HC Deb 13 March 1952 vol 497 cc1695-719

10.2 p.m.

Mr. Eric Fletcher (Islington, East)

I beg to move, That an humble Address be presented to Her Majesty, praying that the Hire-Purchase and Credit Sale Agreements (Control) Order, 1952 (S.I., 1952, No. 121), dated 28th January, 1952, a copy of which was laid before this House on 29th January, be annulled. It will probably be for the convenience of the House if we also discuss the next Motion: That an humble Address be presented to Her Majesty, praying that the Hire-Purchase and Credit Sale Agreements (Maximum Prices and Charges) (Amendment No. 2) Order, 1952 (S.I., 1952, No. 122), dated 28th January, 1952, a copy of which was laid before this House on 29th January, be annulled. The two Motions deal with substantially the same subject-matter. Both Orders to which we invite the House to object were made by the President of the Board of Trade in order to place limitations upon the freedom of the community to enter into hire-purchase agreements. When the Chancellor of the Exchequer made his statement on the financial and economic situation on 29th January, he spoke of the necessity for introducing regulations to lighten the domestic load on the engineering industry by restricting the supply of metal goods bought for personal use.

These Orders were laid before Parliament that day and came into operation on 1st February. I am not sure whether the House, still less the public, are sufficiently familiar yet with their effect or their very serious infringement upon the hitherto very wide freedom of the community to enter into hire-purchase agreements.

Our criticism of the Orders is directed not against the necessity for placing some restrictions upon the use of consumer goods but against the method by which that principle is carried out. The burden of our criticism is that this is a vicious piece of class legislation and that it is unnecessary and unfair discrimination against the poorer sections of the community, which is paralleled by other measures that the Government have introduced since then.

What would be the effect of these Orders if they were to remain unchallenged and not annulled? I should like to draw the attention of the House to the very wide range of articles included in the Schedule. This is not an Order which deals merely with television sets, radio-gramophones and matters of that kind. This is an Order which deals with a very large variety of household goods in daily use in practically every household in the country. For example, it deals with dish washers, drying cabinets, ironing machines and irons, wringers and mangles, floor polishers, vacuum cleaners, water softeners and so forth, apart from all kinds of office furniture, bicycles, tricycles and practically every kind of mechanically-propelled vehicle.

The House will be aware that for many years past the community has been in the habit of acquiring articles of this kind under the hire-purchase system. That has proved to be the only method by which not only the poorer sections of the community, but a very large number of people can, on the one hand, set up in business when it is a case of buying office furniture; I am referring to the needs of the small traders. On the other hand, it is the long recognised method by which a newly-married couple desirous of setting up a home can acquire the essentials of a household.

For a long time people have had the advantage of buying these household goods on very generous hire-purchase terms. The object of this Order is seriously to curtail those terms. What the Order does is to make it illegal as from 1st February for anybody to acquire any of these articles under a hire-purchase agreement unless the hire-purchase agreement conforms to the provisions of the Schedule.

The relevant provisions of the Schedule are, first, that in any hire-purchase agreement entered into after 1st February there shall be paid a minimum percentage in cash of 33⅓ per cent. of the purchase price. That, of course, is far higher than was the standard normally required to be paid by the purchaser under a hire-purchase agreement. Second, the Schedule requires that the period over which the hire-purchase instalments may be spread shall be limited to a period of eighteen months, and in one category of cases to 12 months. Those periods are very much shorter than has been normally the recognised period over which the payments are spread.

There are other serious objections to these Orders to which some of my hon. Friends, who will speak, will draw attention, and to only one of which I would refer, which I am sure would appeal to the Parliamentary Secretary to the Board of Trade. I am talking about the glaring ambiguities in the Order. The hon. Gentleman is a master of precision in the use of the English language, and I was very sorry to see, therefore, that an Order, emanating from his Department of all Departments, contained language of such appalling obscurity and such dreadful ambiguity that he, of all persons, had to go as a penitent in a white sheet before the Statutory Instruments Committee and apologise for the ambiguity of the language, undertaking to introduce an amending Order, which, we hope, will do something to remove the ambiguities.

I will refer to one of them. It seems impossible, reading this Order, to know in which category an ordinary motorcycle falls. Is it in the category governed by 33⅓ per cent. for 18 months or in the category governed by a minimum payment of 25 per cent. for a period of 12 months? The motorcycle is not specifically referred to but there is one group of articles called "mechanically propelled vehicles" and another category, "bicycles and tricycles whether or not mechanically propelled." Practically everybody who buys a motorcycle does so on the hire-purchase system, and many firms specialising in that trade want to know in which of the categories a motorcycle falls. This is even more true of motorcycles and sidecars.

It is an affront to produce an Order containing such ambiguity. The burden of my complaint is not merely technical but it goes to the root of the policy which has led the Government to introduce this Statutory Instrument. We are not unmindful of the realities of the financial and economic crisis, and we are not unprepared to support all necessary measures that Her Majesty's Government may introduce to deal with it, but we object most vehemently to the misuse of the national emergency for the purpose of introducing measures of this kind, which are vicious examples of class legislation.

This Order limits the amount of goods which can be obtained, and discriminates against those who have not the means to obtain ready cash. It discriminates against the poorer sections, who are just as entitled to have these articles as anybody else. It is unnecessary to introduce these measures against one class of the community under the alleged necessity of dealing with an economic crisis. For those, and other reasons which my hon. Friends will substantiate, I hope that the House will support the Motion and annul this Statutory Instrument.

10.15 p.m.

Mr. Desmond Donnelly (Pembroke)

I beg to second the Motion.

I want to say how much I agree with my hon. Friend the Member for Islington, East (Mr. E. Fletcher) about the measure of class warfare contained in this Order. We think that if measures are necessary to restrict the expenditure of the country in order to deal with the crisis with which we are faced, this is not the right method. Indeed, it is a moot point whether the crisis is really as bad as some hon. Members opposite make out. Sometimes I wonder whether it is not, to some extent, a figment of their imagination in order to impose burdens on the working classes of this country. Even if such burdens are necessary, we think they should be shared by all sections of the community and not by one section, which means that people with money in their pockets are able to get away with it.

I want to refer to one or two aspects of the class segregation which this Order imposes. First, let me say a word or two about the transport vehicles referred to in Order 121. The Government are always talking about the need for greater production. The Chancellor of the Exchequer underlined this in his Budget speech two days ago and right hon. Gentlemen on the Treasury Bench are always saying it.

One of the most important aspects of efficient production in this country is how to get workers to and from their work. If we ask men and women to work late shifts when public transport is unavailable, it is necessary to provide means by which they can get to and from their homes readily. I do not know how the Parliamentary Secretary to the Board of Trade can come to this House and justify this kind of Government Order which restricts the sale of bicycles to those people who can put down a certain deposit and who can make payments within a certain period of time. I put it to the hon. and learned Gentleman that there is no valid reason for including bicycles in this Order.

Why should bicycles be included? If the hon. Gentleman says that this Order deals only with luxuries, let me put it to him that if he knew how the working classes of this country lived, he would realise the importance of bicycles. But then hon. Gentlemen on the Treasury Bench have not the vaguest idea of that, or anything else, relating to the livelihood of the working classes of this country.

Let me say a word or two more about transport to and from work. I realise that hon. Gentlemen opposite, who travel in their Rolls Royces, do not always appreciate this, however difficult they may find it without their Ministerial cars these days. However, I would urge them to consider this matter, because it may well be that if their sacrifices are the same as the rest of the nation, they may be needing bicycles or motor bicycles if they really mean business.

Motorcycles are important as far as the rural areas are concerned, and particularly in a constituency such as mine, where we have a big ordnance depot. It it of necessity remote, public transport across country is uneconomic and the motorcycle is one of the main means by which workers get to and from the ordnance depot. They are engaged on vital work for the nation, and yet the President of the Board of Trade has laid an Order which will make it extremely difficult for them to get new motorcycles in the future.

As my hon. Friend has said, motorcycles are under an ambiguous classification in this Order. Nobody is sure whether they are classified as motorcars or pedal cycles. I submit to the Parliamentary Secretary that he might devote some of his knowledge of the English language to this subject to clear up this matter.

I had a question on the Order Paper some time ago asking his right hon. Friend in which category motorcycles came, and whether they could not be classified as motorcars instead of pedal cycles because it extended the period of payments and made it easier to purchase them, if they had to come under this Order at all. One of my hon. Friends asked a Question about this today, and the President of the Board of Trade said he was still considering this matter. He has been considering it for a long time. I hope we are to have an answer tonight and that the answer will be, not that motorcycles are included in the same way as motorcars, but that they will be exempted from the Order altogether.

It is a fantastic situation, even if they are included in the Order, that there should be this ambiguity. I agree entirely with my hon. Friend the Member for Islington, East, that it is ironic that the hon. and learned Gentleman who is the Parliamentary Secretary should be the person having to defend this misuse of the English language.

I have often wondered how the President of the Board of Trade ever became the President, how the Parliamentary Secretary ever went to his Department, or how any of his colleagues on the Government Front Bench ever became the Government. After reading the Order, I am even more staggered as to how they ever became occupants of the Treasury Bench. In fact, they are like flies in amber. One wonders how ever they got there. I have a shrewd suspicion that we may find them not occupying the Treasury Bench—

Sir William Darling (Edinburgh, South)

On a point of order. Is there anything about flies in amber in the Order which is now before the House?

Mr. Speaker

I have not got the relevance of the reference yet, but I have no doubt that the hon. Member will approach the Order in due course.

Mr. Donnelly

Certainly, Mr. Speaker. I apologise if my concern about the occupants of the Treasury Bench has been slightly weighing with me.

Another aspect of the Order is that motor coaches are included as vehicles for which 33⅓ per cent. must be paid down and the rest paid in 18 months. I do not know whether the Parliamentary Secretary is aware that many motor coaches are normally paid for on hire- purchase terms over a very extended period. Very often it is the custom of hire-purchase companies to vary the rates of payment according to the fluctuations of seasonal takings in the tourist trade. The Order will create very real hardship for people seeking to replenish their motor coach fleets.

Doubtless the Parliamentary Secretary will appeal to the country very shortly to try to increase its tourist trade. How on earth does he expect the tourist trade to be increased if the motor coach fleets are to be perpetually kept down, without any hope of replenishment, and with his Department creating hardships of every kind in respect of the re-equipment of the tourist industry? This is just another example of the way in which the Order legislates against those who seek to build up their capital and favours those who already have the cash in the bank or in their pockets.

I do not know whether the Parliamentary Secretary knows that many taxis are bought on terms extending over ten years. The Order will prevent taxis being paid for on any terms which extend over more than 18 months. Taxi drivers already have received one serious blow this week from the Chancellor of the Exchequer. Unless the Order is rescinded tonight, they will receive another serious blow.

My hon. Friend the Member for Islington, East, talked about the need for office equipment being bought under hire-purchase schemes. I will not go into all that, but I say that every one of these discriminations under the Order goes to show that the Government are favouring the "haves" against those who have not, and against those who are seeking to become "haves."

During the last Election, among the many other poses in which they appeared before the electorate, hon. and right hon. Gentlemen on the Treasury Bench posed as the friends of the small man. The Order makes it perfectly clear that they are not in the least interested in the small man. All they are interested in is helping the big man, the man with the cash. If ever there was an example of the Treasury Bench appearing before the nation as the representatives of the capitalists, this Order is it.

Let me come to another argument which has been used in connection with the Order. In announcing it in the discussions in the House on. I think, 29th January, the Chancellor of the Exchequer said that the Order was necessary because the nation needed the restriction on capital expenditure and because hire-purchase was a means of living beyond our income. If this really is a valid argument, why on earth are the Government going ahead with a major scheme of hire-purchase?

I see present the Parliamentary Secretary to the Ministry of Housing and Local Government, who often preens himself about the need to build private homes and create a property-owning democracy. If we need to restrict credit, why on earth are the Government trying to further a major part of hire-purchase in the work of the building societies? It is nonsense if, on the one hand, the Government are saying we want less hire-purchase while, on the other hand, they are urging local authorities to issue more private building licences, nearly all of which will be used by people borrowing from building societies.

Sir W. Darling

Would the hon. Member make clear the difference between capital goods such as houses and consumer goods such as radio sets? Is there any difference in his mind?

Mr. Donnelly

The hon. Member has had a very long experience of the Labour movement and he should know that there is little difference in the capital expenditure on what are now necessities and which go into homes of working class people: refrigerators, lawn mowers, and motorcycles.

Sir W. Darling

I am afraid I have not made myself clear. Does the hon. Member, with his long knowledge of the Labour movement, distinguish between capital goods such as houses and consumer goods such as ice cream makers?

Mr. Donnelly

I am sure the hon. Member will agree that wringers and all these household necessities are just as much a single purchase in one lifetime as a house. I do not suppose the hon. Member would buy several refrigerators. I cannot see why, if we are to restrict one kind of hire-purchase, we should go on encouraging another kind. If the former kind of borrower is living beyond one's income so is the other.

The argument used by the Chancellor of the Exchequer in advocating this kind of restriction is that he also complains that hire-purchase is a means of living beyond one's income. I have a copy of the journal of the Hire Purchase Trade Association. I hasten to say that I am not speaking on behalf of the Hire Purchase Trade Association. I would hesitate to do that, especially when I discover from their notepaper that the hon. Member for the Cities of London and Westminster (Sir H. Webbe) is one of their vice-presidents. I should be speaking with very great diffidence on their behalf when I find they have such an august representative in this House.

I see from their journal, too, that the hon. Member for St. Marylebone (Sir W. Wakefield) was the guest of honour at their last annual dinner. So I should not like to say that I was speaking on behalf of the Association when there are two such distinguished representatives. I am sorry that neither of them appear to be here, but if they come in I hope they may be fortunate enough to catch your eye, Sir, and that, should my hon. Friend and I consider the reply of the Parliamentary Secretary to be unsatisfactory, they will join us in the Lobby in a Division.

Coming back to the argument of the Chancellor that hire-purchase is a means of living beyond one's income, I notice that the Association's journal for autumn, 1951, says: When everyone is prosperous and drawing large real wages they go out and buy those capital goods which they need and for which, owing to their feeling of prosperity, they are confident that they can pay. In such times, capital may be short for the average man, but his confidence is high and he knows he has the necessary margin and the continuing prospects to justify his seeking credit. Hon. Members do not know what that means. They have confidence to justify seeking credit. Now since most people are honest (and there would be no credit at all if most people were not), when the cost of living cuts the value of real wages and so reduces or eliminates what might be termed the H.P. margin in the wage packet, then H.P. sales slump. That is the hire-purchase trade's view on the question of living beyond one's means. When there is a trade boom hire-purchase booms, but, when there is a trade recession hire-purchase declines as well, because the margin in people's wage packets for hire-purchase disappears. I see that the Parliamentary Secretary takes my point. Will he explain, then, when he comes to reply to the debate later tonight, how the Chancellor of the Exchequer justifies his argument about hire-purchase being a means of living beyond one's income.

There is a third point which I should like to put, and that is that hire-purchase in itself is a desirable piece of machinery in a modern society. In my view, it helps savings, it gives working people, when they get their weekly wage packets, certain proportions of which are definitely allocated to some tangible thing which they can see for themselves, an encouragement towards thrift, in saving something that might otherwise go towards some lighter pleasures or be spent in the public house. I am sure that my hon. Friend the Member for Ealing (Mr. J. Hudson) would support me in the view that this kind of thrift is something which is more desirable than spending money on amusements, entertainments or on buying beer in a public house.

I hope the Parliamentary Secretary, in his reply, will be able to justify this Order on the grounds that it is in the national interests. I doubt it. I urge my hon. Friends to join with us in criticising the Govermnent's action, of which we have given some examples, as showing the way in which, after coming into office, they have betrayed the interests of the working classes, safeguarded the interests of one section of the community and played ducks and drakes with the promises which they made at the Election, when they claimed to be standing on the side of the small man, as against the representatives of vested interests.

10.33 p.m.

Mr. A. Blenkinsop (Newcastle-upon-Tyne, East)

I wish to deal with one aspect of the matter which has been raised by my hon. Friends which considerably affects the workers of my constituency, namely, that dealing with the hire-purchase of motorcycles, and the use which workers in all parts of the country, in my constituency amongst others, make of motorcycles bought by hire-purchase in getting to their work when it is some distance from their homes.

I support all that has been said by my two hon. Friends. In this particular question, it seems to me that, if motorcycles are intended to fall into that category which includes bicycles and tricycles, whether or not mechanically propelled, there is unfair discrimination against motorcycles as against motorcars, and there seems to be no reason at all why that discrimination should exist.

There are many people in my constituency who live in Newcastle and who work in the mines, shipyards and engineering factories all over Tyneside. Very many of them purchase motorcycles in order to get to their work in good time, and also, in view of late shifts being worked, to return in reasonable time to their own homes. Under the arrangements provided for in this Order, if one of my constituents wished to buy a motorcycle costing £150 or £200, which I believe is quite common, he would have to make a £50 cash payment, and then make payments of £13 11s. 3d. per month for 12 months.

It may be that in the minds of hon. Members opposite it is possible for workers in the North-East to make payments of that sort from their income. It may seem to them, and perhaps may have seemed to the Chancellor when he prepared his Budget, to be possible for a worker in my constituency to find a large sum of money; but certainly it is true that, so far as the workers of the North-East are concerned—and, I imagine, other parts of the country—none, or hardly any, can possibly manage to make payments at this rate.

We suggest that if motorcycles are to be retained in the provisions of this Order at all—and I would suggest that they should, with cycles, be excluded—then a period of repayment over 18 months or longer should be allowed; so that those with comparatively limited means might purchase motorcycles for vital needs. Surely it is absurd that anybody who can afford to buy a motorcar should be enabled to make his repayments over 18 months, while those with much more limited means—and who cannot, therefore, consider the purchase of a car—should be restricted in this way; and should, in fact, be completely prevented from buying a motorcycle, which they can afford.

In my own area, and doubtlessly elsewhere, I know of cases where, because of inability to buy under these terms, men will not be able to take employment at important factories outside Newcastle which otherwise they could. What is the result? They may well drift into general unemployment, or take employment at much less important work; and on those vital grounds alone it is important that the Parliamentary Secretary should be able to announce that the Order will be withdrawn and that a new Order will be made, excluding at least tricycles and bicycles, whether or not mechanically propelled, so that workers in my constituency and elsewhere can carry on the work which they should undertake.

10.38 p.m.

Mr. Ronald Bell (Bucks, South)

The hon. Member for Newcastle-upon-Tyne, East (Mr. Blenkinsop) differs from his hon. Friends the Members for Islington, East (Mr. E. Fletcher) and Pembroke (Mr. Donnelly) in that he is apparently under a genuine apprehension that he is on a good point. His whole speech seemed to me to be directed to a complaint that those wishing to buy a motorcycle would have a shorter period in which to pay the instalments than those buying a motorcar; but that is not the case. Under this Order, a person buying a motorcycle has 18 months in which to effect the repayments.

Mr. Blenkinsop

That is a question to be cleared up, but as we largely understood it, and as traders in my constituency understand it, the period is 12 months, and not 18.

Mr. Bell

I still give the hon. Member credit for believing he is on a good point, but I do not know how he arrives at this misapprehension. We all know that the Parliamentary Secretary to the Board of Trade would never be guilty of any ambiguity, and it is perfectly clear that motorcycles come under "mechanically propelled road vehicles."

Mr. Blenkinsop

rose—

Mr. Bell

I do ask the hon. Gentleman to contain himself for a moment, or I shall think that he is trying to get up to ride a motorcycle. He keeps jumping about.

The Parliamentary Secretary to the Board of Trade (Mr. Henry Strauss)

If I might intervene for a moment—I do so only for the convenience of the House—I think that on a point of construction the hon. Member for Newcastle-upon-Tyne, East (Mr. Blenkinsop) is quite correct. I will point out the reasons in a moment, but the hon. Gentleman opposite is right in thinking that motorcycles are under the Order classed with other bicycles.

Hon. Members

Withdraw.

Mr. Bell

I shall await the explanation which my hon. and learned Friend may give, but as at present advised I do not withdraw from the position I was explaining just now, because it appears to me that the last category bicycles, tricycles, whether or not mechanically propelled, is governed by the words and auxiliary engines therefor… It is the kind of bicycle with an engine attached that is struck at in the last paragraph of this Order. If my hon. and learned Friend takes a different view I will concede to the hon. Gentleman the Member for Newcastle, East, that there must be some ambiguity in the language, and I say that without any prejudice to the contention I have just put forward.

I now come to the undoubtedly surer ground of the hon. Member for Islington, East, and hon. Member for Pembroke, who tried to whip up a great dust of partisanship and class warfare about the comparatively factual provisions of this Order. I cannot ever remember listening to a more exaggerated and prolonged argument on so narrow a foundation. Their suggestion was that this was class discrimination, attacking only the poorer people. But so far as bicycles are concerned, my hon. Friend the Parliamentary Secretary to the Ministry of Housing and Local Government—who was here a moment ago—is one who travels to and from work on a bicycle.

Mr. Norman Dodds (Dartford)

Will the hon. Member ask his hon. Friend to join the Pedal Club? They want Members of Parliament to join the club.

Mr. Bell

No doubt my hon. Friend will deal with that if he is asked, but I will soft-pedal it. I do not know whether he put down 25 per cent. or how many instalments he has to pay, but I am sure he would not feel that this was an example of class discrimination. That is equally true of the other items included in this Order.

I ask hon. Gentlemen opposite, in so far as they may feel there is some point in the argument they are putting forward, to remember that this is one of at least three provisions which the Government are presenting in pursuance of their policy of restricting credit. I think we are all agreed that some kind of restriction of credit must take place now. We all realise there has been too much money chasing too few goods. [HON. MEMBERS: "Nonsense."] I am glad to hear hon. Gentlemen opposite deserting their right hon. Friend the Member for Bishop Auckland (Mr. Dalton)—whom I was quoting when I used that phrase. [HON. MEMBERS: "When did he say it?"] He said that, I think, a couple of years ago, and it is true now.

It will be remembered that, first of all, we have had an increase in the Bank rate. Secondly, there has been a great stiffening of the conditions under which bank credit is granted. There has been a very strong request to the banks not to allow overdrafts except in cases where a productive enterprise is stimulated. There has been a very strong directive to the banks. Thirdly, we have this measure against hire-purchase.

It is obvious that the increase in the Bank rate and the restrictions on bank overdrafts primarily affect the better-off people. I do not say that they affect them exclusively, for the increase in the Bank rate to some extent affects all classes of the community, but it affects the wealthier classes most, and the restrictions on overdrafts certainly affects the better-off people almost exclusively.

Mr. A. C. Manuel (Central Ayrshire)

On a point of order. Is there anything about the Bank rate in this Order?

Mr. Speaker

No, I do not think there is. I think the hon. Member's argument is a little circuitous, but I could see some relevance in it.

Mr. Bell

My argument was that the criticism against this Order—that it is class discrimination, which is the sole argument advanced by the mover and seconder of the Motion—is misconceived, because the Order is the third of three measures which together make up a coherent policy. The drawing on credit by all parts of the nation has been affected by the Government in recent months to an equal extent.

When we see this Order against that background, it becomes clear that the criticisms offered by the hon. Member for Pembroke and the hon. Member for Islington, East, are misconceived and misdirected. They would not be fair even if this Order stood in isolation, because the articles in it cover a wide range and affect all kinds of people. But when it is seen against the background of the other actions in relation to credit which the Government have taken, the case put forward falls completely to the ground and appears for what it is—merely an attempt to stir up class prejudice and hostility against this Government and this Budget. That creates an atmosphere which, I would remind hon. Members opposite, will be damaging to tfie national interest and, in consequence, as much contrary to their advantage and to the advantage of the country as it is contrary to the advantage of the party which they are attacking.

10.48 p.m.

Sir William Darling (Edinburgh, South)

I hasten to join my hon. Friend the Member for Henley (Mr. Hay) in supporting the Government—

Mr. Manuel

The first mistake! He is not here.

Sir W. Darling

I apologise to my hon. Friend the Member for Buckinghamshire, South (Mr. R. Bell). I think my hon. Friend is right in saying that this Order is part of the general policy of the Government. They have restricted overdrafts and bank lending, very properly, and it would be class legislation indeed if they dealt with only those classes. They have restricted the capital investment programme, and this Order completes the circle of restrictions.

A member of the late Government the right hon. Member for Blyth (Mr. Robens), said last week that we should shortly have one million unemployed. Who am I to despise such a high authority? If that is right, are not the Government right in preventing foolish people, less well-informed than the right hon. Member for Blyth, from embarking upon the purchase of radio sets and television sets?

Mr. Donnelly

How on earth does the hon. Member think that a million unemployed could buy goods on hire-purchase?

Sir W. Darling

I thank the hon. Member, who was so courteous to me, for helping me in my argument. If, as is believed by some right hon. Gentlemen opposite, we are to have national calamity and unemployment, would the Government be right in not protecting simple, innocent people, not so well-informed as the hon. Member for Pembroke (Mr. Donnelly) or even the right hon. Member for Blyth, from purchasing some of these things?

If they do not know of this situation they may be tempted—and I am glad to think hon. and right hon. Gentlemen opposite are with me in this matter—they may be tempted, if they do not know these deep economic facts, to buy drying cabinets, dish washers, wringers and mangles or water softeners. They may now know we are facing an economic blizzard and it is the duty of the Government to warn them of that contingency. This is really a piece of guidance that, I think, will serve a very useful purpose.

The hon. Member for Islington, East (Mr. E. Fletcher) warned the House that this Order would seriously hinder the development of small businesses—a cause, I know, he carries not only in his hand but in his heart. But, really, does he, with his considerable business experience, seriously believe that a man cannot set up a small business in these difficult days without buying on the instalment system a cheque-writing machine? Does he seriously believe that a man cannot conduct his new small business successfully without buying on the instalment system a cash register and the parts thereof? Believe me, successful businesses have been started with less apparatus than that indicated in this Order.

Does the hon. Gentleman really suggest that he would advise a client of his who is short of capital, when we are approaching a crisis, in which we are to be faced with a million unemployed, and great restrictions of raw material and capital investment—would he advise his client, setting up a new business in these circumstances—to buy on the instalment system a coin sorting, counting and wrapping machine? Or would he say to his client, "You can dispense with a coin sorting, counting and wrapping machine, for others have done so successfully, though regretfully, but you ought not to dispense with an addressing, stamp affixing, postage franking, letter opening and letter sealing machine."

Suckers and fools are born every day and the purpose of this Order is to protect such persons in these difficult times, when considerable restrictions of capital investment are imposed, from being foolish. The Socialist Party should be the last to complain. They have been engaged in binding enterprise and enterprising people—and with good intentions, doubtless, have intervened in my life—and they must not blame me if I think it not undesirable that some should be protected from their own folly. This Order is simply intended for that purpose.

In ordinary times I should find myself opposing this Order. In ordinary times I believe in setting the people free. But in the last six years the people of this country have been in some ways enslaved, and face now a crisis from which the late Government ran away. That is the position with which we are faced, and in these circumstances I see no harm in deterring people for a while from buying on the instalment plan a number of commercial and domestic advantages. I find myself in this position regretfully, but it has been brought about by the incompetence, the simplicity and the ignorance of the former Government.

I hope that at no distant date I shall again be able to join with hon. and right hon. Gentlemen opposite in seeking to allow the people full recourse to that system of purchase which in the old days the Socialist Party used to call the "Never-never system." I have heard many and many a time Socialists complain that men's wages packets contained not enough to enable them to buy, for cash, new clothes, so that they were forced to buy on the "Never-never system." That was what the high-purchase system used to be called. Many of us in the hire-purchase system will be pleased at the advocates of it which we have found tonight amongst the party opposite.

Really, they have nothing to complain of, and I suspect that the hon. Gentleman the Member for Pembroke and the hon. Gentleman the Member for Islington, East, are only thinking that here they have in this Order something with which they can attack the Government, something on which they may hang their individual theories about class war. They will be mistaken in that. This is a prudent Order. It is in accordance with the Government's policy of restraining capital investment and it is guiding persons who might be misguided by not very reliable advisers like the hon. Member for Pembroke. It tells them to keep their money in their purses and not to buy wringers, dictating machines and motorcycles.

10.56 p.m.

The Parliamentary Secretary to the Board of Trade (Mr. Henry Strauss)

I shall try to deal with the various points raised by hon. Members who are praying against these Orders. I think the hon. Member for Islington, East (Mr. E. Fletcher) was right in saying that they should be taken together. The second Order is purely consequential. I shall devote my speech, as he and other hon. Members did, to the general subject. It may be useful, having regard to the exaggerated things which have been said, to remind the House of the object of these Orders. It is to check demands upon the productive capacity required for defence and for export. I should have thought that that was a policy with which, with few exceptions, the whole House would have been in sympathy.

It is true that no one is hit by this Order unless he wishes to enter into a hire-purchase or credit sale agreement, to the extent, of course, that the particular category of goods falls within the terms of the Order. Obviously, if a man can pay cash, he is not affected by an Order limiting hire-purchase. If it is desirable to carry out the purpose which I described at the beginning of my speech, it may be necessary, as part of the general scheme, to deal with hire-purchase agreements and credit sale agreements—

Mr. Hector Hughes (Aberdeen, North)

Before the hon. and learned Gentleman leaves that point—

Mr. Strauss

I think that perhaps, I had better develop my speech—[Interruption.]

Mr. Speaker

It is out of order for the hon. and learned Gentleman to remain on his feet unless the Parliamentary Secretary gives way.

Mr. Strauss

The hon. and learned Member for Aberdeen, North (Mr. Hector Hughes) says, "Before the hon. and learned Gentleman leaves that point," but I have not the slightest intention of leaving it. I merely want to develop my argument, if that is agreeable to the House as a whole, and even to hon. Members opposite. Several hon. Members have made speeches to which they wish me to reply. The hon. and learned Member can make a speech later if he wishes, but I beg him to allow me to develop my argument.

I say, first of all, that these Orders have a perfectly good and legitimate object, which is to check demand on the productive capacity required for defence and export. If hon. Members will look at the goods to which the Orders apply they will find they are of direct interest generally to the metal using and engineering industries. These are precisely the industries on which we wish that demands for civilian purposes should be no greater than they need be, in the interests of defence and export.

The next thing of which I would remind hon. Members is that hire-purchase and credit sale agreements are not made illegal. They are not stopped. One would think, from many of the speeches which have been made, that the whole institution of hire-purchase had been abolished. Not at all. There are a great many articles which do not fall within the terms of these Orders. In the case of those which do, they certainly tighten the terms of the agreements, which at present is extremely important, but they do not alter hire-purchase as radically as one would think after listening to some of the speeches that have been made.

I should like to come at once to a charge which appeared in many of the speeches, and was first made by the hon. Member for Islington, East, in regard to motorcycles. Let me deal separately with two points. First, there is the charge of ambiguity in the provisions relating to motorcycles; and, secondly, when I have stated what is the accurate interpretation of this Order, it can be decided whether the category is rightly chosen or whether, in the opinion of this House, the Order ought to be amended.

Let me deal first with this charge of ambiguity, which I should have thought was unarguable were it not for the intervention of my hon. Friend the Member for Buckingham, South (Mr. R. Bell). Let me explain why I cannot think it is ambiguous. The first category is set out on page 3: Mechanically propelled road vehicles and chassis (excluding ambulances, invalid carriages, bicycles, tricycles,…) Nothing comes in that at all which is not a mechanically propelled vehicle, and if it excludes bicycles it must mean mechanically propelled bicycles. [HON. MEMBERS: "Why?"] Hon. Members must realise that if "mechanically propelled vehicles" is the description, then if bicycles are excluded it must mean mechanically propelled ones, otherwise there is no point in the exclusion.

If hon. Members will look at the next page they will see the last category: Bicycles and tricycles, whether or not mechanically propelled.… There is no doubt in our view that a motorcycle comes into the latter category and cannot come into the former. So much for the charge of ambiguity.

Let me turn now to the other charge which many hon. Members have made. Would it not be fairer, they ask, instead of grouping motorcycles with other cycles to group them with other mechanically propelled vehicles? There is a very arguable case for that, and, as my right hon. Friend has said in answer to questions, he is considering an amendment of the Order which would achieve that change, a very early announcement will be made on that subject. There is no ambiguity but I think there is an arguable case here. Hon. Members should not exaggerate the effect of the change. What they are asking for is that there should be a longer period for paying off the balance. But that would also mean, of course, a higher initial deposit, if motorcycles are to be grouped with motor vehicles, which is one of the changes for which hon. Members opposite are pleading.

So much has been said of hardship that I should like to give an example of what the Order means in figures. If the present cost of a pedal cycle varies from £16 to £20, the deposit of 25 per cent. would be £4 to £5 and the balance of £12 to £15 would have to be paid over a period of 12 months. It would mean payments of about 4s. 6d. to 6s. a week. Now the normal practice would be to require a deposit of £2 10s. and the remainder of the payment over 12 months. The additional burden, putting it at its highest, is, therefore, the addition on the initial deposit of say 30s. to 50s.

I am not, in any part of my speech, going to say that no hardship at all is caused by this Order. What I am going to say is that I hope no unnecessary hardship is caused by it. Many of the steps that Her Majesty's Government have to take in the present emergency are not pleasant. The question is whether they are right and necessary steps.

The hon. Member for Pembroke (Mr. Donnelly) who, for some reason which escapes me for the moment, posed as a member of the working class, challenged me to say that this Order applies only to luxuries. I shall say nothing of the sort. Of course it does not.

I have given the object of the Order but I should like to call attention to another matter, that is the contribution that some of these industries are making to our export trade. Take pedal cycles, about which a good deal has been said. Exports of pedal cycles amounted in 1951 to £21 million, which is not a negligible contribution by one industry to our balance of payments. The case for this Order is that it makes a definite contribution to a most urgent national need.

The hon. Member for Newcastle-upon-Tyne, East (Mr. Blenkinsop) asked, among other things, for the exclusion altogether of pedal cycles and motorcycles from the Order. I cannot hold out hope of their exclusion, but I can hold out some hope, for the reasons I have stated, of the alteration of the classification of motorcycles. I agree cordially with the words of common sense which came, as they so often do, from my hon. Friend the Member for Edinburgh, South (Sir W. Darling). [An HON. MEMBER: "He has gone."] He made a useful contribution before he went.

I do not know that there was any other point raised. I think the hon. Member for Islington, East started his speech by saying he did not question the necessity for some such Order, but he complained of its ambiguity and alteration of terms which it imposed. The terms which this Order makes compulsory in the cases to which it applies are not a very great modification of the best practice in the past of the companies who do this class of trade, but only a modification to the extent which, in the view of the Government, is rendered necessary by the emergency in which we find ourselves.

It is perfectly true that there has not been an Order of this kind for some time. It would not be at all astonishing if in the working of this Order certain defects were found. I know from my correspondence with hon. Members in all quarters of the House that there are one or two points of difficulty—the motorcycle is one. There is another—I do not know whether it has been mentioned—and that is the case of taxis, which does deserve careful consideration to see if there might be some way of meeting certain exceptional difficulties without endangering any essential purposes of this Order. That is now under consideration.

I say that this Order is a reasonable Order, with which the vast majority of hon. Members on both sides sympathise. There is no sign of its being a "class" Order because it only hits those who wish to enter into credit sale or hire-purchase agreements. Of course it does, just as other steps that the Government are taking with a similar object—and into which it would not be in order for me to enter now—hit chiefly another class.

But those who are hit by this Order are not hit in some way that dramatically affects them in the supply of necessities. To hear some of the speeches one would think that ordinary furniture was subject to this Order: of course it is not. It has been carefully omitted. Cookers, perambulators and many other articles which are ordinarily supplied under hire-purchase agreements have been deliberately excluded from this Order in order that it shall not have the effect of injuring people setting up homes and so on, as hon. Members fear.

But for the purpose of reducing the strain on our engineering and metal using industries there is an unanswerable case for tackling this problem. I suggest to the House seriously that these Orders tackle this problem in a reasonable way and that they are carefully calculated and designed not to cause any unnecessary suffering. I have mentioned the points on which amendment is being considered, and with that explanation I hope that hon. Members will agree that these Orders are proper Orders and should be sustained.

11.14 p.m.

Mr. E. Fletcher

I regret that I cannot regard the Minister's reply as satisfactory. In these circumstances I think the most convenient course for me is to invite my hon. Friends to test the opinion of the House and have a Division.

Sir Herbert Williams (Croydon, East)

Before we have a Division, I should like to say that I think these Orders are

stupid. The only thing I ever bought on hire-purchase was a refrigerator with a storing capacity not exceeding 12 cu. ft. I bought it on hire-purchase from Worthing Corporation because I knew they would look after it. That was the only reason.

I think both these Orders are quite silly. We have inherited a lot of nonsense from the other side of the House, and I do not think the Government which I support are as yet quite aware of all the nonsense of hon. Gentlemen opposite, who instructed the civil servants unwisely. 'I do not think it matters one way or another what happens to these Orders, and I see no reason for getting excited over them.

Question put,

The House divided: Ayes, 87 Noes, 116.

Division No. 38.] AYES 11 18 p m
Albu, A. H. Hale, Leslie (Oldham, W.) Parker, J.
Bence, C. R. Hargreaves, A. Peart, T. F.
Benson, G. Herbison, Miss M. Price, Joseph T. (Westhoughton)
Beswick, F. Hobson, C. R. Robens, Rt. Hon. A.
Bing, G. H. C. Holman, P. Robinson, Kenneth (St. Pancras, N.)
Blackburn, F. Houghton, Douglas Rogers, George (Kensington, N.)
Boardman, H. Hubbard, T. F. Ross, William
Bottomley, Rt. Hon. A. G. Hudson, James (Ealing, N.) Royle, C.
Bowden, H. W. Hughes, Hector (Aberdeen, N.) Silverman, Julius (Erdington)
Bowles, F. G. Hynd, J. B. (Attercliffe) Simmons, C. J. (Brierley Hill)
Brown, Rt. Hon. George (Belper) Jeger, George (Goole) Snow, J. W.
Burton, Miss F. E. Jenkins, R. H. (Stechford) Sorensen, R. W.
Callaghan, L. J. Jones, David (Hartlepool) Soskice, Rt. Hon. Sir Frank
Castle, Mrs. B. A. King, Dr. H. M. Stewart, Michael (Fulham, E.)
Champion, A. J. Lee, Frederick (Newton) Thomas, David (Aberdare)
Davies, A. Edward (Stoke, N.) Lee, Miss Jennie (Cannock) Ungoed-Thomas, Sir Lynn
Davies, Ernest (Enfield, E.) Lewis, Arthur Wallace, H. W.
Davies, Harold (Leek) Lindgren, G. S. Weitzman, D.
Dodds, N. N. MacColl, J. E. Wells, Percy (Faversham)
Ede, Rt. Hon. J. C. McLeavy, F. Wigg, George
Edwards, John (Brighouse) Mellish, R. J. Wilkins, W. A.
Evans, Albert (Islington, S.W.) Mikardo, Ian Willey, Frederick (Sunderland, N.)
Fienburgh, W. Mitchison, G. R. Willey, Octavius (Cleveland)
Finch, H. J. Morris, Percy (Swansea, W.) Williams, W. R. (Droylsden)
Fletcher, Eric (Islington, E.) Moyle, A. Wilson, Rt. Hon. Harold (Huyton)
Foot, M. M. Mulley, F. W. Woodburn, Rt. Hon A
Fraser, Thomas (Hamilton) Orbach, M. Wyatt, W. L.
Greenwood, Anthony (Rossendale) Oswald, T.
Greenwood, Rt. Hon. Arthur (Wakefield) Pannell, Charles TELLERS FOR THE AYES:
Griffiths, William (Exchange) Pargiter, G. A. Mr. Blenkinsop and Mr. Donnelly.
NOES
Alport, C. J. M. Buchan-Hopburn, Rt. Hon. P. G. T. Duthie, W. S.
Amery, Julian (Preston, N.) Bullard, D. G. Fell, A.
Amory, Heathcoat (Tiverton) Bullock, Capt. M. Finlay, Graeme
Ashton, H. (Chelmsford) Burden, F. F. A. Fisher, Nigel
Assheton, Rt. Hon. R. (Blackburn, W.) Butcher, H. W. Fletcher-Cooke, C.
Astor, Hon. W. W. (Bucks, Wycombe) Carr, Robert (Mitcham) Fort, R.
Baldwin, A. E. Cary, Sir Robert Garner-Evans, E. H.
Barber, A. P. L. Clarke, Col. Ralph (East Grinstead) Grimston, Hon. John (St. Albans)
Bell, Ronald (Bucks, S.) Cole, Norman Grimston, Sir Robert (Westbury)
Birch, Nigel Conant, Maj. R. J. E. Hay, John
Black, C. W. Craddock, Beresford (Spelthorne) Heald, Sir Lionel
Boyd-Carpenter, J. A. Crookshank, Capt. Rt. Hon. H. F. C. Heath, Edward
Boyle, Sir Edward Crosthwaite-Eyre, Col. O. E. Hicks-Beach, Maj. W. W.
Braine, B. R. Darling, Sir William (Edinburgh, S.) Higgs, J. M. C.
Braithwaite, Lt.-Cdr. G. (Bristol, N.W.) Davidson, Viscountess Hill, Mrs. E. (Wythenshawe)
Brooke, Henry (Hampstead) Deedes, W. F. Hinchingbrooke, Viscount
Brooman-White, R. C. Doughty, C. J. A. Hirst, Geoffrey
Holland-Martin, C. J. Nicolson, Nigel (Bournemouth, E.) Spens, Sir Patrick (Kensington, S.)
Hops, Lord John Noble, Cmdr A. H. P. Stanley, Capt Hon. Richard
Hopkinson, Henry Orr-Ewing, Charles Ian (Hendon. N.) Steward, W. A (Woolwich, W.)
Horobin, I. M. Partridge, E. Storey S.
Hudson, Sir Austin (Lewisham, N.) Peake, Rt. Hon. O. Strauss, Henry (Norwich, S.)
Hylton-Foster, H. B. H. Pickthorn, K. W. M. Sutcliffe, H.
Johnson, Eric (Blackley) Pilkington, Capt. R. A. Thomas, Rt. Bon. J. P. L.(Hereford)
Kerr, H. W. (Cambridge) Pitman, I. J. Thompson, Lt.-Cdr R. (Croydon, W.)
Leather, E. H. C. Powell, J. Enoch Thornton-Kemsley, Col. C. N.
Legge-Bourke, Maj. E. A. H Redmayne, M. Tilney, John
Legh, P. R. (Petersfield) Remnant, Hon. P. Turton, R. H.
Lindsay, Martin Renton, D. L. M. Vaughan-Morgan, J. K.
Linstead, H. N. Roberts, Maj. Peter (Heeley) Ward, Hon. George (Worcester)
Longden, Gilbert (Herts, S. W.) Robinson, Roland (Blackpool, S.) Ward, Miss I. (Tynemouth)
Lucas, P. B. (Brentford) Roper, Sir Harold Waterhouse, Capt. Rt. Hon. C.
Mackeson, Brig, H. R. Ropner, Col. Sir Leonard Watkinson, H. A.
MacLeod, Iain (Enfield, W.) Russell, R. S. Williams, Gerald (Tonbridge)
Macmillan, Rt. Hon. Harold (Bromley) Shepherd, William Williams, Sir Herbert (Croydon, E.)
Maude, Angus Simon, J. E. S. (Middlesbrough, W.) Wills, G.
Maydon, Lt.-Cmdr. S. L. C. Smithers, Peter (Winchester)
Molson, A. H. E. Smithers, Sir Waldron (Orpington) TELLERS FOR THE NOES:
Morrison, John (Salisbury) Smyth, Brig. J. G. (Norwood) Mr. Studholme and Mr. Vosper
Nicholson, Godfrey (Farnham) Spearman, A. C. M.