible to isolate pure defence items from the capital budget, and to what extent it is possible on the income side to get credit for those works which do not immediately yield ordinary rentals like we are getting from the Service Departments. I trust that I have satisfied

    2531
    all the points which have been raised, and that the hon. Gentleman will not press this new Clause.
    Mr. Hobson: I am sure we on this side of the Committee welcome the forthright statement made by the Assistant Postmaster-General. It is a considerable step forward. There are one or two points I want to make about the new Clause and that is the main reason for putting it down. This sum of £25 million represents a considerable amount in interest charges. The interest on this money, according to the statement made by the Assistant Postmaster-General on Second Reading, will be operating at 4 per cent., which means that on £25 million £1 million has to be found annually for the interest repayment on capital works which in the main is for defence.
    It is true to say that the Post Office will get revenue from this work. It is perfectly true, as was said a few moments ago and on Second Reading, that a certain amount of capital work can be taken back into the Post Office network when it is no longer required for defence. There is, however, a special problem— and one cannot go into the matter in Committee or at any time in the House to any great extent because of its secret character—which arises from the nature of this work. Therefore, I merely say that the Assistant Postmaster-General is well aware that a lot of work has got to be done in special circumstances and installations made in special buildings.
    To deal with these matters we felt it necessary to put down this new Clause. We shall not divide the Committee on it, but obviously it has been worth while having a discussion on this problem for it has elicited from the Assistant Postmaster-General the new methods that are going to be adopted about costing for the Service Departments.
    Mr. Paget: I do not want to take up very much of the time of the Committee, but I feel there ought to be some protest made at the amount of time wasted on this Bill. We have had a statement tonight which we pressed for during the whole of Friday. We have only received it at this late hour. This has happened time and time again, because Ministers come to the House to present matters and have very little knowledge of their briefs.
    2532
    I do not know if the Leader of the House has suddenly become gun shy, but he never seems to be here on these occasions. These Minister in charge are without authority to give reasonable undertakings for which the Opposition ask, and constantly are without a Law Officer of the Crown to assist them. When that happens the opposition is bound to go on, because that is the only method of providing the Minister in charge with an opportunity of consulting his colleagues and to get the requisite authority, and thereby attain the legitimate objects for which the Opposition has asked.
    It has happened time and again that because the Government have not got anybody here who can give the Minister permission to say anything, or a lawyer who can tell him what effect anything he may say might have, we waste hours and hours of the time of this House. I hope that eventually the Government will be educated by the Opposition, and that we shall be able to get through business with a little more despatch.
    8.30 p.m.
    Mr. R. E. Winterbottom: In asking——
    Mr. Leslie Hale: On a point of order. One of my hon. Friends rose to speak, and I am certain that my hon. Friend does not wish to deprive him of an opportunity of doing so.
    Mr. Winterbottom: I have been called twice, and at the moment I feel like a jack-in-the-box. My intention is to ask leave to withdraw the Motion. I am doing so bearing in mind what the Assistant Postmaster-General has said, and also bearing in mind that he has been pushed into accepting at least part of our case.
    Mr. W. R. Williams: I wonder if my hon. Friend would allow me to intervene briefly before he continues? I have no quarrel with what he proposes. I rather take the opposite view to that of my hon. and learned Friend the Member for Northampton (Mr. Paget) that we have been wasting time. Would my hon. Friend not agree that we have served a very useful purpose in directing the spotlight upon a weakness in Post Office commercial affairs? I am rather inclined to the view that we should be commended for the efforts which we have

    2533
    been making and for the response of the Assistant Postmaster-General to those efforts. I do not think he has gone far enough, and I am sure that my hon. Friend, in asking leave to withdraw the Motion, will try to persuade him to pursue the matter further before he comes to the House with another Bill.
    Mr. Winterbottom: I can agree with everything which my hon. Friend has said. I wish to emphasise that we have pushed the Assistant Postmaster-General and his noble Friend at least part of the way we wanted them to go.
    I wish to call the attention of the Committee to the fact that the concession which has been announced today by the Assistant Postmaster-General relates only to the commercial account as it is affected by the Service Departments. I wish to stress that. The concession completely omits the other State Departments and does not cover the capital account. There must also be added the free services given to all the other State Departments, and because these are not covered, I wish to issue a very friendly warning to the Assistant Postmaster-General that we shall return again to this problem as opportunity offers.
    In asking leave to withdraw the Motion, I wish to say that, the first step having been taken, we shall press on until we have got the finances of the Post Office —both the cash account and the commercial account—on a fair basis that will satisfy the needs of the general public and the Members of this House who for quite a long time have been dissatisfied with the position. I beg to ask leave to withdraw the Motion.
    Motion and Clause, by leave, withdrawn.
    Bill reported, without Amendment.
    Motion made, and Question proposed, "That the Bill be now read the Third time."
    8.34 p.m.
    Mr. Geoffrey Bing: It would be unfortunate if those Members, particularly on the opposite side of the House, who take a great interest in Post Office matters did not say just a word of commendation for what is, after all, a Government Measure. When the House comes to consider whether we
    2534
    should pass this Bill—quite frankly, I think we should—we ought just to consider what is the sum of money involved, whether it is sufficient or not and to what purposes it is to be devoted.
    It is true that on the other stages of the Bill various difficulties and accounting problems have faced the Assistant Postmaster-General. In my constituency I have the good fortune of having—at least he is buried in my constituency—the first Postmaster-General. His tomb is in the church at Hornchurch, and therefore I feel that this Bill might well be described as from Hornchurch to Hornsey. One would like to think there was an even rate of progress, but unfortunately there is not.
    When one considers this large sum of capital expenditure and casts it up against what is to be done, one is tempted at first sight to think that perhaps there is no point whatever in passing this Bill. It is said that we need a lot of capital expenditure for the Post Office. One looks round in one's own constituency and tries to see what is being done there. I am sorry the hon. and gallant Member for Romford (Lieut.-Colonel Lockwood) is not here, because we share the one telephone exchange in our two constituencies and the same sort of problems face both of us.
    Thanks to the public interest roused in Post Office questions by the previous debate there was an inquiry carried out by the "Romford Times" into the conditions in Hornchurch. They said, quite properly, that there is a Bill to provide a huge sum of money for the Post Office, and they went to the Post Office officials and said, "What will it do for Hornchurch and Romford?"
    The answer, I am sorry to say, which was given by the Post Office official was, "Nothing." Far from there being anything for Hornchurch and Romford, the situation now is far worse than before the Bill was introduced. The Post Office official, or whoever it was—the spokesman—said that by capital expenditure restrictions brought about by the country's present economic plight, it really was not possible to have much development. He went on to say:
    "We are not allowed to spend the money we would like to on new exchanges, and new automatic equipment or new cables. Anyway, you've got to have all or nothing. You can't mate old equipment with new."

    2535
    Whereupon the reporter referred the official to a statement made in the days when another Government were planning our capital expenditure for the Post Office, and pointed out that under that plan there was very shortly to be a new exchange. He inquired what was the effect of this further £52 million. The reply was:
    "I can find no information in the files"——
    Mr. Deputy-Speaker (Sir Charles MacAndrew): Order. This Bill deals only with ways of raising the money, and not how it is to be spent.
    Mr. Bing: I perfectly appreciate that, Mr. Deputy-Speaker, but whether we are to raise the money at all depends upon whether the people of this country will receive any benefit from it. I do not want to dwell too long on the problems of my own constituency, but I think that all hon. Members, when dealing with Post Office matters, are in the position that they can only judge Post Office questions from the conditions in their own areas. If, as the result of taking another £52 million for the civil side of the Post Office, what has apparently happened in Romford is that a new exchange is to be postponed until 1962, then surely that is an argument why the House should not indulge in capital expenditure which results in a worse and not a better Post Office service. I hope, therefore, that when the Assistant Postmaster-General replies he will deal with this matter once again.
    What is not understood by the people in the country is how, under the present administration, we can spend so much money on the Post Office and yet, in an area such as mine, obtain so little in return for it. The Post Office is a very important service which affects especially the small business man. Before the Assistant Postmaster-General accepted his present office, he was always taking the part of the small business man. So far as I recall, he even gave his time to some organisation called C.O.R.D. which dealt with the problems of the small business man. And if there is one problem which confronts the small business man at the moment, it is to get a telephone.
    There are 1,500 small business men in the Romford area who are waiting to be connected to the telephone, and what is
    2536
    the solution that is offered? It is not a plan of reform based on the £50 million, but that 500 of them should be transferred to the Hornchurch exchange. I do not know whether the hon. Gentleman has ever tried to make a connection between these two points, but if he has attempted to do so, he will have found that the Hornchurch exchange is already over-burdened.
    I think that, in passing a Post Office Bill of this sort, dealing with capital expenditure on the Post Office, we ought to say that the difficulties which we all experience with these manual exchanges are in no case the fault of the operators, but are due to the absence of sufficient capital equipment, to the size of the switchboards——
    Mr. Deputy-Speaker: Do not these points arise on the Supply Vote for the Post Office, rather than here?
    Mr. Bing: With great respect, Mr. Deputy-Speaker, I think not. What we are concerned with on the Supply Vote is the pay of the people working there, but the question here is what they are to work and the capital expenditure that is provided for permanent installations. As I understand the memorandum which we had, the purpose of the Bill is to provide the capital installations which will be worked by the Post Office. From time to time, it is necessary to secure more money to enrich the Post Office to build up their material, and all I am trying to say is that we should review the matter before we part with the Bill in order to find out exactly how this money is to be spent and what are the capital works in which the Post Office will engage.
    The point that I have in mind, in dealing with these capital works, is that we cannot—indeed, it would be quite unfair to do so—blame the operators in the Post Office, because the absence of proper facilities makes it impossible for them to give proper connections. It is entirely wrong merely to transfer, as is now proposed, 600 subscribers from an exchange already overloaded to another exchange which is even more overloaded. If this is the problem in Hornchurch, it is also the problem all over the country.
    The only point I raise is the suggestion that, while the hon. Gentleman is now in office, he ought to show the interest in the small business man that he used to

    2537
    show when out of office. Surely, this is not only a political facade? Surely, he has the small business men's interests at heart, and will tell us what he will do to provide them with telephones, because the telephone is very often life or death to the small business man. It is all very well for the hon. Gentleman to say, "We are in a mess now and we cannot give anyone a telephone." This is a poor reply to the business man, who may suffer damage in his business, and there are hundreds of people of that sort.
    In my constituency, certainly, the problem is worse because of war damage. We have never really repaired the damage to the Post Office circuit which was done in the war period, and, if we are raising this amount of money, we ought to hear a little more about what is being done in the blitzed areas to restore the telephone service in those areas which suffered most in the war.
    One of our problems in the area of which I am speaking is created by an aerodrome in the constituency, which takes a great number of lines. In these circumstances, are we to increase capital expenditure in these areas to make up for the difficulties which they have suffered from the presence of military and air installations? What is the position there?
    Leaving aside the telephone service, I want to ask what is being done to provide better Post Office facilities, not only behind the counter, which the people can see, but in the building behind, where all the hard work is done. How far are we to have a proper development of the buildings of the Post Office, and how far are we to provide a post office that really corresponds with local needs?
    To take one example in my own area, we have always been in the Romford postal area. The one thing which gives a locality some degree of individuality is the possession of its own post office, and where this is not so, it leads to great difficulties in the case of people paying their rates, and so on. Again, in the case of houses, when there is such a restriction on the number of houses available, as is the case in my constituency, it is important to be able to ascertain under which authority one is living. [Laughter.] I do not know why hon. Gentlemen laugh, because it is so, although I cannot develop that.
    2538
    The hon. Gentleman really should consider this sort of question. Each of the new areas should have its own post office or its own centre where people can come. To some degree, the post office is a social centre. It is the place where people draw their money. One of the great complaints locally is that we have no post office of our own. Are we going to get one in the near future? Hornchurch is the place which produced the first Postmaster-General and because of that fact alone is, I think, entitled to have its own postal services.
    8.45 p.m.
    Mr. William Wellwood: For the first time in my life I have been disappointed by the hon. and learned Member for Hornchurch (Mr. Bing). During the whole of, his remarks he did not mention Northern Ireland, which surprised and disappointed me very much. Here was an opportunity for the hon. and learned Member to find fault with the Post Office service in Northern Ireland, although I am happy to say that I am perfectly satisfied with the service I receive from the Post Office there.
    Mr. Bing: I want to make it clear that the only reason I did not refer to the matter which no doubt the hon. Gentleman has in mind, the opening of the mail of people in Northern Ireland, was because the funds for that are not borne, I think I am right in saying, on capital account. No doubt the Minister can tell us whether any permanent installations for this purpose are being installed in Northern Ireland on capital account. I think I am right in saying that is a Supply question and that I could not deal with it on this occasion without being out of order.
    Mr. Wellwood: The hon. and learned Member has not got with him tonight his guide, philosopher and friend from the County of Fermanagh. There were no complaints from any other quarter of the House at the time regarding the Post Office service.
    I have intervened in the debate because I wanted to say that I am very happy to know that the hon. and learned Member for Hornchurch is quite happy regarding the Post Office service in Northern Ireland, as also I am.
    8.48 p.m.
    Mr. Hale: I intervened in one stage of this discussion to mention one or two questions regarding Oldham, and I think it might be convenient to mention them briefly now. It seems to me that we are entitled to know how it is proposed to spend this money. Up to now we have had very little information as to its prospective allocation. We are told that it is for the capital development of the Post Office, for periodic grants and that the money voted last time has not yet all been spent, but will be in a limited space of time.
    We have been given no information whatever except on the basis of the curious figure of percentages when we were told that 90 per cent. was being allocated to some form of telephone service. We were given no information as to what are the plans of the Assistant Postmaster-General. The difficulty is, of course, that the Postmaster-General is a Member of another place and we do not have the privilege of hearing him. Therefore, we have to rely solely on vicarious statements in this House.
    I want the Assistant Postmaster-General to realise that once he was committed to the proposition that capital development in the Post Office should be diminished, and once he was committed to accepting the dictation of the Treasury and the decision to slow down all this development and to cancel many projects, the whole question of priorities became a new question altogether. The House is entitled to be told how it is going to be handled now.
    Twelve months ago in Oldham there were several thousand applications for telephones outstanding, and some were of quite vital importance. At that time we were told in a speech at the local Rotary Club by a distinguished Post Office official that the whole of the lag would be taken up by June of this year. As I understand it, if there had been no change of Government, that might very well have been the case. [Laughter.] I do not know what is the meaning of that interjection. This was an official statement made by the Post Office of what was going to happen in the programme then being carried on so efficiently by my right hon. Friend the then Postmaster-General.
    Mr. Anthony Fell: I am sure that the hon. Member will not mind my laughter—my expression of joy at his magnificent speech.
    Mr. Hale: I am much obliged, but I am very surprised that it was joy. It sounded like nervous irritation.
    This question of priorities is one which we have never had explained to us. Whilst Oldham has one or two useful hotels, it is still very short of accommodation. Many people who have business in Oldham have to stay in Manchester, and yet there is difficulty in having a telephone installed in an hotel right in the middle of Oldham, West. We are told that there is no cable available, that applicants have to wait until a cable is put down and that that depends upon the capital investment programme.
    The result of all that is that there will be no practical cable-laying in towns such as Oldham for the next year or two. Almost all the projects contemplated in Oldham which would have built up the telephone and Post Office service are to be abandoned and we are to have no new development at all.
    My hon. and learned Friend the Member for Hornchurch (Mr. Bing) referred to the manual exchanges. I was very glad to hear him do so, because I think the time is coming when, except in rural areas where an automatic exchange is impracticable, we all want to see the manual exchanges go. I have worked on a manual exchange and my wife was a sub-postmistress. [An HON. MEMBER: "Is that why the hon. Member wants it abolished?"] If the hon. Member who interjected will have the courtesy to rise in his seat and ask his question, I will tell him precisely why. It is because the only provision made in that post office was a bell——
    Mr. Deputy-Speaker: I do not think this Bill deals with abolition. It deals with borrowing money.
    Mr. Hale: With respect, the whole purpose of the development is the construction of central exchanges, which is an absolutely vital matter to the modern telephone service. It means centralisation and, therefore, a more efficient service, and so it is vital that we should have an assurance from the Assistant Postmaster-General that a good deal of this money is to be put to that purpose.

    2541
    Since I was interrupted, perhaps I am entitled to complete my reply to the interruption.
    I was saying that in this post office there was a bell. It rang over the whole house every time the telephone was used. Someone had to go down every hour of the day and night when that bell rang and its ring was loud enough to awaken the dead. At nine o'clock the mail came and someone had to handle that. That was the sort of life in small villages in those days. I am very glad to see that something has been done to put it right.
    There are still one or two services which have not yet even been started, and I want to press the Assistant Postmaster-General to give us some information about priorities. I want him to tell us what case has to be established in these difficult days to obtain a telephone and how he fixes the priorities. There are instances of a big bookmaker with 200 telephones, whilst a smaller fellow cannot obtain one.
    A doctor should be able to obtain a telephone in almost any circumstances. I hope that there is no case in the country of a general practitioner who is not on the telephone today. There must be many matters of urgency where a telephone is essential. There are people like nurses and midwives who have to be available at any moment. It can be a grave tragedy in some of the wide rural areas where problems are liable to be magnified by the size of such areas.
    There are one or two curious procedures which still remain. I was surprised to learn the other day that I had to pay for the delivery of a telegram if I happened to be more than a certain distance away from the post office. This matter was taken up by a former distinguished Member of this House, Sir Frank Lockwood, who was Solicitor-General many years ago. He had a friend who was known for his particular objection to the fact that he had to pay 5s. for the delivery of a telegram. He sent a wire asking whether he could come to stay for a few days. He got a letter back saying, "Yes, by all means come, but please do not wire." Whereupon he wired back and said, "I am arriving on the train at 3 o'clock in the afternoon." He got the reply, "I will meet you by all means, but please do not wire."
    2542
    He terminated the matter by wiring "Why not?"
    I still have to pay for the delivery of telegrams. I do not object to it because I think the people running the post office have a hard job. They have to go round these vast areas. At the same time, I hope that a gradual development will eliminate some of these archaisms and will give us an efficient system as soon as reasonably possible.
    It would not be right for me to conclude without saying that, on the whole, this service is one of the best that have been produced. The removal of our grievances in Oldham in such a comparatively short time after the war is a tribute to my right hon. Friend. I am complaining about the deliberate decision of the Treasury to set the clock back and to cease to proceed at the same pace of development.
    On the whole, the efficiency of the Post Office and the courtesy of the telephone operators is quite incredible. I appreciate very much the constant courtesy and assistance that we get from a staff who have never been overpaid, who always have a tendency to be overworked, and who have to face a great many technical problems in the course of their duties.
    This is the supreme example of nationalisation which has now become part of the fabric of our life, which is part and parcel of almost every commercial activity, which renders assistance and is still conducted, even under a Tory Government, at rates which compare favourably with almost any Post Office service in the world. The Assistant Postmaster-General has taken over a responsible task, and one in which I am certain his passion for private enterprise is beginning to abate because of the efficiency of this nationalised service.
    I deplore this introduction of large defence expenditure in the Post Office accounts. I deplore the fact that we are adopting a method which we condemn so often when we refer to other countries, by which a sum of £25 million of defence expenditure is concealed in the Post Office accounts. This is a very regrettable matter. There was never any necessity for it from the first. It could easily be borne on the Defence Vote, as it has always been previously. Subject to that, my only regret is that the services are

    2543
    being run down. My desire is that we should be informed a good deal more fully what are the effects of this running down in Oldham and other Lancashire towns.
    9.0 p.m.
    Mr. Paget: I too should like to know how this money is going to be spent, and I think Northampton would like to know that too. In Northampton the situation has really been outrageous. It has been going on for years.
    There is a system of priorities which goes about half way down business needs. No private persons have the slightest hope of getting telephones in Northampton. Indeed, they are constantly losing them. If householder A changes house with householder B, both telephones are taken away. A is not allowed to move the telephone with him to his new house and B is not allowed to take over A's telephone because he was not previously a subscriber.
    Each time we are told that the reason for this lamentable situation is shortage of capital. It is not the telephone; it is not the equipment; it is the exchange. The exchange cannot deal with the volume required. Over two years ago Northampton was promised a new exchange. I have been putting down Questions to the hon. Gentleman and to his predecessors for many years now. Each time I am told, "It is going to come," and it never turns up. In voting this money I hope that Northampton is going to get its share, because that share is very much overdue.
    I should like to say something with regard to the countryside, because telephones are highly important instruments of production on the farms today. We are trying to get a large increase in our dairy and meat production. That increase can be achieved by improved cattle breeding, which in turn can be achieved by artificial insemination; but the work of artificial insemination depends entirely upon a telephone being available. [Laughter.] Hon. Gentlemen opposite laugh. I presume they do not come from the countryside, where this is a very real problem.
    As the hon. Gentleman's right hon. Friend the Minister of Agriculture will tell him, the main breeding policy of this
    2544
    country is based upon the extension of artificial insemination, making selected and valuable bulls available to thousands of cows where previously they served only tens. That whole service depends upon the provision by the hon. Gentleman of an adequate supply of telephones. This is a service which is essential to production.
    Now that we are giving him these large sums and now that we have exerted enough pressure for him to succeed with his colleagues, I hope we shall hear that he is going to hang on to the Post Office's own money and not have it concealed in defence, and that we are going to make a proper use of this money, a proper extension of the telephone service to the countryside, and in particular, that Northampton is going to have its new exchange, which it has been promised over and over again and which is still being delayed.
    9.4 p.m.
    Mr. William Ross: I think that we must pass this Bill tonight. I do not think that there is any question of voting against it. At the same time, I think we should let it be known that this Bill, which is seemingly so satisfactory, does not bear optimistic examination. After all, last year we spent £36 million on capital equipment —the very things which my hon. Friends have been talking about, such as new post offices, extra telephone exchanges and kiosks in the countryside.
    This year we are to spend £48 million and the year after that £50 million, which. on the face of it, looks very good indeed. But, as we have learned from the discussion of the Bill, we have to reduce that £98 million in the next two years by about £25 million, which is being diverted purely to defence purposes and from which, for the moment, the civilian population will get no benefit.
    I want the Assistant Postmaster-General to be frank with the country and the House. No one has done more than the party opposite to rouse the hopes of farmers, of business men, of shopkeepers, of the still growing army of citizens needing a telephone, that if only they got rid of the Labour Government they would get telephones. It is for them to bring the Bill to the House and to be frank with the country. They should tell the country what little hope there is of meeting the

    2545
    demand. There is even less hope when we appreciate that since the end of the war we have been building up a service, for the ordinary replacement and maintenance of which we need to spend more capital each year. Furthermore, with equipment of this type there has been no fall in price, so that for the same capital expenditure this year we shall get less in results—in telephone exchanges and so on—than in the past.
    One of the most disagreeable features is how little we are to spend in the next two years on postal and telegraph services. That means that these small towns and new areas within our cities, new housing estates, which have been hoping to get better postal facilities, will for some time have to be content with makeshifts. The Assistant Postmaster-General must be frank and tell the House and the country what the position is. It is far better that he should do so than he should lead the people to hope that something will come along.
    For the Post Office itself and those who work in it, this Bill and this situation spells frustration. I do not know any service which sets out more anxiously to provide the facilities which it could provide, given the elbow room within the existing situation. We on this side of the House are faced inevitably with this situation and we have to accept it; and, in supporting the Bill, I ask the Assistant Postmaster-General to be frank about the situation.
    9.8 p.m.
    Mr. Hobson: I do not propose to detain the House for more than two or three minutes. I am sure both sides of the House appreciate the biennial Post Office (Money) Bills, because they afford to the House an opportunity to discuss the whole ramifications of Post Office work. In that way, the Bill is an advantage, as, indeed, it is to everyone who holds the position of Postmaster-General or Assistant Postmaster-General.
    I took three of these Bills through the House and I know the time necessary to study the potential questions which may be asked. I sympathise with the hon. Gentleman, particularly in view of the fact that the Postmaster-General is in another place. I do not propose to deal with the difficulties in my constituency, the Keighley Division of West Yorkshire;
    2546
    nor do I suppose the Assistant Postmaster-General will reveal the difficulties which exist in Clissold and Tudor. All I can say is that he is probably now cognisant of the reasons for those difficulties.
    I was interested in the short debate we have had, because I remember discussions on rating and valuation arising out of a Post Office (Money) Bill, but never a debate on artificial insemination; and only a lawyer of the standing of my hon. and learned Friend the Member for Northampton (Mr. Paget) would not incur your pleasure, Sir Charles, when discussing such a subject on the Post Office (Money) Bill.
    Mr. Paget: I think a possible reason why is, that you are a countryman, Mr. Deputy-Speaker, and realise how essential the telephone is. and how vital is this agricultural service.
    Mr. Hobson: In a more serious vein, I just want to say to the Assistant Postmaster-General that I do hope he will see to it that some of the £75 million we are voting tonight is devoted to the building of new exchanges, and that he will use all the influence he can with the Chancellor of the Exchequer to remove the ban on new buildings, because if the ban is not removed there will be a far greater waiting list in a few years' time than that which exists at the present moment. I know full well that one in five of the exchanges at the present time is full. Moreover, even with shared services there has to be separate equipment. Therefore, it is essential that some of this money should be spent on new building, and I hope the hon. Gentleman will use his influence in that regard.
    I think we have certainly had a very friendly debate, and I do not want to say anything that would alter the atmosphere in which we have reached the Third Reading of this Bill.
    9.12 p.m.
    Mr. Gammans: First of all I should like to refer to the point made by the hon. Gentleman the Member for Oldham, West (Mr. Hale), in which he paid a great tribute, and a very deserved tribute, to the Post Office staff. All of us who have ever had anything to do with the Post Office for long or short periods agree with what he said, but the particular point I should like to make is, that

    2547
    if we in this House feel a sense of disappointment and frustration that more developments cannot be done by the Post Office because of re-armament and because of our economic position, that presses especially hard on the men in the Post Office itself.
    I hate to use this word "frustration," but there is nothing more discouraging than to know that projects that ought to be undertaken, and which, as an engineer, one would take part in, simply cannot be carried out. I cannot imagine any more satisfying job, any more satisfying post in any Government, than that of the Postmaster-General or Assistant Postmaster-General at a time of great development and expansion, and the tragedy of the situation today is that we know that there are great developments possible, technical and otherwise, and that there is great expansion required, and yet I have to stand at this Box at a time when I know that that cannot be done, and when I have to tell so many people they cannot have this and they cannot have that—not because I do not think they ought to have it, but simply because I know it is not feasible.
    The hon. Gentleman the Member for Kilmarnock (Mr. Ross) asked me to be frank. I tried on Second Reading to be very frank, and I think that what I said then covers all the points that have been raised by hon. Gentlemen tonight. Let me quote one thing I said:
    "The chief point I want to make…is that the sum we are providing today and are likely to be able to spend in the foreseeable future, is quite inadequate for the new developments which the Post Office would like to undertake"—
    and I should like the House to mark these words—
    "or even for us to be able to guarantee that we can maintain the service at present standards."
    I do not think anyone could be franker than that, and I do not think that any Minister could come to this Box to say anything more disappointing than that. I went on to say:
    "I am not suggesting the Post Office is unique in that respect. Almost every Government Department which serves the public, and most private concerns, would today say the same thing."—[OFFICIAL REPORT, 31st March, 1952; Vol. 498, c. 1192.]
    But let us realise the reason for it. This is due to the defence position and
    2548
    the need to restrict capital development on account of the economic situation. That is the reason, and the only reason. Therefore, when hon. Members on either side of the House criticise us for having to take up that attitude we very soon come to the question whether we agree that it is necessary for us to undertake this great defence programme, or whether it is necessary for us to divert to the export trade many of the materials and much of the results of the skill which we would like to keep at home.
    Mr. Bing: The hon. Gentleman says it is necessary in the public interest to restrict spending on capital account. How does he reconcile the restrictions of expenditure on capital account in the public sector with the increase of expenditure in the private sector, as, for example, the increase in building allowances at the moment for repairs and building?
    Mr. Gammans: It would be completely out of order for me to try now to make a speech on housing or house repairs, which are not my concern. The point I want to make is that this restriction is caused for two reasons: the need for re-armament and for maintaining and extending the export trade. That is a very disappointing position to have to take up, and I have warned the House now on three occasions that this may mean, not merely that we cannot improve our telephone service, not merely that we cannot provide the hon. Gentleman and his constituents in Oldham, or elsewhere, with the telephone exchange they require. It may be worse than that. It may mean that we may not be able actually to maintain the present level of the service that we are giving the public today.
    Mr. Hale: The hon. Gentleman referred to the need for re-armament as the reason for the diminution. There have been substantial cuts in armaments, because they are now spreading the whole programme over three years instead of two. Could not Oldham therefore get a telephone exchange without actually reducing expenditure on armaments?
    Mr. Gammans: I am afraid that without notice I cannot tell either the hon. Member for Oldham, West or the hon. and learned Member for Hornchurch (Mr. Bing) whether Oldham will get its telephone exchange or whether there will be a new post office in Hornchurch.
    Mr. Paget: What about Northampton?
    Mr. Gammans: Or Northampton; or, for that matter, any other place. If hon. Members are particularly concerned, of course I will try to let them know later.
    Mr. Ross: The hon. Gentleman referred not only to re-armament but to the need for exports. Has there not been pressure on the Post Office and the Postmaster-General from exporters themselves wanting more civilian expenditure because of a falling off in exports?
    Mr. Gammans: That position may develop, of course.
    Mr. Ross: It is developing.
    Mr. Gammans: It has not developed up to now As hon. Members are aware, British telephone equipment has an unrivalled position and reputation in the world, and in the past few years has contributed very substantially to our export trade.
    I want to be absolutely frank about this, because I do not want hon. Members to go away with the wrong impression. I said on Second Reading that this year, so far as I could see, we were not likely to be able to start any new building at all. Now that is a most depressing state of affairs, because anyone who knows, as the hon. Member for
    2550
    Keighley (Mr. Hobson) knows so well, the whole organisation of the telephone service, appreciates that if we start now in a new area it would be four or five years before we could adequately cover that area with a proper telephone service, and the first stage of that development is the building into which the telephone exchange equipment is put. There are parts of the country—luckily it is not universal—where the congestion is extremely serious, and where the only thing we can do to start to put things right is to put up a new telephone exchange. That is why the whole of this is so depressing.
    I hope I have given hon. Gentlemen who have raised certain matters the information they require. If they would like further information about their particular constituencies I should be only too glad to supply it. I can only end by saying that I hope the time will not be all that distant when it will be possible for me, or someone holding the position I now hold, to come to this Box and give the green light to the development of the telephone and postal services generally, in order to provide our people with the services they require and should have.
    Question put, and agreed to.
    Bill accordingly read the Third time, and passed.

  NAVY, ARMY AND AIR EXPENDITURE, 1950–51
  Considered in Committee.
  [Sir Charles MACANDREW in the Chair]
  I. Whereas it appears by the Navy Appropriation Account for the year ended the 31st day of March, 1951, that the aggregate Expenditure on Navy Services has not exceeded the aggregate sums appropriated for those Services and that, as shown in the Schedule hereto, appended, the net surplus of the Exchequer

  SCHEDULE

  No. of Vote

  Navy Services, 1950–51 Votes

  Deficits

  Surpluses

  Excesses of Actual over Estimated Gross Expenditure

  Deficiencies of Actual as compared with Estimated Receipts

  Surpluses of Estimated over Actual Gross Expenditure

  Surpluses of Actual as compared with Estimated Receipts

  £

  s.

  d.

  £

  s.

  d.

  £

  s.

  d.

  £

  s.

  d.

  1

  Pay, &c., of the Royal Navy and Royal Marines.

  —

  23,802

  10

  7

  884,775

  7

  6

  —

  2

  Victualling and Clothing for the Navy.

  —

  —

  216,121

  11

  10

  252,404

  5

  2

  3

  Medical Establishments and Services.

  9,770

  16

  11

  —

  —

  3,255

  18

  6

  4

  Civilians employed on Fleet Services.

  —

  —

  154,486

  11

  4

  33,561

  13

  0

  5

  Educational Services

  —

  6,085

  2

  0

  102,086

  9

  9

  —

  6

  Scientific Services

  —

  —

  577,954

  16

  0

  105,881

  16

  5

  7

  Royal Naval Reserves

  —

  —

  129,790

  18

  9

  334

  7

  1

  8

  Shipbuilding, Repairs, Maintenance, &c.:—

  Section I.—Personnel

  —

  13,369

  19

  5

  54,019

  17

  8

  —

  Section II.—Matériel

  —

  —

  2,195,609

  19

  4

  880,059

  12

  10

  Section III.—Contract Work.

  331,684

  16

  7

  4,163

  13

  6

  —

  —

  9

  Naval Armaments

  —

  —

  573,377

  5

  0

  1,020,944

  9

  8

  10

  Works, Buildings, and Repairs at Home and Abroad.

  —

  —

  400,768

  6

  2

  187,081

  6

  3

  11

  Miscellaneous Effective Services.

  —

  —

  332,500

  14

  6

  398,198

  4

  0

  12

  Admiralty Office

  —

  —

  16,194

  17

  5

  7,679

  12

  1

  13

  Non-effective Services

  —

  —

  138,202

  1

  1

  88,545

  16

  3

  14

  Merchant Shipbuilding, &c.

  —

  —

  17,826

  10

  3

  80,603

  19

  1

  15

  Additional Married Quarters.

  —

  178,903

  18

  1

  178,903

  18

  1

  —

  —

  Balances Irrecoverable and Claims Abandoned.

  7,583

  11

  6

  —

  —

  —

  349,039

  5

  0

  226,325

  3

  7

  5,972,619

  4

  8

  3,058,551

  0

  4

  Total Deficits:

  Total Surpluses:

  £575,364

  8s.

  7d.

  £9,031,170

  5s.

  0d.

  Net Surplus 18,455,805

  16s.

  5d.

  Grants for Navy services over the net Expenditure is £8,455,905 16s, 5d., namely:

  £

  s.

  d.

  Total Surpluses

  …

  9,031,170

  5

  0

  Total Deficits

  …

  575,364

  8

  7

  Net Surplus

  …

  £8,455,805

  16

  5

  And whereas the Lords Commissioners of Her Majesty's Treasury have temporarily authorised the application of so much of the said total surpluses on certain Grants for Navy Services as is necessary to make good the said total deficits on other Grants for Navy Services.
  Motion made, and Question proposed, "That the application of such sums be sanctioned."—[Commander Noble.]
  9.20 p.m.
  Mr. Leslie Hale: I am a little surprised that the Minister does not think fit to make a few opening observations with regard to this £8 million surplus. We are, of course, considering tonight, not the activities of the present Government or the figures for the present year, but those for the year 1950–51. All these matters are well out of the control of the Minister, and now that he has presented a surplus to the House he does not even get the credit for the fact that there is this £8 million surplus, if in fact it is a matter for credit at all, which I do not think that it is.
  The first matter to which I wish to call attention in the Appropriation Account is the somewhat remarkable matter of the forecast of March, 1951, which is presented in this account, and the difference between that forecast which took place on 19th March, 1951, when a letter was written,
  "I am commanded by My Lords Commissioners of the Admiralty to forward, for the information of the Lords Commissioners of H.M. Treasury, the accompanying statement showing the expected outturn of Navy Votes for the current financial year."
  That "expected outturn" was a surplus of £4 million and that prophecy was made within a fortnight of the termination of the financial year. Tonight we are recording a surplus of £8 million. The figure is £8,455,000-odd surplus to be surrendered to the Exchequer. That is perhaps even more remarkable when we find that so far as this particular Service is concerned, it contrasts strangely with the other Services. There was an estimated complement of 143,000 and the actual number of personnel borne was 141,832; it is normally the practice to give a little margin beyond the overall figure approved by the House. I think that we should have an explanation of that surprising discrepancy and how it came about.
  The next matter that arises, and the specific matter to which the attention of the Committee is called by the Comptroller and Auditor General, is that of the purchase price of warships. As far back as 1946–47, various Committees reported to the House the determination to revert to the system in which contract
  2554
  prices were charged and agreed, and one knew the cost of a warship before the building actually commenced.
  Unfortunately, year after year, in these various reports, we have been told time after time that it was hoped that would happen soon, but this still goes on. In many things we have reverted to the old and pernicious system of cost plus 10 per cent., of putting in all extras, of bargaining for overhead charges, and that has carried us so far that in some of the Estimates we are continuing outstanding claims in respect of contracts finished many years ago. I am certain I carry the Financial Secretary with me when I say that he himself would welcome a clearer system which would enable him to know precisely what amount is allowed him by the Treasury and how it can be laid out, instead of having on almost every one of these figures a fantastic series of rises from time to time.
  The Report of the Comptroller and Auditor General is that the original estimate provided for a gross expenditure of £216,250,000. This was increased by the Supplementary Estimate of January, 1951, by £13,500,000. Therefore, although we are reporting a surplus today, we actually spent more than the original Estimate, the difference being £5 million. That included or purported to include provision for acceleration of the naval re-armament programme announced in July and September, 1950.
  Thus, so far as one can judge by a careful reference to the accounts, there has been a good deal of lag in the period of the development of the programme. I suppose that is inevitable. One cannot build naval stores rapidly. There is a long planning process, and everyone anticipates a time lag. However, there is a good deal of information that we ought to be given in connection with these accounts. I ask the Financial Secretary to say what is the explanation of the 100 per cent. error in the estimated surplus and the surplus now revealed.
  There are some gratifying features about these accounts. I find the accounts much more gratifying than the other two which we shall be called upon to discuss later tonight or in the early hours of the morning. Here the losses appear to show a much tighter system of discipline in the Navy and a much tighter system of accountancy than is perhaps possible in

  2555
  an Army strung over the four quarters of the globe. I congratulate the Financial Secretary on that. Subject to what I have said, I have no other observations that I desire to make.
  Mr. R. T. Paget: I want to ask one or two questions about this. First, I observe in the column, "Deficiencies of actual as compared with estimated receipts," the sum of £23,800 against pay of the Royal Navy and the Royal Marines. As a matter of interest, why does the Admiralty expect to receive pay? I thought pay was something the Admiralty parted with. I should be interested to hear the explanation.
  Secondly, under "Surpluses of estimated over actual gross expenditure" we find nearly £1 million relating to pay. Does that really mean that the Admiralty were authorised to pay £1 millionmore than they have paid? One cannot help knowing, certainly with regard to allowances, that many people in the Navy, when continually changing stations, find themselves in very difficult situations, and if £1 million is voted and available for pay or additional allowances to the Navy, surely it can be used.
  Finally, with regard to item No. 11, which is additional marriage quarters, there is a deficiency of actual as compared with estimated receipts and surplus of estimated over actual gross expenditure of just the same size. Why is that?
  9.30 p.m.
  Mr. Geoffrey Bing: I wonder whether I might add one or two points to the catalogue of questions which the hon. and gallant Gentleman has got to deal with. I only want to deal with two points. In the report of the Comptroller and Auditor General, the hon. and gallant Gentleman will notice that the explanation of these surpluses is that manpower and production fell short of expectations. It is fair to say that in the Navy there is not very much of a manpower shortage. I think I am right in saying that the figure is about 1,180 below the maximum fixed by Parliament, and presumably when we fixed that maximum we were not expecting to get to that figure. It does not seem to me that there is a manpower shortage.
  What the Committee is interested in is the point made by my hon. and learned
  2556
  Friend the Member for Northampton (Mr. Paget) when he said that apparently there was a large sum set aside by way of pay which has not been accounted for. Is that because the maximum was reached very late in the year and that the considerable sum expected to be necessary was not reached until a later stage?
  There is one other point which also arises from the Report of the Comptroller and Auditor General and concerns the contracts for the building of warships. I do not know what the position is in regard to that, but in civilian shipbuilding all contracts were of a fixed-price nature, except for a short period in 1948. There is no increase in the profit, for the profit was a fixed element. The only increase was an increase in the cost of materials and other costs, so that there is no question of cost-plus. I think it would be valuable to the Committee if we knew whether the same position obtained in regard to naval shipbuilding.
  Mr. James Simmons: For Married Allowance and National Service grants, there is a surplus of over £250,000. I should like to ask, first, why married allowances and National Service grants are lumped together in the Navy Estimates and are separate in the Army Estimates. We cannot see whether the surplus is on the married allowances or on the National Service grants. What I am concerned about is whether we are satisfied that in the National Service grants we are doing justice to the Service man's family by the amount of grant we are allowed to pay?
  The Chairman: I think the hon Member is on a subject more suitable for the Appropriation Fund.
  The Parliamentary and Financial Secretary to the Admiralty (Commander Allan Noble): I am very glad to have this opportunity of answering the various points that have been made. I agree with the hon. Member for Oldham, West (Mr. Hale) that it seems odd that the Admiralty should have stated a week or two before the end of the year that the surplus was going to be less than it actually was. The explanation is quite a fair one. It was only in the autumn of 1950 that the re-armament programme began in three steps. The Committee will remember that it started in July and went up until we had the sum of £4,700 million

  2557
  over a period of three years. It would have been a little difficult to assess what the actual position was going to be at the end of the year until one could see how the re-armament programme was going to go. I would say that that is the answer to the hon. Member's first point.
  Mr. Hale: But the curiosity is that anything is said at all on that date. There is no financial obligation, the accompanying statement is not printed in account. Yet suddenly the Lords Commissioners of the Admiralty decide to inform the Lords Commissioners of the Treasury that they are now in a position to make a reasonable forecast, and they are over 100 per cent. out. It is a huge difference. Even in these days £4½ million is a lot to have floating about.
  Commander Noble: I quite agree with the hon. Member, but the letter is written as part of the procedure that is carried out by the Treasury and the Service Departments which leads up to this formal approval being given tonight. It is merely to make quite certain that another Supplementary Estimate is not required and that the accounts balance on the right side.
  With regard to the point raised by the hon. and learned Member for Northampton (Mr. Paget) about the very small sum, which I must say it looks as if the Admiralty will receive in pay, that is due to income from other Departments and other Services to which officers or men have been loaned. It is really a ledger transaction.
  As for the large surplus of the pay, the Committee will remember that in the 1950 Navy Estimates, Vote A was running down to about 127,000. When the re-armament programme started the figure was increased, I think to 147,000. The surplus is a result of a Supplementary Estimate of £13 million, which was to cover the re-armament programme and the fact that the increase in Vote A was not achieved.
  That also answers the hon. Member for Brierley Hill (Mr. Simmons), when he queried the question of allowances. I can assure him that the Admiralty, like the other Service Departments, does everything possible for the families of Service men.
  The question of married quarters was raised by two hon. Members. That again is a ledger transaction. The
  2558
  sum referred to was not drawn from the Consolidated Fund, which the Admiralty and other Service Departments are allowed to do, as hon. Members will know, under the Armed Forces (Housing Loans) Act, 1949. The sum is balanced by the equivalent under the surplus. That is merely a ledger transaction; the amount is not really drawn and is shown on the other side as the surplus. That is the money which the Admiralty borrow to build married quarters.
  In reply to the profit question which was raised by the hon. and learned Member for Hornchurch (Mr. Bing), I would say that the same system is in force today, and the profit allowed is re-considered from time to time.
  Mr. Bing: As I understand it, I may be wrong about this, in the case of civil contract for the building of a ship a fixed element of profit is provided for and is not varied even though the contract price may be exceeded as a result of a rise in the price of materials or an addition in the cost of labour. The profit element does not vary with the change in the total sum to be paid out on the contract. I was querying whether the same thing took place in regard to naval contracts.
  Commander Noble: I should not like to give the hon. and learned Member a categorical answer on that point. I will confirm my facts, but as far as I know, the same arrangement applies to naval contracts. I will certainly let the hon. and learned Member know at a later stage.
  Mr. James Simmons: I am concerned about the large reduction under the heading "Miscellaneous Effective Services," because I understand from what I have looked at that it covers welfare. I think it very important in these days when we wish to bring men into the Armed Forces that the welfare services should be maintained at the highest possible degree. Can we have an assurance that this £332,500 reduction in the expenditure under that head covering welfare services, canteens and things like that, is only of a temporary character, due perhaps to the check on capital expenditure, and that it will be pushed forward in the future?
  Commander Noble: I can assure the hon. Member that there is no policy of

  2559
  permanent reduction in that sort of way and. as I think he knows, the Services do attach great importance to these welfare services.
  Question put, and agreed to.
  11. Whereas it appears by the Army Appropriation Account for the year ended 31st day of March, 1951. that the aggregate Expenditure on Army Service has not exceeded the aggregate sums appropriated for those Services and that, as shown in the Schedule hereto appended, the net surplus of the Exchequer

  SCHEDULE

  No. of Vote

  Army Services 1950–51 Votes

  Deficits

  Surpluses

  Excesses of Actual over Estimated Gross Expenditure

  Deficiencies of Actual as compared with Estimated Receipts

  Surpluses of Estimated over Actual Gross Expenditure

  Surpluses of Actual as compared with Estimated Receipts

  £

  s.

  d.

  £

  s.

  d.

  £

  s.

  d.

  £

  s.

  d.

  1

  Pay &c. of the Army

  —

  230,398

  3

  3

  1,026,225

  14

  9

  —

  2

  Reserve Forces Territorial Army and Cadet Forces.

  —

  —

  71,243

  3

  0

  31,445

  15

  3

  3

  War Office

  50,097

  3

  1

  —

  —

  2,947

  2

  11

  4

  Civilians

  3,356

  7

  5

  350,871

  17

  1

  —

  —

  5

  Movements

  —

  —

  165,379

  3

  6

  85,746

  2

  2

  6

  Supplies &c

  —

  583,935

  10

  1

  2,321,147

  19

  8

  —

  7

  Stores

  —

  279,147

  2

  9

  169,882

  8

  3

  —

  8

  Works, Buildings and Lands.

  —

  —

  2,827,904

  9

  6

  495,000

  18

  3

  9

  Miscellaneous Effective Services.

  —

  —

  686,006

  0

  9

  19,710

  1

  2

  10

  Non-effective Services

  —

  —

  357,060

  2

  2

  43,486

  2

  0

  11

  Additional Married Quarters.

  —

  1,290,004

  2

  6

  1,290,004

  2

  6

  —

  —

  Balances Irrecoverable and Claims Abandoned.

  307,629

  18

  4

  —

  —

  —

  361,083

  8

  10

  2,734,356

  15

  8

  8,914,853

  4

  1

  678,336

  1

  9

  Total Deficits:

  Total Surpluses:

  £3,095,440

  4s.

  6d.

  £9,593,189

  5s.

  10d.

  Net Surplus £6,497,749

  1s.

  4d.

  Motion made, and Question proposed, "That the application of such sums be sanctioned."—[Mr. J. R. H. Hutchison.]
  Mr. Hale: There are some serious matters to discuss in the Army Estimates. I think that in fairness I should say again that we are discussing the accounts for 1950–51, and it is impossible to blame anyone on the benches opposite in respect of anything which has happened. But we are entitled to know what has been done about the exceedingly important Report
  Grants for Army Services over the net Expenditure is £6,497,749 1s. 4d., namely:

  £

  s.

  d.

  Total Surpluses

  …

  9,593,189

  5

  10

  Total Deficits

  …

  3,095,440

  4

  6

  Net Surplus

  …

  £6,497,749

  1

  4

  And whereas the Lord Commissioners of Her Majesty's Treasury have temporarily authorised the application of so much of the said total surpluses on certain Grants for Army Services as is necessary to make good the said total deficits on other Grants for Army Services.
  of the Auditor and Comptroller General on the cost of married quarters in the Army, which has raised a very substantial issue indeed.
  I must confess it may very well be that I have failed in the performance of my duties in this House, but I am surprised at some of the figures given in this connection and at some of the figures given for the cost of married quarters. The Auditor and Comptroller General ought to be thanked by the Committee for the

  2561
  careful investigation he made into the costing, which shows that very large sums have been spent on the provision of married quarters over and above the comparable costs of similar houses being built for local authorities.
  The Report covers both the Army and Air Force Estimates so far as the investigation into this matter was concerned, and the replies to the questions he put are in fact contained in the next Estimate we have to discuss. It is fair to say that it is quite obvious that something like £300 or £400 a house, or more, has been paid in respect of items which we would not have been called on to pay had a local council been looking after the matter with their staff in charge.
  The Auditor and Comptroller General called our attention to this matter and it is right that we should give it serious attention. It is right to say that some of the Ministerial explanations are shown by his careful investigation to be completely inadequate and indeed inaccurate. One explanation given is that it was the small number of houses being built on one site that added so substantially to the cost of each house. The comparison with the Birdwood Committee's investigations shows that in point of fact the advantage was with the Service Departments in this matter and that they were building, on the average, larger numbers per site than were being built in the case of other houses at the comparable time.
  The Chairman: I would remind the hon. Member that we are concerned only with the disposal of surplus funds and not with a question of general policy. We cannot discuss that.
  Mr. Hale: I am much obliged to you, Sir Charles. May I say, with respect, that that completely contradicts the Ruling given by your predecessor. Major Milner, who said in answer to my hon. Friend the Member for South Ayrshire (Mr. Emrys Hughes)—and I regret the opening Words:
  "That is out of order. The only questions which can arise on this matter are as to how respective surpluses or deficits arise. The rest is a matter of accountancy."—[OFFICIAL REPORT, 10th July, 1950; Vol. 477, c. 1097.]
  May I, with respect, refer you to Erskine May on the matter, because he says that in point of fact the one thing we cannot discuss is how the surpluses are disposed
  2562
  of. We cannot challenge or put down any Amendment to that at all. Erskine May does not repeat the wording of the Ruling of your predecessor, but does describe the whole procedure of the House constituting itself in a special Committee.
  9.45 p.m.
  What the Navy, Army and Air Expenditure Committee has to do is to consider the Report on the surpluses. I am referring you, Sir Charles, to the bottom of page 275 and the top of page 276 in Erskine May, where it is stated:
  "A Committee of the whole House, known as the Navy, Army and Air Expenditure Committee, is set up every Session to consider the application by the three service departments, on the temporary authorisation of the Treasury (under what is known as the power of 'virement'), of surpluses on some of their grants to meet deficiencies on other grants."
  Then it describes the procedure which takes place earlier in the Session regarding Exchequer and Audit Department Acts, and the Appropriation Accounts, to which I am referring, are then presented, with the Report of the Comptroller and Auditor-General, and goes on—
  "and these accounts and reports are referred to the Committee of the whole House when it is set up."
  That is precisely the procedure which is now going on. The Reports and Accounts are referred to this Committee for consideration, and may I remind you, Sir Charles, that once we have finished doing this, the Committee of the House ceases to exist for the current year. This is the sole function which we have to perform.
  I cannot find offhand the reference which I wish to quote, but there has been a ruling that we cannot criticise the disposal of the surpluses as such. We can only consider the Accounts and the Report.
  The Chairman: I am trying to assist the hon. Gentleman. If he looks at Volume 452, column 2476, he will find what I read out a moment ago.
  Mr. A. Edward Davies: On a point of order. You have ruled, Sir Charles, that we are only concerned with the disposal of the surpluses. This is really a very important matter of interest to all of us in the Committee. Some time ago, we had the Estimates before us from the Services,

  2563
  and it has now been found, in the event, that the sums which were allocated to the Departments for specific purposes were either not used or were exceeded. What we are asked to consider tonight under this process in this Committee is a means to enable the money which is surplus to be devoted to some other purpose within the Department. I take it that that is the reason.
  If we are to be limited, as I gather from your Ruling we are, to the mere discussion of the surpluses, without reference to the way in which a Department has been spending its money, and if it is shown in the Report of the Comptroller and Auditor General that the Department has been mis-handling or misspending its money, are we not then in a difficulty in agreeing to their having the use of whatever surpluses there are, when they may again waste the money, as they have done in the past?
  Mr. Hale: I am grateful for that intervention of my hon. Friend, for it has enabled me to find the passage that I wish to quote. Surely it is important that we should get the matter straight? On page 726, of Erskine May, it is stated:
  "In the Navy, Army and Air Expenditure Committee, criticism of the system of applying surpluses has been ruled out of order."
  That is not quite what I said, and, therefore, it is quite right that I should have checked it. It might well be argued that criticism of the system is different to criticism of the separate applications of each different surplus, but, as the surpluses here are going into the Exchequer anyhow, there is nothing very material about that.
  I do respectfully submit, Sir Charles, that Major Milner, on two or three occasions in the last discussion, did make it quite clear that we could range questions on the items of expenditure, and, indeed, I venture to suggest that the whole point of this procedure surely must be that our function is to receive the Report of the Comptroller and Auditor General.
  This is the only occasion upon which the Committee can consider the Report of the Comptroller and Auditor General, and this a very important point. The mere fact that the Opposition in the last two Parliaments failed in their duty in
  2564
  raising these matters really should not enable one to suggest that the matter has gone by the board because of desuetude. It has often been said that the main job of a Member is to exercise a close and rigorous control over our financial system, and that is what I am trying to do.
  If I may continue, in the whole of these two Reports the very substantial point which is made throughout is the question of married quarters, which is a matter we must look into. There is a substantial increase in the cost of married quarters, and, therefore, a diminution in the number provided. In other words, we are providing fewer and fewer for more and more. That is a serious matter, and I will if I may refer the Committee to what precisely the Comptroller and Auditor General says in paragraphs 18 and 19 of his Report. He says:
  "In January, 1948, as an interim measure to meet the deficiency of married quarters for officers, the Treasury authorised the War Office to accept tenders for the construction of houses similar to those being built by the Ministry of Works for civilian officers at research establishments, etc."
  If tenders had been accepted on normal lines, the rest of the problem would not have arisen. He goes on to say:
  "The larger of these houses was 1,320 square feet and the smaller 1,252 square feet in size. The average recorded costs of 42 houses of the larger type, and 228 of the smaller, constructed under schemes completed by 31st March, 1951, were £2,614 for those completed in 1949–50 and £2,650 in 1950–51."
  No one can doubt for a moment that that is a very serious matter, and when we realise that he goes on to say that provision was made for still larger houses which amounted to £3,300 and £3,690 and some, indeed, to nearly £4,000, it is a matter for very serious consideration.
  I accept that it is as much my responsibility as that of anyone in the Committee that we did not exercise close control, and I personally think that is to be regretted.
  Brigadier Terence Clarke: I wonder if the hon. Gentleman realises that the criticisms he is making are of houses built during the time that his own Government were in power.
  Mr. Hale: The hon. and gallant Gentleman has just walked into the Chamber and, in effect, asks me to repeat for his benefit an observation of which

  2565
  I openly boasted. But as he has addressed a question to me, may I say to him, yes I do.
  Brigadier Clarke: I just wanted to know.
  Mr. Hale: There is another aspect of the matter raised by the Comptroller and Auditor General's Report which is also a serious matter. The War Office operated with Treasury authority a scheme for hiring furnished houses and flats. The Report says:
  "At 31st March, 1951, hirings had been arranged for 1,300 officers and 480 other ranks; the cost in March Quarter, 1951 … was £99,500 and, in the whole year, approximately £330,000."
  That gives us a figure of something like £200 for each set of quarters hired for the year. That seems an exceedingly high figure, although one must realise that this was a difficult time and that matters improved somewhat towards the end of this period.
  Another matter to which substantial attention is directed, although we do not want to comment at any length on it, is the disposal of stores in East Africa. The Stores Disposal Board was set up for this purpose, and I will accept the proposition that it is right that we should be a little generous in dealing with this matter in areas of some poverty and distress. But the figure of £93 per vehicle as the revenue that is obtained from the disposal of these vehicles seems to me to be a very small figure indeed. I should be very glad if we could be given some information on this subject.
  I do not think there is anything else which I want to criticise at all. [Interruption.] I will do my best, but I was being congratulated on the other side five minutes ago because I was criticising. Adaptable as I am, it is exceedingly difficult to know what to do to satisfy hon. Members opposite. There is, of course, one general point of very great substance that arises on this matter. The original Estimate was £341,600,000. That was increased in January, 1951, by a Supplementary Estimate for a fraction under £25 million.
  The Chairman: We can really only discuss the surplus. We cannot discuss the original Estimate. That has already been approved.
  Mr. Hale: With respect, Sir Charles, the only way a surplus can arise is by having a figure on one side and a figure on the other.
  The Chairman: That is quite true, but after we have had the surplus that is all we can discuss now.
  Sir Patrick Spens: Surely the point before the Committee is simply that in the Schedule a total surplus of £9,593,189 is shown and a total deficit of £3,095,440 and the Motion is that so much of that total surplus of £9 million odd as will be sufficient to defray the deficit of £3 million odd shall be applied as indicated in the Schedule.
  In my submission, all that the Committee is entitled to discuss is whether or not it is proper that £23,000 odd should be applied in defraying the deficit on pay and £50,000 applied to the deficit on the War Office, and so on right down the Schedules. How that surplus came about does not arise at all on the Motion before the Committee.
  The Chairman: I thank the hon. and learned Gentleman very much. That is exactly what we are doing, and we are only dealing now with the application of these surpluses.
  Mr. Wedgwood Benn: Further to that point of order. I wonder, Sir Charles, if you can elucidate this point on which I find myself in some difficulty. We were provided by the Vote Office with Appropriation Accounts, which I understand are ordered by the House of Commons to be printed; and the accounts which deal with the financial matters under consideration begin with the Report of the Comptroller and Auditor General which, if not addressed to the House, must be addressed to Her Majesty's Government.
  It is obvious, therefore, that it is addressed to this Committed and it is surely our duty not only to consider figures printed for convenience on the Order Paper but also the various points raised by the Comptroller and Auditor General, acting in his capacity as servant of the House, so that we can arrive at a conclusion whether these deficits should have arisen and whether the surpluses should be applied to meet them. If we do not do that we shall be gravely failing in our duty. I should be grateful, Sir Charles, if you could clear up whether it

  2567
  is or is not in order that we should consider this Report presented to us for our consideration.
  10.0 p.m.
  Mr. Bing: Further to that point. I should like to call attention to the final item in the Schedule relating to the Army —"Balances Irrecoverable and Claims Abandoned. "In my respectful submission, obviously before this Committee agrees to write off the sum of £307,000 odd we ought, at least, to investigate the reasons or have some explanation why it is necessary to abandon these claims. In one case it seems that a sum was due to the sudden posting of the Quartermaster, and that the Comptroller and Auditor General draws attention to the undesirability of this practice. It may well be that it is proper for the Committee to address one or two questions on those sort of issues, and before we write off a sum surely we are entitled to ask why it is that these sums should be written off. Fortunately we have the Report of the Comptroller and Auditor General which gives various explanations and, supplemented by what the Minister has to say, assists the Committee to come to a decision on what may be written off and what may not.
  Mr. Hale: I have obtained a copy of HANSARD which is referred to in Erskine May. It is Volume 452 of 1947–48. The Chairman's Ruling arose on precisely the discussion of this particular section, and indeed on the Army section of the Committee's activities. Again, curiously enough, it was my hon. Friend the Member for South Ayrshire (Mr. Emrys Hughes) who was speaking when the Chairman gave his Ruling. What the Chairman said was this:
  "The hon. Member cannot discuss the eventual disposal of the surplus. That question may only be discussed on the Estimates in which that item appears. The only question here is why there is a surplus. Questions on general policy are not permissible."—[OFFICIAL REPORT, 2nd July, 1948; Vol. 452, c. 2476.]
  The particular point to which I was addressing myself when you interrupted me, Sir Charles, was why there was a surplus, and the reason is that the Army was not up to establishment and was indeed greatly below it.
  The Chairman: The point is that we are sanctioning the application of these
  2568
  surpluses. We are discussing how they are to be disposed of.
  Mr. Bing: Surely, in the terms of the Ruling which my hon. Friend has read out, we are entitled to discuss why any particular surplus has arisen and not why we should spend so much money in this or that direction, but why, having voted £X, there should only be £X minus so much spent on that surplus. Surely we are entitled to discuss that aspect of it, and surely that is completely within the Ruling read out by my hon. Friend?
  The Chairman: That is not what we have been doing.
  Mr. Benn: On a point of order. A moment ago I asked whether it was in order for us to discuss a report which has been presented to this House. I raised that point of order because the hon. and learned Member for Kensington, South (Sir P. Spens) raised the question of the limitation imposed on this Committee. It is a little difficult for us when hon. Members opposite, now that they are in power, try to impose limitations upon our capacity to discuss.
  The Chairman: We are not discussing the Report now.
  Mr. Hale: I am obliged, Sir Charles. If in one or two of my observations I did go outside your Ruling, I express regret. Clearly, on your Ruling, it is possible to raise the question that I want to raise, namely, that the original allocation of numbers for the Forces was 467,000 men in this year. Under the Supplementary Estimate it was estimated that we should need another 55,000 men, which gives a total estimate at the end of the year of 522,000.
  The Chairman: That is just why I stopped the hon. Gentleman. We are not dealing with the original sum. We are only dealing with the surplus.
  Mr. Hale: Of course, I must bow to your Ruling, Sir Charles, but I do submit that it has been said time after time in Erskine May that it is proper to discuss the question how the surplus arose. This is a question of how the surplus arises. It arises because we are 20,000 men short. It is the whole substance of the Report that is before us. In fact, the Report shows on page 1 that we never reached within 20,000 of the maximum

  2569
  total, except in the very last week of the year. I should like the Under-Secretary of State to tell us what is the situation now and explain why, when we look at that figure and see that we were never within 4 per cent. of the maximum estimated, the surplus is only 2·3 per cent. of the total. It seems to me that there is a very real discrepancy there.
  I do not want to weary the Committee, but I think it is material that I should say just a concluding word. The Report of the Comptroller and Auditor General calls attention to the fact that the cost of the operations in Korea amounted to £7 million up to the end of the financial year. That is a very considerable sum. It may be that that is one reason why the surplus is not so great as it otherwise would have been having regard to the diminution of forces. For the moment I am content to seek the answers to those questions and I hope that we shall have full answers.
  Mr. Bing: Before we leave this point I think that we might pursue in further detail this problem of the irrecoverable balances and abandoned claims. The Committee appreciates the point which the hon. and gallant Member for Portsmouth, West (Brigadier Clarke) made— that these events all took place under the administration of the late Government. But even the late Government had to work through brigadiers and, as the Committee will appreciate, some brigadiers are more competent than others.
  It would be a very proper course for the Committee to pursue the question of the disappearance of these various sums of money, in order to see whether proper steps had been taken in these various cases. I do not think the Committee want to go into this matter in any great detail. Indeed, the Comptroller and Auditor General has given a very full account of the losses. Earlier on I referred to the case of the Middle East Land Forces Hospital, where there was an accounting lapse owing to the sudden posting of the quartermaster.
  Those are the sorts of small items in which there is a great value in using the machinery of the House to see that the Army does not always get away with this sort of thing and to discover who was responsible for the sudden posting of a quartermaster. Perhaps it was a
  2570
  brigadier here or a brigadier there who thought he did not need a quartermaster and recalled him.
  We ought to know how these losses come about and who is responsible. I think it is difficult for the hon. Gentleman to deal with details of items like this, but when we are dealing with a loss of £307,000 we must remember that that is about 10 times the sum that is going to be saved by closing down some of our most notable museums, and before we write sums like this as irrecoverable we should see whether we cannot get back a few of them. I think the Committee should consider whether all the balances are in fact irrecoverable.
  I hope that the Financial Secretary will deal with a few of the bigger claims and explain how they arise, what steps have been taken to deal with the people responsible for allowing the losses to occur and how he proposes, in the future, to prevent the recurrence of a loss of £307,000 and other irrecoverable balances lost through bad accountancy or through foolishness on the part of officers and others in the Services.
  Mr. George Wigg (Dudley): I think some protest ought to be made about the archaic presentation of these Accounts. The responsibility does not rest with the present Government; it is lost in the pages of history. I should like to know why the House of Commons, almost 18 months after the financial year has ended, requires to have Appropriation Accounts in this form.
  I think there was a time when the civilian population looked upon every member of the Armed Forces, whether he was a private soldier or a brigadier, as either a crook or a potential crook. Therefore, they hit upon a type of accounts which, I have often been told, are not accounts in the modern sense but merely a conglomeration of figures which can mean anything to anybody.
  It is clear that there is some misconception in the mind of my hon. Friend the Member for Oldham, West (Mr. Hale), because when he was talking about Vote A, he was mixing up the numbers on Vote A with the actual establishment. In discussion of the Army Act, we persuaded the Government to set up a Select Committee to look into that Act and to bring it up to date.
  The Chairman: That is quite true, but I do not see how it could possibly arise here.
  Mr. Wigg: I mentioned it only by way of illustration and I do not want to dwell on it. If the Government have been prodded into such an excellent step as appointing a Select Committee to look into the Army Act, would it not be very useful to appoint another Select Committee to look into the presentation of these Accounts, and not only these Appropriation Accounts, but also the form in which the Estimates are presented?
  Mr. Hale: My hon. Friend referred to some observations I made. I was dealing with what was said on page 1:
  "Vote A—maximum number of officers and other ranks actually maintained for Army Service."
  I may be wrong, and if my hon. Friend is correct in saying that I am wrong, I am most happy to have the correction.
  Mr. Wigg: I did not say the hon. Gentleman was wrong; I said he did not understand it, which is quite different. There was a time in the affairs of this House when there was a conflict between Parliament and the King. The King took money voted for pay and used it on rations, with the result that he had more men on the establishment than Parliament wanted him to have. In the 17th century, they set about the task of limiting the number and they did so by saying that in the course of a particular year they would not allow the size of the Armed Forces to go above a certain figure and——
  The Chairman: The hon. Gentleman knows perfectly well that that is not in order.
  Mr. Wigg: I am sorry to have been led astray by my hon. Friend; I was explaining the position to him.
  Mr. Hale: We had some discussion on the Army Act this year and one learned quite a bit from that, although I do not pretend to understand all this. The point I made is that we have voted an increase for the Estimates and that increase obviously was for the year in question; and for that year that was the effective and proper number.
  Mr. Wigg: It is clear that my hon. Friend still does not understand. He is confusing establishment with Vote A. I
  2572
  am not pleading for a reform of the establishment but for a reform of the presentation of the Service Accounts to the House. Hon. Members opposite joined with my hon. Friends in the years 1945 to 1950 in pressing the Government to give us more information, and as a result of the steps which we took in 1945 and 1946, we have considerably more information than we had in the immediate post-war years.
  We have gone one step further this year, and I plead with the Under-Secretary of State, not perhaps to give a pledge, but to promise to have a look at this between now and next year to see whether this method can be avoided. I suggest that it is a waste of time of the Committee, 16 months afterwards, to have this sort of mumbo-jumbo which gives little or no information and which means little or nothing. If one reads Erskine May, one sees that even this is not the end of the process, because there is yet another step to be taken. It does not add to the power which the Committee can exercise and to that extent, therefore, it is a waste of time.
  It may well be that something like this should be done. The House is quite right to keep a tight grip on the disposal of these surpluses, but I think there is a better way of doing it than the presentation of these Appropriation Accounts. I will not spend any time now in going into detail, because I am not at all sure that I should not make the same mistake as that with which I charged my hon. Friend, but I most earnestly plead with the Under-Secretary of State to go back to his right hon. Friend and see whether, between now and next year, we cannot do better than we have done in the past.
  10.15 p.m.
  Mr. Simmons: I agree with my hon. Friend the Member for Oldham, West (Mr. Hale) about the importance of this debate and examination of these Votes. I wish with my hon. Friend the Member for Dudley (Mr. Wigg) that they were a little simpler, so that simple chaps like myself could understand them without our having to ask questions about how the figures are arrived at.
  I understand that Vote 9, Miscellaneous Effective Services, includes educational and technical training. I thought that today technical training was one of the

  2573
  vital things in a modern mechanised army. I think we ought to have some explanation why such a large surplus has been arrived at on that item of education and technical training.
  The Under-Secretary of State for War (Mr. J. R. H. Hutchison): I do not quite follow the hon. Gentleman. Will he tell me where he finds that? From what he is quoting? Is he quoting from the Appropriation Account?
  Mr. Simmons: I am quoting from page 3031 of the Notice Paper—Vote 9, Miscellaneous Effective Services. Of course, the full Vote will be found in the Appropriation Account. Under the same heading there is also welfare and recruiting. I am very concerned about welfare. I have already asked a representative of the Senior Service here about welfare so far as that Service is concerned. I think the Army is just as important as the Navy —probably a bit more. Anyway, I think welfare is an important thing.
  I understand that under Miscellaneous Effective Services we have an item for fees and payments for services which include legal aid, and I understand that the legal aid to soldiers has either been abolished altogether or considerably curtailed. I do not think a surplus should be arrived at in that way.
  I see that Non-effective Services includes Chelsea, and a surplus is arrived at there. I am concerned to know whether that surplus is arrived at by the application of a means test to the Chelsea pensioners, because of the more generous social service benefits which they are receiving. I think it is rather a bad thing for the general position of recruiting if we have cheeseparing going on at the expense of pensions for which the Minister of Pensions is not responsible, as the Minister of Pensions would not be cheeseparing.
  Chelsea is included in the Vote, and the surplus which is arrived at on that item of Non-effective Services includes an amount arrived at partly as a result of economies at Chelsea Hospital. I am not, of course, talking about the chaps in the red coats, but the people who are receiving pensions through Chelsea Hospital.
  The Under-Secretary of State for War (Mr. J. R. H. Hutchison): I hope that I shall be able to satisfy hon. Members on
  2574
  the points that have been put. I think I may be granted a certain amount of indulgence, because it has been made clear to the Committee that none of us was sure in what detail on this occasion one was expected to go. Subject to that, I hope that I shall be able to answer the questions, and not be led away from the rules of order in the way that the hon. Gentleman the Member for Dudley (Mr. Wigg) was led astray by his hon. Friend.
  The hon. Member for Oldham, West (Mr. Hale) was good enough to absolve me and my colleagues from any direct liability for these Accounts, for which. as he rightly said, we have no parentage. While we are in no way responsible for the parentage I should, nevertheless, like to try to clear up the points he raised. The first point to which he drew the attention of the Committee was the question of the cost of married quarters, about which the Comptroller and Auditor General has made remarks in the preamble to the Army Appropriation Accounts. I am bound to say that, looking at those remarks, I did not read into them the acute criticism by the Comptroller and Auditor General which the hon. Member seemed to think was there.
  Mr. Hale: In point of fact, I could not deal with it because in the combined Accounts he selected the areas for investigation, but makes it quite clear that similar considerations apply to both. A comparison is to be found in the Air Estimates, although with the Army this is the problem to which he directed careful attention.
  Mr. Hutchison: No doubt when we come to the Air Estimates, in which the matter is dealt with in greater detail, there will be a more adequate explanation than I am able to give. In the short time at my disposal I have inquired why there should be this discrepancy between local authority prices and the prices paid by the Army for somewhat similar houses, and I am informed it is because in general the Army has erected its buildings in more isolated areas, and that the expenditure on curtilage and preparation, and things like that, in the case of the Army is generally higher than that involved in the case of local authorities whose building is more concentrated. It will be noticed, however, that the logic of the hon. Member for Oldham, West—that because these houses cost more therefore the sum

  2575
  available was more rapidly absorbed, and there results from that a diminution in the provision of married quarters—is not really an explanation why the married quarters did not amount to the total for which we had hoped, because it states at page 20 of the Appropriation Account that
  "Owing to severe weather and delays in planning, progress in building additional married quarters was less than was anticipated."
  Mr. Hale: I am sorry to interrupt again, but I am sure the Under-Secretary would, out of courtesy, like to get this clear. If he reads the report I think he will find the answer to the two observations he has made. In the first place, paragraph 15 of the Report of the Comptroller and Auditor General says:
  "In my Report on the Air Services Accounts I have recorded that the designs' of quarters",
  and so on. In paragraph 16 the Report gives the complete reply to the observation the Under-Secretary has just made, because there it says:
  "The price limit fixed in February, 1948, was £1,750, or £1,800 in exceptional circumstances. These figures excluded the cost of land and of services outside the curtilage and extra costs incurred by contractors in bringing workmen to the sites."
  So one of the answers the Under-Secretary has given—I admit at very short notice and with the shortest consultation —is excluded by the very terms of the financial arrangements.
  Mr. Hutchison: I may have used the word "curtilage" wrongly as part of the explanation. It is understandable nevertheless, that when building houses in small numbers in isolated areas the cost invariably goes up. I know we found that in Scotland, because a house in Scotland costs more than an equivalent house in England because of the distance over which materials have very often to be carried.
  We ought to be very careful in considering these figures—because the hon. Member referred to figures in the neighbourhood of £2,600 and £2,650, or nearly £3,000 as he said—that we compare like with like. These houses, as will be seen from paragraph 18 of the Appropriation Account, are considerably larger in superficial area than the local authority houses with which the hon. Member was making a comparison.
  2576
  The next point of the hon. Gentleman was in connection with the Mackinnon Road stores. I say frankly that I think the Mackinnon Road adventure was an unhappy one, and considerable steps have been taken, as is shown in the Report of the Comptroller and the Auditor General to clean the place up. Such stores as the Army still requires out there are now held in different places, and what the Mackinnon Road store holds is, in effect, virtually scrap not required by any of the Services. As to the vehicles which fetched the almost derisory figure of £93 each, this was a scrap value for vehicles in very unget-at-able part of the world.
  The hon. Gentleman also mentioned the hiring of furnished quarters. I realise that it is costing the country money, but I think it is money well spent. We have to provide for these families, and if we cannot provide them with the married quarters that we should like to build, I think we have to put our hands in our pockets and pay the difference between the normal rate and the market rate for such houses as we are able to hire and provide for them. I think this will soon terminate. It is reducing as we catch up with the total of married quarters to be provided, and I hope that eventually it will be completely extinguished.
  The hon. and learned Gentleman the Member for Hornchurch (Mr. Bing) was concerned—I quite appreciate the fact— with the proposal to write off as irrecoverable £307,000 on claims. When I saw that figure I made inquiries, because it is rather a staggering figure when one first looks at it. When it is realised that we are really dealing with enormous sums of money and that in one item which is detailed in the Appropriation Account there was a loss of £1,100,000 in one fire alone, the hon. and learned Gentleman will appreciate that, when dealing with sums of money like that, and with scattered units and many people handling cash all over the world, it is very difficult to avoid having something in the nature of this sum. I understand that it is not greater than in the past. The Comptroller and Auditor General seemed to show in his Report that the accounting system is being tightened up and that things are improving, and I very much hope that they will continue to improve, and I shall be only too glad to do anything I can in that direction.

  2577
  The hon. and learned Gentleman asked whether we were getting any of these sums back. He will see in the Appropriation Account that each of these cases is gone into in very considerable detail. and wherever it has been possible to recover from anybody responsible for these losses that has been done. I am afraid I cannot at such short notice solve his problem of the posting of the Quartermaster-General. [HON. MEMBERS: "Quartermaster."] Yes, it was the Quartermaster. I am glad to say that the Quartermaster-General is still with us. If the hon. and learned Gentleman is very anxious about this matter I will make some inquiries.
  I now come to the point raised by the hon. Member for Dudley (Mr. Wigg) about the archaic form of the accounts. I agree with a great deal of what he has said. We may remember that 18 months or two years ago a body of opinion in the country thought the whole system of national accounting was out of date and that, instead of being on a cash basis, it should be on an income and expenditure basis. I believe it was a body called the Associated British Chambers of Commerce which took up the cudgel strongly. We applied for a Select Committee to consider this, and it reported to the then Chancellor of the Exchequer that the form and presentation of the national accounts could not be altered because a great deal of confusion and difficulty would be caused if that happened. I do not think there is much hope of being able to select one facet or slice of the national accounts for this purpose, but I will take up the question again.
  10.30 p.m.
  I myself think it is an archaic system. Here you have the whole of the accounting dealt with on a cash basis and once the cash is over and done with, anything that happens afterwards has to be written off. If there had been an income and expenditure basis there could be a writing off of bad debts instead of putting them into the Accounts merely to be noted and passed by the Committee, as is the system at the present time. May I point out, however, that the Public Accounts Committee are charged with the duty of examining these Accounts and part of their duty is to consider the
  2578
  form in which the Accounts are presented to the House, so it is more properly a question for the Public Accounts Committee to consider.
  Finally, there was a question raised by the hon. Member for Brierley Hill on the question of technical training. I was not altogether clear what his point was, because technical training is going on apace and is tremendously important, but I can find no trace of there being any technical training provided under Vote 9, and I do not think it comes in there at all. The various heads on page 16, as he will see, cover a variety of activities, but I cannot see any provision there for the technical training of soldiers in the Army.
  Mr. Simmons: Vote 9, Item K.
  Mr. Hutchison: "Miscellaneous and Educational and Technical Training Charges." I beg the hon. Member's pardon. I had not gone into it in that detail. I will inquire and see whether there is any curtailing in any way of technical training. I am sure there is not. If there is a surplus I am sure it is because we could not get the personnel to train. We are finding it extremely difficult to get personnel with technical knowledge. It is one of the problems we are examining at the present time. I was also asked about legal aid and whether the surplus meant that that was being curtailed. Again I will look into that, but I do not think it is being curtailed. I am constantly being asked whether a man can have legal aid, whether he should have legal aid and whether it is necessary for him to have legal aid.
  Finally, I was asked about the surplus on the Royal Hospital, Chelsea. I shall have to go into that, because I see that the Comptroller and Auditor General has not made any particular or specific explanation of that item. The Comptroller and Auditor General makes his comments on the basis of percentages in the deficits or surpluses, and when we are dealing with sums of money in the nature of £7,700,000, £264,000 of a surplus is proportionately not so very high. I will make a point of finding out for the hon. Member and let him know how that surplus does, in fact, arise.
  Mr. Bing: I should like to put one other question to the hon. Gentleman. I

  2579
  do not know whether he will be able to deal with it now, but I should like to put it on record. I want to inquire about the method by which attempts are made to recover losses. Let me give two examples from the Accounts.
  There is a deficiency on accommodation stores of £1,157, due to inaccurate accounting and faulty administration, and an ex-commanding officer paid £25 towards the loss. If he was really responsible for such a large sum, it seems rather a small amount to pay. If he was not responsible, it seems rather wrong to make a charge at all. The same is true of another item where rations were overdrawn to the value of £1,035, and the officer responsible was ordered to pay £30 towards the loss. If rations of that value were overdrawn, they should have found somebody who had that value.
  The Chairman: I do not think it is in order to discuss deficiencies.
  Mr. Bing: Surely, how the deficiencies arise is one of the questions we have to debate, and whether we can right that deficiency.
  The Chairman: It is a question of whether they are to be made good by the transfer of surpluses.
  Mr. Bing: I do not want to detain the Committee, but surely the whole point we are considering is whether or not we should write off these sums. If we can recover more than £30 out of this £1,035, surely we should. It is quite unfair to ask the hon. Gentleman to deal with it
  2580
  at the moment, but I raise it so that the War Office can look into the matter again.
  Mr. Hutchison: Of course, all these losses are the subjects of inquiry, and it would be quite impossible for me, as the hon. and learned Gentleman appreciates, to have at my finger tips any one of the 104 cases outlined here.
  Mr. Ede: We ought to express our thanks to the Under-Secretary for the courtesy and fullness with which he has answered these questions at a moment's notice. I express not only my thanks but congratulations. But can he, for the sake of stimulating recruiting, find out which unit was able to overdraw its rations?
  Question put, and agreed to.
  III. Whereas it appears by the Air Appropriation Account for the year ended the 31st day of March 1951, that the aggregate Expenditure on Air Services has not exceeded the aggregate sums appropriated for those Services and that, as shown in the Schedule hereto appended, the net surplus of the Exchequer Grants for Air Services over the net Expenditure is £8,166,612 3s. 2d. namely:

  £

  s.

  d.

  Total Surpluses

  …

  9,022,801

  0

  9

  Total Deficits

  …

  856,188

  17

  7

  Net Surplus

  …

  £8,166,612

  3

  2

  And whereas the Lords Commissioners of Her Majesty's Treasury have temporarily authorised the application of so much of the said total surpluses on certain Grants for Air Services as is necessary to make good the said total deficits on other Grants for Air Services.

  SCHEDULE

  No. of Vote

  Air Services, 1950–51 Votes

  Deficits

  Surpluses

  Excesses of Actual over Estimated Gross Expenditure

  Deficiencies of Actual as compared with Estimated Receipts

  Surpluses of Estimated over Actual Gross Expenditure

  Surpluses of Actual as compared with Estimated Receipts

  £

  s.

  d.

  £

  s.

  d.

  £

  s.

  d.

  £

  s.

  d.

  1

  Pay &c, of the Air Force

  —

  —

  776,738

  15

  2

  110,442

  17

  9

  2

  Reserve and Auxiliary Services.

  —

  247

  15

  8

  35,309

  5

  2

  —

  3

  Air Ministry

  —

  —

  2,906

  18

  7

  479

  4

  6

  4

  Civilians at Outstations

  —

  806

  6

  8

  214,909

  19

  9

  —

  5

  Movements

  —

  —

  411,571

  17

  8

  15,945

  5

  1

  6

  Supplies

  —

  294,354

  0

  8

  1,105,621

  4

  0

  —

  7

  Aircraft and Stores

  —

  —

  2,234,244

  6

  8

  926,516

  4

  10

  8

  Works and Lands

  —

  250,332

  17

  1

  2,628,451

  1

  6

  —

  9

  Miscellaneous Effective Services.

  —

  26,454

  18

  7

  217,489

  10

  11

  —

  10

  Non-effective Services

  —

  —

  70,769

  15

  6

  1,301

  14

  10

  11

  Additional Married Quarters.

  —

  270,102

  18

  10

  270,102

  18

  10

  —

  —

  Balances Irrecoverable and Claims Abandoned.

  13,890

  0

  1

  —

  —

  —

  13,890

  0

  1

  842,298

  17

  6

  7,968,115

  13

  9

  1,054,685

  7

  0

  Total Deficits:

  Total Surpluses:

  £856,188

  17s.

  7d.

  £9,022,801

  0s.

  9d.

  Net Surplus £8,166,612

  3s.

  2d.

  Motion made, and Question proposed, "That the application of such sums be sanctioned."—[Mr. Ward.]
  10.36 p.m.
  Mr. Benn: The most significant item in this Appropriation Account is a blank on page 34. It comes under Subhead (d)—"Losses due to other causes"—and would appear to be a whole series of writings off of stores in the Middle East. Whereas earlier on, such as the safe stolen from the Air Ministry with £10,000 in it and the fact that there was an over-issue of rations in the R.A.F. as well, we get details of the losses, there is this extraordinary item on page 34 in which, I imagine, a very large amount of stores was written off as a result of the difficulties in Palestine and the Canal Zone, without even an estimate by the Service Department or, indeed, by the Comptroller and Auditor General of what the losses were.
  It is easy to see how vulnerable these stores in the Middle East might be and how the losses occur. In the Report, the
  2582
  Comptroller and Auditor General draws special attention to the fact that he referred to these losses in his earlier reports, considered by the House in previous years. But in the last paragraph on page 10, at the very beginning, he just mentions that owing to the difficulties there has had to be a wholesale writing off of these stores in the Middle East. I should like to know whether the Minister can give any estimate at all of what was involved in this figure.
  The Deputy-Chairman (Mr. Hopkin Morris): I do not think the hon. Member is in order in discussing the losses and the deficit, nor, indeed, the report of the Auditor General. The Question before the Committee is that the application of sums be allowed. It has been ruled that how the surplus arose is in order.
  Mr. Hale: It is unfortunate, of course, that the very long discussion on this point we had with the occupant of the Chair previously took place in your absence. I ventured then to draw the

  2583
  Chairman's attention to Erskine May on this point, which does make it quite clear that the one thing we cannot discuss is the application of the surplus and the one thing we can discuss is how the surplus arose.
  The Deputy-Chairman: Yes—how the surplus arose. The hon. Gentleman at the moment is talking about deficits—about losses.
  Mr. Hale: He is talking about the possibility of recovering the sums which would affect the surplus.
  The Deputy-Chairman: Recovering the sums is not the surpluses that are being transferred.
  Mr. Benn: If I may be allowed to intervene in respect of my own speech, I did address a point of order to the previous occupant of the Chair. In the Vote Office, we are provided with the Air Services Appropriation Account, "ordered by the House of Commons to be printed," and it includes a report which, under the constitutional procedure of the House, can only be considered at this period of the year.
  The Deputy-Chairman: I have not the advantage of knowing what has gone before, but it is quite clear that the only thing that can be discussed is a very narrow issue. The point which the hon. Gentleman is now discussing can be raised on the Estimates and on the appropriate item of those Estimates, but it cannot be discussed on this issue.
  Mr. Benn: My imagination boggles at the thought of trying to discuss what happened in 1950 on the Estimates for 1953, and I should think the occupant of the Chair would take a very stern view of the width which I interpreted the Estimates to possess. Here, we are asked to provide money, because if we are transferring surpluses to cover deficits we are providing money, and I was asking what those deficits were. I am requesting your guidance, Mr. Hopkin Morris. We are told in the Accounts that there was a huge deficit, but no figure is attached to it. I want to know from the Minister —and I see from his anxious look that he is anxious to reply—what exactly was the extent of that deficit, and to ask him if
  2584
  he has any news about other deficits also mentioned in this Report.
  The Deputy-Chairman: This matter has been discussed many times before, and Rulings have been given. Deficits cannot be discussed, and it would not be in order for the hon. Gentleman the Under-Secretary to reply with regard to the deficits. Questions can be asked about how the surpluses arise; otherwise, the narrow issue here is the transfer of surpluses to meet the deficits.
  Mr. Wigg: With very great respect, Mr. Hopkin Morris, it is surely in order to discuss how the surpluses can be spent? If the losses were less, the surpluses would be greater, and to inquire into that is surely relevant to the application of the surplus?
  The Deputy-Chairman: It has been clearly ruled in the past that the purposes for which the surpluses are devoted are not admissible in this debate.
  Mr. Wigg: It is a question of the application of the surpluses, and, quite clearly, if the losses had been less, the surpluses would have been that much greater.
  Mr. Benn: Will you guide me on this point, Mr. Hopkin Morris? The only difference between a surplus and a deficit is that, in the one case, expenditure exceeds receipts, and, in the other, receipts exceed expenditure, and, in this case, we have a deficit where there might, possibly, have been a surplus. If we can get an explanation of these deficits, we might find that we should have had a surplus. This is the whole burden of my point, and it is exceedingly difficult to consider financial matters when we are allowed to discuss only one side of the balance-sheet, and, throughout the whole of the Accounts, see that every meaningful symbol is produced by balancing one against the other.
  The Deputy-Chairman: It might be a hardship on the hon. Gentleman, but the point capable of discussion here is a strictly narrow point. It is the transfer of surpluses to meet deficits, and the question that can be raised and discussed here is whether the surplus is a genuine surplus or not, or whether it has been arrived at by a juggling of the figures. That can be raised, but the purpose for which it is devoted cannot be discussed.
  Mr. Hale: Might I refer you, Mr. Hopkin Morris, to a previous Ruling which I quoted to your predecessor in the Chair? I think it is rather important. This question of watching financial expenditure is a matter of grave responsibility to every hon. Member. In column 1097 of volume 477 of 1950, Major Milner, as he then was, said this, when intervening in a speech by the hon. Member for South Ayrshire (Mr. Emrys Hughes):
  "That is out of order. The only questions which can arise on this matter are as to how respective surpluses or deficits arise. The rest is a matter of accountancy."—[OFFICIAL REPORT, 10th July, 1950; Vol. 477, c. 1097.]
  It would be improper for me to try to quote from memory what was said by the previous occupant of the Chair in your absence. If I tried to do that I would be liable to error. Certainly this discussion has proceeded for some considerable time, though not for a long time, having regard to the fact that we are considering accounts of this magnitude.
  10.45 p.m.
  Major Milner gives another Ruling in 1948, namely,
  "The hon. Member cannot discuss the eventual disposal of the surplus."
  That is quoted by Erskine May with approval. He went on to say,
  "That question can only be discussed on the Estimates in which that item appears. The only question here is why there is a surplus."— [OFFICIAL REPORT. 2nd July, 1948; Vol. 452. c. 2476.]
  That is, I think, what we have been trying to discuss, namely, why there is a surplus, and why there is a deficiency.
  The Deputy-Chairman: That is a different issue. The hon. Member quoted the Ruling accurately, which was that the only question arising was why there was a surplus. Parliament has already voted these monies, and the question now is the transfer of monies to meet the deficit.
  Mr. Paget: Major Milner ruled expressly that the thing we could discuss was why there was a surplus and why there was a deficiency. That is what he expressly ruled.
  The Deputy-Chairman: That is not the second Ruling read by the hon. Member.
  Mr. Paget: It is the second Ruling.
  Mr. Benn: I should like if possible to make my second point, if I cannot make my first. My first point was simply that Parliament had voted a sum of money and it had disappeared. I am interested in why it has. But I understand that that question is out of order. My second point may tax you even further, Mr. Hopkin Morris, because it is something which is put down as a surplus but is a deficit. I do not think you can intervene, Sir, until we hear from the Minister whether it is a surplus or a deficit, because we understand from the Accounts, page 1V of the Report of the Comptroller and Auditor General, that air training of the R.A.F. Volunteer Reserve is carried out under contract with civil flying schools.
  On page 22 the Minister will see that training of personnel at establishments outside the R.A.F. shows a surplus of £92,000. The reason for this is that a number of outstanding accounts could not be settled within the year; but if one has money left over because the butcher has not sent in his account, is it fair to define that as a surplus? It may be; but that money may be just a balance. It may be a substantial deficit.
  The Deputy-Chairman: As I understand it, the hon. Member is dealing with a specific item. This Vote deals with total surplus and deficit. Upon that the hon. Member cannot go into specific items.
  Mr. Benn: I bow to that Ruling, although I find it difficult to believe that the House, which after all has to keep a careful control on expenditure, is not allowed to consider these details.
  The Deputy-Chairman: The House has already considered the expenditure and voted the money. What we are now dealing with is a certain deficit on a certain fund and the surpluses on others, or the transfer of deficits to meet the surpluses, but the money is already voted.
  Mr. Bing: Surely that meets the point on which the hon. Member is talking. If we look at the Order Paper—Item 9,"Miscellaneous Effective Services"—we see that there is a surplus of roughly £217,000. One item is made up of a sum of £92,000, which, if we look at the Comptroller and Auditor-General's Report, appears not to be a real surplus but to be due to the fact that certain accounts had, at this time, not been paid.

  2587
  If we are examining whether a sum is a surplus or not, we are entitled to look at the account to see whether it is a surplus or whether it is due to the fact that, on the day the account was struck, a certain sum had not been paid, in which case it would not be a genuine surplus because it would have to be paid the following year. I submit that this point is very much within the rather restricted meaning under which we are discussing the Item.
  The Deputy-Chairman: If it is taken to show that the total figure is not a total surplus, that would be in order, but to deal with specific items one by one would not be in order.
  Mr. Benn: I always understood that the larger figure was the sum of its parts. Perhaps I can put it this way—that I believe the surplus as given is inaccurate because one item—on the page to which I referred earlier—which I am not allowed to mention, is a false surplus. If that is within the Rules of Order, I am obliged to put it in that way.
  Perhaps I may make, as a point of order, a very serious protest against this Ruling. Surely it is the function of the House of Commons to do three things——
  The Deputy-Chairman: That is an improper remark.
  Mr. Hale: Perhaps I may refer to another Ruling by Major Milner which is directly contrary to that which you have given, Mr. Hopkin Morris. [HON. MEMBERS: "No."] I am perfectly certain that you, Mr. Hopkin Morris, would welcome a reference to the Ruling of your predecessor. In column 1099 of Volume 477 of the OFFICIAL REPORT—the same volume from which I quoted earlier— Major Milner said:
  "I do not think the hon. Gentleman can indulge in a roving commission of that description. He must ask a specific question on a specific item and bring something to support his question."—[OFFICIAL REPORT. 10th July, 1950; Vol. 477, c. 1099.]
  With great respect, that was precisely what I understood you to say we could not do.
  The Deputy-Chairman: What I said was that we were concerned with total surpluses and total deficits. If it is
  2588
  suggested that a total surplus is not accurately arrived at, reference to items which go to prove that would be in order, but to deal with specific items one by one apart from that would not be in order.
  Sir P. Spens: On a point of order. May I make one more attempt to suggest what the Committee is doing? The Resolution before the Committee states that there is a large surplus of over £9 million and a very small deficit of £856,000, and that there is a net surplus of £8,156,000. It goes on to state that,
  "And whereas the Lords Commissioners of Her Majesty's Treasury have temporarily authorised the application of so much of the said total surpluses on certain Grants…as is necessary to make good the said total deficits on other Grants…"
  These deficits are set out in the first column of the Schedule. What the Committee is asked to do is to ratify what the Lords Commissioners of the Treasury have temporarily done. That is all we are being asked to do. In those circumstances—and I was not in the Committee when the previous Ruling, which was quoted, was made—how it is possible to discuss anything more than whether it is right that these deficits should be met out of the total surplus, I myself, very respectfully, cannot understand.
  Mr. Paget: Further to that point of order. I do not know where we are coming to over this. We had this point of order made while your predecessor was in the Chair, Mr. Hopkin Morris, and rejected by him. Since then we have had a long discussion based on your predecessor's Ruling. Now, apparently, because there has been a change in the Chair, all the discussion has to go over again covering exactly the points which were raised before. If the Ruling which is now made is right, everything which we have discussed in the last two hours has been out of order. If, with every change of the Chair, there has to be a re-opening of each point of order, and re-discussion——
  The Deputy-Chairman: I do not know what happened in previous discussions, and cannot enter into it at all. I am merely drawing the attention of the Committee to the issue before it, and that is, that Parliament having already voted money, we have now to decide whether these surpluses shall be used for the purposes indicated in the Vote. That is a very narrow issue.
  Mr. Benn: Surely the object of this exercise is to circumvent the previous Parliamentary decision? In the course of the year, as my hon. Friend the Member for Oldham, West (Mr. Leslie Hale) has already pointed out, the Government Departments have found that they could not spend the money which Parliament had voted, and what we have to do is to give an indemnification to a Department which has spent money contrary to the will of Parliament. It is not that we are simply looking at something which we have previously approved, but that we are looking sympathetically at whether Government Departments were right to incur these surpluses; and if we may not do that, then I submit that we cannot function in re-appropriating such surpluses.
  Mr. Geoffrey de Freitas: When I had the honour of serving as Under-Secretary for Air, the Department came down to the Committee to justify this matter year after year. The Government is on the defensive and has to justify its case to the Committee.
  Mr. Edward Davies: It is no use hon. Members opposite making a noise, because we need a little daylight on this. For two hours, as has been pointed out by my hon. Friend the Member for Oldham, West (Mr. Hale), the Chair has ruled that we cannot examine the surpluses on individual items. What you say, Mr. Hopkin Morris, is that we have already had the opportunity of discussing those items when the Estimates were first introduced; but, as my hon. Friend has explained, during the course of the year, the Department found that it had to depart from the project which it had set out to accomplish.
  In the Auditor General's Report there are some matters which I think call for comment, and unless we are permitted tonight to consider how these surpluses have arisen, it is very difficult for us to say if it is sound for us to agree with the proposal which is now before the Committee, namely what the Lords Commissioners propose. Vote 11, on page 3032, refers to additional married quarters, and here there is both a deficit and a surplus. This becomes a very argumentative subject. Shall we be in order in discussing that?
  11.0 p.m.
  Mr. Bing: Further to that point of order. There is one other point which I think I ought to put before you, Mr. Hopkin Morris. You said that in many cases this was money voted by Parliament, but in one case there is no money that could possibly have been voted by Parliament, and that is the balance of irrecoverable losses. Parliament could not have anticipated beforehand that the quartermaster would have been posted— or whatever it was that we were discussing—and that therefore there would be a deficit.
  Surely we are in a position to discuss whether we ought to make up these losses, whether we ought to say they should be made up in some other way, and whether the Treasury, as it has done for some time should pay for services out of other funds and make up losses incurred by some unfortunate circumstance or some unfortunate individual, and say whether the sum should be recoverable in some other way. In no other way can we make the Services accountable publicly. That seems to be the issue here. We have a balance which is borne on no Vote at all, and therefore there is a blank against it. That is what my hon. Friend was talking about when we interrupted him.
  Mr. de Freitas: Is talking about.
  Mr. Bing: Is talking about, indeed. A point arises because the losses could not have been voted on any occasion. There are sums which have been lost. What we are discussing is whether or not it is right that public money should be used to meet a loss incurred for some reason by the action of some individual.
  The Deputy-Chairman: What hon. Members are seeking to do by their arguments is to convert this Committee into Committee of Supply. This Committee is not the Committee of Supply. It is not concerned with Supply at all. It is concerned merely here with the transfer of the surpluses already voted to meet deficits which have arisen. In previous years when debates have occurred they have been within strictly narrow limits, confined, as I understand it, to that position and that position alone. It is legitimate and proper to inquire if a surplus is a genuine surplus,

  2591
  or, may be, how the deficit arose. However, this is not the Committee of Supply to inquire whether the sums have been properly applied.
  Mr. Benn: Perhaps I may be allowed, with the help of your guidance, Mr. Hopkin Morris, which is very fruitful, to make very briefly the point I wanted to make. The first point, which you said a moment ago would be in order, was how the deficit arose. I want very briefly to refer to this writing off of losses. I would ask the Under-Secretary of State whether he would explain this writing off of losses. Curiously enough, it is not reported in the figures of the Accounts.
  At each stage, Mr. Hopkin Morris, I refer to your Ruling, which I hope I can use to cover me. and the second point I want to refer to is about Vote 9 B. I shall not mention the amount, because I do not want to go into too great detail, but the surplus is far from being a surplus because the money has not been voted. We were told that the money has not been paid, and that that is a surplus. Well, that is not a very real surplus, in those circumstances.
  The last point is one that I am sure, Mr. Hopkin Morris, you will admit is a fair one, and that is that the case where we do not know whether it is a surplus or whether it is a deficit because we have no accounts at all. That is the case of the Far East Air Command. On page 3 of the First Report of the Comptroller and Auditor General we are told, in effect, that the examination of the cash of the Far East Air Command for the year would not be completed as the accounts were not available for his officers when they visited the Command.
  It may be that because of the war in Korea and because of difficulties in the Far East Air Command it has not been possible to see that the accounts were audited, but what I want to know is how far this is the beginning of a sort of difficulty that may lead to the wholesale writing off of losses in the Far East as we saw it in the Middle East. We have had to write off a lot of losses in the Middle East. We were warned in previous Appropriation Accounts that we could not get full figures of claims in the Middle East, and finally we were told
  2592
  that we had to write them off. Now the Comptroller and Auditor General sounds a note of warning about stores in the Far East. Admittedly it is only the first note of warning, but we may find next year a similar note of warning, and finally in two years' time find that a lot of stores have had to be written off. If the Under-Secretary could give any explanation of that it would help us to be satisfied that we were right in passing these appropriations from surplus to cover deficit.
  The Under-Secretary of State for Air (Mr. George Ward): Although we have had quite a long discussion there have not been many Questions put to answer, so I shall not take very long in replying. However, I am sure the Committee will understand that if this was Question time I should probably be asking for notice and for the questions to be put down on the Order Paper. I have in the very short time available been able to do something about finding out the answers, and if they are not as complete as they might be perhaps the hon. Gentleman will write to me and I will try to amplify them a bit.
  The first question put by the hon. Member for Bristol, South-East (Mr. Benn) was about the loss of stores in the Middle East, and he drew attention to a note in the Report of the Comptroller and Auditor General on page 34. The depot referred to in that note is the Central Works Stores Depot at Kasfareet in Egypt. The position was that by March, 1950, the physical check of stores and stocks at that depot was very considerably in arrears because there had been a large accumulation of stores and materials there, which was mainly stores which had been brought back in a great hurry from the Delta and from Palestine.
  There was simply not adequate staff available there to cope with the checking of these stores, and to make that staff available would have considerably prejudiced and interfered with the operational work of the Air Force there. There was, I understand, no question whatever of fraud or theft involved. It was purely physical inability to keep track of this sudden accumulation of stocks. But we did very shortly after that make available additional supervisory and clerical staff in order to keep the

  2593
  stores and records in a reasonable state, and I trust the Committee will accept this as being rather an exceptional case which I hope will not occur again.
  The hon. Gentleman also asked about the £92,000 relating to Reserve flying training. That was a real surplus because it was money which was not spent, and therefore it is fairly part of a total net surplus which has to be returned to the Treasury. Of course, the claims will have to be settled in the following period, in the period 1951–52, and it will have been allowed for in the Estimates for that year, so it is quite a simple transaction really.
  The hon. Member for Stoke-on-Trent, North (Mr. Edward Davies) did not press his question about married quarters, but he made what I thought was a valid point, to which he might like to know the answer. He asked why, apparently, when dealing with married quarters there is a surplus and a deficit shown at the same time. The explanation is that we are underspent on married quarters owing mainly to slower progress being made than was expected. This was largely due to the abnormally wet weather in this country in the autumn of 1950 and the following winter. Having underspent that, and not building as many houses as we would have liked, we naturally did not receive in return as much by way of grant under the Armed Forces (Housing Loans) Act, 1949. So the amount of loan we did not receive is shown as short receipts.
  Mr. Benn: Can the Under-Secretary make some reference to the accounts of the Far East Command not received by the Comptroller and Auditor General?
  Mr. Ward: That is a point which I should like to look into, but I would draw the attention of the hon. Gentleman to paragraph 5 on page 3 of the Report. The Comptroller does not in fact make any mention of stores. He refers to cash accounts. I do not think there is anything there which might be assumed to refer to stores. However, I will look into it, but I think the hon. Gentleman was jumping to conclusions in the light of what happened in the Middle East.
  Mr. Bing: I had not intended to intervene because I had thought that the Under-Secretary would have dealt at
  2594
  some length with the question of married quarters in view of the fact that a great part of the Report deals with a somewhat unsatisfactory position. This matter is of considerable importance to most people, and certainly to me, because I have in my constituency Hornchurch aerodrome, where the married quarters question is extremely acute. One of the great problems is the provision of adequate quarters.
  The Deputy-Chairman: I do not quite follow how that is in order.
  Mr. Bing: I was attempting to illustrate the undesirability of the underspending on married quarters, as it happens to affect my constituency. It is probably in my own constituency that it has taken place.
  The Deputy-Chairman: It may affect the hon. and learned Gentleman's constituency, but there are appropriate times to raise this matter, and this is not one of them.
  Mr. Ward: I did say that the underspending was due to the abnormally wet weather.
  Mr. Bing: I appreciate that, but the argument of the Comptroller and Auditor General is not only that there has been underspending but overspending in the sense that fewer houses are built at a larger cost, and a great deal of his Report deals with that particular aspect. I do not know whether the hon. Gentleman is in a position to deal with it, but it is unfortunate, when we have the Report before us, that we cannot deal with it when the accounts come up.
  Mr. Hale: There are two curious differences in the presentation of the Air Estimates and the presentation of the Army Estimates. We are not told what the original estimate of surplus or deficiency for the Air Estimates was when the Report was made. When we come to the question of the presentation of the deficiencies and losses of stores and losses, in each case they are written off as stores of the Air Ministry, whereas in the Army Estimates we are told the amount written off by corps and formations.
  This is a question which is nearly always raised. Anyone who has experi-

  2595
  ence in the Forces knows that if a unit wants to write off a certain amount it never likes to go to a higher authority and get a ticking off. As little as possible is written off in the hope that the quartermaster will carry over which is left to the next writing off time. I remember we had a great amount of trouble about a certain loss of petrol and all-night sittings as well to avoid reference to a higher command.
  11.15 p.m.
  This question of married quarters is one which I would ask the Under-Secretary to deal with. The Comptroller and Auditor General comments on what appears to be a very unsatisfactory explanation. If the Under-Secretary would be good enough to refer to paragraphs 17 and 18 of the Report, he would himself come to the conclusion that a very serious point has been treated by the Air Ministry somewhat perfunctorily and that no adequate investigation has been undertaken. Indeed, it appears that they have submitted an explanation of this extraordinary spending which the slightest investigation would have shown would not stand investigation at all.
  They suggest that the higher cost of the married quarters as compared with the global figures was that it was due to the fact that they were building in smaller units whereas, in point of fact, they were building in larger units. That should not happen, and the Comptroller and Auditor General is entitled to the thanks of this Committee for the care with which he has examined these figures and the difficult task that he has——
  The Deputy-Chairman: The hon. Gentleman has been given a great deal of latitude, but I do not think that the Report of the Comptroller and Auditor General and whether he should be complimented is in order.
  Mr. Hale: I do not want to pursue the matter, but I should like respectively and courteously to ask you, Mr. Hopkin Morris, for a definite Ruling on this. Is it really the case that these figures can never on any occasion be discussed, because I respectively submit that we are presented with the Appropriation Accounts and Erskine May says that they can be discussed?
  The Deputy-Chairman: No, I have not said that. What I am saying is that this is not the appropriate occasion on which to discuss them. They can be discussed upon other occasions.
  Mr. Hale: On what other occasions?
  The Deputy-Chairman: Upon the report of the Public Accounts Committee, but this is not a proper occasion for them to be discussed. This is a very narrow point, as has already been pointed out, and it has been held time and time again that this is a very narrow point.
  Mr. Hale: I am very much obliged, and I am quite sure you wish to try to co-operate with me, Mr. Hopkin Morris, in trying to clear up this matter, because I apprehend and venture to submit that it was through the negligence of the previous Opposition that a very valuable right of scrutiny of accounts was allowed to lapse. I realise that this is a very difficult point on which there has been disagreement in the past. I did not mean to intervene, but my hon. Friend the Member for Bristol, South-East (Mr. Benn) was presenting his arguments about the Ruling on the application of surpluses. I gathered that the Ruling then given was precisely the opposite to that given in Erskine May on page 726:
  "In the Navy, Army and Air Expenditure Committee, criticism of the system of applying surpluses has been ruled out of order."
  It then refers to 1906 and a Ruling by Major Milner in 1947 to which I have already referred.
  If I can, I should like to refer to what Erskine May says on this subject generally, as found on pages 725 and 726:
  "A committee of the whole House known as the Navy, Army and Air Expenditure Committee is set up every session to consider the application by the three service departments, on the temporary authorisation of the Treasury (under what is known as the power of 'virement',) of surpluses on some of their grants to meet deficiencies on other grants. Earlier in the Session the Treasury, in accordance with statutory provision (see Exchequer and Audit Department Acts, 1866 and 1921), will have presented a copy of the Appropriation Accounts for each defence service, with the reports of the Comptroller and Auditor General thereon, and these accounts and reports are referred to the Committee of the whole House when it is set up."
  That is what is happening now.

  2597
  We have set ourselves up in this ancient and traditional form—by the movement of the Mace from the Table—as the Navy, Army and Air Force Committee of the whole House for this Session. The moment this discussion concludes this Committee of this House will cease to exist. The function of this particular Committee is to receive these Accounts and, according to Erskine May, to receive and discuss the Comptroller and Auditor General's Report on these Accounts, and then to pass a Resolution for the application of the surpluses. It has been said that we cannot discuss the method of application of these surpluses.
  Let me add that this matter has been raised before in the last two hours, and that is why I am referring to it only briefly now. The figures given in paragraph 16 of the Comptroller and Auditor General's Report show that the Girdwood figure for a house of 1.050 sq. ft. was £1,400 in May, 1946, and £1,550 in the second half of 1948, while the comparable figures for married quarters for the R.A.F. are £1,901 in 1946–7 and £1,875 in 1947–8. Both figures exclude the cost of land. In fact, the square footage area of the R.A.F. married quarters is somewhat smaller than that of the council house.
  The Comptroller and Auditor General regarded this as important. It appears that he formed the conclusion—and the House may form the conclusion—that the answers given were rather perfunctory and the Air Ministry did not take this criticism seriously at all.
  I have only one other observation arising out of what the Under-Secretary himself said. We are indebted to my hon. Friend the Member for Bristol, South-East (Mr. Benn) for raising this question of the Far East accounts, which show that the representative of the Auditor General visited this Command in the spring of 1951. He said that the accounts were still not complete for the last two months of 1950. I do not want to press the matter. There may be frightful difficulties facing them. But it is a matter on which Members would welcome some information.
  Mr. Edward Davies: I wish to ask the Under-Secretary a question about the surpluses. In Item I, "Pay of the Air
  2598
  Force"—page 3032, Vote 1—there is a surplus in the two columns of some £877,000. How does that come about? We should like to be satisfied that the money voted is being properly expended. Are we to assume that the Air Force is below establishment? If so, is it due to the absence of recruits, because there are many men who are anxious to get into the R.A.F. if they are accepted.
  The Deputy-Chairman: It is clearly over the mark to discuss recruiting.
  Mr. Davies: But surely, I am permitted to ask how the surplus arises. I was seeking to help the hon. Gentleman.
  The Deputy-Chairman: The hon. Member was discussing recruiting.
  Mr. Ward: I have really answered the main points which have been made. With great respect, I do not think the question of the cost of married quarters really comes into this debate, because we are dealing now with surpluses and deficits, and the cost of married quarters would seem to be outside the scope of that discussion. In order, however, to avoid being accused of a lack of courtesy, I will say that there are a number of reasons—good and sound reasons— for it, and they are all here, I think they are sound reasons, though I will not trouble the Committee by reading them all, because I think that would be outside the scope of this debate.
  Mr. Hale: I am permitted to put this question, since I put a similar question on the previous debate and got a reply. Is it not ineffective for the Under-Secretary to say now that this is out of order? If the Chairman were to rule me out of order, of course, I would not complain.
  Mr. Ward: I did not say it was out of order. I would not presume to give rulings for the Chair. I said I thought it was rather outside the scope of the particular point we were discussing about. over-spending or under-spending on numbers of houses. However, there are various considerations, such as site considerations and freedom of choice in the siting of airmen's quarters. We have to take into consideration where they are placed, because of flying hazards, availability of communications, drainage and so on.
  The Deputy-Chairman: This is well outside the scope of this debate.
  Mr. Bing: With very great respect——
  The Deputy-Chairman: I have ruled upon this, and I must ask the hon. and learned Gentleman to stand by it.
  Mr. Bing: On a point of order. I merely wished to call attention to a particular section of the Exchequer and Audit Departments Act, but if you feel that I am out of order in so doing——
  The Deputy-Chairman: I think the hon. and learned Gentleman is right in thinking so.
  Mr. Edward Davies: May I have a reply to the point I made, which I think was in order, on the pay of the Air Force?
  Mr. Ward: The point here is a rather complicated one. I will try to put it as shortly as I can. We lent the Government of Pakistan a number of personnel, for which we made certain financial. claims. The Government of Pakistan, without agreeing to our claims, did however pay us certain monies which were deposited against these claims, and that has been going on since April, 1948. Although these deposits have been coming in, the outstanding claims have never been agreed by the Pakistan Government, and that is the reason why we show this surplus on the pay of the Air Force. It is not a true position, because eventually the position will be regulated by the Pakistan Government agreeing to these claims.
  Question put, and agreed to.
  Resolutions to be reported upon Monday next.

  MOTOR VEHICLES (INTERNATIONAL CIRCULATION) BILL [Lords]
  Considered in Committee.
  [Mr. GEORGE THOMAS in the Chair]

  MOTOR VEHICLES (INTERNATIONAL CIRCULATION) BILL [Lords]

    Clause 1.—(ORDERS IN COUNCIL FOR FACILITATING INTERNATIONAL TRAFFIC.)
    11.30 p.m.
    Mr. R. T. Paget: I beg to move, in page 2, line 18, at the end, to insert:
    (3) Provided always that no such Order in Council shall permit any person who has not passed a driving test or who is unfamiliar with the provisions of the Highway Code to drive a motor vehicle upon the highways of Great Britain or of Northern Ireland.
    The Temporary Chairman: I intended to ask the hon. and learned Gentleman and the Committee whether we might not take this Amendment and those in the name of the hon. and learned Member for Hornchurch (Mr. Bing) and the hon. Member for Oldham, West (Mr. Hale) together for the purpose of discussion. I hope that the hon. and learned Gentleman will agree.
    Mr. Paget: Yes, Sir. This is a Bill giving effect to an international agreement and permitting foreigners to bring their cars to this country and to drive them on our roads. It seems to me that if this is to occur, in view of the heavy toll of the roads, provision should be made for the safety of our citizens.
    In the first Amendment I ask that the people who come here to drive should undergo a driving test and satisfy an examiner that they are familiar with our Highway Code. They may be competent drivers in their own country, but the rules of the road there may be, and often are, different from the rules in this country. There may be different systems of signals; it may be custom to drive on a different side of the road, and there may be different habits and rules. Before we allow these people to drive on our roads, bringing this added risk, they should understand our Highway Code and what they ought to do on our roads.
    The second Amendment with which I am dealing is the third on the Paper, which provides that no person shall be authorised to drive on the roads here if

    2601
    he has had his licence suspended. I understand that at present this situation can arise. A man who is not a citizen of this country can have an English driving licence. That licence may be suspended. He can then go to France, or elsewhere, get a French licence and a French car, and come and drive here on his French licence although his English licence has been suspended.
    Mr. Gerald Nabarro: Surely the hon. and learned Member realises that a French licence can only be granted to a French citizen.
    Mr. Paget: Precisely; but in England an English licence can be granted to a French citizen.
    Squadron-Leader A. E. Cooper: But surely there are only two forms of licence which he can get in this country. One is the learners' licence, granted for a certain period, which requires the L plates to be carried on the car, and a permanent licence for which the holder has to pass a driving test.
    Mr. Paget: Precisely. Let us get the situation clear. In England one gets a learner's licence and then a permanent licence. A Frenchman resident here could do that. I put this interrogatively, because I want to understand the effect of the Bill—a Frenchman with a French driving licence could, by international agreement, come and drive here on his French driving licence. Is that accurate?
    If so, there could be a situation in which a Frenchman here gets an English driving licence, which is subsequently suspended; he then goes to France, gets a French driving licence and brings a French car over here which he can drive on his French driving licence, during the period of the suspension of his English licence. Is that the situation? If it is, it does not seem to be right and I hope steps will be taken to deal with it. The object of the Amendment is to put it right.
    Further, I want to be reassured that anybody who is driving a foreign car which he brings over on a triptyque must have that car insured under the same terms as those provided in the Road Traffic Act, so that if he injures anyone that person will know that there is somebody solvent whom he can sue.
    2602
    That is the object of the Amendments. I hope the Minister will be able to assure us that these dangers are being dealt with. If they are dealt with effectively without the Amendment, I shall, of course, be happy to withdraw it.
    Mr. Wedgwood Benn: There is little to say on the first Amendment. It is unlikely that one could introduce such a scheme whereby people coming here were forced to pass a driving test in their own country. It would be very difficult to insist on their knowing the Highway Code. At the same time, my hon. and learned Friend the Member for Northampton (Mr. Paget) was right to put the Amendment on the Paper in the hope of extracting some sort of assurance from the Minister about how these regulations will work. When people come to this country—and in their own country if it could be arranged—steps should be taken to see that they have a copy of the Highway Code so that, when they arrive, they know some of our road regulations.
    The second Amendment deals with the case of the man whose licence is suspended by a court of law in Great Britain, and the hon. Member for Kidderminster (Mr. Nabarro) made great play of the fact—which I did not know until he told us—that in order to get a French driving licence one has to be a Frenchman. That certainly is not the case everywhere, and it is not the case in the United States, for I went to America four years ago and got a temporary licence in a local laundry——
    Mr. Nabarro: I was not talking of temporary licences. To get a permanent driving licence in most Western European countries it is necessary to prove residence, which generally rests on three years' stay in the country.
    Mr. Benn: If the hon. Gentleman had not been so quick to interrupt, and had allowed me to finish, I should have explained that I went into a local laundry where there was a notary, and got a temporary licence for three months, paying eight dollars. Later on, I turned it over for a permanent licence, and that permanent licence would enable me to drive in this country, even if my British licence was suspended. I think that the Minister might make some observation on that because of the consequences which might result.

    2603
    The last Amendment is, of course, a far longer one. I understood during the Second Reading debate that some sort of arrangement should be made by which insurance could be proved, and if I understand this Clause correctly, one of its purposes is to enable us to reach agreement about foreign visitors in this country and the vehicles they bring with them. It is only right, therefore, to refer to the adequacy of compensation to British subjects hurt in accidents involving American Forces. Clause I states, at the beginning, that it is,
    "For the purpose of enabling effect to be given to any international agreement for the time being in force in respect of the United Kingdom…"
    That must include any agreement between the United States Forces and ourselves, but this is an intensely complicated question. Speaking for myself, I think the position of the British subjects injured in motor accidents by Forces of another nationality is not satisfactory, and that the Minister, if he cannot accept this Amendment, might turn his attention to this matter when he comes to reply.
    Mr. Nabarro: I drew attention during the Second Reading to the extraordinary complexity involved in taking a motor car through countries in Western Europe, and I would thank the hon. and learned Member for Northampton (Mr. Paget) for his remarks about visitors understanding our Highway Code. There are great variations in road safety standards in the many countries of Western Europe, and in Clause I there arises this point. Whether the Orders in Council which will enable permission to be given to foreign visitors to have a temporary driving facility will rest on those visitors having an international driving permit. Because, to get that in Western Europe, it is necessary for a person to produce a driving licence issued by the country concerned; and if the international permit is produced in this country it would be a reasonable assurance that certain driving standards had been achieved.
    Mr. Benn: I think I am right in saying that the United States are not signatories to the international convention, and when one can get a licence from a laundry, there would be no safeguard in this Clause.
    Mr. Nabarro: I think the hon. Member is right, but I am directing my remarks to Western European countries; and the short point is that, in the case of a foreign visitor coming here, he or she should be able, before being given permission to drive on our roads, to produce an international permit which would not have been given in that person's own country unless that person was able to produce a driving licence. That would be evidence, I suggest, that the person had achieved a reasonable standard of efficiency in driving on the roads.
    11.45 p.m.
    Mr. Geoffrey de Freitas: I wonder whether the Parliamentary Secretary could tell us what the effect of the Bill would be as drafted and if the Amendment were accepted in the case of someone coming here from a State like Texas. It used to be the case in Texas —I do not know whether it is so still or not—that Texans regarded driving a car as they regarded riding a horse. One did not have to have a licence to ride a horse, so one did not have to have one to drive a car. A Texan could drive a car in any of the other 47 States quite legally, because, of course, under their Constitution, they had to have respect to the laws of every other State. That used to be the position, and, for all I know, it is still the position today.
    Suppose a Texan comes here—and I do hope many Texans will, for they are welcome visitors in the summer or at any other time—what will be the position under the law, and under the law if and when the Bill is passed? Because, of course, it could be said that a Texan was entitled to drive a car in the United States, and yet he may not have passed the test, and we should not have any evidence if he had. That is one small point.
    Another point on which I should like information from the Minister is on the matter of the categories of licence. Is it not fact that we have three categories of licence? I am not very familiar with the subject, but is there not a temporary or "visitor to Great Britain" permit— not a learner's licence, but another one valid for six months or something like that, and which is got—not at the laundry —but at the L.C.C. or some other county hall?
    Mr. Leslie Hale: Speaking as a director of a laundry, I deprecate this constant reference to one of the forms of my occupations— although, of course, I entirely concur that it is desirable to see that dirty sheets become clean as soon as possible. I do feel that these Amendment are exceedingly important, and I do feel that they merit the closest possible consideration. With very great respect, Mr. Thomas, I do not want them to be represented as being merely of an exploratory character. I feel that some of them are very vital indeed. Perhaps it would be best if I were straight away to direct my attention to the Amendment standing in my name, in page 2, line 18, at the end, to insert:
    "(3) Provided always that no such Order in Council shall exempt any person from the provisions of Part II of the Road Traffic Act, 1930 (which imposes an obligation to insure against third-party risks)."
    You suggested, Mr. Thomas, it would be desirable to consider all the Amendments at the same time.
    I should think that no amendment in the law in regard to motor cars has been more universally approved than the position with regard to motor cars being driven by persons insured against third-party risks, but I have always thought a mistake was made there, and that the law should have included passengers. That was one of the unfortunate omissions. I do say that, having spent most of my life dealing with motor accidents, I do know—[Interruption.] Well, indeed, I have. I have been at the head of a not inconsiderable litigation in connection with claims for passengers arising out of accidents. Of course, the whole situation was altered by this provision. There was tragedy after tragedy.
    So one has to face this now. It is that tragedies do arise all too frequently now in connection with persons who come from other countries, however friendly and however generous they may be. We know that it is a frightful difficulty that there are different systems of law and different rules. I want to say that I have always found the United States' authorities in this matter to be perfectly generous, and as generous as ours, and perfectly prepared to deal with matters on a sympathetic basis.
    I should like the Committee to remember that there are quite different
    2606
    rules—a different period of limitation, for instance. In England, if a man is killed in a motor accident, the period of limitation runs from the time when death occurs. In the United States it runs from the date of the accident—not even from the date of the death. Therefore, it is possible to find—I have known many cases in which I have found—that on the basis of English law the right of compensation is important.
    Now I want to say something quite bluntly—and probably I shall say something that is not universally agreed. I do not think it is important that we should go to the tremendous trouble of attracting people to bring their motor cars over here and drive them for ordinary purposes. I really do not. Certainly, if the price we must pay is that we restore chaos on the roads, and if the price we must pay is that drivers who come over, and are being urged to come over, have not got to pay regard to the Highway Code or the provisions of our law, that may be too heavy a price to pay.
    Of course I am in favour of attracting visitors from overseas as much as possible, but if it is necessary for them to bring a motor car over here, then they should in any case read the Highway Code. As I apprehend the matter, they should know the Highway Code, and that is the purpose of our first Amendment. It is a matter which falls well within the provisions of the Convention on Road Traffic, because Chapter V of that Convention, which we are considering ratifying, says:
    "Each Contracting State shall allow any driver admitted to its territory who fulfils the conditions which are set out in Annex 8 and who holds a valid driving permit issued to him, after he has given proof of his competence, by the competent authority of another Contracting State or subdivision thereof, or by an Association duly empowered by such authority, to drive on its roads without further examination motor vehicles of the category or categories defined in Annexes 9 and 10 for which the permit has been issued"—
    I am reluctant to interrupt the conversation taking place in such loud terms from below the Bar, but it is exceedingly difficult to pursue an important argument in the circumstances in which these interruptions are being made.
    I understand it is clearly implied in the Convention that it is the duty of the driver at least to familiarise himself with

    2607
    the rules of the country he goes to. Nobody would say that a man who comes over from France with his car has not got to find out that we drive on the left-hand side of the road whereas in France they drive on the right. But in addition, surely he ought to know our system of signalling. Surely he must know what is mean by the signal of somebody in front of him when they are going to turn across him. In other words, surely he owes a duty to familiarise himself with the provisions of the Highway Code.
    I remember when I took a car across to Ireland in the last two years I was provided with a mass of material to enable me to study any mild diversity there may be between Great Britain and Ireland, whereas there are very substantial diversities between ourselves and various other countries, and it is because of those diversities that this international Convention is in one respect sought to be made.
    I sincerely suggest to the Minister that the proposal about insurance is a vital one. If it is to be said to the people of this country that we want to attract foreign visitors here but that if our people get killed by a car driven by a foreign visitor they will have no chance of compensation, that is a very serious thing to say, and it is a matter this Committee ought to challenge at once. The amount of suffering, loss, deprivation and damage that can be caused, and is caused, in a motor accident is very great indeed, and it is exceedingly difficult, even when the foreign visitor is a person of some wealth and substance, to enforce these judgments abroad. It is almost impossible when trying to deal with somebody who is trying to dodge the judgment and is taking active steps to do so, as anybody who has tried to enforce these international judgments will know.
    Of course, it is literally almost impossible for a widow of a person in England, even with the aid which would be readily granted under the legal aid procedure, to embark on litigation against someone resident abroad where there is no insurance company in this country who can take up negotiations. I think we ought to insist on some undertaking of the fullest possible character that there must be some method by which people can be compensated for the loss of a
    2608
    relative in this sort of accident. It really is quite nonsense to pass an Act to regulate this Convention when there is nothing in this Convention which precludes any such provision being imposed in that Act by any of the assenting parties. I hope we shall have the fullest assurance. It is far too serious a matter to let it go by default.
    Mr. James Hudson: The hon. Member for Oldham, West (Mr. Hale) is right in the emphasis he has laid on insisting on proper standards, such are imposed on the citizens of this country, relating to security on our roads. In Switzerland particularly, the Swiss are not wholly satisfied with the insurance arrangements made by our companies under our laws. During the last three years when I have driven in Switzerland I have had to sign a special declaration through my insurance company to satisfy the Swiss on the particular insurance conditions that they impose, and I am told by the Automobile Association that this year also, if I endeavour to go into Switzerland, I shall have to follow the same procedure.
    I think the Swiss are right. They have special dangers involved in driving in their country. But we, too, in view of our road accidents have our special situation, and it is right that we should be well assured by the Government that either in connection with this Measure, or any other arrangement we make, proper insurance cover is fully provided for foreigners who drive in this country.
    I noted in the general discussion, and perhaps even in the speeches of my hon. Friends, a weakening of emphasis in relation to the first Amendment on the importance of the Highway Code. I agree that probably we are not very keen about being well assured that the Highway Code is understood by our own citizens. There are many occasions in the courts when it comes out that the culprits and convicted persons have admitted stupid misconceptions over considerations clearly laid down in the Code. Hon. Gentlemen will be well aware upon which particular point I shall dwell to illustrate this matter.
    The Highway Code lays down what apparently some hon. Gentlemen do not know, that it is inadvisable before driving to take alcohol at all. Yet special claims

    2609
    are made for foreigners, whose drinking habits are of such a character that we have to break or amend the law in order to meet their drinking habits. I can well imagine foreigners coming from countries of that sort, who have to be provided for by proposals to alter the law without one injunction about the danger of alcohol in driving, readily falling into the consumption of alcohol and the accidents which will inevitably result.
    12 midnight.
    Mr. Nabarro: Hear, hear.
    Mr. Hudson: I hope that "hear, hear," from the depths of the soul of the hon. Member for Kidderminster (Mr. Nabarro) marks the sense of seriousness which he shares with me about this matter.
    I would warn hon. Members that countries about whom we have been very critical in our relations lately were much more alive to this situation than we seem to be. If before the war any of us had driven in Germany or had a temporary licence——
    The Temporary Chairman: I think the hon. Member would be better advised if he confined his remarks to this country and the application of the Highway Code here.
    Mr. Hudson: I was upon the point of the application of the particular clauses in our Highway Code here and was wishful of showing that the seriousness of the point in our own Highway Code had been recognised in other countries, which in itself is a reason why we should recognise it. I was not. however, wishing to press that point.
    I do not see why in this country we should not insist on the foreigner coming here and signing a declaration that he has read our Highway Code and has noted the points. I think we might pick out the points of importance for foreigners to observe. That has been done and is being done in other countries, and I do not see why it should not be done here. We ought to see to it that foreigners, who are not likely to be aware of what we lay down, have all these matters brought clearly to their attention before they drive on our roads, and that the same inhibitions are observed by them as we are asked to observe ourselves.
    Mr. Geoffrey Bing: There are three points which arise from the three Amendments which we are taking together. In the first place, of all people those who come from abroad are those to whose attention it is most necessary to bring the Highway Code, because the people who live in this country, even if they are only starting to drive, from their experience as pedestrians are familiar to some degree with what are zebra crossings, the nature of signals by drivers and the like. Therefore, it is particuliarly important from the point of view of foreigners that they should know about these things, but as the law stands at present they are the people on whom there is no necessary obligation either to pass a driving test or to familiarise themselves with the Highway Code.
    Secondly, there is this difficulty about line 18 of the Bill, that it is possible, particularly in regard to visiting forces, for permits to be given by those forces for somebody to drive a vehicle on the roads here who has been disqualified. Even though we, in our own courts, were to disqualify someone from driving, under the international arrangements— and such arrangements, I understand, are to be made under this Bill—it is still possible for that person to be given a permit by his own military authority, disregarding entirely the ruling of the court here, and permit him to go on driving. That point at least needs the attention of the Committee.
    Thirdly, there is what I consider the most important of the three points raised by these Amendments, the question of the payment for any injury that may be done. Not only can somebody come here without any knowledge of the Highway Code, without having passed a driving test, and continue to drive after being disqualified by the court, but if a person has the misfortune to be knocked down by him there will not necessarily be any redress. Of all the people one requires insurance against is someone not living in this country. If a person lives here, there is the possibility of taking action against him, but someone living abroad is not only outside our jurisdiction but there are all sorts of practical difficulties in suing him. Even the difficulties of tracing him may be very great.
    Therefore, I hope that the Parliamentary Secretary will give some satis-

    2611
    faction on this and the other points. The third point is by no means a fanciful one; it is coming up from time to time and results in great hardship. A member of my own union was knocked down by a car driven by a national of another country and was completely disabled from work. He has not been able to work for two years, and he has not been able to get any compensation at all. I hope the Parliamentary Secretary will be able to do something on the point.
    The Parliamentary Secretary to the Ministry of Transport (Mr. Gurney Braithwaite): I am sure the Committee are grateful to you, Mr. Thomas, for permitting these three Amendments to be taken together, because they have much in common. All of them are provisos which it is sought to add to Clause I, and all have a general background which I will endeavour to place before the Committee without repeating arguments I put on Second Reading before Whitsuntide.
    The main purpose of the Measure is to enable the Government to ratify and give effect to the United Nations Convention on Road Traffic of 1949, which was presented to the House in 1950. When one is endeavouring to get an international convention there has to be a good deal of give and take—what I would call the lowest common denominator—and in many cases there are things one would like to see included in international negotiations that do not find their way into the final agreement.
    Under this Convention, the Government of the day—that refers to our predecessors—agreed that they would take the necessary steps, of which this is the first, to introduce certain modifications into the present arrangements relating to the use and driving of motor vehicles by temporary visitors to the United Kingdom coming from countries that are parties to the Convention. On Second Reading I ventured that the word "temporary" is taken to mean a period of 12 months, which I think is a generous interpretation.
    The modifications spring from long experience. They go back even before the existing International Circulation Act of 1909, which was in the very early days of motoring. Each has been very carefully evolved, and none of them affects
    2612
    in any vital manner public safety on the roads or the basic principles of the Road Traffic Acts, such as third-party insurance, with which I shall deal when I come to the last of the Amendments in the name of the hon. Member for Oldham, West (Mr. Hale). The Convention of 1949 is already in force in some countries. Until this Bill is passed, H.M. Government cannot themselves ratify it, and any delay would, in our view, be unfortunate, in view of this country's strong interest in the tourist trade in both directions.
    In regard to the Amendment in the name of the hon. and learned Member for Northampton (Mr. Paget), the driving test proviso, if I may so call it, would prevent H.M. Government from fulfilling their obligations under the United Nations Convention on Road Traffic of 1949. of which Article 24 provides, among other things, that a contracting State shall allow any visiting driver, who nolds a valid driving permit issued, after he has given proof of his competence, by another contracting State, to drive on its roads without further examination.
    Mr. Nabarro: My hon. Friend says "a valid permit." That is a point I have raised three times. Is a valid permit an international driving permit?
    Mr. Braithwaite: We are discussing three matters together, and, if we can get along, and my hon. Friend is not satisfied and wants further elucidation, as we are in Committee, I shall be able to speak again, though I hope it will not be necessary.
    The hon. Member for Lincoln (Mr. de Freitas) put a rather specific point about Texas. I have not had time to find out if there is a driving test there, and I am assuming that the hon. Gentleman was correct in saying that there is not.
    Mr. de Freitas: I said there was not in the thirties.
    Mr. Braithwaite: I am informed that, if there is no driving test, in the sense in which we mean it here, anyone coming from that country may declare that he is a person who is permitted to drive in his own country, and, if he so satisfied our officials, he would get a British driving licence.

    2613
    The object of the Bill, in general, is to facilitate international traffic, and, if we were to accept this particular Amendment, it would place visiting drivers, from both Convention and non-Convention countries, in a less favourable position than they are in at the present time. We are anxious that those which are at present non-Convention countries may be encouraged themselves to sign the Convention and come into the general arrangements.
    Of course, the hon. and learned Member for Northampton, in moving his Amendment, had very much in his mind road safety, and, indeed, we all have, and we had a debate on it only on Friday last. All of us are seized of the importance of that question. A very careful examination has been made of this problem, and there is no evidence that driving by foreign visitors gives rise to any special danger.
    Indeed, it is reasonable to suggest that they are generally experienced drivers, who take especial care in this country, if only because of the fact that our rule of the road is opposite to theirs, in almost every case. The foreigner coming here is particularly careful in his use of the road because of that one factor, and there is no evidence that the foreign drivers who come here are an element of danger or carelessness. In fact, they often set an example which might well be followed by some of our own citizens in that respect.
    The Amendment of the hon. and learned Member for Hornchurch puts us in a little difficulty, for this reason. Article 24 of the United Nations Convention of 1949 provides, again among other things, that a contracting State may withdraw from a visiting driver the right to use a driving licence if the driver has committed a driving offence of such a nature as would entail the forfeiture of his driving permit under the laws of that contracting State. The procedure to be followed where a visiting driver has his licence suspended by the courts will be set out in the Order in Council, a draft of which must be laid before Parliament and approved by Resolution of both Houses before it is, in fact, made.
    12.15 a.m.
    I think it was the hon. and learned Member for Northampton who suggested that anyone suspended in this country could, for example, go to France and get
    2614
    a French licence and return to this country to repeat the offence, or the danger. That will not be so. There will be machinery by which a person suspended in this country will not be permitted to drive during the period of suspension with a French or any other licence. The country of origin will be notified of the offence and the suspension. There are officials who "vet" people coming to this country at any time, particularly foreign nationals. They have to go through a procedure of which the hon. and learned Member is well aware. There will be a black-list of foreigners who have had their licences suspended in this country.
    Mr. Paget: Surely that is impracticable. It would mean a black-list of everyone here who had his licence suspended. The people in France would have not the slightest idea that a person who got a licence there had had his licence suspended here. When that person came along with a French licence and with a triptyque issued through the French equivalent of the R.A.C., no one would have any idea that his English licence had been suspended.
    Mr. Braithwaite: That is wrong. It is intended to set up machinery through which it will be known when offences have been committed. The procedure to be followed when a visiting driver's licence is suspended will be set out in the Order in Council which will have to be laid before both Houses of Parliament by Resolution of each House before it is made. To include in the Bill a proviso on the lines of the hon. and learned Member's Amendment is, we suggest, unnecessary and would be contrary to the general principle on which the Bill is framed, which is that we deal with detail of this sort through the medium of the Order in Council. In any case, I do not think the wording of the Amendment would be appropriate.
    Regarding the observation of the hon. Member for Bristol, South-East (Mr. Benn) about visiting forces, it is not because of the lateness of the hour, or lassitude, that I inform the Committee that in another place yesterday there was taken the Second Reading of a Measure which is intended to deal with this aspect of the problem, namely the Visiting Forces Bill, which will be coming to us in due course. It would be more

    2615
    appropriate and convenient to discuss details of that aspect of the matter then.
    Mr. Benn: Before the hon. Gentleman leaves that point, may I ask whether this Bill, when enacted, will be used as a means of providing facilities for visiting forces to be covered by the Bill which has not yet reached the House?
    Mr. Braithwaite: The Bill which is coming from another place deals with N.A.T.O. Forces in general. The difficulty which the hon. Gentleman mentions refers to the fact that there are at present visiting forces of only one nationality in the country, and they are in a position of immunity under the 1942 agreement, which has been mentioned in the debate.
    Mr. George Wigg: I was listening to the Minister with close attention. I did not think he dealt with the point made by my hon. and learned Friend the Member for Northampton (Mr. Paget). My hon. and learned Friend was referring to a British subject whose licence was suspended in a British court, who went to France, let us say, took out a driving licence, went to the French authorities, got the necessary papers and came back to this country. He would proceed to get a British licence. I thought the Parliamentary Secretary dealt effectively with the case of foreign subjects, but not with what I thought was the point made by my hon. and learned Friend.
    Mr. Philip Bell: No one seems to have referred to Section 4 of the Road Traffic Act, 1930, which says
    "A person shall be disqualified from obtaining a licence—
    (b) if he is by a conviction under this Part of this Act or by an order of a court thereunder disqualified from holding or obtaining a licence."
    The question is—What is a licence? In this Bill it is defined as
    "'licence' means a licence to drive a motor vehicle granted under this Part of this Act or under article 5 of the Motor Car (International Circulation) Order, 1930."
    I may well be wrong, but I should have thought that says that a person is disqualified from obtaining a licence, even a foreign licence or an international permit, if he is disqualified in this country. I should have thought that anything in the Bill which enables an Order in
    2616
    Council to be made must be subject to the provision in Section 4.
    Mr. Paget: That is so if he obtains his foreign licence subject to the 1930 agreement. I want to make sure that the rule which applied to the 1930 agreement, with which the Road Traffic Act deals, will also apply to this agreement, with which the Road Traffic Act does not deal. The position at present under the Bill would be this. A man gets his licence suspended here, goes over to France, gets a French licence, comes back and drives here under the French licence. That French licence being a licence subject to this agreement, it is not a licence subject to the 1930 agreement, and he is allowed to drive here. That is a state of affairs which I think we ought to avoid.
    Mr. Braithwaite: I am in the fortunate position of having what is known as free legal aid from both sides of the Committee. I think my hon. Friend the Member for Surrey, East (Mr. Doughty) was putting far more competently than I can hope to do what I believe the position to be——
    Mr. Ede: It was not the hon. Member for Surrey, East.
    Mr. Braithwaite: I am sorry; it was my hon. and learned Friend the Member for Bolton, East (Mr. Philip Bell). The hon. and learned Member for Northampton raised a point of great substance on which the Under-Secretary of State for the Home Department is trying to seek inspiration under the Gallery. We shall be most anxious for the Order in Council to cover that situation, and we will do our best to see that it does.
    May I turn to what I think was the most important of the three Amendments, that in the name of the hon. Member for Oldham, West (Mr. Hale)? I want to give him this assurance. There is no intention to include in any Order in Council under the Bill any provision which would affect the rights of third parties to secure compensation for injuries arising from the use of a vehicle by a visiting motorist. It is inconceivable that this or any future Government would seek to make such a provision, and the reason why it is considered unnecessary to insert into the Bill a special proviso to preclude such action, is that a draft of any Order in Council

    2617
    must be laid before Parliament and receive an affirmative Resolution by each House before it is submitted to Her Majesty.
    I do not think that the hon. Member was with us on the Second Reading debate, but I then said that a new international scheme relating to the insurance of motorists against third party risks is being brought to finality at Geneva by the Road Transport Sub-Committee of the Economic Commission for Europe; and this scheme, which will provide for foreign visitors to have insurance certificates, will be a great advance on the current arrangements applicable to them. It will be a great advantage from the point of view of safeguarding the interests of injured third parties, and the scheme, when ready, will be introduced by Regulation in this House under the provisions, not of this Bill, but of Section 41 of the Road Traffic Act of 1930.
    Mr. Hale: I appreciate the courteous information which the hon. Gentleman has given us, but I am a little worried as to his phrasing; because it is capable of being termed ambiguous. Do I gather that if I go to France, or to Ireland, my insurance company will, in future, insist on an insurance certificate being produced? Is there a clear undertaking that no permit will be granted to people who come here with cars unless there is evidence that they are insured against third party risks?
    Mr. Braithwaite: The scheme does not operate under this Bill; it arises from the agreement being negotiated at Geneva.
    Mr. Hale: I understood that quite clearly, but if I remember rightly, he said that no Order in Council would be made which did not make provision for protecting the rights of a person to sue for injuries arising from a third party risk. There must be an insurance to cover such action, but it is not clear if there will be compulsory insurance provided for by the Order in Council which, he says, will be made under the 1930 Act.
    Mr. Braithwaite: I would adhere to the wording which I used originally; but the machinery which it is proposed to operate would cover completely what he seeks in his proviso; and before sitting down, I would say why it is that the Government think it is a mistake to
    2618
    insert these words. It would somewhat handicap the machinery of international ratification if where we are seeking to give our ratification to an international convention we put in too much detail in the ratification Act itself.
    Her Majesty's Government prefers to leave itself with the machinery of the Order in Council—which procedure will permit of adequate debate in Parliament —and while it is felt that there is nothing in this proviso to which we take exception, it would be a mistake to insert it in the statute; for the very good reason which I have given, namely, because it might be regarded as a handicap to the spirit of the Convention where there will be the signatures of a number of countries. It is not easy to get agreement, and we prefer to follow the course I suggest to the Committee.
    Mr. Paget: Will the Parliamentary Secretary give a firm undertaking that no foreign motorist, as a result of this Bill, will be able to drive on our roads while not insured?
    12.30 a.m.
    Mr. Braithwaite: I do not think I can add to what I said. Perhaps I may repeat the phrase I used in reply to the point that the hon. Gentleman the Member for Oldham, West (Mr. Hale) was anxious about. I was able to give him a certain assurance. Perhaps I may repeat it, because it was phrased with great care. There is no intention to include in any Order in Council under the Bill any provision which would affect the right of third parties to secure compensation for injuries arising from the use of a vehicle by a visiting motorist. That is as far as I can go.
    Mr. Ede: May I put it as one layman to another? I think the hon. Gentleman will understand why I put it like that. What we had to provide against in this country was the fact that it was necessary to ensure that the injured party should be in a position where he could recover damages that were awarded by the court. The phraseology used by the hon. Gentleman does not give that assurance.
    I have deplorable cases coming in front of me as a justice of the peace concerning people driving uninsured. A man of straw knocks down a person and

    2619
    widows some woman. I recollect one case where the dead man was a solicitor, and all that she was left with was the goodwill of the solicitor's practice. I do not want to say anything disparaging to my hon. Friend the Member for Oldham, West (Mr. Hale), but I understand that that is not a very valuable asset to have—although this was a young man who was making his way, and, undoubtedly, would have provided a substantial income for that woman. The right to sue is of not great advantage unless one can be certain that the damages awarded by the court will in fact be recoverable by the injured party after the case has been heard.
    Mr. Braithwaite: I am able to give this undertaking. It is proposed that no person will be permitted to drive in this country without third party insurance. That is, perhaps, putting the thing in rather plainer language. It is now on record. Perhaps the Committee will say that that is a more definite form in which to put it. It so often happens on Committee stages that we find elucidation of these points.
    Mr. Ede: Third party insurance enforceable in this country?
    Mr. Braithwaite: Yes.
    Mr. Eric Fletcher: Third party insurance with a British insurance company?
    Mr. Paget: Not necessarily a British insurance company, but an insurance organisation which, under international agreement, has agreed to be sued in England. That is the important thing.
    Mr. Braithwaite: I think that that is so.
    Mr. J. Hudson: Before the hon. Gentleman sits down. He has not really referred to the points I urgently pressed upon his attention. One difficulty is that our Highway Code is different from the road codes of other countries. Will there be some attempt to bring to the attention of persons coming here the precise differences between their road codes and ours? It was on that that I specially wanted an answer. Is nothing to be said about that matter?
    Mr. Braithwaite: Of course, everything said on the Committee stage today will
    2620
    be of value when Orders in Council are being framed, and we shall carefully study all the suggestions made, but I could not give an undertaking here and now that everything the hon. Gentleman asked for will be included in the Orders in Council. I can assure him that we shall go through the OFFICIAL REPORT of this debate carefully and include what we think is practical.
    Several Hon. Members Several Hon. Members rose——
    The Deputy-Chairman (Mr. Hopkin Morris): Mr. Ernest Davies.
    Mr. Paget: Surely the hon. Gentleman will give an assurance——
    The Deputy-Chairman: Order. I have called on Mr. Ernest Davies.
    Mr. Ernest Davies: I am sorry to come between my hon. and learned Friend and the Parliamentary Secretary, but perhaps he will have an opportunity of pressing the matter later.
    I am a little disappointed at some of the replies the hon. Gentleman has given to this discussion because, while I think that he was endeavouring to be helpful, he only gave a certain assurance after being very hard pressed for it, and I consider that he has left far too much to Orders in Council rather than to the Bill itself. He has put off each one of these Amendments, as it were, to be dealt with in Orders in Council or in other legislation and left the matter in suspense to a certain extent; it is still rather in the air.
    On the first Amendment, I think my hon. Friends were pressing largely for the Highway Code to be brought to the attention of all foreign visitors to this country, and for it to be made certain that they would study and understand this Code, as far as it was possible for them to do so, in order that we could expect as high a standard of driving from foreign tourists as from our own citizens. I should have thought the Parliamentary Secretary could give us a little further assurance on that and say that every effort will be made to bring the provisions of the Highway Code to the attention of tourists coming to this country and the necessity for their studying it.
    Perhaps it would be possible to arrange that when tourists express their intention of coming to this country and apply for the necessary papers in their own country

    2621
    copies of the Highway Code could be made available to them in the better known languages. In that way we could be more certain that the Highway Code was studied by them prior to their coming to this country. I appreciate the difficulty of imposing the driving tests suggested in the first Amendment, because that would destroy the purpose of the Bill.
    What we are concerned about is that the dangers of the road will not be increased, and that the driving of anyone coming to this country will be of the same standard as we expect from our own drivers. While we cannot insist on this driving test and at the same time ratify the Convention, I think that a little more attention should be given to the driving standards of those drivers, particularly from those countries which have not ratified the Convention.
    On the second Amendment, concerning the licence suspended by any court of law, again the Parliamentary Secretary indicated that in an Order in Council it would be provided that no one who had had their licence suspended would be allowed to drive, and that a practicable administrative scheme would be instituted. We shall anxiously await to see exactly how this is included in an Order in Council, and to see what the scheme is, because I think it will be rather difficult to work out a practicable scheme. Certainly we would much prefer to see these provisions in the Bill. It is not desirable to leave too much to Order in Council. After all, Orders in Council can be annulled later, whereas repealing an Act is somewhat more difficult to undertake.
    As regards insurance, the last statement by the Parliamentary Secretary is certainly a satisfactory one. It is now going to be a provision in this country that tourists and everyone must be insured for third party risk. As regards the drivers of foreign countries, this matter has again been put off, and we must await the legislation in another place. During the Second Reading debate I was not happy at the reply I received from the Parliamentary Secretary.
    The Parliamentary Secretary was unable to give any assurance that American drivers, for instance, who were involved
    2622
    in accidents in this country would be subject to a similar punishment in their own courts as they would be in British courts. That is to say, if they were involved in accidents which in our courts would result in the suspension of a licence similar action would be taken by their courts. There does not seem to be any agreement between us and the Americans on this score as yet.
    I hope the Parliamentary Secretary can say that the discussions with the Americans have gone sufficiently far to assure us that their drivers will be treated no less favourably than our own. Without that assurance I fear the dangers on the roads will be increased even further under this Bill.
    I think there are certain points upon which we must await further elucidation from the Parliamentary Secretary when these Orders in Council are forthcoming. In view of the fact that so much has been left to them, and also the fact that the legislation regarding N.A.T.O. forces has not yet reached us, it might have been better for the Bill to have been delayed a little longer so that the whole matter could have been dealt with at one go.
    Mr. Braithwaite: If I may assure the hon. Gentleman at once, everything he said about visiting forces will be noted by the Government in relation to the Bill from another place. At the moment all these matters are outside it, including the question of insurance. Since the hon. and learned Member for Northampton (Mr. Paget) spoke, I have managed to clarify one point about the position of disqualified drivers and what they might do to elude the consequences. A person who has been disqualified in this country would be committing an offence if he drove here while so disqualified, even if he were to obtain a licence abroad and come back here to drive.
    The Parliamentary Secretary to the Treasury (Mr. P. G. T. Buchan-Hepburn)The Parliamentary Secretary to the Treasury (Mr. P. G. T. Buchan-Hepburn) rose in his place, and claimed to move, "That the Question be now put."
    The DEPUTY-CHAIRMAN proceeded to put the Question.
    12.45 a.m.
    Mr. Benn: On a point of order. We were discussing the three Amendments together when the Parliamentary Secre-

    2623
    tary to the Treasury moved the Closure. Could you tell us, Mr. Hopkin Morris, whether we are now dividing on all three?
    The Deputy-Chairman: We are voting on the Closure Motion at the moment.
    Mr. T. Driberg: When the Parliamentary Secretary moved, "That the Question be now put," he was heard speaking in the singular. Would you be good enough, Mr. Hopkin Morris, to say whether all three Amendments will be put immediately on the result of the Closure Motion?
    Question, "That the Question be now put," put, and agreed to.
    Question, "That these words be there inserted," put accordingly, and agreed to.
    Mr. Benn: I beg to move, in page 2, line 18, at the end, to insert:
    (3) Provided always that no such Order in Council shall exempt any person from the provisions of section three of the Road Traffic Act, 1930 (which section provides that it shall be unlawful to use any motor vehicle that does not comply with the regulations applicable to that class of vehicle).
    As the first Amendment has now been inserted in the Bill by your collection of the voices, Mr. Hopkin Morris, I venture to hope that it will now be possible——
    The Deputy-Chairman: I beg pardon, but I made a mistake.
    Mr. Benn: No, with great respect, Mr. Hopkin Morris. It has now been passed. You collected the voices and nobody said "No."
    Mr. E. Fletcher: I can assure you, Mr. Hopkin Morris, it was no mistake at all.
    The Deputy-Chairman: Nobody said "No"?
    Mr. Fletcher: Everybody said "Aye."
    Mr. Paget: You said, "The Ayes have it." That stands. That is the law. It may be corrected on the Report stage, but it is the law now.
    The Deputy-Chairman: It was certainly a mistake if I did say that. It was a mistake on my part.
    Mr. Paget: No.
    Mr. Ede: When you put the Question asking if the Ayes were in favour there were murmurs of "Aye" from both sides of the Committee and when you asked for the "Noes" there was no sound at all.
    Brigadier Terence Clarke: On a point of order. I most distinctly said "No" from this side and I could be heard.
    Mr. Benn: As I was saying, as the Committee has now accepted the first Amendment, which I think was very wise, despite the assurance given, I hope the Minister will now be able to accept the Amendment which I am now moving. It deals with this question of visiting Americans or visiting North Atlantic Treaty Organisation Forces. The Road Traffic Act, 1930—[Interruption.] I hope that the Parliamentary Secretary will give me his attention. I am sure he is disappointed at the result just arrived at and may even be contemplating resignation, I do not know.
    I am now dealing with Section 3 of the Road Traffic Act, 1930. Under that Section the Minister of Transport lays down certain regulations and rules affecting various types of vehicles that are permitted on the roads. It is the duty of the Minister of Transport under that Section of the Road Traffic Act to make certain exceptions, so that other vehicles can from time to time go on the roads. Normally, the categories of vehicles allowed are the kinds found in every ordinary driving licence, but in certain circumstances—such as a time of war— he has to make exceptions for Service vehicles and other types that go on the roads. [Interruption.] I must say that it would be only courteous when I am moving an Amendment standing in my name for either the Parliamentary Secretary or the Minister at any rate to appear to be giving a little attention.
    Mr. Ronald Bell: On a point of Order, Mr. Hopkin Morris. May we know in which way you eventually gave your Ruling, just now?
    The Deputy-Chairman (Mr. Hopkin Morris): I gave my Ruling that the Ayes had it.
    Mr. Bell: I ask because I understood my hon. and gallant Friend the Member for Portsmouth, West (Brigadier Clarke) intervened from the other side to say that he said "No," and therefore I did not rise to say that I also said "No" from this side. I do not know whether you heard, but I also said "No."
    The Deputy-Chairman: I did not hear that.
    Mr. Benn: If I may go back to the Amendment before the Committee, it deals with the making of exceptions for special vehicles. Since the Road Traffic Act was passed the Minister of Transport has from time to time made exceptions for such vehicles as motor mowers, rotary ploughs, and so on. [Interruption.] Mr. Hopkin Morris, I have asked your advice on this before—nobody on the Government Front Bench, at least, is paying the slightest attention to the remarks I am addressing on this Amendment.
    The Deputy-Chairman: Order. Mr. Wedgwood Benn.
    Mr. Michael Foot: Would it not help the proceedings if we could have some attention from Members opposite to what my hon. Friend is saying?
    The Deputy-Chairman: I hope that the hon. Member will be heard.
    Mr. Benn: I ought to count myself rather fortunate to be moving this Amendment at a moment of excitement, when our little band has consumed the Goliath. The instrument we used was so utterly above any challenge by either side that it was, indeed, a true victory.
    I am moving another Amendment which deals with the fact that the Road Traffic Act laid down certain types of vehicles allowed on the road. It is obviously necessary that other types of vehicles should be allowed on the roads from time to time. The Minister of Transport makes a ruling that these other vehicles can go on the roads—for instance, a motor mower to pass from a lawn to a cricket pitch. During the war there was a host of orders in which the Minister authorised military vehicles to be put on the roads.
    If one looks through the statutory rules and orders to be obtained from the Minis-
    2626
    ter of Transport's Department, it will be found that whenever a new crash wagon was to be used by the Air Ministry to transport aircraft from one place to another the Minister of Transport authorised it. Of course, he authorised all these vehicles with special provision for safety. He said that if those types of military vehicles—tanks or aircraft crash wagons—were to be on the roads, the local police must be given five days' notice and informed of the route to be followed so that civilian traffic should be dislocated to the minimum possible extent. That seems to me a very satisfactory arrangement. During the war, the American equipment that was used was similarly authorised by special Statutory Order issued by the Minister. The big petrol tankers used by the Americans were authorised by the Ministry of Transport under certain safety precautions regarding smoking and the number of attendants.
    Here we have a situation when a Visiting Forces Bill will shortly be brought before the House, and when this Bill gives the Minister power to make rules also covering those forces from the North Atlantic Treaty Powers, and all I am seeking to get by this Amendment is an assurance from the Minister that, when these visiting forces bring this heavy equipment, he will not relax the old regulations under which, if these vehicles are to be used, a special Statutory Order has to be made and special safety precautions are laid down.
    It must be the experience of almost every hon. Member to have been stopped by the police while a heavy piece of equipment or heavy vehicle has passed by, occupying almost the whole of the road. That is very likely to happen with the American forces here, and it is only reasonable to expect visiting forces to comply with the minimum safety regulations which we impose on similar vehicles here.
    I hope the hon. Gentleman will give an assurance that he will look into the question, so that the normal comfort and convenience of the British road user, and the consideration of the police, are not forgotten, but that, in fact, the existing arrangements for all vehicles of a special type on our roads should follow the arrangements hitherto prevailing here in time of war.
    Mr. Bing: I rise only to urge on the Committee one or two extra points with which my hon. Friend has not dealt. In the absence of the Patronage Secretary, who if he were here would, I am sure, intervene at once, and before accepting his assistance in this matter, it perhaps is a good thing that the Committee should look for a moment or two at the merits of the matter.
    In these circumstances, the question arises concerning vehicles from other countries which, very often, are in a poor state of repair. It is not only a question of large vehicles, but of vehicles the brakes of which are in a very inadequate condition, and which have not got the various safety precautions upon which we rightly insist in the case of any vehicle going on our roads. There is a standard of safety for vehicles on our roads which is not necessarily the same as in other countries, and, for that reason, it is particularly necessary that we should have some Amendment such as this.
    The Minister may want to reconsider the decision to which the Committee has come in regard to the three previous Amendments, and may feel that, at a later stage, he should put down some Amendments varying or altering the decision to which the Committee has just come. I do not know, but, if so, this would be a convenient time to adjourn the matter in order to have a look at it again.
    It is now very late, and other important business will take some time, and so I hope that, in these circumstances, the Parliamentary Secretary will not brush this off, but will take the opportunity to consider the whole matter, and, in the interval which is now bound to elapse before we proceed further with this Measure, will give an opportunity to see whether it would not be desirable to let this Bill and the other Measure about which we have heard run side by side.
    1.0 a.m.
    It is clear from what has been said that this Session is going to continue for some time, probably into next year; therefore there is time to deal with these small Bills at a more convenient time than the present. I hope that the Parliamentary Secretary will not give a final answer tonight but will reserve this for consideration when the Bill comes again
    2628
    before the House on a subsequent stage, so that we can reconsider the recent decision.
    Mr. Wigg: Through the Patronage Secretary, with his usual incompetency, moving the Closure without having listened to the debate, every foreigner, whether he wants it or not, is now to get a copy of the Highway Code. My right hon. Friend the Member for Lewisham, South (Mr. H. Morrison) reminds me that he was the inventor of the Code. It seems to me that if the Patronage Secretary intervenes again every foreigner will get his tyres and brakes tested; indeed, if he intervenes often enough he may even get a free car. This is in addition to getting his teeth extracted.
    I think there is a great deal in the point made by my hon. Friend, and the hon. Gentleman ought to give careful attention to the safety of vehicles which foreigners may bring here. A British subject is liable to severe penalties if he drives a vehicle which is not in a fit condition, but the standard of safety on the Continent is certainly not up to our standard. We ought to ensure that foreigners are not allowed to take on the roads vehicles which we would not allow a British subject to drive. I agree that it is not an easy point to deal with, and that may be that because of the international complications involved in this measure, we cannot include this form of words. But perhaps the Minister will say whether something can be done, particularly with regard to the heavier type of vehicle.
    Mr. E. Fletcher: I will not detain the Committee for more than a few minutes. After the very interesting discussion on the three previous Amendments, the Committee has unanimously decided that the other three Amendments should be inserted in the Bill, notwithstanding the advice of the Parliamentary Secretary.
    Mr. Braithwaite: Surely all that the Committee has done is to agree to insert the first proviso.
    The Temporary Chairman (Mr. George Thomas): That is perfectly clear. All that has been inserted so far is the first Amendment. The others have not been put.
    Mr. Ede: It does involve this, that although it was promised that there would

    2629
    be an opportunity to divide on the others, if necessary, in the general excitement the putting of the other two was forgotten.
    The Temporary Chairman: They have not yet been reached.
    Mr. Benn: This is a point of substance. Your predecessor, Mr. Thomas, suggested that all three Amendments should be taken together, namely, the first, the third, and the fourth.
    The Deputy-Chairman: It was an agreed discussion which took place on the three. The other two Amendments have not yet been reached; we are dealing with the second Amendment on the Paper.
    Mr, T. Driberg: On a point of order. Does the Closure, Mr. Hopkin Morris, have to be moved separately for a Division on each of the three Amendments, even though the debate has gone on for a considerable time about the three of them simultaneously?
    The Deputy-Chairman: We have had the Closure on one of the Amendments.
    Mr. Michael Foot: Does that Ruling mean that when we come to the other Amendments, unless they are accepted by the Government it is possible to have a further discussion on them?
    The Deputy-Chairman: An agreed discussion has taken place. If the Committee wish, they can divide upon the other Amendments.
    Mr. Driberg: When will the Divisions occur?
    The Deputy-Chairman: We have to dispose of the Amendment we are discussing first of all.
    Mr. Driberg: It is a very odd, irregular position.
    Mr. E. Fletcher: I do not think that discussion affects the point I was trying to make. During the discussion on those three Amendments, the Parliamentary Secretary invited the Committee to reject the Amendments, and one of the strong points in his argument was that, having regard to the international convention, it would be inconvenient to introduce into the Bill any proviso to the effect that
    2630
    there should be no Order in Council unless it contained such a provision. He said that these international conventions follow a particular pattern, and that it was convenient that the Act should be in a certain form.
    He went out of his way to repeat two or three times that it would be inconvenient to have inserted into the Bill a proviso which had the effect of limiting the kind of Orders in Council that could be made under the Bill. He said the Committee could rely on the Government's assurances that when the Orders in Council were made they would have regard to the points raised by my hon. Friends. In the matter of the first, second and fourth Amendments, he said we could rely on the assurances which he gave that the Orders in Council would not contravene the point which was of concern to my hon. Friends.
    I listened with great care, as I am sure did all hon. Members, to the arguments which he gave to the Committee, but the fact is that the Committee unanimously decided to disregard the advice which he gave. They decided that whatever force argument might have, it did not weigh with them. In other words, the Parliamentary Secretary was over-ruled by the Committee, who said that whatever may be the ordinary methods of the international agreements on this matter, the consideration of our own domestic affairs, the necessity to give protection to the people of this country, require special, specific provisions inserted in the Bill.
    Mr. P. Bell: Is it correct that this has been done? Does the hon. Member seriously want to go on record as saying that the Committee deliberately accepted the Amendment?
    Mr. Fletcher: It is on record. Your predecessor. Mr. Hopkin Morris——
    The Deputy-Chairman: It is not in order to discuss that on this Amendment.
    Mr. Fletcher: The whole point of my argument to the Committee on this Amendment is the Parliamentary Secretary's advice to the Committee having been over-ruled so decisively on the first Amendment——
    The Deputy-Chairman: The hon. Member is making the same point that he has made before.
    Mr. Fletcher: I will not mention it again, Mr. Hopkin Morris, but will say that the previous decision of the Committee seems to have removed the most serious arguments which the Parliamentary Secretary might have introduced against this Amendment.
    The Committee having decided, in principle, that it is necessary to introduce provisos into the clause, it is, I think, also necessary that there should be provisos in the terms of the second Amendment on the paper; because the arguments are equally cogent with regard to the desirability, in the interests of the British public, that no Order in Council shall exempt persons from Section 3 of the Road Traffic Act of 1930. It seems most desirable that there should be in this Bill the limitations on the nature of the Orders in Council which may be made under its provisions.
    You will remember, Mr. Hopkin Morris, that in the last Parliament, and in the previous, how right hon. and hon. Members opposite—and the Parliamentary Secretary not less than anybody else—quite rightly inveighed, over and over again, against delegated legislation. They were always to the fore in urging that Parliament should retain control over the kind of Orders in Council which should be made, and the real issue here is whether Parliament should retain control, in this legislation itself, over the sort of Orders which can be made, or whether it should rely on some assurances given from the Government front bench.
    If the Orders are made, the House will have the opportunity of disallowing them by passing the appropriate resolution. Of those alternatives, I would prefer to see a definite provision placed in this Bill so that there can be no question of an Order in Council being created which has the effect of infringing Section 3 of the 1930 Act. I would prefer that definite limitation laid down in the Statute rather than any assurance which may be given from the Front Bench opposite to say that no such Order will be made. I hope that the Committee will come to the same conclusion as it did on the previous Amendment.
    Mr. Paget: But, until the intervention of the Patronage Secretary, I think it will be agreed—and I am sure that the Parliamentary Secretary will admit it—that
    2632
    we were having a serious discussion on points of importance. There were, it was agreed, new points arising which the Parliamentary Secretary said he would consider, and it will also be agreed that nobody, on either side, was being unduly long and that we were discussing serious matters.
    There were three Amendments to be discussed, and there was nothing unduly complex about them. I would ask the Parliamentary Secretary to remember that the hour is now very late and that we are discussing these matters which are serious and which might affect the lives and safety of people in this country. That is an important matter. Possibly the incident which we have just seen shows that some of us are not quite as bright as we were earlier.
    1.15 a.m.
    I would say this to the Parliamentary Secretary and to the Minister. Why not let us adjourn now, for there must be a further stage as an Amendment has been accepted? That will give us the opportunity, and the Government the opportunity, to have a look at the arguments that have been advanced. Why should not the Government give us a dummy Order in Council, as is often done, showing what provisions they intend to insert, or consider whether it would not be desirable to put some of these proposals into the Bill? If the Government were to take that line we— I think I speak for my hon. Friends in saying this—we should take very little time on the further stage.
    On balance, I think that the right hon. Gentleman will find he will save Parliamentary time if he does that. We regard these Amendments as important. We have had this joke; we have had this fun; but we do regard these matters as serious. We do think they affect safety. We think the Government ought to consider adjourning now——
    The Deputy-Chairman: The hon. and learned Gentleman must direct his attention to the Amendment.
    Mr. Paget: I shall not be more than a moment, Mr. Hopkin Morris. I would ask the Minister to think over the proposal I have made, because I can assure him of this—and I am sure I speak for my hon. Friends on this—that if he does

    2633
    meet us over this we shall be very quick indeed on the further stage, once we are satisfied that the Government have had the opportunity to look at our arguments and think them over. I am sure that they are sympathetic towards them and perhaps they will show us a dummy Order in Council, which is customary on these occasions, or consider whether it is better to insert these provisions in the Bill.
    Mr. Braithwaite: Let me, without being guilty of brushing this Amendment aside in any sense of the word, try to explain to the Committee, without being too lengthy, what its effect would be in its widest interpretation. The consequence would be to preclude compliance with obligations accepted as long ago as the 1926 Convention—quite apart from that of 1949—relating to motor traffic, and the 1949 Convention of Road Traffic to permit the use in this country of vehicles which may not comply in some respects with the regulations which govern our own domestic vehicles but which do comply with the technical conditions as to construction and equipment which are laid down in those Conventions.
    It was clearly necessary in relation to vehicles proceeding from one country to another to arrive at an acceptable compromise between the differing requirements of different Governments as to the construction and equipment of the vehicles. This was done in the 1926 Convention and again—this time on a more detailed basis—in the 1949 Convention.
    Our regulations provide, therefore, that vehicles brought temporarily into Great Britain shall not be required to comply with Part II of the Motor Vehicles (Construction and Use) Regulations of last year, 1951, other than those relating to maximum dimensions, provided that they comply with the 1926 Convention requirements; and in due course will be expanded to cover the 1949 Convention requirements. Regulations for visiting vehicles have been settled as a result of many years' experience, and are not such as to affect the roadworthiness of vehicles in general, and I do hope that, in those circumstances, the hon. Gentleman will feel able not to press his Amendment.
    Mr. Benn: I certainly do not intend to press the Amendment, but I think that the Parliamentary Secretary has done less than justice to the case put to him by my hon. Friends, because they did ask for consideration of one specific thing concerned with the big vehicles that visiting Forces might bring here. All we ask is that in those circumstances the Minister should use the method which is open to him of making a Statutory Instrument cover the cover and laying it on the Table of the House in the normal way, thereby making specific safety precautions for the use of the police and others.
    The second point dealt with the importation and use of ordinary foreign cars from abroad. Even that is covered by his powers under the Road Traffic Act, 1930. I think it is a little discourteous to the Committee that the Parliamentary Secretary should not have given us some reason why he and his right hon. Friend are not going to continue to use this method of the Statutory Instrument, which is open to them, instead of just waving it away entirely by a magic and extensive power given to the Minister under this Clause.
    Mr. Bing: I intervene again a little diffidently, because I do not want to put the Minister in the position in which the Patronage Secretary hurries in to force the Committee to accept an Amendment which the Parliamentary Secretary has asked us to reject. I think that in the interval—no doubt we have a moment or so before he arrives—-we ought to deal with the sort of questions which have not been dealt with by the hon. Gentleman so far, for example, the right-hand drive.
    It is quite clear that cars from the Continent are equipped differently from the cars of this country. What is to be done? Are there to be no provisions at all ensuring that they indicate that the drive is on the other side? Are there to be no arrangements indicating that no hand signals can be given? There may be a car which is not equipped with any form of mechanical signals and from which no hand signals can be given in this country. I should have thought all those were questions which required some sort of answer.
    It seems rather foolish for us to spend, as we did quite recently, a whole day

    2635
    debating road safety and yet shortly afterwards, in the middle of the night when dealing with a matter like this, not to give some serious consideration to the question of cars brought in by people from abroad which are not equipped to comply with the Highway Code. In a sense the matter is made more urgent because now everybody in this country has to be acquainted with the Highway Code. But what is the use of their being acquainted with the Highway Code when driving a vehicle from which they cannot carry out——
    The Deputy-Chairman: I do not think the hon. and learned Gentleman can discuss the Highway Code on this Amendment.
    Mr. Bing: With great respect, Mr. Hopkin Morris, I think I can. The argument I am advancing now is that of the vehicle which is not equipped with the type of signals the driver is required to give under the Highway Code. Under the Highway Code it is obligatory for certain signals to be given. The Committee, in its wisdom, saw fit to insert a provision that visiting cars should comply with the Highway Code, and it would be quite ridiculous for us now not to insist that those cars should be physically so equipped as to be able to fulfil the obligations imposed on them under this Bill. Therefore, we ought to have from the Minister, who I am glad to see here, a statement about what is to be done. Will they have to put up a little notice "No right-hand drive" or "No signals," for example? One often sees that on foreign vehicles, but there are other foreign vehicles which do not necessarily have such a notice.
    I am prepared to admit that perhaps this Amendment is not drafted in the best possible way. One can always draft an Amendment far better after all the speeches have been made. It is one of the difficulties of our procedure that that is not possible. I would be the first to admit that this Amendment possibly needs some emendation. But whether it requires it or not, we ought to have from the Minister some explanation of what happens to visitors who drive on the blind side and cannot make signals at all. How can they possibly obey the Highway Code? If the right hon. Gentle-
    2636
    man takes no power to see that foreign vehicles comply with the Highway Code he is making the Bill illogical.
    I think we really should have an answer from him on that point, even if he can only go as far as to advise people that the traffic here, unlike the politics, runs to the left, although I think our politics will follow the traffic very soon. However, it is not for us to debate at this moment that point, whatever analogies spring to the mind. That is not the issue. What we are really considering is how we are to provide in the simplest way how a foreign motorist indicates to the person following what he is going to do.
    The Minister of Transport (Mr. Alan Lennox-Boyd): As the hon. Gentleman has specifically referred to me I would like, in reply, to make one or two observations. In the first place he asked me what advice we would give to motorists on this matter. My advice would be that they are welcome in this country, and judging from some of the speeches of hon. Gentlemen opposite that might be a little difficult to understand. These visitors are welcome visitors. On them not only our economic survival, but our military security alike depends.
    It is our duty to carry out the international obligations into which we have entered in 1926 and 1949. Hon. Gentlemen opposite are very happy when busy breathing platitudes about the brotherhood of man. As soon as opportunities arise they try to keep the House of Commons in interminable discussions on points of detail which defeat the whole object of the Bill. As far as the broad issue is concerned these provisions which affect the international comity of nations appear to us to carry out fully our international obligations. The more people who come here from those countries who are on our side to take advantage of the privileges provided the better for everyone concerned.
    The Deputy-Chairman: This is really getting wide of the Amendment.
    Mr. Lennox-Boyd: I am sorry if I have been tempted by some of the baits offered by hon. Gentlemen opposite, but I hope I may be allowed to say that we hope that the particular part of the Bill with which we are now dealing may lead

    2637
    to a wide increase in the number of foreign visitors to this country.
    The precise way in which the indication of intended movements on the road may be conveyed to other motorists can be left safely to the general good sense of our people and those visiting this country. If we are not going to show a sensible approach to problems of this kind, then we might as well abandon any hope of bringing the nations of the West closer together. I hope the Committee will say that they recognise what is the real interest behind this sort of Amendment by not proceeding very much further in discussing it.
    1.30 a.m.
    Mr. Ernest Davies: We have just listened to an extraordinary intervention by the Minister. That was his first intervention in the debate I believe; I am not aware that he was present in the Committee during the early speeches. If he had been, he certainly would not have made the remarks which he has just made. He would have heard a welcome expressed during the debate for any tourists coming to this country. We consider that increased tourist trade is of value to this country, and no one has criticised the provisions regarding the N.A.T.O. agreements.
    However, we are also very much concerned about the safety of our own people on the roads. Recently the House of Commons was much concerned in a debate about the question of road safety, and now we are concentrating on whether the action that this Bill proposes will increase the danger of the roads. The Amendment was put down with the object of seeking to diminish that danger and, while welcoming all tourists coming here, we hope that the danger on our roads will not increase to all those who use the roads. Having said that, I should like to say that we want to carry out our international obligations, but there is no point in entering into international obligations if they are going to increase the danger to our own people. We want to make sure that they have this protection.
    As regards this particular Amendment, I think that the Parliamentary Secretary failed to give us any convincing reasons why it should not be considered a little more carefully. He referred to the 1926
    2638
    requirements of the Convention and the 1949 requirements but he did not explain to us what those requirements were. We all felt that if some provision could not be made in the Bill through this Amendment then it ought to be done through Orders in Council or in some other way to make sure that vehicles coming to this country are not in such a condition that they fail to meet our requirements, thereby again increasing the dangers in this country to the people who use the roads.
    In view of the fact that the Bill has to go to a further stage on another day, I would suggest that the Minister or the Parliamentary Secretary would give a little more consideration to the matter, and that they should seriously consider the proposal of my hon. and learned Friend the Member for Northampton (Mr. Paget) that we should adjourn at this stage and consider this Bill on another occasion.
    Mr. Edward Heath Mr. Edward Heath rose in his place, and claimed to move, "That the Question be now put."
    Question, "That the Question be now put," put, and agreed to.
    Question, "That those words be there inserted," put accordingly, and negatived.
    The Deputy-Chairman: The next two Amendments can now be formally moved and divided upon. Does the hon. and learned Member for Hornchurch (Mr. Bing) wish to move the Amendment in page 2, line 18, at the end to insert:
    (3) Provided always that no such Order in Council shall authorise any person who has had his licence suspended by any court of law in Great Britain to drive in Great Britain during the period of such suspension.
    Mr. Bing: It would be ungenerous if I were to move my Amendment in view of the concession by the Patronage Secretary on the first Amendment. As the Minister will now have an opportunity to think the matter over I therefore beg to ask leave to withdraw the Amendment.
    Hon. Members: No.
    The Deputy-Chairman: The Amendment has not been moved, and apparently the next Amendment is not being moved.
    Motion made, and Question proposed. "That the Clause, as amended, stand part of the Bill."
    Mr. Paget: The performance of the Government tonight has been extraordinary. We had arranged to have an early night. I rang up my wife and told her that I should be back at home by 11 p.m.
    The Deputy-Chairman: The Question is "That the Clause, as amended. stand part of the Bill."
    Mr. Paget: Owing to the extraordinary ineptitude of the Government, time has passed and the Minister's intervention was the most extraordinary thing that I have ever heard. He wanders in to what had been, until the intervention of right honourables, a serious, friendly, and constructive debate. Then the Patronage Secretary, who also had watched none of the proceedings, wanders in and, by his ineptitude, gives us the Amendment that his own Minister had not given us. After that, along comes the Minister and tells us that throughout this evening we have been violating the principle of the brotherhood of men, when in all conscience what we had been doing was to try to limit the appalling toll on the roads.
    As hon. Members and the Minister know, a number of Amendments are put down to open a subject. Amendments have been put down to raise for consideration matters affecting public safety. We received assurances before the Minister's arrival that these matters would be considered, and would be brought into the Statutory Instruments which would be used to bring this Clause into operation.
    Then, we were told that this was designed to exercise some spite against the Minister's foreign friends, in which, he told us, Spain was certainly to be included, though we were not quite certain about Yugoslavia. This is really a very remarkable effort——
    The Deputy-Chairman: I hope the hon. and learned Member will direct himself to the Question before the Committee.
    Mr. Paget: I had hoped that the Minister's speech, with which I was dealing, since it was concerned with Amendments to the Clause, was also concerned with the Clause.
    Mr. Lennox-Boyd: I said I hoped that we would welcome visitors from Spain over here. As a large number of hon. Members, a very large number of them from the Socialist Party, go to Spain for their holidays I hoped that we should see some Spaniards here.
    The Deputy-Chairman: The discussion, on both sides, is wide of the issue before the Committee.
    Mr. Paget: The Minister might have realised that, as he had not been present during the debate, that his intervention was of a most extraordinary nature. He made a speech totally irrelevant not only to the matter but to the whole spirit of the debate we have been having. That is why time was wasted——
    Mr. Godfrey Nicholson: On a point of order. Are we discussing a Bill, or are we having a resume of HANSARD?
    The Deputy-Chairman: I have more than once called the attention of the hon. and learned Gentleman to the fact that we are discussing the Question that the Clause stand part, and I hope he will keep that issue before him.
    Mr. de Freitas: We have had a discussion about Spain and Yugoslavia. Would I be in order in discussing Italy?
    The Deputy-Chairman: I have already sought to restrain hon. and right hon. Members from doing so, and I hope that the debate will be confined to the Question that the Clause stand part of the Bill.
    Mr. E. Fletcher: It seems to me that we could not possibly expect the Committee to allow Clause I to stand part of the Bill without further elucidation of some of the matters we were discussing on the Amendments previously considered, some of which were withdrawn. If the Minister is now going to take charge of the matter, so much the better, although I am bound to say that his maladroit performance was not conducive to the harmonious or expeditious considerations of the Committee. We were getting on quite nicely when the Parliamentary Secretary had charge of the matter——
    The Temporary Chairman (Mr. George Thomas): Perhaps the hon. Member will

    2641
    confine himself to the Question that the Clause stand part?
    Mr. Fletcher: That is exactly what I propose to do.
    Clause I has regard to the Orders in Council that may be made for the purpose of giving effect to this international Convention. One of the matters about which the Parliamentary Secretary, under great pressure, gave assurances was the question of the insurances to which residents in this country could look for protection in the event of their being involved in accidents with foreign motorists. I think that under pressure from this side he went so far as to say that no Order in Council would be made except upon terms which——
    Mr. Wigg: On a point of order. May we seek your protection, Mr. Thomas, against the private conversations which are going on on the other side of the Committee, and which, I am sure, have nothing to do with the matter under discussion.
    1.45 a.m.
    Mr. Fletcher: The point which I was trying to put to the Parliamentary Secretary is a serious one. I think he said that no Order in Council would be made unless it gave the residents of this country protection to enable them to recover damages on third-party basis, similar to those which obtain against a British motorist. I am not sure that the Parliamentary Secretary went as far as is necessary to give the assurance which the public of this country are entitled to have. Anyone involved in an accident with a British motorist knows that the motorist is insured with a British insurance company. Therefore, if there is a claim against a perhaps impecunious motorist there is behind that motorist an insurance company which will be able to meet any claim for damages, however much, which may be awarded.
    The machinery which obtains in the Act to give that satisfaction, is that the British company concerned has to deposit a considerable sum with the Board of Trade. We want to be satisfied that if a foreign motorist takes advantage of this international convention and is involved in an accident in Britain the British public have at least as much protection against him as against a British motorist.
    2642
    Can we be sure that these foreign motorists will be insured against third party risks with a British insurance company or with an international company which also can be sued in the courts, and against whom a claim, if awarded, may be answerable, and which has adequate funds available in this country to discharge such an obligation?
    Mr. Driberg: Impartial persons reading HANSARD on Saturday morning will. I think, agree, as indeed the Parliamentary Secretary may agree on reflection, that this Clause has been greatly improved by the Amendment which the Committee has made to it. I wonder whether the Parliamentary Secretary can tell us something about the provisions which he proposes to make to implement this Amendment.
    During the main debate on the three Amendments, I thought that the Parliamentary Secretary's main reply was thorough, serious and courteous. The debate was wrecked only by the arrogant folly of the Patronage Secretary.
    Mr. Wigg: And the Minister.
    Mr. Driberg: That was later. [Interruption.] When the Minister, whom we all like personally, although we detest his politics——
    The Temporary Chairman: Perhaps the hon. Gentleman realises that he is going far from the Question that the Clause stand part.
    Mr. Driberg: I hope you will realise, Mr. Thomas, that I was tempted to do by the very audible interjection from the Minister, whose ideological approach. I quite agree, helped to wreck what had been a perfectly serious debate. He made the comment that Spain, of course, was on "our side" in the great international conflict——
    The Temporary Chairman: The hon. Gentleman must confine himself to the Question that the Clause stand part.
    Mr. Driberg: I was proposing to do so, although if the Minister intervenes again I shall have to seek your protection, Mr. Thomas, as I shall not be able to reply to him, in view of what you have just said.
    The Parliamentary Secretary was replying perfectly seriously to the main

    2643
    debate on the three Amendments, and the point on which I thought his reply was least satisfactory was that about the Highway Code, on which he said he did not think it was necessary to make any such proviso as this, because foreigners coming here would in any case realise that they were going into a country with different rules—driving on the left instead of the right, for instance—and would quite naturally make it their business to find out what those rules were.
    But the best place to find out what all our rather complicated rules are is in the Highway Code, and I should not think it would be very difficult or very expensive to accept the suggestion made by my hon. Friend the Member for Enfield, East (Mr. Ernest Davies), that it is possible to provide copies of the Highway Code to visitors arriving here by the Channel ferry with their cars. It might be possible to provide these copies at Calais, instead of Dover, so that the visitors could study the code on the way over.
    In replying to this debate, would the Parliamentary Secretary be good enough to say whether this action has been contemplated, whether the Highway Code is available in various foreign languages—French, German, Italian, and, of course, Spanish—and whether he would give serious consideration to my hon. Friend's perfectly reasonable suggestion. I am sure it would not cost much, and foreign visitors would learn from it and would be glad to study the regulations in some detail.
    The only other point I put to him is one which has not been mentioned in the debate at all. Will he say a few words about foot-and-mouth disease? That may sound a little remote, but before you interrupt me, Mr. Thomas, may I say that this is a very serious matter indeed. All of us who know about the terrible epidemics there have been in the past few months in this country——
    Mr. Nicholson: On a point of order. Surely we cannot discuss foot-and-mouth disease on this Clause of the Bill.
    The Temporary Chairman: I was just waiting to see what was the point which the hon. Gentleman was making. I shall be surprised if we can discuss it, but I shall wait and see.
    Mr. Driberg: If the hon. Gentleman had been courteous enough to let me finish my sentence he would not have found it necessary to interrupt and thus waste an extra minute.
    Mr. Nicholson: A very long sentence.
    Mr. Driberg: It was not a very long sentence. I will repeat it for the hon. Gentleman. I merely said that I was asking the hon. Gentleman to consider a point which had not so far been mentioned—the subject of foot-and-mouth disease. I said that this might seem a little far from the subject of the Bill, but there has been a terrible epidemic: and it is suggested by many authorities— veterinary experts, and others—who are well qualified to speak on the matter, that the infection can be carried on motor vehicles coming in from rural parts of foreign countries, and particularly Belgium, where the disease has also been epidemic, or perhaps, endemic.
    The Temporary Chairman: That does not come within the Question that the Clause stand part, and I ask the hon. Member, accordingly, to pursue his argument without such references.
    Mr. Driberg: I bow to your ruling, Mr. Thomas, but this Clause is designed to facilitate the arrival of drivers and vehicles from foreign countries; and I want to ask merely if it is contemplated that any additional precautions will be necessary if this epidemic should get worse. I should have thought that, with respect, the Parliamentary Secretary could give an assurance that he would look into this, without going outside the Clause at all. It is a perfectly serious point, because all of us know how drastic has been this epidemic, and I hope that the Parliamentary Secretary will deal with it, as well as with the point I have put to him on the subject of the Highway Code.
    Mr. J. Hudson: I address my remarks closely to the Question before the Committee. We have forgotten, perhaps, that the Clause has been amended. With regard to my hon. Friend's remarks about knowledge of the Highway Code, and the ability to drive according to our standards, I think that raises in most serious form questions about what is to be done under subsection (3) where it is stated that an Order in Council may

    2645
    authorise the Minister of Transport to make regulations for any of the purposes of the Order, as amended.
    I intervene to remind the Committee that the Parliamentary Secretary was very fair, as he has been throughout this discussion, in saying that the matters he had listened to would be carefully considered. Although he could not commit himself, he said those matters would be considered; and if we were relying on his word and his promise, it would be carried out to the best of his capacity.
    But something else has happened since that assurance was given. The right hon. Gentleman has come in and given us an exhibition which is beyond all endurance. In view of the attitude on the other side, I really must ask whether that undertaking which has been given will be implemented by the Minister.
    2.0 a.m.
    Does the right hon. Gentleman really intend to carry out the suggestion I made and which was turned down—the hon. Gentleman saying only that it would be considered? Will the Minister, as the Parliamentary Secretary said he would, give his best attention to this issue? I suggest that visitors to this country should have to follow the same regulations on the roads as all the citizens of this country do—the regulations of the Highway Code, with reference, for instance, to alcohol. Citizens of this country follow the Highway Code whether they drive home from a late night Sitting at the House of Commons or whether they drive to or from elsewhere, and foreigners should do so. Will the right hon. Gentleman be as good and fair as the Parliamentary Secretary was in carrying out what literally must be carried out under the Amendment which was carried?
    Mr. Lennox-Boyd: I should hope to be as good and fair as my hon. Friend. He undertook that all the points raised would be given serious consideration, and in saying that he was speaking on behalf of himself and on my behalf. I must say this to the hon. Gentleman, whom I respect and like very much, that if his views on the sale of alcohol ever became universal we should have no problem whatever of any foreign visitors to this country.
    Mr. Hudson: Are the regulations to be like that?
    Mr. Wigg: I would preface my remarks by thanking the Parliamentary Secretary for the courtesy and kindness with which he conducted the debate up to the point the Patronage Secretary intervened. I am not saying anything about the Minister. We know him, and leave him to his constituents, and can congratulate ourselves that he will not be in the next Parliament.
    I wish to direct my remarks to the Amendment which is in the Bill as a result of the arrogance of the Patronage Secretary to ensure—though the Minister says not for long—that persons coming to this country are familiar with the Highway Code. That does present a difficulty, as many foreigners will have but an imperfect knowledge of English. So what is to be done about ensuring that they understand the Highway Code?
    Of course, it does not matter very much whether the Minister takes the Amendment out or not. It still remains the fact that thousands of people are coming to this country—so we hope—to drive upon our roads, and whether it is in the Bill or not, whether the Minister takes it out or not on Report stage, it remains the case that foreigners who come here shall be aware of what is in the Highway Code. The delay that has occurred would never have occurred but for the intervention of the Patronage Secretary; these words would not have been there.
    We were asking the Parliamentary Secretary to do what he would, I am sure, have agreed to do, namely, to make available copies of the Highway Code to foreigners who want to come into this country. The foreigners who come here have a vested interest in not getting involved in accidents because they are risking their necks as well as those of our fellow countrymen, and I suggest that the foreigners themselves would be glad to have copies of the Highway Code.
    I hope that the Parliamentary Secretary will be good enough, when replying, to tell us that he is aware of the importance of this point, and that he will make available at the ports where foreigners are likely to come into this country, or make available through motoring organisations of other countries, including Spain, if it so please the Minister— perhaps he might arrange for General Franco to hand to each Spaniard as he

    2647
    departs a copy of the Highway Code in Spanish——
    The Deputy-Chairman: The hon. Gentleman is now going outside the Question before the Committee.
    Mr. Wigg: With great respect, Mr. Hopkin Morris, I am only replying to the arguments of the Minister who, with his well-known Fascist views, would, I am sure, welcome foreigners——
    The Deputy-Chairman: The hon. Gentleman is now out of order.
    Hon. Members: Withdraw.
    Mr. Wigg: If I am directed by the Chair to withdraw, I withdraw. Otherwise, I do not withdraw.
    Hon. Members: Withdraw.
    The Deputy-Chairman: That remark was out of order and I think that, on reflection, the hon. Gentleman would wish to withdraw it.
    Mr. Wigg: If the Chair orders me to withdraw those words I will withdraw them. Otherwise, I will not withdraw them.
    Mr. Nicholson: Withdraw them out of decency.
    Mr. Wigg: I am not prepared to take a lesson on that subject from the hon. Gentleman. He might address his remarks to the Minister.
    The Deputy-Chairman: All remarks should be addressed to the Chair.
    Mr. Wigg: I am quite willing to obey your Ruling, provided hon. Gentlemen opposite do the same, Mr. Hopkin Morris.
    The point I want to make is that having the provisions of the Highway Code printed in languages which visiting foreigners can understand is a matter of paramount importance, and whether the Minister leaves these words in the Bill or whether he does not, the subject remains important. I very much hope that the Parliamentary Secretary will give us an assurance that copies of the Highway Code will be made available to foreigners in English if he cannot make arrangements to have the code translated into the languages of foreigners likely to visit this country.
    Mr. Braithwaite: I should like now to reply briefly to the points made on this Clause, taking, first, the remarks of the hon. Member for Islington, East (Mr. E. Fletcher) on the subject of insurance, which was debated at some length on the Amendment in the name of the hon. Member for Oldham, West (Mr. Hale). It is a matter of very considerable complexity, and I confess to having made somewhat heavy weather of it when we were discussing it before. It is not easy to get through without making mistakes, but I am informed that the last statement which I made does clarify the position, and that the effect will be that the Order in Council will carry out the provisions of the proviso which the hon. Gentleman sought to insert.
    To the hon. Member for Maldon (Mr. Driberg) may I say that it is rather important to avoid anything in the way of aggravation to foreign visitors who come to us by having a multiplication of regulations or officialdom. It would be a pity if they were greeted in such circumstances when setting foot on our shores.
    Mr. Driberg: I quite agree, but they are, after all, bound by the regulations while driving here and I only suggest that they should be enabled, more or less painlessly, to know what the regulations are.
    Mr. Braithwaite: My remarks were a preface to what I was about to say about the hon. Gentleman's suggestion, and to what I want to say in reply to the hon. Member for Dudley (Mr. Wigg) and others. We will, as a result of this debate, examine whether it is administratively possible to give to every visitor from a foreign country entering Britain with a motor car—not every foreign visitor—a copy of the Highway Code in English; but I can give no undertaking that it would be translated into the various tongues spoken throughout the world.
    It will be recalled that I said last Friday that a new and simplified Highway Code is likely to make its appearance very soon, and I am not sure whether it would not be wise to await that publication rather than issue a great number of copies which would be out of date. It will not be necessary to insert this undertaking in the Bill because we do not think these words need necessarily go in at all.

    2649
    On the question of foot-and-mouth disease, the hon. Gentleman will acquit me of any technical knowledge of the subject, but I can say that the Minister of Agriculture will study his remarks.
    The Deputy-Chairman: I do not know what foot-and-mouth disease has to do with this Clause.
    Mr. Braithwaite: Merely that when the hon. Gentleman put his question your predecessor in the Chair, Mr. Hopkin Morris, did say that as far as it affected foreign vehicles suspected of carrying the infection it was in order to refer to it in passing, and, in passing, I would merely repeat that the Minister of Agriculture will be informed of the hon. Gentleman's remarks. I think those are the main points, and I hope that the Committee, after this very full discussion, will allow us to have the Clause.
    Mr. Ede: I want to thank the Parliamentary Secretary for the way in which he has answered the various points of my hon. Friends. I fully accepted, at the end of the exchanges that we had, the view he has now reinforced with regard to the most important question of insurance. He and I had a series of exchanges in which we gradually managed to clear the point up as layman to layman. I am not trying to bind any hon. and learned Gentleman on either side to the form of words we used, but I am quite sure everyone felt it was the intention that a person injured in this country should have the assurance that any award received in the courts would be honoured by the insurance arrangements that had been made.
    During the six years down to last year I sat a good many hours in this House listening to the denunciations of hon. Gentlemen opposite on delegated legislation. There can hardly be a Measure and hardly a Clause which does provide, more for effect to be given to the law by delegated legislation than this particular Clause. I think it is probably inevitable there should be a considerable amount of delegated legislation in a matter of this sort, and I hope that when the Orders in Council are prepared and placed before the House we shall have an opportunity of considering them privately before the affirmative Resolutions are moved.
    2650
    It is quite clear that these will be very important, and we want to be sure that the various undertakings given in good faith tonight are, in fact, in accord with the Orders that are made.
    Mr. Braithwaite: I gladly give that undertaking.
    Question put, and agreed to.
    Clause, as amended, ordered to stand part of the Bill.

    Clause 2.—(ORDERS FOR FACILITATING INTERNATIONAL TRAFFIC IN NORTHERN IRELAND.)
    Motion made, and Question proposed, "That the Clause stand part of the Bill."
    Mr. Bing: I do not think we need detain the Committee any length of time on this Clause. I only rise because I think there is an unfortunate tendency in this House rather to encroach on the prerogative of the Parliament of Northern Ireland. It would be far more suitable to leave the actual details of how long the Orders should lie to the Parliament of Northern Ireland. It would be better if we gave them the power to approve their own Regulations, and to leave it to that Parliament to decide exactly when these Regulations should be carried out.
    May I ask whether the Government of Northern Ireland were consulted about this Clause, and whether they agreed with it? Does it fit in with the different legislative system in Northern Ireland? Whether this is the most effective means, when a Parliament only sits for a short period in the year, of seeing that there is a popular safeguard in regard to the requirements in Northern Ireland, is another matter. I only raise the matter shortly in the hope of getting some elucidation from the Home Secretary.
    2.15 a.m.
    Mr. Hale: I would not have risen if I did not profoundly disagree with my hon. and learned Friend the Member for Hornchurch (Mr. Bing) on this issue. It goes to a question of principle, and I am sorry to have to criticise my hon. and learned Friend in the way I must. The Committee is discussing an international convention, and it is quite fantastic that, when we have an international agreement to cover the whole of the motoring world and bring in countries

    2651
    in South America, in Europe, in Asia, and so on, that we should lay down a special dispensation for Northern Ireland to opt out of this provision and lay down their own requirements and their own procedure.
    We have to be fair to the foreign visitor. After all, the foreign visitor coming to this country thinks he is visiting the United Kingdom. He will have studied the law and will have mastered one code which applies in England. It would be unfair if, when he went to Northern Ireland, he found he had to learn something new. I would be the last person in the Committee to say anything derogatory about the Parliament of Northern Ireland, which has a vested duty, but this is not a vested duty or it would not be dealt with in this Bill.
    If we had delegated to the Northern Ireland Parliament the right to legislate on these matters, it would not be necessary for us to be considering these provisions with reference to Northern Ireland, but we have not. Ours is the responsibility, and ours being the responsibility I cannot see for one moment what possible argument there can be for Orders in Council to be issued here laying down a scheme in this country, and for the Parliament of Northern Ireland, the Governor or by the various procedures which can be used to adopt a different scheme over there.
    This is quite serious. It seems to me, with very great respect to my hon. and learned Friend, with whom I normally agree, and, indeed, whose interventions in debate I always welcome, that he is wrong in this matter. I hope that the Parliamentary Secretary will resist his blandishments. He has accepted one Amendment by my hon. and learned Friend, and I welcome that and I am in complete agreement with it, but I do not think he should accept his suggestion here. I think it would be very much better if a comprehensive Bill were passed in which comprehensive rules were laid down by this Parliament for the whole of the United Kingdom, including Northern Ireland.
    Mr. Braithwaite: It may assist the transaction of our business if I say to the hon. and learned Member for Horn-church (Mr. Bing) that in view of his
    2652
    solicitude for the people of Northern Ireland, we will look again at the question of the time limit.
    Question put, and agreed to.
    Clause ordered to stand part of the Bill.
    Clause 3 ordered to stand part of the Bill.

    Clause 4.—(REPEALS AND SAVINGS)
    Mr. Braithwaite: I beg to move, in page 4, line 30, to leave out subsection (4).
    This is what is generally described as a Privilege Amendment. Hon. Members will be well aware that this Bill comes to us from another place, and on the Report stage their Lordships inserted this subsection to demonstrate their financial rectitude and that they were not in any way interfering with money matters nor impingeing on the privileges of this House. Now that we have reached this subsection we should like to delete it.
    Mr. Benn: I should like to intervene very briefly, because it seems of some constitutional importance that when this Bill was introduced in another place this meaningless subsection was inserted to satisfy certain constitutional requirements in the relations between the two Houses.
    It is not only this subsection which is remote from direct public control. Here is, in fact, the controller of the hon. Gentleman and the right hon. Gentleman sitting on the Front Bench over there. In negotiating on this Bill, we are not dealing with the real master in transport matters at all. He is tucked away in another place, beyond our reach. Therefore, it seems to me we should register a protest against the fact that the overlord dealing with the important question of transport should be beyond the reach of the House.
    Amendment agreed to.
    Clause, as amended, was ordered to stand part of the Bill.

    Clause 5.—(POWERS OF PARLIAMENT OF NORTHERN IRELAND.)
    Motion made, and Question proposed, "That the Clause stand part of the Bill."
    Mr. Bing: As we have two representatives from Northern Ireland here, I want

    2653
    to ask again whether this legislation had the assent of the Northern Ireland Government. The purpose of this Clause is to give the Northern Ireland Parliament powers they did not previously possess. There may be some very good reason for having the same ploughing grant scheme for both England and Northern Ireland and quite different schemes in regard to international vehicles, but we ought to know what is the attitude of the Northern Ireland Government on this matter—whether the Northern Ireland Government have seen fit to communicate to the hon. Members who are supposed to represent Northern Ireland here what they think about the Bill, or whether anybody bothered to consult Northern Ireland at all.
    It is a little hard that it should be left to Members on this side, who do not even represent Northern Ireland constituencies, to press questions of this kind. I hope that the Minister will let us know whether the Northern Ireland Government were consulted, whether they had made representations that they should have these powers, or whether the Government here suggested they should have them.
    What, any way, is the point of having different arrangements in the two areas? I am grateful to the Parliamentary Secretary for agreeing, on a previous Amendment, to reconsider procedure in the Northern Ireland Parliament, but it seems strange to make an alteration for the purpose of giving Northern Ireland powers they did not have before.
    Mr. Braithwaite: I can once again soothe the hon. and learned Gentleman and expedite the Committee's business. There has been full consultation, agreement, and clearance with the Government of Northern Ireland.
    Mr. Hale: I am glad to hear that. The Parliamentary Secretary, who has been so courteous throughout the debate, was a little discourteous to me on the previous matter, because he made no reply to what I consider the essential point I raised.
    It seems incredible that in an international agreement we should lay down two separate systems. I am glad that my hon. and learned Friend the Member for Hornchurch has rather come round to my point of view in this matter. I think he has, because he takes the view that, on the whole, there is really no occasion for
    2654
    this Committee to authorise special legislation of this kind to be conferred on the Government of Northern Ireland.
    Mr. Lennox-Boyd: Is not the only purpose of this Clause to enact that this Act should be deemed to have passed before the date appointed for the purpose of Section 6, Government of Ireland Act, 1920, and is not a general discussion on two different systems in different parts of the United Kingdom out of order?
    Mr. Bing: I think the Minister is not speaking with that detailed knowledge one would expect from him of the Government of Ireland Act. This form of Clause is always put in for the purpose of authorising the Government of Northern Ireland to perform an act which otherwise they would be unable to perform by law. Therefore, in my submission, we have every right to ask why it was inserted.
    The way in which the matter arises is that Section 6 of the Government of Ireland Act did not allow the Parliament of Northern Ireland to make laws in regard to any matter affecting Northern Ireland after the passing of that Act. We have to have this rather complicated system by which it is deemed to have been passed at an earlier date in order to control the legislation of the Northern Ireland Government, and, therefore, the whole purpose of this Clause is quite clearly for that reason.
    The Deputy-Chairman: That may be true, but I do not think it is in order to do what I think the hon. Member for Oldham, West (Mr. Hale) is doing—repeating arguments we have heard before on a previous Clause.
    Mr. Hale: On that point of order. The Clause is designated "Powers of Parliament in Northern Ireland," and it is so designated for the reasons which my hon. and learned Friend the Member for Hornchurch has given. If this Clause is deleted from the Bill, the Parliament of Northern Ireland will not be able to make a separate scheme for international control of motor vehicles. That is precisely the point we are discussing, and to which I have directed my observations.
    It is an almost incredible and unprecedented thing in the history of this coun-

    2655
    try for a Minister, who absented himself from a vital debate which lasted some time, to rise to a point of order to seek to put that in the Bill. It is quite unprecedented. My right hon. Friend the Member for South Shields (Mr. Ede) has paid a tribute to the patience of the Parliamentary Secretary, and it is rather a tragedy that he was not allowed to continue handling the debate in the way he did. The Minister means well, but I think that both sides of the Committee deplore the fact that he does not succeed.
    I am not convinced that we ought to go outside the terms of the Government of Ireland Act, 1920, and confer special powers in this matter, which is what this Clause is doing, to enable the Government of Northern Ireland, for some reason or other, to pass a scheme which will allow cars to go down the middle of the road instead of the left-hand side. I am not suggesting that they will, but it is pure nonsense to say, when talking about the desirability of having a scheme which will enable drivers to know what their obligations are, that there will be two separate schemes for two separate sections of the United Kingdom. It is quite fantastic. If you, Mr. Hopkin Morris, had had the advantage of hearing the arguments in the Welsh debate——
    The Deputy-Chairman: I have heard the arguments of the hon. Gentleman at least once before.
    Mr. Hale: I am very much obliged, and I apologise. I do not like being repetitive, and it is only because the Bill is Iepetitive in respect of two separate Clauses that it is necessary for me to repeat on the second Clause the arguments which I advanced on the first. What would have happened if the Welsh hon. Members had been here tonight? We should have had Welsh Amendments——
    The Deputy-Chairman: Order. Wales is not affected by this Clause.
    Mr. Hale: I am very much obliged; I am not suggesting that at all. I am merely suggesting that we should delete the reference to Northern Ireland, because it would be an affront to Scotland and Wales not to give them these powers. However, I will not pursue the matter.
    2656
    I hope we shall be told why it is necessary to separate these powers.
    Question put, and agreed to.
    Clause ordered to stand part of the Bill.
    Clause 6 ordered to stand part of the Bill.

    Clause 7.—(SHORT TITLE AND COMMENCEMENT.)
    Motion made, and Question put, "That the Clause stand part of the Bill."
    The DEPUTY-CHAIRMAN declared that the "Ayes" had it.
    Mr. Benn: On a point of order. When you put the Question, Mr. Hopkin Morris, I was on my feet, but you collected the voices.
    The Deputy-Chairman: Order. I did not see the hon. Member on his feet before I collected the voices.
    Mr. Hale: In forthright voice which could be heard all over the Chamber my hon. Friend addressed you by name before you collected the voices, Mr. Hopkin Morris.
    The Deputy-Chairman: I certainly neither saw nor heard the hon. Member.
    Mr. Paget: With great respect, Mr. Hopkin Morris, surely it is your duty in the Chair—— [Interruption]
    The Deputy-Chairman: I cannot have that said.
    Mr. Paget: May I ask your guidance, Mr. Hopkin Morris? Is it not the duty of the Chair, before putting a Question, to see whether any hon. Member wishes to address the Committee?
    The Deputy-Chairman: I do my best to carry that out.
    Mr. Hale: May I venture to suggest, with great respect, that there was no difficulty this time? You started to put the Question and——
    The Deputy-Chairman: I cannot have that argued now. I have given my decision.
    Clause ordered to stand part of the Bill.
    Schedule agreed to.
    Bill reported, with Amendments; as amended, to be considered upon Monday next, and to be printed [Bill 125].

  LICENSED PREMISES IN NEW TOWNS BILL
  Order for Committee read.
  2.33 a.m.
  The Secretary of State for the Home Department (Sir David Maxwell Fyfe): I beg to move,
  "That the Order for Committee be discharged, and that the Bill be committed to a Standing Committee."
  If I may recall the facts to the Committee, the Second Reading of this Bill was on the 27th of February, and afterwards the Motion to commit the Bill to a Committee of the whole House was moved and carried. It was thought then that there would be sufficient time for the Bill to be taken on the Floor of the House, but intervening events have lessened the time available. So that the Bill may make progress the Government now wishes that the Bill shall go to a Standing Committee upstairs.
  I am glad to think that this course is one which will appeal to hon. Members opposite, whatever may be their point of view in that party; because when that party was in office it made great use of the Standing Committee procedure for many important Bills. Many hon. Members present tonight remember that, as we were present when the matters were dealt with. One of the best known ex-Ministers of the last Government, the right hon. Member for Ebbw Vale (Mr. Bevan) said only a few weeks ago:
  "We are entitled to ask them why they have not sent certain legislation upstairs."— [OFFICIAL REPORT, 9th April, 1952; Vol. 498, c. 2795.]
  I am glad to think that the right hon. Gentleman and those who co-operate with him will have every satisfaction in the course that I am taking tonight.
  In order that I may not seem to concentrate on any particular section of hon. Members opposite, may I say a word for those whose views are slightly different and remind the House of what the Leader of the Opposition said as short a time ago as 21st April, when, with some vehemence, he said to my right hon. Friend the Leader of the House:
  "Does not the right hon. Gentleman realise that the trouble really comes from the fact that he is trying to take a complicated and technical Bill on the Floor of the House instead of upstairs?"—[OFFICIAL REPORT, 21st April, 1952; Vol. 499, c. 46.]
  2658
  That was referring to the National Health Service Bill. We have had from every group of the Opposition a request that we should take this step and I am glad to think, therefore, that whatever may be the points on which we disagree, on this point I can anticipate almost universal agreement.
  Mr. James Hudson: Would the right hon. and learned Gentleman be able to add now the evidence of the agreement of the temperance group, for I have never heard of it?
  Sir D. Maxwell Fyfe: I had not come to that. The presence of the hon. Member for Ealing, North (Mr. J. Hudson) was sufficient warranty to me that that important section of opinion would have to be considered. Nothing was closer to my thoughts than that his well-known power of debate and his charm of manner, which delights us all, would find an equally good vehicle in the smaller compass of an upstairs room.
  I felt that some right hon. and hon. Gentlemen might have made research into these matters. The hon. and learned Member for Hornchurch (Mr. Bing) is here, and I am sure that in his passion for research, of which we all know, he has looked into them. I wondered whether he and some others, being fundamentally conservative, in favour of the status quo, would be a little alarmed at the fact that this Motion is somewhat of a novelty in late years. I know that in matters of procedure there are no more rigid upholders of practice than those whose views are most extreme Left-wing. I thought I ought for a moment, therefore, to deal with that point and to try to calm these troubles. It is quite true that the last precedent for this actual Motion was a considerable number of years ago.
  Mr. Geoffrey Bing: It was 1917.
  Sir D. Maxwell Fyfe: It was 1917. I thought the hon. and learned Member had found that out. But the hon. and learned Member is aware that there have been a number of Motions which have done the converse—transferred Bills from upstairs to the House. There are two that come to my mind from the time of our predecessors—the War Damage

  2659
  (Valuation Appeals) Bill and the Coal Industry (No. 2) Bill.
  One has to consider—and it is a problem which both sides have had to face—a change in the procedure of the House. As the right hon. Member for South Shields (Mr. Ede) is well aware, a Bill now goes automatically to Standing Committee, whereas up to about 40 years ago it went automatically to the Floor of the House unless there was a Motion. The procedure, if I may say so, has still to be worked out in relation to this modern state of things when there are small majorities in the House. I thought I ought to refer to the point for that reason, and for the other very good reason that, had I not, the hon. and learned Member opposite would have referred to it.
  We have to consider that the procedure of Standing Committees has to be taken into account; nobody would deny that for a Government with a relatively small majority to send a Bill upstairs shows courage and a disregard of the risk of influenza or anything else affecting the voting power of the Committee. That is to be encouraged in these modern days. There is also the consolation that anyone unfortunate enough not to be nominated to the Committee can reserve at any rate part of his fire for the Report stage.
  I thought that I ought to put that to the House in opening, rather than wait for points to be raised later. But, also, the House may quite properly say, I ought to make some explanation about the practical need for this. Why does the Government want to speed up the passage of the Bill? Three of the development corporations are already building new public houses, for which the corporations themselves have taken over responsibility in view of the introduction and passage of the Second Reading of this Bill. It is likely that one or two of those will be completed in the early autumn, and the Corporations were not in a position to apply for licences at this year's Brewster sessions because they had not then had time to find tenants, and the Bill was in its earliest stage.
  Mr. Ede: They were under the existing Act.
  Sir D. Maxwell Fyfe: They were, but the Bill was already introduced and, therefore, the corporations had still the responsibility for the building of the houses. Apart from the Bill, licences could not be applied for until next year's Brewster sessions, and would not become effective until some time next year— April at the earliest. It is undesirable that these houses should stand completed, but unused, for several months: this would be an inconvenience to the local residents, and would involve loss of revenue to the corporation. But, once the Bill has become law, the Secretary of State may grant certificates under Clause 4 (8), and licences may then be obtained at the next transfer sessions, thereby cutting out delay.
  The next point, which is not so urgent, but which, nevertheless, is urgent, is that there are a number of proposed houses for which sites have been selected, and for which plans have reached various stages of completion. These were originally intended for treatment by the procedure under the law of hon. Members opposite, but these sites will be certifiable under the same Clause 4 (8) of the Bill. Progress in regard to them is impeded in the matter of selecting tenants, and the corporations are in a difficulty in the matter of completing contracts for letting the sites or buildings until the final stage of the Bill is known.
  The third point is that the development corporations must also proceed fairly soon with the preparation of plans, so that they can finally settle their building programmes for 1953 and beyond. No further progress can be made as regards deciding the sites for further houses, until the committees proposed under the Bill have been set up and are in active operation. Under the Bill the committees have to consist of representatives of the development corporations and of the justices. This point, therefore, makes it essential for the Bill to make progress.
  There was just one further point that. I heard, troubled certain hon. Gentlemen opposite, and if I may deal with it, it will, perhaps, save some searching in the course of debate. It is, I am told, that hon. Gentlemen opposite have worried lest the rights to move instructions are impaired by the course which I am suggesting by this Motion. However,

  2661
  if hon. Gentlemen will consider Erskine May, page 526—if I may refer to that to show that the point has no substance —they will find that "Time for moving instructions" is dealt with as follows:
  "An instruction to a Committee of the whole House upon a bill is usually moved when the order of the day for the first sitting of the committee has been read, except an instruction founded on the report of a Committee of the whole House, which is given when the resolution as reported from the committee has been agreed to by the House."
  It goes on to say:
  "In the case of bills referred to standing or select committees, an instruction can be moved as soon as the bill has been committed, or subsequently."
  I think that that deals with the fear of technical troubles which, I am told, have been aroused.
  In the two parts of my speech I have, I hope, satisfied all sections of hon. Gentlemen opposite, first, that I am doing what they desire and, second, that it is necessary from the practical point of view for providing these new houses for the new towns.
  To the hon. Gentleman who was good enough to remind me—though I scarcely needed reminding—that there was another point of view, I repeat what I said. I am sure his point of view can be urged in the Committee if he is a member; and, if the Committee is unfortunate enough not to have him as one of its members, I am sure he will find on the Report stage and on Third Reading the opportunity to ventilate that point of view. I say that with complete certainty because I have never found any subject of debate in this House, in all the years that he and I have been Members, on which he has failed to put that point of view. I do not think he will fail to find one on this Bill.
  2.49 a.m.
  Mr. Ede: This Bill was given a Second Reading on 27th February. I believe we are now at 27th June—although not for the Sitting of the House, for which we are still at 26th June. It is remarkable that it has taken four months for the Government to make up their mind about this matter.
  Let me disabuse the right hon. and learned Gentleman straight away: the House decided unanimously, on a Motion moved by the Government, that the Bill
  2662
  should be committed to a Committee of the whole House. As a matter of fact, I was somewhat surprised that the Government moved in that direction. I was just about to jump up to do it when I was forestalled by one of the junior Whips moving it on behalf of the Government. Therefore, let it be understood that we are being asked to depart from the unanimous decision of the House.
  I have heard nothing from the right hon. and learned Gentleman that convinces me that there is any need for this course. All the Amendments tabled so far come from his own side of the House. The hon. Gentleman now the Parliamentary Secretary to the Ministry of Civil Aviation, who is, I understand, about fourth in command at the Treasury as well, has put down some Amendments; the hon. and learned Member for Hove (Mr. Marlowe) has his name associated with those Amendments; there is one more to which the name of the hon. and learned Member appears at the head of the list, and the name of the Parliamentary Secretary to the Ministry of Civil Aviation is a little lower down on the same Amendment.
  Then there are a number of Amendments on the Order Paper in the name of the Home Secretary and the Secretary of State for Scotland. Notice of those was given on 12th March and 21st April, so that some of them have been on the Order paper for three and a half months and others for two and a quarter months, and no approach has been made to this side of the House to ascertain whether our views have changed or whether there was any desire on our part that the Bill should be taken upstairs. I do not regard this as a complicated and technical Bill, although it was apparently very hastily drafted, if one can judge from the number of Amendments that the Government themselves have found it necessary to put down in the name of the two Departments concerned.
  This change of Committee is described by Erskine May in these terms on page 513, after dealing with the reverse process:
  "On the other hand, an order committing a bill to a Committee of the whole House can be discharged and the bill committed to a standing committee or a select committee, though the necessity for such a proceeding rarely arises."

  2663
  Therefore, apparently it is desirable, judging from that broad hint, that necessity should be the governing principle in the Government's plea for such a transfer. Now, I do not know whether the necessity is in this case, and I am bound to say I was very surprised when I found that the Government had proceeded in this way.
  It is true that the last occasion on which this was done was on 27th February, 1917. The Motion was then taken as the first Order of the Day, and was moved by Mr. Bonar Law as Chancellor of the Exchequer and Leader of the House. It was obviously regarded as a matter of very considerable importance. I do not intend to go further back than that, because I think most of the earlier precedents deal with a time when the procedure of the House was very different from what it is now. From what I have been able to discover, without any very serious studying of the matter, they were generally with regard to Bills which we would now regard as Private Bills and not this type of public Bill.
  On that occasion, in 1917, there was a debate and a Division, and I looked through the Division list to see what happened. There are two present Members of the House who voted in the Division. One is the present Father of the House who voted for the Bill going upstairs, but the present Prime Minister, although a supporter of the Government which had tabled the Motion, voted for it staying on the Floor of the House, and as a good House of Commons man, desired that the largest possible number of Members should participate in the discussion of the Bill.
  I do not think that any of the three reasons that were urged upon us need have any weight with us at all. What is quite clear is that the right hon. and learned Gentleman is encouraging the development corporations to proceed on the assumption that because the Government have introduced a Bill it is already the law. The Act that the Parliament of 1945–50 passed is the law of the land, and the appropriate procedure at the moment is in accordance with that law.
  There is, as far as I can see, no excuse, and I am surprised at the right hon. and learned Gentleman as a lawyer suggest-
  2664
  ing that some of the things he has advocated are in accordance with the existing law. The three houses being erected at the present time are being erected under the existing law, and I cannot see why it is necessary that this Bill should be sent upstairs so that it should be passed. At the beginning of the present Sitting of the House the Leader of the Opposition suggested that there was a process known in former Parliaments as "the massacre of the innocents," and I gather that the Prime Minister remarked that some of the Bills were not so innocent as all that. I suggest that this is one of them.
  After all, we have not had the real reasons. I get every month from the brewing industry a very interesting little booklet—which I believe is sent to all Members, irrespective of the extent to which they contribute to the funds of the brewing industry—called the "Monthly Bulletin." I received in the middle of the month the copy for June, and it has on page 93 an article beginning "Licensing in New Towns." I am quite sure the right hon. and learned Gentleman has probably got the words off by heart. It reads:
  "By the time this number appears in print the Licensed Premises in New Towns Bill may be approaching its passage to the House of Lords. The time has come for a more detailed examination of its provisions and to compare them with the pertinent sections of the Licensing Planning Act."
  It adds, in brackets:
  "(The Bill may, of course, be amended in Committee.)"
  It is quite evident that the brewing industry has said, "Well, what about this Bill? It was introduced early. We have heard nothing more about it and we expect in view of the probably short life of this Government that this Bill shall become law while they are still there."
  It is not good enough that this arrangement, which was made unanimously by the House, and which both the Opposition and the Government desired, should now be set aside. Because of what we believe to be its origin, we think it should be discussed on the Floor of the House with the fullest publicity given to it instead of being sent upstairs to be discussed in a place where there is far less publicity.

  2665
  The right hon. and learned Gentleman has given us no reason for sending the Bill upstairs. It is weeks since the Bill was introduced and nothing has been done with regard to it. The Government Amendments have been tabled, but for a very long time nothing was done and no approach was made to us in view of the alleged difficulties of the Parliamentary time-table. Erskine May speaks of some justification for an action like this on the grounds of necessity, but as far as we are concerned we would prefer that the Bill should remain on the Floor of the House with every Member participating in the debates on it.
  I do not think that the courage which the right hon. and learned Gentleman said the Government were showing in sending this Bill upstairs is a spirit to which we need give encouragement. After all, if any Amendment were made upstairs the Whips would be on when we came down here again. Unless we have some better reasons than those advanced by the right hon. and learned Gentleman, we cannot agree that there is any reason for relieving this Bill from being discussed in the fullest possible glare of publicity.
  That is what we desire, and I sincerely hope that the right hon. and learned Gentleman will understand that, so far as we are concerned, we cannot be taken as in any way feeling that this is a Bill in which we are called upon to assist the Government by enabling them to dispose of it upstairs and relieving pressure on the Floor of the House. We have no intention of assenting to the Motion which the right hon. and learned Gentleman has moved.
  3.4 a.m.
  Mr. James Hudson: The intervention of the right hon. and learned Gentleman has, of course, made it difficult to continue the antipathies that the Front Bench managed to work up a little while ago. The right hon. and learned Gentleman has the capacity to put a thing as reasonably as it can be put. He is very friendly in his approaches to us. He has approached us in a reasonably, Parliamentary fashion.
  All the same—and he will forgive me for being forthright about it—that statement that was read out just now by my
  2666
  right hon. Friend the Member for South Shields (Mr. Ede) showing that the liquor trade intended that what the Government are actually doing should be done and that the discussions on the Bill should be held upstairs, is but a continuance of the spirit shown by the trade from the beginning of this matter.
  From the beginning of this Bill we have charged the Government with the fact that the thing was imposed upon them illegitimately without a fair opportunity for the country as a whole to consider what was being done. In spite of our protests, the Government have been determined to go on with a step which, at any rate until the Bill was completed, ought not to have given them any excuse at all for regarding these public houses embarked upon as a reason for entirely departing from the plans that had been carefully worked out.
  Under the schemes that have been considered in the new towns, it is not only a question of building a public house that is involved. It is a question of an entirely different approach to the problem of the supply of alcoholic beverages, with not only the question of the place where the liquor was supplied and sold to be taken into account but the question also of the part that was to be given to residents in the locality to have representatives on advisory committees to look carefully at every point of development that was taking place.
  All these things are involved in the plans that are being worked out in the new towns. I have been getting letters recently from ministers of religion, temperance reformers, and others who are well disposed towards trying to get a reasonable development along the lines that were suggested by the last Government. Complaints have reached me wholesale that they want to know where they stand in regard to the committees they, too, have been setting up—committees of well-meaning people who want to be of service to the community. They are asking where they stand in the confusion that has been introduced as a result of the introduction of a Bill which has been left high and dry for the four months that have elapsed and is now to be pushed away into a Committee to meet the fate that awaits it there.
  I submit that there is something different about this Bill when considered

  2667
  alongside those that are dealt with by committee procedure. It is different from the Bill that was referred to by my right hon. Friend, the Member for Ebbw Vale (Mr. Bevan). This Bill requires a very careful scrutiny by the general public, who have been very much more interested in latter months than I can remember at any time in the power that the liquor trade possesses in getting a great party to wander away from its commitments.
  The party opposite made commitments before the last Election.
  I have recited before how the party opposite went to the General Election with a promise given to the temperance movement and to the churches that they would take carefully into account the issues that are raised in the community by too much drink on the roads and too much neglect of child life.
  Mr. Speaker: The hon. Member is not entitled to go into the merits of the Bill on this Motion, but must merely discuss whether or not the re-committal Motion should be passed.
  Mr. Hudson: I must bow at once to that reminder, Sir. Probably I have transgressed, under strong feelings, more than I should have done.
  The party opposite, in sending it to a Committee, where there is not the same amount of reporting—and they know it as well as we do——
  Sir Ian Fraser: You get a longer holiday that way.
  Mr. Hudson: There we have an interruption which indicates the way in which the hon. Member looks at the matter. All he wants is a holiday. I am rather in need of a holiday myself, but I have my duty to do on occasions like this.
  As a Member of Parliament, I know that the general public feel they are being cheated by a powerful interest in the securing of a Bill that was not in line with what was best in the party opposite. There has been a throwing-over of the unanimous agreement to deal with the matter in public, in the full light of day and with the Press reporters looking on, in a way which shows that powerful interests have too great a power. Hon. Members may look up at the Gallery
  2668
  now, but there is nothing to encourage us in that direction at present.
  If the Bill had been taken, as other Bills of the Government have been taken, on the Floor of the House itself there would have been an opportunity for the mass of the public to be taken into our confidence. We should even have been able to secure that the great body of people who are drinkers—people who do not take the view I take—could at least have been made aware of the dangers involved in the life of the community by permitting a powerful interest behind the scenes to pull its weight with the Government and bring in a Measure which, when passed, will not have received the discussion, which it ought to have had from the House of Commons in full, and concerning which the people generally will not have had the opportunity to understand it and the issues involved in it, in the way that I am pleading they should have.
  I strongly support the right hon. Gentleman in the protest he has made, and I plead with the right hon. and learned Gentleman to reconsider this matter before plunging us into a most difficult situation.
  3.15 a.m.
  Mr. Geoffrey Bing: The whole House probably sympathises with the right hon. and learned Gentleman the Home Secretary in the always invidious task of moving a Motion which is not only in the name of another right hon. Gentleman but was the responsibility of one of his right hon. Friends. We all regret that the circumstances are such that his right hon. Friend did not see fit to sit through and listen to the debate on a Motion in his name concerning the duties with which he is now solely entrusted.
  If there was one proposal which met the convenience of the House, it was surely this one. Every hon. Member was glad when the right hon. Gentleman was divested of his responsibilities as Minister of Health and was able to concentrate on the business of the House. I do not know whether the right hon. Gentleman is to reply to the debate, or whether he feels that he will be able to do it better without having heard it in the first place. It may be so. But it is a little unfortunate if the Minister has to seek leave of

  2669
  the House to speak twice because his right hon. and learned Friend is afraid to speak even once.
  The question we are asking is why this unanimous decision of the House was reversed. There is one reason. It is the good nature and good manners of my right hon. Friend which have persuaded him not to put it forward. It is one which would commend itself to his hon. Friends; because originally the Motion was moved by the Patronage Secretary. In those circumstances, no doubt all his hon. Friends behind him would like to set that aside and demonstrate that, having been moved from that quarter, it was evidently one of those mistakes which happen there. But that has not been the argument put forward.
  This is really a matter for which there has been no precedent since 1917. Of course, there are precedents in the other way, because it is not necessary to move a Motion if a Bill is to go upstairs. In 1917 there was a change of policy which was explained; but since then there has not been a Chief Whip or a Government who have not understood their business and who were not able to say whether they wanted a Bill on the Floor of the House or upstairs. The right hon. Gentleman said that the business of the Government is congested. But it is not hon. Members on this side of the Committee who introduce the business. Surely he had some idea of what business was coming forward, and of what sort of time it was likely to take.
  But business has been congested for some time. We have warned hon. Gentlemen opposite when they were taking holidays that perhaps they ought not to take such long ones; but there was never any suggestion from the opposite side of cutting them by a few days. When did it become apparent that it was not possible to take this Bill on the Floor of the House as originally decided? It seems to have become apparent at some time between Friday afternoon and Saturday morning last week. On Friday the order for the Committee stage of this Bill in Committee of the whole House was read, and the Whip on the benches opposite postponed it until Tuesday.
  There appeared on the Order Paper for the first time on Monday a Motion to do this unusual thing. By this time the
  2670
  matter had become so urgent that the right hon. Gentleman could not even give any notice of business. I have had to complain before when hon. Members opposite brought up debatable business without giving notice. The Lord Privy Seal has control of the business of the House. If any hon. Gentlemen want to set down instructions, the only time they can be certain the instructions will be considered is when the Order for the Committee is read. If, as was attempted here, the right hon. and learned Gentleman puts it down without notice, there is no opportunity for setting down instructions.
  We have not put down any Amendments so far and the small matters I want to put on the Order Paper, in the hope that they may be considered—in case I am not on the Committee—can be raised without instructions, but it was unfair to present the House with a situation where hon. Members could not put down instructions if they wished to do so.
  We ought to hear a little more about the reason for this change of plan. All the right hon. and learned Gentleman has exhibited is a touching faith—apparently not shared in any other quarter of the country, so far as one can tell from Gallup polls—in the permanence of this Government. His case was that this matter should be brought forward because the new towns corporations were not obeying the law; they had given up following the law and were devoting themselves to doing what they thought the Government would do if it survived long enough.
  Squadron Leader A. E. Cooper: Amongst this high rate of abuse and insults, the hon. and learned Gentleman should not include the belief that this Government will be short-lived. He may be interested to know that in my division today there were three municipal elections, all of which we won with increased majorities.
  Mr. Speaker: That is quite irrelevant.
  Mr. Bing: I am glad to hear that the hon. and gallant Member for Ilford, South (Squadron Leader Cooper) has been making some profitable speeches. What a pity he does not make them in the House. If I may put myself in order by phrasing it in this way, if that

  2671
  is the situation, why does not the Prime Minister take the opinion of the country on this and other Measures if, in the opinion of the hon. and gallant Member, he is certain to win?
  We should like to hear from the right hon. and learned Gentleman about this strange change by the Government. There was a long period—two or three months —in which the House was adjourned in order that Her Majesty's Ministers could prepare the important legislation which they wished to place before us. The first Measure which was introduced after the pause, the fruit of the nine weeks' Recess, was this Bill. It was so urgent that it was the first Measure. We had been told that we were in the middle of an economic crisis, but the first Measure to be introduced was this.
  Was it brought forward at that time because the right hon. and learned Gentleman could think of nothing eise? If that was not the reason, surely it must have been a matter of urgency; and if it was urgent, why was this Committee not set up long ago? I can understand that, confused as he was at the time, and unable to give all the attention that he should to the business of the House, the Lord Privy Seal did not appreciate that he had no time left for the first month or so, but as time went on surely it must have been apparent that it was not going to be possible for the Bill to be taken. Why was it not sent upstairs then?
  It is very unfair to the House to ask hon. Members to rush through a Bill of this sort at the tail end of a Session. Whatever our views on the Bill, we are all agreed that it needs careful and detailed consideration. Why should we suddenly be asked to deal with it at this time and under very unfavourable circumstances? The right hon. and learned Gentleman holds a pistol to our heads—and not a water pistol; and he says, "Here is the position. The new towns are doing illegal things, they cannot get a licence, they are deprived of drink, and in those circumstances this Bill must be sent through." That is his case as to why it should go upstairs. But, he must have known this some time ago; and why should he not have set up a Committee then. at the earliest stage?
  There is a further argument. Before we agree to send this Bill upstairs, we
  2672
  ought to consider if there is going to be any value by so doing. Have we got all the information or knowledge at our disposal which makes it of value to send it up now? When is it proposed to send it up? Immediately? I suggest that one of the reasons why we have not taken the Committee stage before now is that the right hon. and learned Gentleman is completely ignorant about the whole Bill.
  I set down two Questions, the answers to which are obviously necessary before one deals with the first Clause of this Bill; and they were: who are the owners of these public houses? But somehow, he cannot get hold of this information; perhaps the clerks to the justices will not reply to his letters, but whatever the reason, it is strange that he did not know who owns any of these houses.
  That, I suggest, might be a very good reason for not taking the Committee stage for some time. Then, we do need to know a little more about the plans for future business. Nothing would be more unfair to right hon. and hon. Gentlemen opposite, who work hard, and attend for long hours at a time—and there are far more hon. Members on that side than on my own—to have them locked up in a Committee room in the mornings as well when they were not likely to reach any fruitful conclusion.
  One cannot tell whether it is worth while sending a Bill upstairs if one does not know for how long the Session is going to continue. If, after much work upstairs, we finally approve the Bill in Committee and bring it back here, it may be that we find it impossible to take the Report stage.
  Can we be told when the Session will end? Will it be this year? Is the right hon. Gentleman going on until March, or will he end it at the normal time? When are we to have the Recess? Should we wait until after that Recess in order that he might collect the various material which is necessary for our deliberations? All of these are highly material questions which should be asked when considering whether we shall send this Bill upstairs or not.
  Cannot we be told a little more about the motive behind this matter? There were two important items which won the last Election—"red meat "and" public houses to go back to the brewers." One

  2673
  got the votes, and the other got the money. It was said, very naturally, that the first promise could not be honoured, and then decided that they had better have the second as quickly as possible.
  We started off with a return for a definite pledge given; but if the pledge had been given, why, after the Second Reading, was it forgotten completely? Surely this is one thing that ought to have been on the right hon. and learned Gentleman's conscience—that here was a Bill of importance, here was the one pledge of the pledges given that it was possible to keep. Or is the case that all the other pledges were so automatically broken that hon. Gentlemen opposite felt that this, too, just should go?
  Why do we have this long gap? Why, after four months, send this Bill upstairs? I can understand putting a Bill upstairs straight away, because then there would be a good deal of time in Committee upstairs, but at this stage of the Session it is most unusual to send any Bill upstairs that is controversial. I think, looking back on past Parliaments, that in a normal Parliament—it is a pity we have not the Leader of the House here to explain the matter to us— this is the time when the Standing Committees are closing down, when Bills cease to go to them; and now we are suddenly to send the most controversial Bill of all upstairs to a Committee.
  I hope that the right hon. and learned Gentleman will be frank with the House —if he feels that this is a discreditable Measure. Because that is the interesting thing. That was the reason the 1917 Bill was sent upstairs—the 1917 Bill which amended the criminal law—for it was felt that the subject was such that it should not be discussed in the whole House; and that was the reason why the change took place there. It is all very well for the right hon. and learned Gentleman to cite that precedent in favour of doing this, but is he doing it for the same reason? Is his argument the same why the Bill should be sent upstairs—because it is not quite nice to discuss it with the full publicity downstairs.
  If that is not the reason, what is it? He hopes to save Parliamentary time down here? Will he tell us what for?
  2674
  What other Measures are there to be discussed in this Chamber? If there is none, then we have plenty of time. Or are we to rise soon? Then, the Standing Committee will rise, too. I do hope that the Parliamentary Secretary will answer the many unanswered questions on this matter.
  3.32 a.m.
  Mr. Anthony Marlowe: This topic has been discussed with so much fervour and zeal by hon. and right hon. Gentlemen opposite that it would be impossible to accuse them of any insincerity, but, of course, one might otherwise have been driven, perhaps, to the conclusion that their motives might not have been unconnected with the enthusiasm to get controversial Bills of this kind on the Floor of the House to delay other work which has to be done. But they have omitted to tell the House something—and this is the only point on which I wish to take up the time of the House in considering whether this Bill should go to a Standing Committee or not.
  It would be quite inappropriate to discuss the merits of the Bill at this stage, but it is essential for the purpose of the argument just to recall what this is about, and what this Bill does is to repeal one part of the 1949 Act. The 1949 Act was a very major Act affecting a wide field of the licensing law, but what hon. and right hon. Gentlemen opposite who have talked on this subject tonight have not told the House is that the very major Measure of the last Government was sent upstairs to a Standing Committee. It was perfectly proper for them to take that major Measure upstairs, but now they seek to tell the House that it would be most improper to send this much smaller Measure upstairs.
  I ask the House to have some sense of proportion about this. The real position is that there was a major Measure in 1949 which made material and important changes in the law. This Bill is to restore the status quo ante as to a part of it. It was proper to send that Measure upstairs before, why is it improper to send this one upstairs now?
  Mr. Ede: Then why did the Government move to keep it on the Floor of the House?
  Mr. Marlowe: I will tell the right hon. Gentleman: because at that stage we had only just begun this Parliament, and we supposed that there would be an effective Opposition; we were not quite sure whether it was safe to send Bills upstairs. Since then we have learned that the Opposition have no desire to defeat the Government and we feel much safer, and we know perfectly well that we can send Bills upstairs with safety.
  3.36 a.m.
  Mr. George Wigg: Not the least attractive attribute of the Home Secretary is his rollicking sense of humour, but I thought that this evening he overstrained it a little when he gave the Government's courage as one of the reasons for their change of mind. It was also unfortunate if that was not a joke, because it was made quite clear, if he did not know it already, that on the Government benches sit a collection of men shivering at the result of every urban district council election. The Government have made it quite clear that Measure after Measure, in the last few weeks, has been wholly dictated by electoral results, and when the right hon. and learned Gentleman comes here now and tells us that it is an act of courage that prompts the Government, after a lapse of four months, to change their minds, we can rule that out.
  There is a possibility that the right hon. and learned Gentleman is correct. It may be that the well-known influence of the brewing industry on the Tory Party has been decisive. If so, it is wrong to suggest that it is merely in fulfilment of past promises. I do not think the Conservative Party can be relied upon to fulfil their promises to the brewing industry any more than is expedient, any more than their promises to the electorate as a whole.
  If the Government have now changed their minds because they are conscious of their obligations to the brewing industry, it is not in fulfilment of past promises but in the hope of favours to come. It is the realisation that the coffers of the Conservative Party are empty, and that unless they make a gesture of fulfilling those promises there will be no money for the next Election.
  My view is that the reasons why the Government have changed their minds
  2676
  are not specifically connected with that, although I am sure that is not far absent from their minds. The reason why they have changed their minds was touched on by the hon. and learned Member for Hove (Mr. Marlowe). It is the change in the political atmosphere since 27th February. When this Government took office they were wholly persuaded of their success, and as a result they suffered from the same complaint as the late Dr. Goebbels of believing in their own lying propaganda. They completely failed to appreciate the decision the country had given.
  I do not know who was responsible for that. Maybe that brilliant intellectual the Patronage Secretary is their chief-of-staff and guide in these matters. It is quite clear that they failed to realise that the electorate had given the same answer to the Conservative Party as they gave to the Labour Government in 1950. The electorate had said, "We do not want you to carry out any wide, sweeping legislative changes. What we want you to do is to concentrate on administration. Go in and carry out the promises you made. Give evidence of the fact that you are the competent administrators you claim to be."
  But the Government did not take heed of that. They embarked upon a vast legislative programme, and they have got completely bogged down as a result of their own efforts. Now, of course, they are forced to send this Measure upstairs, otherwise they will jeopardise it. It is perfectly true, as my hon. and learned Friend pointed out, that in fact the Government could, had they wanted, sent the Bill upstairs in the first instance. But they did not do it. It was positive action on their part which determined the Bill being taken here. Having made the initial mistake on 27th February they have been guided by hope until now, on 27th June, when all hope has been abandoned. There is no prospect of getting this Measure if it is left on the Floor of the House.
  What the country wants to know is whether, if the Government cannot get this Bill through, is there any prospect of getting the Steel Bill through. I do not think there is the least prospect. What is to happen when the great steel interests who also sympathise with the Conservative Party realise that? That is

  2677
  the real reason why the Government have hoped since last week-end to smuggle this through. What the Government are afraid of is that the steel interests, and the other interests behind the Conservative Party who have paid in the past, and whom they hope will pay again, will draw the correct lesson from their action. That is the accurate and charitable explanation of their action.
  3.43 a.m.
  Mr. Michael Foot: The hon. and learned Gentleman the Member for Hove (Mr. Marlowe) made a powerful point when he said that the previous Bill which dealt with this matter was sent to a Committee upstairs when the Labour Government was in power, and that possibly the same course should be followed in this case. If that was the right argument it was even a more powerful argument when the original proposal was made by the Government.
  What is remarkable is that the hon. and learned Gentleman should have stayed to make this powerful intervention, but was not prepared to make the same point on the previous occasion. It was all the more remarkable when one recalls that he began his speech by demanding that everyone should prove his sincerity. If he was sincere in thinking it was altogether right that this question should be referred to a Committee upstairs rather than the whole House, then, obviously, his sincerity would have been more apparent if he had intervened on the previous occasion.
  I am sure on a matter of this kind, which might be considered a House of Commons matter, if the hon. and learned Member had appealed to his Whips for a free vote he might have got the same answer as he got tonight when he asked whether he could go home.
  The hon. Member for Ealing (Mr. J. Hudson) said, quite rightly, that a Bill sent upstairs cannot be reported in the newspapers on anything like the scale of a Measure taken on the Floor of the House. It was a very great Parliamentarian, Henry Fox, who said, about two centuries ago, at a time when there was not reporting of speeches," I will speak so loud I will be heard outside the House." I sometimes think that my hon. Friend models his oratorical style with that in mind.
  2678
  Due to the unfortunate pressure on space in the newspapers it is difficult for them to report at one and the same time proceedings on the Floor of the House and in Committee upstairs. Therefore, I think that that was one of the factors which should have been taken into account by the Government before they proposed this plan of altering their original decision.
  I must agree with what was said by my hon. Friend the Member for Ealing, North when he implied that however reasonable and however orthodox this proposal may be, we must admit that the Home Secretary would bring it before the House in the most reasonable spirit possible. If the attempt is to be made to make a silk purse out of a sow's ear the best person on the Government Front Bench to attempt that hopeless task would be the Home Secretary. It is a pity that he is called on to perform this alchemistic feat so often.
  I should like to refer, briefly, to some of the points made. The right hon. and learned Gentleman based his case on four separate propositions. He referred, first, to the unanimity that we had established on this side of the House. That was dealing with the constitutional aspect of the matter, and I will come back and refer to that again in a few minutes. The second part of his argument referred to the question of the procedure, and, I will add nothing to what was said by my hon. and learned Friend the Member for Hornchurch (Mr. Bing), because I do not think the Home Secretary dealt with the novelty which was involved in this proposal in anything like adequate fashion. A full answer was also made on all the points by my hon. and learned Friend and by my right hon. Friend the Member for South Shields (Mr. Ede).
  The third point he referred to was the question—I suppose laughingly referred to—of the courage of the Government in committing this matter to a Committee upstairs, and that I think has been dealt adequately with by my hon. Friend the Member for Dudley (Mr. Wigg). The fourth point dealt with the practical needs of the situation, and I would only add a few words to what was said by my right hon. Friend the Member for South Shields, because this is a further example of the new kind of legislation which this Government seems to be increasingly

  2679
  favouring. We had a similar example in the recent National Health Service Bill
  We have had a lot of complaints about retrospective legislation, but it seems to be a growing fashion to have anticipatory legislation. In many respects anticipatory legislation is a much greater insult to the authority of the House of Commons than retrospective legislation, because in the case of retrospective legislation the House of Commons has the advantage of being able to review the facts. In the case of anticipatory legislation the situation is very different. If there is an increase in this practice, we will see the Government coming along before the normal stages of a Bill is complete and saying that they must speed it up because they had anticipated that the Bill would complete its passage through the House much sooner.
  It is a serious constitutional departure and particularly alarming when a novel constitutional proposal of this kind is introduced primarily to upset what has already become the law of the land. Therefore, there should be a much fuller explanation by the Home Secretary as to why he embarked on this form of anticipatory legislation, so strongly condemned by many hon. Gentlemen during the discussion on the National Health Service Bill when the same risk was attempted by the Government.
  My main point is that the first matter the Home Secretary dealt with—the general question of what sort of Bills should be sent to the Committee and what are the kind of circumstances in which the House should decide to send a Bill upstairs. I agree with the inference at the beginning of the right hon. and learned Gentleman's speech that this is an important and, in many respects, a difficult matter. Nobody can be dogmatic about it. Whether a Bill should go upstairs or not depends on the circumstances, and the right hon. and learned Gentleman referred to some speeches from this side on this subject at an earlier date. He said that we then claimed that we were entitled to ask why Bills had not been sent upstairs, a reference to a speech by my right hon. Friend the Member for Ebbw Vale (Mr. Bevan).
  It is interesting that the Home Secretary should say that on 27th June, because when my right hon. Friend put that ques-
  2680
  tion on 9th April the Leader of the House refused an answer. It is a bit hard that my right hon. Friend should have to wait three months for the answer, and it would have been much better for the Home Secretary's case and the whole procedure of the Government if the answer had come when the question was originally put.
  What happened on 9th April, when there were roughly 10 Members present opposite? I am glad there are more present tonight to listen to the arguments that were then put, for on the earlier occasion they were upstairs discussing whether they were going to have a Transport Bill at all, and unfortunately that clashed with an important discussion on how the business of the House might be conducted. If more attention had been paid to that debate, the Government might have saved themselves a great number of difficulties.
  Let me refer to what was said by my hon. Friend the Member for Oldham, West (Mr. Hale), who referred to the Marine and Aviation War Risks (Insurance) Bill—we are still in the middle of it. It was suggested it might have been an advantage to the Government to send that kind of Bill upstairs. My hon. Friend said on 9th April:
  "The very first Bill on (he Order Paper in this Session was the British Museum Bill."— [OFFICIAL REPORT, 9th April, 1952; Vol. 498, c. 2801.]
  It is still on the Order Paper; we have not reached it. The Government would not listen when we said some of these Bills should be sent upstairs. If they had sent them to Committee, it might be that the British Museum Bill would now be on the Statute Book.
  The Marine and Aviation (War Risks) Insurance Bill might have made further progress, and there were other Bills as well. But the main argument to which I was referring——
  Mr. Bing: Would my hon. Friend also emphasise that, at this period, Standing Committees had had no Bills committed to them, and that, therefore, there was the opportunity to commit this particular Bill, which had already received a Second Reading?
  Mr. Foot: This proposal was made to the Government by Members of the Opposition at a time when it would have been possible for the Government to have used this procedure in the way it has been normally used in previous

  2681
  Parliaments. It was regarded as a matter of such little importance, and so much annoyance was shown, that they would not listen to the suggestion. The Patronage Secretary was most impatient on that occasion, and tried to bring the debate to an end as quickly as possible.
  What I want to do is to quote a passage from a speech of my right hon. Friend the Member for Ebbw Vale, to which the right hon. and learned Gentleman has referred, though he did not reveal the full implications of it in the reference which he made to it in the House tonight. On 9th April, my right hon. Friend said this:
  "…the practice has always been either to abandon contentious legislation and confine the legislation to what is required by the Constitution and by the first requirements of the nation, or to divide their Bills into two classes—Bills which are required absolutely essentially and Bills which are not so essential.
  Those which are not so essential are sent upstairs, and if they are murdered upstairs because they cannot be passed in a way that is congenial to the Government, then past Governments have always accepted their demise. In fact, I sat on Committees with the present Leader of the House, who was very dexterous in legislative assassination."— [OFFICIAL REPORT, 9th April, 1952; Vol. 498, c. 2794.]
  That was the general case presented by my right hon. Friend, and that is the argument which has been invoked by the Home Secretary in his speech tonight. What I want to ask him—if he can tear himself away from his discussion with the Patronage Secretary for a second-on the point he himself raised at the beginning of his speech, is whether he accepts the argument put forward by my right hon. Friend. Did he mean to imply, by his reference to that speech, that he is now, three months later, accepting that general argument?
  Are we to understand that the Motion which we are discussing, which is a matter of some importance in the constitutional history of this country, because it introduces a precedent never resorted to since 1917, is an isolated proposal by the Government, or that it is a general change of policy? It would appear to be indicated by the very fact that the Home Secretary did refer to the speech of my right hon. Friend that he is accepting the general argument.
  Therefore, he must really try to clear up the matter, and tell us whether he has now accepted the proposition that,
  2682
  because of the narrow majority in this House, it is not possible for such contentious legislation to be introduced, and that the only possibility is that Bills should be divided into two classes, and that the Government would be prepared to accept the situation that many Bills sent to Committees upstairs shall be murdered, according to the pattern described by my right hon. Friend.
  It is only right that we should have a full reply on that point, because it does make a difference to our attitude to this Motion. If this is an isolated proposal to deal with one particular Bill, then all the sinister implications that have been very rightly suggested by my hon. Friends are fully substantiated.
  But if the Home Secretary is going to say that they have at last discovered the wisdom of the advice given on 9th April; that this is a general change of policy and that they are proposing to abandon much of their contentious legislation and to send other Bills to the Committee and to run the risk of losing them; if they accept the proposition that it is better late than never. I think we ought to have an explanation from the Home Secretary of why it has been done. It will be treating this matter more lightly than it deserves if the Home Secretary does not give an answer to the quetion whether this is a general change of policy, or whether it is a policy to be applied only to this Bill.
  I must confess that if it had been a general change of policy which was intended, the Home Secretary ought to have read more carefully the speech of my right hon. Friend, who said:
  "We are therefore entitled to ask the Government— and this is an exceedingly serious matter—why they have cluttered up the House with legislation and not sent certain legislation upstairs. If the Government want to ventilate certain issues and to move the Second Reading of them, in my respectful submission they ought to accept the logic of the Parliamentary situation and the logic of the electoral situation, and ought not to seek to force through the House of Commons legislation repugnant to the vast majority of the people of Great Britain."—[OFFICIAL REPORT, 9th April, 1952; Vol. 498, c. 2795.]
  Are we to understand from the quotation which the Home Secretary has given us that he has accepted the advice of my right hon. Friend—that he accepts the logic of the Parliamentary situation and the logic of the electoral situation? If

  2683
  that is so it may be difficult for me to follow my hon. Friend into the Lobby against him, because I always thought that there was a powerful argument for the whole of the case put forward on that occasion. But if the Home Secretary will not say that, and if he is going to prove that he has chosen this particular instrument to deal with this particular Bill, the whole case made by the hon. Member for Ealing, North, and by the Front Bench on this side stands proved and substantiated. It proves that the Government, unable to get this miserable Bill through in the open, intend to try to do so in the dark. To use a metaphor, they do not think that they will get served in the public bar so they are going to try to get what they want in the bottle and jug department. But the Home Secretary may find that he has to face a few difficulties upstairs, just as he would have to face difficulties downstairs.
  Sir D. Maxwell Fyfe: If the Committee will give me leave I shall try to deal shortly with the points which have been raised. I will begin with the point put by the hon. Member who has just spoken. He has asked whether I accept a constitutional thesis which he elaborated by quotation, a constitutional thesis which would have made Blackstone blench and Dicey shiver, and which contained a novel, jejune, unfounded suggestion, based neither upon history nor fact. I think it was Sheridan who was the first Member of this House to remark that an hon. Member opposite took his jokes from history and his facts from his imagination. The hon. Gentleman has certainly followed the second part, but he has given a speech singularly free from jokes—except one, which I will give him: he said, with all that synthetic passion to which we are accustomed, that if I took a certain line, he would consider abstaining from following his hon. Friends into the Lobby. Following his hon. Friends into the Lobby! We know, and everyone knows, that 13 Socialists have sufficient interest in the Bill to be here tonight, and we know that those 13 Socialists will never summon up courage to go into the Lobby in any event.
  I tried very hard to find some subject, something, on which I could unite the divided ranks opposite me. It is a diffi-
  2684
  cult matter. We on this side of the House have tried in foreign affairs, home affairs, transport, economic problems— and we have always found that a yawning chasm showed itself more and more with every subject. I thought here, tonight, was a really kind act. Here, I said; is a quotation from the right hon. Member for Ebbw Vale (Mr. Bevan) in which he says, "Send Bills upstairs." Here is a quotation from the Leader of the Opposition in which he says, "Send Bills upstairs." I thought I might be the new uniter of this party which is rent by division; but my generous efforts have failed. Not one right hon. or hon. Gentleman opposite has supported the plea of the Leader of the Opposition—of course, we are used to that—and only one hon. Gentleman, and then in a most qualified way, has supported the plea of the right hon. Member for Ebbw Vale that Bills should be sent upstairs.
  If the debate has done nothing else, it has shown how inevitable and incurable these divisions are; and it has also shown the complete lack of interest in this subject by the party opposite. I except the hon. Member for Ealing, North (Mr. J. Hudson), who approached it from a different way. The debate has shown the complete insincerity of everything that has been said tonight. We are left with a small group of rhetoricians to support what they say is a great cause and a great attack. When right hon. and hon. Gentlemen opposite sent the Transport Bill upstairs, they were only too ready that it should go upstairs to be guillotined, and the livelihood of thousands of men and women taken away. Did they think that Bill was important? They sent the Town and Country Planning Bill there, too, and the Licensing Bill itself.
  After many years in the House, one knows the phrases in which procedural protests are always couched, and even the hon. Member for Devonport, with all his literary experience, scarcely avoided the proportion of two clichés per sentence which is almost universal on these occasions. But he did try to make certain points; and those I shall try to deal with. It is quite clear that the situation in February, when we were opening the second part of the session, was such that it was impossible to judge what would be the effect, either on the time of the session, or on the House itself.

  2685
  But, may I say that, on this one point, we have had two conflicting views. The right hon. Gentleman who spoke from opposite asked why the Government claimed to be courageous in sending this upstairs; because, if beaten there, the Government could put things right on report stage. The argument of every other speaker has been that we were afraid to take it on the Floor of the House.
  I have taken first of all the plea from the party opposite and, secondly, the needs of the Development Corporations. There is no question of illegality, but of practical planning, which it is their duty to carry out. We have heard nothing from hon. Members opposite on that basic point.
  Mr. Leslie Hale: The right hon. and learned Gentleman is addressing the House for a second time, with the leave of the House; and to say that certain representations have not been made, and to refuse to give way, is a discourtesy when addressing the House by leave.
  Sir D. Maxwell Fyfe: I am trying to deal with the points which have been made. With regard to giving way, the hon. Member knows that an argument suffers greatly if one does not complete it; and on the run of the game, taking one session with another, I think I may fairly claim that there are not many people who give way more than I. But what I want to make quite clear with regard to the Bill is the position of the session. That has changed with regard to the amount of business to be taken, and the amount of time available for it. It is most unfortunate if I may say so with respect, that, in these circumstances, the only answer of a small body of something like 4 per cent. of the party opposite, when their fellows have not the courage to come and face this debate, is the making of base charges. It is reducing Parliamentary opposition to something which they will live to regret.
  Mr. Donald Kaberry Mr. Donald Kaberry (Leeds, North-west) rose in his place, and claimed to move, "That the Question be now put."
  The House proceeded to a Division. Mr. CEDRIC DREWE and Mr. HENDRIE OAKSHOTT were appointed Tellers for the Ayes, but no Member being willing to
  2686
  act as Teller for the Noes, Mr. SPEAKER declared that the Ayes had it.
  Question
  "That the Order for Committee be discharged, and that the Bill be committed to a Standing Committee,"
  put accordingly, and agreed to.

  LICENSED PREMISES IN NEW TOWNS BILL

    LICENSED PREMISES IN NEW TOWNS [MONEY]
    Resolution reported,
    That, for the purposes of any Act of the present Session to make provision as to the grant of new justices' licences, and the removal of justices' licences, for or to premises in new towns in England and Wales and as to the grant of new certificates and the renewal of certificates in respect of premises in new towns in Scotland, it is expedient to authorise any increase, attributable to provisions of that Act imposing functions on development corporations in relation to committees constituted under that Act, in the sums which under section twelve of the New Towns Act, 1946, may be paid out of moneys provided by Parliament, issued out of the Consolidated Fund, raised by borrowing or paid into the Exchequer.
    Resolution agreed to.

  NON-CONTRIBUTORY OLD AGE PENSIONS
  Motion made, and Question proposed, "That this House do now adjourn."— [Mr. Kaberry.]
  4.17 a.m.
  Sir Ian Fraser: I apologise to you, Mr. Speaker, and to the House and the servants of the House for raising a matter so late, but the Minister having waited, it seems better to proceed briefly to the matter. There are 4.8 million people living in this country who are 65 years of age or over, and they are, of course, a group of people who are slowly dying out, and before very long those of them who receive the non-contributory old age pension—the old fashioned, original old age pension—will have completely died out. I do not know at the moment how many receive the non-contributory old age pension and how many receive the newer type of pension for which contributions are made, but we may, perhaps, guess that a half of them receive the one and a half of them receive the other.
  Now, this old fashioned, non-contributory old age pension is payable subject to a means' test, the base for which

  2687
  is the sum of £39 a year, and there are no disregards in connection with this old old age pension. Unlike the other types of pension and other social allowances of this kind, in connection with which certain incomes are disregarded, there are no disregards in this old type of pension. Savings are not disregarded. war pensions are not disregarded, contributions by the family are not disregarded, and nor are regular charitable contributions.
  The consequence is, in my submission to the House, that a very great many people, perhaps 2 or 3 million, are unable to get any assistance in their old age because they have a very modest income. If it was right to fix the figure which should be disregarded as £39 in, say, 1939, then clearly the fall in the value of money would make that figure equivalent to £100 now. It can, I think, be shown, and it must be within the experience of very many hon. Members, that there are a great many of these old people who find it very hard to make ends meet and to lead anything like a comfortable life on the incomes available to them.
  Inflation is not disagreeable to many people. Indeed, it is agreeable enough to wage earners, salary earners and those who receive dividends, because as inflation proceeds these people receive their money in the new currency of today rather than in the old currency of an earlier generation. But a vast number of our people are not themselves able to contribute towards their better living because they are too old or too disabled to work; inflation hurts them very much, and there is this large number of our people for whom at present no provision is made. The policy in the Budget was to try to stop inflation, and I welcome that myself because it seems to me very wrong to allow an economic process to go on which hurts so much all those defenceless people who cannot do anything themselves to avoid its consequences.
  It would be out of order were I to suggest methods of meeting the difficulties of these people by, for example, legislation so I will content myself with calling attention to their plight, and with saying to the Government that, just as they have compensated many classes in the community to some extent for the
  2688
  Budget changes which imposed higher costs of living upon many people, so they ought to consider whether there is not some way in which they can compensate this group of whom I am speaking.
  Anything that could be done must be done in the context of the national finances, and if it were not possible to alter the disregards in the case of these persons so that they were allowed £100 a year of income, so that the £1 a week of a war pension was disregarded, and so that some of the other disregards which occur in other social legislation——
  Mr. Speaker: I should like the guidance of the Parliamentary Secretary on this. Would not what the hon. Gentleman is suggesting involve legislation?
  The Parliamentary Secretary to the Ministry of National Insurance (Mr. R. H. Turton): I understand, Mr. Speaker, that the hon. Gentleman is suggesting the alteration of a means test that is fixed by Regulations under the Old Age Pensions Act, 1936. In that case it would be in order.
  Sir I. Fraser: I ask the Government to review the position of this very deserving and thrifty class of the community. It is not their fault that they are unable now in their old age to compensate themselves by working. It is not their fault that the war and the subsequent periods of five or six years led to this severe inflation, but it is a fact that many of them are very hard up, and I ask the Government to see what they can do about it.
  4.26 a.m.
  The Parliamentary Secretary to the Ministry of National Insurance (Mr. R. H. Turton): The history of these pensions is that they were originally payable under the Old Age Pensions Act of 1908, introduced by Mr. Lloyd George. When contributory pensions started in 1926 the right to these non-contributory pensions was preserved and at that time there were over 1 million of them. Now, with the passing of the 1946 Act, the majority of old people are eligible for contributory retirement pensions, and the number of non-contributory pensions has declined very considerably. On 27th May this year the number of non-contributory pensions in payment was 385,000. As the years pass the number will decline very rapidly and after September, 1961, no

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  new non-contributory old age pensions at the age of 70 will be awarded.
  Unlike the retirement pension under the National Insurance Scheme, the recipients of these pensions have not contributed to the cost which has to be borne entirely by the Exchequer. There is, therefore, a means test attached to them. The hon. Gentleman has argued tonight that that means test should be raised. I think he should bear in mind that of the 385,000 non-contributory pensioners less than one-sixth have their payments reduced on account of means. I mention that to put this matter in its true perspective. Hon. Gentlemen must also consider the relationship between these pensions and assistance paid under the National Assistance Act, 1948. Both are paid and administered by the National Assistance Board. The only reason why these pensions were not completely merged in the National Assistance scheme in 1948 was to prevent established expectations from being disappointed.
  As a result, there have been two scales of assistance and two different means tests administered by the Board. The non-contributory pensioner can choose whichever test or scale gives him the greater advantage. Indeed, he can go further and supplement his non-contributory pension under this test of means with National Assistance under that test of means. In fact, over one-third of the non-contributory pensioners are adopting that course.
  I think my hon. Friend is under a little delusion as to what this means test is. It is not £39 a year as he mentioned, but £39 plus £26 5s. making a total disregard of £65 5s. And any non-contributory pensioner who has an income between £65 5s. and £128 5s. receives a modified pension. In the case of a married couple, each partner is treated as owning half the joint means. Therefore, there is no reduction of non-contributory pensions for a married couple unless the joint incomes amount to £130 10s. and the pension is not extinguished unless their joint means are £256 10s. a year.
  I must qualify this broad statement by pointing out that the limit of earnings in order to obtain full pension is £26 5s. in the case of the single person and £52 10s. in the case of the married person. Turning from the income to capital, the test
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  of means under this means test allows a disregard of £865 capital for a single person and £1,730 capital for a married couple.
  Sir I. Fraser: An entire disregard?
  Mr. Turton: An entire disregard, £865 for a single person and £1,730 for a married couple. Claims for pension are not extinguished unless the capital exceeds £1,495 for a single person and £2,990 for a married couple.
  Sir I. Fraser: Is that really entire disregard? Do they not have to produce a certain percentage of capital each year more than, in fact, it yields?
  Mr. Turton: If the capital does not exceed those amounts of £865 and £1,730, then there is no deduction at all from the pension. The test of means is worked out so that when the capital exceeds a certain sum the actuarial value of the capital is taken; it is worked out at a certain percentage; that is one-twentieth or one-tenth of the remainder is taken as means.
  If the suggestion of my hon. Friend were adopted and this disregard raised by £61, the result would be that the capital disregard would be raised to £1,475 for a single person and £2,950 for a married couple, and the income limits would be up to £378 a year for a married couple. At a time of great economic pressure I feel that we would not be justified in giving this special relief to some 60,000 pensioners, whose pensions are reduced on account of means. I cannot believe that that would be justified, and it would not be consistent with the policy of Her Majesty's Government which is to see that the hardest needs are met first, as we said in our Election manifesto. It was because we considered that the harder cases were the non-contributory old age pensioners who were having recourse to National Assistance that we raised the National Assistance scales from 16th June of this year. It has been our policy, and will continue to be our policy, to relieve hardship wherever possible and where the needs are greatest.
  My hon. Friend complained that neither savings nor war pensions were disregarded. I hope after he has heard what I have had to say that he will agree with me that we are giving a substantial disregard for savings, a far higher disregard

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  than is afforded under the National Assistance test of means.
  On war pensions which my hon. Friend mentioned I would only say that I have not in my experience in this office come across any case where the operation of the test of means has deprived a war pensioner of his non-contributory pension or has reduced his non-contributory pension. I would be most grateful if my hon. Friend would send me details of any such cases and I promise him that if he does I will give the most careful consideration to them. I cannot believe that they will be very numerous.
  Sir I. Fraser: Before my hon. Friend leaves that point—in case it should go on record that there are no such cases. There is the case of Mr. B., who lives in London. He is a man nearly blinded in the war. In addition to his 55s. war pension, he has 10s. for his wife and 10s. attendance allowance, and he gets 15s. a week for an adopted son. When I had the particulars of his case a year ago, he was getting 2s. a week non-contributory old-age pension. Obviously, if there had been no disregard in respect of his war pension he would not have been knocked down to 2s. Probably now that his war pension has gone up by 10s. he has been knocked down altogether. 'That may be typical of many cases.
  Mr. Turton: I am most grateful to my hon. and gallant Friend. If he will send me any such cases after the debate I will go into them.
  The interesting fact came in the National Assistance Report, 1949, that
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  three-quarters of these non-contributory pensioners are women, and, of course, there cannot be many war pensioners when it is borne in mind that in order to qualify for a non-contributory old age pension the war pensioner must have been at least 32 years old in the year 1914.
  This debate will have served a useful purpose in drawing attention to the struggle these old people are facing, owing to the rise in the cost of living that has gone on for the last six years. I believe that one of the greatest worries that these old people face is the problem of accommodation. I should like in this connection to pay tribute to the work of the Church Army, the Salvation Army, and other organisations who are providing that accommodation for these old people. If I might make a suggestion, it would be that other organisations should consider whether they cannot give help in this direction rather than by giving money grants. Help in the way of providing either cottages or flats for old people can do much to reduce their anxieties. If that course is taken the results will be treated with the greatest possible indulgence by the officers of the National Assistance Board.
  I can assure the House that my right hon. Friend the Minister and the National Assistance Board are doing their best to administer these Acts of Parliament with sympathy and helpfulness towards old people.
  Question put, and agreed to.
  Adjourned accordingly at Twenty-one Minutes to Five o'Clock a.m., Friday, 27th June.