HC Deb 13 May 1952 vol 500 cc1123-396

4.0 p.m.

The Chairman

In the Fourth Schedule the next groups which may be considered are the men's group— A 19, 20 and 21 and the women's group B 22 and 23—and the Amendments on the Order Paper which relate to that part of the Schedule are all the Amendments except that in page 75, line 42.

Mr. Douglas Jay (Battersea, North)

On a point of order. I think the Amendments about boots and shoes end three Amendments before that.

The Chairman

I beg the right hon. Gentleman's pardon; I could not read my own writing. It should be from the beginning to the Amendment in page 75, line 37, in the name of the right hon. Member for Leeds, South (Mr. Gaitskell), and then the first Amendment in page 77, line 36, column 1, in the name of the right hon. and gallant Member for Leicester, South-East (Captain Waterhouse), and then it goes down to the Amendment in page 77, line 48.

Captain Charles Waterhouse (Leicester, South-East)

I beg to move, in page 75, line 19, column 1, after "bootees," to insert: other than industrial safety boots used for protective purposes. I have not intervened in the debates of the Committee thus far and I should like, therefore, in opening my remarks on the Schedule dealing with boots and shoes, to join in the thanks which have already been expressed to my right hon. Friend for what he has done. There is not the smallest doubt that the decision he has made will be both a real and a general benefit to the textile trade. It will also be a benefit to the boot and shoe trade which we are now discussing.

There are, however, certain peculiarities in the boot and shoe trade on which I want to dwell for a few minutes in the hope that I may persuade my right hon. Friend to give the trade even further consideration. The first is a very general one. The textile trade as a whole welcomed the D scheme and thought it was a definite improvement on the old Purchase Tax provisions. The boot and shoe trade, on the other hand, as a whole found themselves very much worse off under the new provisions than under the old, for two or three reasons.

The first reason is that they will have to pay a very great deal more in tax, even now, than they had to pay in the old days. It is estimated that under the old system a payment of something like £280,000 a year was made in connection with British-manufactured boots and shoes. Before this present tax was modified by the Financial Resolution which we have just discussed, the tax to be collected would have been something of the nature of £3 million. The tax has been reduced to the extent of 25 per cent., so that the figure will now be something over £2 million which the boot and shoe trade may expect to have to pay, by comparison with something not very much over £250,000 which they had to pay. They are still a very great deal worse off than they would have been.

In the early stages of the debate, the Chancellor of the Exchequer made it clear that there was no hope of a general removal of the tax in the present financial position.

Mr. R. T. Paget (Northampton)

I received an answer to a Question the other day when I inquired how much had been levied by the old Purchase Tax, and I was told that it was £3,300,000 by comparison with £3,500,000 under the D scheme. The right hon. and gallant Gentleman now tells me it was something like £250,000 as against £3 million. Could he clear that up?

Captain Waterhouse

I do not know whether I can clear it up, but the reason is probably that the figures given previously included the tax on rubber boots, and I think they also included the tax on imported boots and shoes as well as on the home-manufactured commodity. No doubt the Chancellor of the Exchequer will tell me whether I am right or wrong.

Mr. Paget

The Question which I put to the Chancellor—and perhaps he can clear this matter up, because it is important that we should know at this stage—concerned Purchase Tax on British-made leather footwear. I was told that the Purchase Tax on British-made leather footwear produced £3,300,000. I was rather surprised by the answer, but that was the answer I was given. Is it right?

Captain Waterhouse

I think I can now clear this matter up because I put a similar Question to my hon. Friend the Financial Secretary and he gave this answer: Separate figures for home-manufactured footwear are not available, but it is estimated that receipts of Purchase Tax from both home-manufactured and imported supplies of footwear of all kinds (including rubber footwear) in the calendar year 1950 were £3.8 million, and in the calendar year 1951, £3.3 million."—[OFFICIAL REPORT, 10th April, 1952; Vol. 498, c. 270.] That bears out my suggestion that the figure quoted by the hon. and learned Member for Northampton (Mr. Paget) include both imported and rubber footwear, both of which we are excluding from the present discussion.

Perhaps I may carry my argument a stage further. My Amendment was put down after the Chancellor had told us quite clearly that it was impossible for him to remove the whole of the tax, for financial reasons. Of course, he is in no way to blame for those financial reasons; he inherited the financial position of the country from right hon. Gentlemen opposite. In view of what he said, I took a figure half-way between what we wanted and the lowest weight of tax, a figure of 16⅔ per cent., and I thought and hoped that the Chancellor of the Exchequer would agree with me that that was a fair split—and I still hope that he may agree with me in this case. But my right hon. Friend has split my split, has halved it with me again and has given a figure of 25 per cent. We are grateful for that, but I urge upon my right hon. Friend that the boot and shoe industry deserves special treatment.

One of the reasons for that, which I have already given, is the vastly increased incidence of the present tax. Another, and I think even more important reason, is the geographical set-up of the trade. It is unusually concentrated by districts. We have, for example, the Norwich district, the Northampton Town district, Street, a district of Somerset, Edinburgh, and Kendal which produce the higher-quality boots and shoes. They have been to a large extent taxpayers; the boots and shoes they produce bear tax. My own constituency and other parts of the city of Leicester, and the County of Northampton, are partly producers of the better-class and largely producers of the not-quite-so-expensive boots and shoes, which to a large extent are untaxed. They are, therefore, in the middle category. At the extreme end we get Rossendale and certain parts of London, which produce goods which are altogether untaxed.

What will be the effect of this tax? I ask my right hon. Friend—and, as everybody in the Committee knows, he has a real concern for industry—to bear this in mind. The effect will surely be that the trade producing taxed goods within the lower level of the tax will try to get down their price and quality so as to come outside the tax range. Surely there will be a tendency among men and women going into the shops to ask of those who attend them, "Is there a tax on these boots and shoes or are they tax-free?" If the answer is that they are taxed, the customer will then say, "Please show me something which is not taxed."

It is almost certain, therefore, that the four or five districts which I have mentioned will very soon find their order books for the better-quality goods empty, and the Leicester and Northampton county and Rossendale districts will find fresh competition arising from districts which previously had a quite different trade. That, surely, is not to the long-range advantage of the Chancellor or the country, much less of the trade itself. I urge the Chancellor, between now and the Report stage, or even this afternoon if possible, to indicate that he will take special additional steps to see whether he can do something to avoid the heavy drawbacks of which I have spoken.

I have spoken so far on the general case. It is now my duty to draw attention to three anomalies. These anomalies have been put to us by the Federated Associations of Boot and Shoe Manufacturers of Great Britain and Ireland. These Amendments are, therefore, considered Amendments. In discussing the matter with these gentlemen, as I dare say hon. Members on all sides of the Committee have done, my hon. Friends and I said, "Please reduce your cases to the very minimum; do not put down one that you do not need; tell us the least that you think necessary to meet the most glaring of your difficulties."

They gave us these three anomalies. The first is that of safety boots and shoes. Safety boots were exempt in the original Bill and they are, therefore, still exempt. Safety shoes are apparently not exempt. They used to be exempt under a category of the Utility scheme, but under the present provisions they will be subject to tax. I ask the Chancellor to be kind enough, between now and the Report stage, to look into the specific point about safety shoes. If he agrees with me that they were free and are now taxed, perhaps he will introduce a provision to relieve them, for I am sure that he will agree that these industrial safety devices should not be the object of any tax.

The second point deals with what are called warm boots and shoes, either fur-lined or lined with wool. I have put down a series of Amendments to bring those up from their present D level of 37s. into the first category of £3. My reasons are that one wears shoes to keep one's feet dry, and one also wears shoes to keep one's feet warm. I do not think that it can be said to be a luxury to want to keep one's feet warm either when working in the house or when one is a housekeeper going out to do the morning shopping.

There is no class issue involved. There is no question of the fur-lined boots being worn only by the better-off. They are worn by women and by men in every walk of life when going about their necessary avocations. I believe that the Chancellor will agree that it is a great pity—it may be an oversight and I hope that he will be able to tell us that it is—that they have been left in the category which attracts a considerable measure of tax.

The last of the three small points to which my attention has been drawn affects men's slippers. The trade pointed out to me that there is an artificial distinction with men's slippers which does not exist with women's slippers. There is a special D level of 15s. for slippers as compared with £2 for sandals. That does not seem to be commonsense. Surely a slipper has as much work in it and as much value in it and is of more practical use than a sandal. Sandals may be used constantly by a few people, but they are used only occasionally by many people at the seaside and elsewhere. On the other hand, slippers are used by the majority of people when they go home in the evenings to rest after their work. I hope, therefore, that the Chancellor will consider some change on the question of men's slippers, which have a category to themselves, while women's slippers are included with ordinary shoes.

Those are the three points I wish to make. I repeat most urgently my request to the Chancellor that, between now and the final stages of the Bill, he should re-examine the whole position of this trade. Possibly he could consult again with those in the industry. I ask that, if he can, he should give some relief to avoid the dislocation which this Measure will cause.

4.15 p.m.

Mr. G. R. Mitchison (Kettering)

On a preliminary point of order. Shall I be in order, Sir Charles, as I hope I shall, in discussing not only the one Amendment that you have called, but the other Amendments which appear in the group?

The Chairman

That is the case. After we have had a discussion ranging over all the Amendments in this group, there will be certain Divisions on Amendments selected.

Mr. Mitchison

In that case, I shall only make the shortest comment on the small points, as he rightly described them, which the right hon. and gallant Gentleman the Member for Leicester, South-East (Captain Waterhouse) raised. The Amendments about safety boots and shoes look very nice. No one will object to them and they are unlikely to have any effect at all, for almost all the safety boots and shoes—in fact, I believe all of them—come below the proposed D level at present and would therefore not be affected. That is my information.

Next, on the question of woollen linings, I am informed that the view taken by the Board of Trade is that boots or shoes lined, as they usually are, not only with the wool itself but with the skin of the animal that bore the wool, are leather-lined and therefore already exempt. I may be wrong, but we shall hear later. In any case, there would be no objection to the principle. I hope that the right hon. and gallant Gentleman will persevere with all these Amendments and that he will have the support in the Lobby of Members on this side of the Committee who are most anxious to see relief given to this industry, not only on these small points but also on the far larger issue raised by our own Amendments.

The right hon. and gallant Gentleman was perfectly correct in saying that the boot and shoe industry as a whole—and I may add the operatives as well as the employers—have read these proposals and the Finance Bill with some apprehension and complete dislike. In that respect they differ entirely from the textile trade. I hope that when the Chancellor said earlier today that he did not intend to make any more major concessions, he did not mean to shut his ears entirely. In the legal profession we have a certain preference for hearing what someone has to say before condemning him or turning down his case. In this instance the boot and shoe trade have not had too good a hearing.

I think that it is fair comment on the Douglas Report to say that it was primarily a textile report. Though it does deal with boots and shoes as well as with furniture, by far the greater part of it is occupied with the textile trade. The experts on the committee were textile experts, and though memoranda were submitted by two organisations in the boot and shoe trade, I understand that there was no verbal evidence given and that therefore the Douglas Committee proceeded, in the light of those memoranda and of their generally inexpert knowledge, to lay down a number of propositions about the boot and shoe trade of which the trade itself has not approved.

It was not until after the Budget speech—there again, I believe I am right—that the boot and shoe trade was heard by the Chancellor of the Exchequer, or by the Financial Secretary on his behalf. I may be wrong on that. I hope I am, but that I understand to be the case. True it is that they have been heard since then, but it was rather late in the day to reconstruct a scheme which was regarded by the trade as inapplicable to them.

The Chancellor spoke last night with some feeling, which I am sure we appreciated and understood, about the responsibilities on his shoulders. In a somewhat lighter vein he spoke of his ignorance of corduroy trousers and corduroy shorts. I suppose that most Chancellors of the Exchequer, having to deal with Purchase Tax, are in that position. I should like to put a point quite generally to him. Surely when, after not very much consultation, a scheme is introduced to make a very considerable difference to a whole trade, the Chancellor ought not to shut his mind to the representations of the trade, when they are absolutely unanimous and when the matter differs considerably from the main matter upon which he formed his policy and his scheme.

Now I turn to the concession which the Chancellor has made by taking a quarter of the Purchase Tax rate off boots and shoes, as he has done in the case of other goods, too. I suppose that it was not too difficult for the wit of man to guess that something of the sort might be done in the case of boots and shoes. It was probably rather more than coincidence, or the common philosophy of distinguished Tories, that an Amendment appeared on the Paper in the name of the right hon. and gallant Member for Leicester, South-East, and other hon. Members suggesting that the Purchase Tax rate should be halved. As the right hon. and gallant Gentleman has just pointed out, it has in fact been Quartered—[Interruption.]—well, three-quartered.

My hon. and right hon. Friends and I object both to that Amendment and to the concession on principle. Naturally enough, at this time of the year one welcomes any concession from the Chancellor of the Exchequer on behalf of the taxpayer and of the industry concerned, and in that sense we would sooner pay half of a bad tax than the whole of it. We feel, and feel very strongly, that both the Amendment and the concession were on the wrong lines. Though this point has been made to some extent with regard to textiles, it has particular force in the boot and shoe trade.

For the purposes of what I am going to say, I shall treat the boot and shoe trade as falling roughly into three sections. There is no absolute line, and everybody can differ as to the exact point at which to draw the line between the sections. First of all, let me mention the case of the boots and shoes which were Utility before and therefore did not carry Purchase Tax, which will now fall below the D value, and, therefore, again will not carry Purchase Tax. Broadly speaking, the information we get from the distributors, from an excellent source, is that the retail price at which tax will begin to operate is, as regards men's leather shoes, 53s. 5d., and as regards Women's, 49s. 5d. For convenience, I call "low grade shoes" those which fall below that level, below which prices are not affected by the change.

I should like to call the Chancellor's attention to two points. I am coming now to medium-grade shoes. When we were discussing the National Health Service the other day, the Minister of Health fixed £3 as the proper charge for surgical boots, considerably less, of course, than their actual cost. I understood him to take that figure as representing not necessarily the lowest price that one could pay, but the sort of price one would pay without undue extravagance or undue economy. Therefore, I think that I am right in saying that if we take the range of men's shoes from 53s. 5d. and women's shoes from 49s. 5d. upwards, on the retail prices, we shall include no luxury shoe for a long time but the kind of shoe that the ordinary person in this country, the majority of the population who are in work, would naturally buy.

There appeared on the tape late last night a notice, I think from Government sources, mentioning the effect of the concession on what were called "a popular range of shoes" retailing at 75s. We can fairly take it that the medium grade represents the ordinary, typical demand from men in work and their wives, from the middle group of the population varying from the salary earner on a not-very-high scale and from the highly-paid workman, down to the average-paid worker—if there is such a person.

That is by far the most important group. Under the old system, that group paid no Purchase Tax at all. Not until we got to retail prices of very nearly £6—about 115s.—in the case of men's shoes and a few shillings less in the case of women's shoes, did we begin to get the Purchase Tax operating, because we got our Utility. The result was that the tax was paid. and a heavy tax, on a very limited range indeed of the products of the industry. It was stated, and correctly, in the Douglas Report that it was paid on under 2 per cent. of the whole product, and for pretty expensive boots and shoes, whether men's or women's. The main and the startling effect of this scheme is to impose a new tax, not, of course, on the low-grade shoes but on the very wide range of medium-grade shoes—those with retail prices running, in the case of men's shoes, from about 53s. up to 115s.

4.30 p.m.

That is really the backbone of the industry. It is the ordinary man's footwear, and this scheme is, so far as the industry is concerned, for the first time imposing Purchase Tax on the ordinary man and woman's footwear. That is the significance of it, and it is that aspect of if which from various points of view has led to the acute dismay and opposition of the whole trade to what is now proposed.

I shall not go into the money question which was raised by the right hon. and gallant Member for Leicester, South-East and my hon. and learned Friend the Member for Northampton (Mr. Paget). It may be that the difference between the figures quoted for all footwear and the very much smaller figure quoted by the right hon. and gallant Gentleman can be accounted for by imports and rubber footwear. I doubt it, because footwear imports were taxed under the old scheme since they could not be Utility products, and they still remain taxed under the new scheme. It does not seem to me that in any figures of the past or estimate of the future that can make very much difference.

I need not trouble the right hon. and gallant Member for Leicester, North-East and my hon. and learned Friend on this point. We are, after all, dealing with pretty small figures in the way of taxation. This has not been a very heavily taxed industry, and I rather regret that it seemed to be partly on that account that the Douglas Committee, which really was not concerned with that kind of question, seemed to think that the industry ought to carry some additional Purchase Tax.

According to an answer we received the other day, it appeared to me that it was a re-distribution of the burden rather than any increase of it that was involved. I am not concerned with that point exactly at the moment, very largely because the figures are really comparatively small, and a concession of the type for which we are asking would, on any view of the matter, not cost the Chancellor very much. I hope that the right hon. Gentleman will sooner or later elucidate the matter, and that we shall know whether, as the trade thinks, the D scheme, even reduced in accordance with the announced concession, will mean a considerable additional burden on the trade, or whether it is only a redistribution.

From our point of view, however, the fatal damage lies in its incidence. I wish to point out to the Chancellor how that damage will take effect. I would remind him of the story of the Co-operative movement, which was always said to have had a newspaper called "The Producer, with which is incorporated The Consumer." Something of the sort was indicated by the Chancellor when he pointed out that workmen make boots and, having made them, like others. Wear them.

I represent a constituency in which boot and shoe making is the principal trade, at all events inside Kettering, and it represents a pretty fair average of the trade. Though I wish to say a little about that constituency, it is only by way of illustration, and I shall try to relate what I say to the trade as a whole. This is what is happening. There are in that town at least two firms which make high-grade footwear, perhaps not all of it above the old Utility range, one of them at least on quite a considerable scale. One firm has been in considerable difficulties for some time.

In the boot and shoe trade people do not begin to get their cards until things become pretty bad. The reason for that is that under the agreements in this trade, in which there has been very good feeling between both sides of the industry for a long time, there is a guaranteed week on the basis, so far as workers on time rates are concerned, of three-quarters of the 45-hour week, and so far as piece-rate workers are concerned—and this is practically entirely a piece-rate industry by now—on the basis of three-quarters of the man's normal earnings. I ought to say "a man's or a woman's normal earnings" because a great many women are employed in that industry.

What first happens is that, as in the instance I have mentioned, there is a gradual shortening of hours worked in the factory, and a whittling away of work, whether by piece or on time, and more and more people are put on to the guaranteed week, or, as the phrase goes, "made up" in the case of piece workers. That process can go on for quite a long time before any one begins to be sacked. What is significant is that these people are beginning to sack workers.

I do not want to be unkind to the boot and shoe trade in any way, and I am only voicing its own opinion—I believe the opinion of both sides of the table—when I say that it is on the whole an ageing trade. The average age standard in it is rather higher than the average age of the industrial population. If I might take the industry in my own constituency, I would say that I had had the most vigorous complaints from the boot and shoe people there that they act practically as a hospital for Corby; that is to say, they take on numbers of men who. through illness or accident, are unable to work in the iron and steel trades or perhaps in some other industry.

The boot and shoe trade certainly has quite a high proportion of men who are not very well and who may perhaps have suffered from some injury or another. These are the people who are being sacked. They will not contribute to the export drive, or re-armament or anything else; they will just be out of a job. That is only the beginning, I wish to make that quite clear, but it is beginning quite definitely. To turn to the main run of this industry—

Mr. W. M. F. Vane (Westmorland)

In speaking of the question of short time, the hon. and learned Member is not trying to represent that it is only starting now, seeing that it was obvious last summer?

Mr. Mitchison

All I can say is that that is neither my experience nor my information. I am not suggesting that the General Election was responsible for it, but it began about that time and has lately been very definitely getting worse. I said something of the sort in the Budget debate, and my information, which I have taken a lot of pains to verify, is that it is getting distinctly worse.

I am not saying that the number of dismissals is at all large at present; I do not think that is so. But that is the second stage; and the first stage of making up and depending on the guaranteed week is very widespread in the high-grade part of the industry. It is not without significance, and certainly not outside the knowledge of hon. Members opposite, who have had their attention called to this by the employers, that it is in the high-grade industry for instance, in Northampton, that one firm is said to have discharged 60 workers and is having difficulty in providing the remainder with half-time work. There are similar difficulties in Stafford. All that was a couple of months ago, and if Kettering is any guide it has been getting worse since.

I now turn to the middle-grade section of the industry which represents the bulk of the production in Kettering. These are the people who are going to be taxed for the first time, and the question I want to put to the Chancellor is whether he really expects them to stand it. I will tell him what is happening there. They have not yet reached the stage of dismissal—there is a certain amount of reliance on the guaranteed week—but there is something which is a good deal more serious than that.

They are now making increasingly for stock, and if hon. Members will look at the last issue of the Board of Trade Journal they will there find a significant fact that bears all this out very clearly. It is that the stocks in the boot and shoe trade at the latest available date, which was March, were no less than 30 per cent. higher than they were a year ago. True, that was an increase in price, but there has not been a very large movement in price, and I doubt if there has been a movement upward. The Board of Trade Journal itself pointed out quite rightly that that indicated a substantial increase in the volume of stocks.

I know this to be true from my own experience. I go round these boot and shoe factories, and I know that they have been piling up stocks. The reason is pretty clear; they cannot sell as fast as they make because their prices are a bit high.

Mr. Edwin Leather (Somerset, North)

Does that stock figure, which is extremely interesting, refer to total stocks in the hands of manufacturers, wholesalers and retailers, or is it that all that has happened is that stocks have been pushed back from the retailer to the manufacturer and that the total is not much higher?

Mr. Mitchison

I do not think that is so, and I believe the conclusion reached in the Board of Trade Journal should help the hon. Gentleman. I was referring to the stocks at an earlier stage than the retailer, but I think the hon. Gentleman will find that there has been an increase throughout the trade. I do not know whether there are any official figures available, but I think the reason for the present position is perfectly clear. It is that people are finding it difficult to pay the price of these goods.

What is going to be the effect of all this? Here we come to the consumer side of the producer, if I may put it in that rather Irish way. Let us take the two prices, the £3 which was used in the debate on the National Health Service Act and the 75s. that was mentioned in the debate last night. Let us take the case of men first. Even with the present concession, 1s. is added straight away to the retail price of a £3 pair of boots or shoes. So far as the women are concerned, there is an increase of Is. 6d., because in their case the D line is rather different. If we take the 75s. retail price, the figures begin to get a bit larger. As regards men they are 3s. 3d., and as regards women they are roughly about 4s., or perhaps a little more.

4.45 p.m.

Those are very considerable additions. I would remind the Chancellor that it was his party which put up posters saying that the high cost of living was the high cost of Socialism and that the Tory Party were going to stop the leak in the purse, and all the rest of it. After all, boots and shoes are pretty essential articles. We do not want hon. Members appearing bare-footed in this Chamber just because they cannot afford to buy boots and shoes. Neither do we want the population to go bare-footed. These are the ordinary necessities of life in this country.

Mr. George Odey (Beverley)

Would the hon. and learned Gentleman bear in mind in this connection that during the last nine months there has been a reduction of over 50 per cent. in the cost of leather?

Mr. Mitchison

Yes, I have that point in mind, and there is a good deal more to be said about the factors that go to make up the cost of shoes than the cost of leather, as the hon. Gentleman knows perfectly well. If I were to embark on that question I should only take up even more of the time of the Committee, and I must put my case in my own way.

Because of the way the Chancellor is levying this tax he is, in effect, putting it on to the backs of the ordinary working man and woman of this country, because it is their type of shoe which will have to carry it. It is they who will have to pay more, not because of the amount of the tax, but because of the way in which it is levied. After all, it is the business of the Chancellor, not merely to provide for the coming year, but to provide for further years ahead. He has to consider what his Income Tax yield is going to be next year and what his next Budget is going to look like.

The boot and shoe industry is in a really critical condition at the present time. It has not yet fallen over, but if it were given a very small push—and this particular tax will give it quite a big push—it would topple over altogether. It is, as the right hon. and gallant Member for Leicester, South-East just reminded the Chancellor, a highly localised industry. The result will be that in the places where it is localised we shall get for the first time since the war real unemployment.

It is a long time since there were soup kitchens in Kettering, and no one in this Committee wants to see that kind of thing again. I suggest to the Chancellor that for the comparatively small sum involved it is perhaps hardly worth while imposing this tax at all, but that, if he insists on doing so, he should give heed to what he is doing and should not, merely to keep the boot and shoe trade in theoretical line with textiles, put it on in such a way as to do the greatest possible damage both to the producers and to the mass of the population who wear those boots and shoes.

It is for that reason that we have put down a row of Amendments—I am not going to speak to them in detail—with the general intention of raising the D level by a little more than 50 per cent. of what it is at present. I do not see why the Chancellor should not have regard to the views of the industry itself. Whatever burden they have to carry, let them carry it in the old way, on the top grade of shoes. After all, socially that is right.

As regards the export trade, this is not a very large factor in the boot and shoe industry. Indeed, I am not sure that it can ever become so, but I believe that if there is room for such expansion then the emphasis should be not entirely on the top grade products. After all, a great deal of this footwear goes to comparatively poor countries which do not want the very high grade article. The trade has been building up little by little an increase in exports. It has been doing this on the old basis. I suggest that the effect of the present tax will be such a disturbance and difficulty in the trade as to make the continuance of that expansion of exports exceedingly difficult.

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

I would point out that export goods are not subject to Purchase Tax.

Mr. Mitchison

I am much obliged to the Chancellor, but I had that very well in mind. Perhaps I did not express myself clearly. What I meant was the argument in the Douglas Committee Report that the home market must be maintained as a showroom, as it were, for the export trade.

There is no more that I can say—[HON. MEMBERS: "Hear, hear."] It is quite easy for hon. Members opposite to make that sort of noise, but I suggest it is an exceedingly silly thing to do, and let me tell them why: Everyone in this Committee is wearing boots and shoes. So is every man and woman in this country. This concerns all of us. It is an important trade of which we have every reason to be proud. Incidentally, it is a very old one, and upon it depend the livelihood and prosperity of a large section of our fellow men and women who have had to build this trade up, whether as employers or as operatives, over a long period of years. They have raised it from being by no means so successful a trade into what it is at present—something of which we can all be proud. Not the least factor in that has been the skill of the operatives in the trade.

The effect of this tax, imposed as it is suggested it should be, must inevitably be to drive the employers to lower their standards in some cases so as to bring the footwear in question just below the D level. Exactly that is happening in one particular case in Kettering, and we shall get it again and again. It is not very pleasant for a man who prides himself, and rightly so, as these boot and shoe operatives do, on a certain traditional and practical skill, to have to prostitute it because of the effect of an ill-judged tax.

Lieut.-Commander S. L. C. Maydon (Wells)

I have the honour to represent a constituency where there are two completely separate branches of this industry. In Street and Shepton Mallet in Somerset they make women's and children's shoes of a comparatively high grade which previously came just below the Purchase Tax level. In Glastonbury is a very old-established industry making fur-lined boots and shoes and other articles from sheepskins.

The normal boot and shoe industry—that is to say, the women's and children's shoes—in the two former places was building up a most important export trade both in the United States and in Australia. Those who work in that industry feel very strongly that the imposition of taxation on their industry will have a most serious effect upon that export trade.

It has to be admitted, of course, that goods which are exported do not carry tax, but the industry is supported by its home market and, as the right hon. and gallant Member for Leicester, South-East (Captain Waterhouse) has recently pointed out, this industry is peculiar in one particular respect, and that is that it is concentrated according to its qualities of product in various localities. In my constituency in Somerset we make only those shoes of a particular quality which came just below the Purchase Tax level previously. That quality is not carried by a cheaper product which can be marketed elsewhere, and for that reason this added tax upon the industry is going to be very serious indeed.

On the subject of the fleece-lined boots, shoes and slippers, there is another point which I should particularly like to draw to the attention of the Chancellor. The proposed D level for such footwear—which presumably will come in the category of "articles of any other description" —will be lower than that for "articles which are either unlined or lined only with cotton fabric or leather, and are not made wholly or partly of fur or imitation fur." To begin with, this policy does not seem to be in line with the policy employed under a provision which was discussed yesterday. In order not to be called out of order I would only allude to that briefly.

Under the Fourth Schedule, Group A, 3, relating to coats, cloaks, etc. Class A material which is "fully lined, or of sheepskin" carries a higher D level than other articles. I contend that in fairness these sheepskin fleece-lined boots and shoes should be treated in a similar manner and should carry a higher D level. After all, they are by their very nature a more expensive article; they are bound to be.

If this industry is injured, as it is likely to be, by the incidence of Purchase Tax at an even greater level than that which is levied on other branches of the footwear industry, it will have most serious effects in this part of Somerset which is largely a rural area where the only main alternative industry to which workers can turn is that of agriculture. Glastonbury is the largest centre of this industry in Europe. It has developed the dressing and the manufacture of these sheepskins over a great many years. In fact, I think I can say that it has gained a world-wide reputation in this trade, and the incidence of a heavier level of Purchase Tax on this industry will be most serious upon our export trade.

Mr. Arthur Allen (Bosworth)

By way of preface to what I have to say, I think I ought to declare my interest. I started to work in the boot and shoe industry over 52 years ago in a small village in Northamptonshire at the age of 13, doing 54½ hours a week for half a crown a week. That half a crown to me was symbolic because I had left boyhood behind and had become a man, more or less, and I have been sorry for it ever since. My last 21 years in the industry I spent as an official of the Boot and Shoe Operatives Union.

I want to give to the Committee the opinion, as I conceive it, of the organised operatives in the industry, of this D line. As we see it, the D line engenders three fears. There is the effect on employment, the effect on quality, production and craftsmanship and the effect on the export trade.

5.0 p.m.

As has been said already, until recently only 2 per cent. of the output of the industry carried Purchase Tax, 98 per cent. being free of tax. The intention of these Amendments is to restore the level more or less to the old position. We felt there was some justification for 2 per cent. of the production carrying tax because it is in the nature of a luxury trade. However, we feel that any tax on footwear is a bad tax, only less reprehensible than a tax on food. People buy footwear because they must, and the luxury production inevitably is very small. People do not spend money on luxuries to tread underfoot.

The D scheme widens the area of lower quality production. There is a natural disposition on the part of buyers to avoid tax and consequently there is a falling off in the demand for better goods. This gives rise inevitably to unemployment in those centres where the better grades are produced. It has already been stated that the industry is segregated in certain areas. I cannot go through the whole list, but it includes Norwich, Northampton, Stafford, Street and Kendall. In the areas where it is the staple trade serious unemployment has developed.

It will be appreciated from what I say that I am not stating a constituency point of view. In my own constituency there is boot and shoe production but, generally speaking, in that area the industry will not be seriously affected by the new D line. As I have said, I am trying to put the case as my union sees it. The tax bears unfairly on certain centres as compared with others and on certain firms as compared with others. In consequence we hold the tax to be invidious in its incidence. A tax which discriminates in this way is altogether bad.

Now let me turn to the effect this tax is bound to have on quality production and craftsmanship. In the boot and shoe industry we are very proud of our craftsmanship. It must be remembered that the machinery in the industry is not wholly automatic. Footwear is not made as sausages are made: you do not put the leather in at one end and draw the footwear out at the other. The machinery in the boot and shoe industry is like an improved tool: everything depends on the skill and craft of the operative. It is the all important touch of craftsmanship in the good shoe which the others have not got that makes all the difference, but that touch of distinction inevitably involves expense.

My hon. and learned Friend the Member for Kettering (Mr. Mitchison) said that the boot and shoe industry is based on payment by results. That has been the case ever since 1895. In an industry such as this, where the output is priced at so much per dozen pairs, a bigger price has to be paid for the better output because more time is involved on the part of the operative in doing a good job than is involved in doing a bad one.

The incidence of this tax serves to injure that better craftsmanship which we as operatives in the boot and shoe industry have always fostered as much as possible. It is that touch of craftsmanship in the high grade footwear which gives British production a world reputation. We want to retain that. As operatives we have done our level best to assist the better manufacturers in fostering this better grade of footwear and in retaining the craftsmanship required to produce it. We have promoted recruitment and train- ing schemes, we have spent money on them, and we fear that they are endangered by this tax.

Instead of fostering the better end of the trade, the Purchase Tax tends to have the opposite effect. It is a tax on skill and craftsmanship. If footwear is to be taxed at all we think the tax should lie on the shoddy rather than on the chic. I am glad that the Financial Secretary was able to meet a deputation from the boot and shoe industry. I am also pleased to know that they were well received by the hon. Gentleman and that he listened sympathetically and attentively to what they had to say. I feel sure they made an impression on his mind. I understand they went into the question of alternatives.

I should be out of order if I attempted to pursue that, so leaving aside the consideration of alternatives to the D line, I want to emphasise the fact that it seriously affects employment in those parts of the industry given over to the production of the better grades of footwear, and it tends to create and deepen unemployment; in fact, it has done so in Norwich, Northampton and Stafford. In addition, I want to stress the fact that it affects the standard of workmanship in those centres which are given over to the production of the better grades.

Now as to its effect on quality production. At its prevent level the D line forces manufacturers to step down in the use of materials from the good to the not so good, from calf to kip, from good sound leather to leather whose wearing qualities are suspect. It is not generally appreciated that the shoe sold from the factory before the war at 10s. 6d. a pair would carry Purchase Tax under these regulations, and that shoe today would be the wrong side of the D line. No self-respecting boot and shoe operative of those days would have dreamt of going out for a walk on a Sunday wearing anything of a lower quality than box calf or willow calf, but if he bought it today he would have to pay Purchase Tax.

In consequence of the tax manufacturers will be forced to cut down in all directions to avoid it, and in consequence quality will be sacrificed. It will have a depressing effect on the reputation of British footwear, and it will impair our reputation in foreign markets. The argu- ment put up by the party opposite when they were on this side of the House has always appealed to me, namely, that there must be a good home trade as the basis of our export trade. We can only exploit foreign markets by insisting on quality production.

For instance, I do not believe we have any hope of exploiting the American or Canadian markets with mass-produced stuff. The Americans can do that much better than we can. They have a much wider market to exploit. We can only hope to get in there and hold the market by high-grade quality production, and in this I disagree with my hon. and learned Friend the Member for Kettering. I think that we are wasting our time in trying to exploit the American market by mass-produced footwear.

But I have always felt, even in the days of depression, that we were not doing what we might have done with regard to the American market. My own experience leads me to that view, and I am quite sure that the firm with which I was working was not doing what it might have done in that respect.

We as operatives have always had an interest in the export trade. I remember, when quite a boy, seeing in the industry an emblem, which was a recognition of continuous membership of my trade union, with the caption: "Let the trade be trodden underfoot the world o'er." That is a desire that is properly held by the operatives. We keep our chins up in every other respect, but we do not mind our product being trodden on.

It is because we think that the present D line is too low, that it is causing unemployment in certain centres and firms, that it is depressing quality and craftsmanship and that it will hinder, rather than help, our export trade, that we seek in this series of Amendments to the Schedule to raise the line to a level at which its effects will be less mischievous. The operatives' union is appealing to the Chancellor to go even further than he has already gone, and to lift the level to that suggested in the Amendments and to help us to do the things we are hoping to assist in achieving on behalf of the industry.

Mr. Leather

I wish only to detain the Committee for a few minutes to deal with a point which has been already mentioned by my hon. and gallant Friend the Member for Wells (Lieut.-Commander Maydon). I should like, however, to say a word about the argument which was put forward about stocks by the hon. and learned Member for Kettering (Mr. Mitchison), because the point has not been discussed further. Perhaps I did not put my question very clearly. The importance of the argument about stocks is that when one begins to study a lot of the statistics—and I know that they are very interesting just now in the boot and shoe trade—a lot of them are not nearly so alarming as they at first appear.

It is wise to say that, because we may be in a very real danger of talking ourselves into a slump. It has been done before, and it can be done again. It would be most tragically unnecessary and unfortunate if, by looking simply at all the gloomy signs, we persuaded ourselves that we were in a slump. Before we knew where we were, we would be in it.

I am not disputing the hon. and learned Member's figures—he has had the advantage of studying them and I have not; but I have studied similar figures recently, and one so often finds that a year or so ago, and for a continuous period up to that time, the retailers were carrying the stocks because they were buying everything they could lay their hands upon. They knew that they could sell it, and the manufacturers were carrying virtually no stocks. The stuff was going off the assembly lines and straight out of the factory.

Suddenly, things changed. Retailers cut down their stocks, having seen that prices were dropping, and the manufacturers built them up. The total level of stocks, however, has not altered radically; it has merely shifted to another section of the trade.

Mr. Paget

That is not the case so far as the boot and shoe trade is concerned, save, possibly, with some of the very small retailers. The big retailers are tremendously overstocked and have far higher stocks than they had a year ago.

5.15 p.m.

Mr. Leather

That being so, I accept what the hon. and learned Member says, because I have not got the figures and I am sure that he has. But we want to study all these statistics very carefully before we derive any gloomy forebodings which may not be justified.

I should like to draw the Chancellor's attention to an Amendment in the names of my hon. and gallant Friend the Member for Wells, my hon. Friend the Member for Bodmin (Mr. D. Marshall) and myself: In page 75, line 24, at end, insert:

(b) articles made wholly

or partly of fur or imitation fur

4 0 0 per pair
(2 0 0 per article)
The West country industry is a high-quality industry, largely based on fleece and fur-lined footwear, and so on. In Schedule 4 there appears to be an effort to differentiate between varying qualities, but the effort does not seem to me to have any great logic to it.

Item 19, to which I am referring, contains (a) articles which are either unlined or lined only with cotton fabric or leather, and are not made wholly or partly of fur or imitation fur and category (b) comprises articles of any other description. The "any other description" might mean articles a great deal better or articles infinitely worse than those included in category (a), and yet they all appear to be lumped under the "any other description."

We merely put to the Chancellor—we hope he will consider it seriously—that although the industry is a small one, it is of great importance, especially in the smaller towns in Somerset. It is based on the higher quality and we say that it is most unfair to make the higher quality pay a D line rate which is even lower than for the standard quality.

I concede that there is an argument to say that the D line should be the same as for the standard quality, although I hope that that is not what we will be told, but it is completely illogical to make the industry pay at a much lower line than the standard quality. I hope that when my right hon. Friend is considering the Amendments, he will look at the question of the higher quality fur-lined or fleece-lined article to see if he can put it right

Mr. William Ross (Kilmarnock)

So far, we have heard pleas from Members with constituencies in England, and I should not like it to be thought that the Scottish part of the trade and Scottish consumers do not have exactly the same feelings. I represent a constituency which is probably traditionally better known for engineering and for what might be termed the "spirit of Scotland" and that brand of whisky that is "still going strong."

We have in Kilmarnock, however, a very important boot and shoe industry—the best in Scotland and, probably, the best in Britain. [HON. MEMBERS: "No."] All that I ask hon. Members to do if they wish to prove my statement is to buy some Saxone shoes, and they will find out. We have a very high reputation for that craftsmanship and for the quality of footwear that was spoken about so well by my hon. Friend the Member for Bosworth (Mr. A. Allen).

We have to take into account the incidence of the D scheme against the present background of the industry. We already have rising unemployment. The hon. Member for Somerset, North (Mr. Leather), suggested that we should not talk ourselves into a slump and that we have to look very carefully at the statistics. There is one group of statistics that shouts very clearly that the Government must take action, and that is the statistics of production. As far as Scotland was concerned, production in the last quarter of the past year was down by as much as 12 per cent., and I think that the figures for the industry throughout England would show that in many cases production has fallen even more.

We are not being alarmist in drawing to the Chancellor's attention the fact that that is already the situation in an industry which at present retails 98 per cent. of its shoes in this country tax free. I doubt whether even the Minister of State for Economic Affairs would be able tortuously to argue that by putting on the new imposition we should help the industry. We have short time weeks in the industry and, for the first time, young people are experiencing unemployment. Naturally, they are looking to the Government and to the Chancellor with some anxiety on this question.

Since the war this industry has been expanding to meet national needs and in Kilmarnock an extension has been built to a very big factory. A great deal of export trade has been developed. Up to now unless boots were retailed at a price of more than £6 7s. there was no Purchase Tax, but now the position will be that if the retail price is more than £4 a pair Purchase Tax will be paid. My constituency is a big railway centre. Although it is all right for hon. Members to use the same pair of boots or shoes for work and in the streets, the engine driver has to have a special pair for working on his engine. I can tell the Financial Secretary that they cost more than £4 10s. The same applies to the farmer, the agricultural worker and also to miners.

These are the people who will have to pay Purchase Tax on footwear for the first time. On their ability to buy depends the prosperity of the boot and shoe operatives in Kilmarnock. The prosperity of each is complementary. But in this D scheme for the boot and shoe industry the Government are destroying the ability to buy and the chances of employment of the operator. The question of shoes is even worse. Under the old Purchase Tax, unless a pair of shoes for a man cost more than £5 15s. there was no Purchase Tax, but now the amount is to be £2 13s. I guarantee that there is not a Member in this Committee whose shoes cost £2 13s. or less. Even for us, as well as people outside this will mean an additional burden.

This 98 per cent. includes shoes of very high quality, medium qualities as well as the high quality are going to be hit very hard. The figures were quoted by my hon. and learned Friend the Member for Kettering (Mr. Mitchison) and are worth repeating. A pair of shoes retailing at £3 9s. will now have to bear an additional 2s. 6d. Purchase Tax. If things are bad at the moment they will be very much worse in future.

We have heard the argument that the D scheme will be a grand thing for the export drive because it will wipe out the gap and spread over the whole field, making more strong the home basis for the export market. But, in the case of boots and shoes, the export is from the 98 per cent. The 2 per cent, of boots and shoes now subject to Purchase Tax, as the Douglas Committee Report states, gives freedom from tax on all but handmade shoes, but we are exporting factory made shoes, shoes from the 98 per cent. The application of Purchase Tax in the home market, therefore, will not assist in getting the necessary export of these shoes.

The whole scheme means a driving down of standards and that manufacturers who hitherto have been competing in quality will now start competing in price. Standards will be driven down to catch what trade is available. The industry, I think, is by no means alarmist in the attitude it has taken up. We would be failing in our duty if we did not try to draw to the attention of the Chancellor the fact that what applies to textiles does not apply to boots and shoes, but that it is an entirely different argument. I think there is need for new thinking on the Government Front Bench. It is not good enough to say that such changes as are to be made have already been made. If anything calls for action it is the incidence of the D scheme on the boot and shoe industry.

I can assure the Chancellor that a considerable amount of thought and consultation has gone into the consideration of the Amendments which we have put down. If he raises the D level as we have suggested he will help the industry considerably. Before he suggested the application of this scheme the industry was already suffering. To give the industry a chance, the consumers at home a chance and those who are anxious to continue the export drive a chance, he should accept the Amendments.

Mr. Hugh Fraser (Stafford and Stone)

I regret that the hon. Member for Bosworth (Mr. A. Allen) has left the Chamber because he echoed the words of a former Member for the constituency of Stafford, which I am proud to represent. No less a person than Richard Brinsley Sheridan said: Let the whole world tread the trade of Stafford underfoot. I am certainly joining issue as a rival of hon. Members opposite in trying to get something out of the Chancellor and on this occasion I confess that I am a bitter critic.

This issue, for hon. Members representing boot and shoe industry constituencies, is a grave one. I believe it is especially grave after the concession which was given last night to the textile industry. Hon. Members opposite may not appreciate it, but, apart from the help given to Rolls-Royce cars by a former Socialist Chancellor, the concessions given last night were the biggest since 1945. They were concessions of something like £14 million for an industry. Yet we find that the boot and shoe industry has to face new tax which may run up to £4 million or £5 million. After last night's magnificent concession we in the boot and shoe trade are all the keener to see some reciprocation regarding the industry in which we are interested.

As the hon. Member for Kilmarnock (Mr. Ross) pointed out, the arguments which apply to textiles obviously do not apply to boots and shoes. The main argument put forward by the President of the Board of Trade, who also, like Richard Brinsley Sheridan, was a Member for a part of Stafford at one time, was that the advantage of the D scheme was that it got rid of the blind spot in textiles, and there is a great deal of truth in that argument. Blind spots were created by the clash of Utility with Purchase Tax in certain textiles and manufacturers necessarily reorganised their production to go into either one group or the other, leaving a large range which, so to speak, formed a blind spot.

But precisely by applying Purchase Tax and a D scheme to a trade where previously 98 per cent. of the trade was free either from Purchase Tax a wide blind spot is created such as the Chancellor is trying to avoid by creating the D scheme for textiles. The same arguments which apply to textiles cannot apply to boots and shoes. If the D scheme is good for textiles on which there was Purchase Tax automatically it must be a bad thing to support the D scheme for boots and shoes where there was none.

It was not entirely foolish that for the last 10 years or so boots and shoes have been free from tax. It was not some strange whim of the party opposite, but was based on the reasonable thought that one of the chief ways of preserving the health of the nation was to see that they are well shod. The argument that the D line will help the boot and shoe industry will, in fact, do precisely the opposite.

5.30 p.m.

Some hon. Gentlemen on both sides of the Committee have addressed themselves to the question of stocks. I think that we should address ourselves much more to the question of the type of production which the manufacturers will go in for now. They will try to pull their products below the D line, and that is the danger. As hon. Members on both sides of the Committee have said, they will try to depress the standard of boots and shoes in this country. The Chancellor will not get the return he anticipates from this tax; we will lose some of the export markets we might have been gaining, and were on the point of gaining, not merely with hand-made shoes, but with the middle range which used to sell for £4 and £5 in the American market. This market can only be sustained by an active home market, and now, naturally, the production equipment will be used to produce shoes to beat the D line.

There is another argument which I am not sufficiently knowledgable about the industry to advance, but which should be advanced by somebody, regarding the use of leather. If high standard shoes are produced, leather will be made available which may be used for the cheaper type of shoe. The manufacture of the more expensive shoe automatically produces, as a by-product, the type of shoe which may be sold at a cheaper price. The hide has an entity, and there is a technical argument about leather which can be worked out to prove that a ready sale of the moderately high priced shoe will afford leather for the cheaper type of shoe.

There is, further, the question of leadership in the shoe industry throughout the world. If we lose that leadership, if we lose the lead in styling which we have until recently enjoyed, any chance of building up further exports will be lost. Therefore, I hope that when the Chancellor regards this scheme he will either make a concession, or, if he is unable to do that, he will, between now and Report stage, consider whether there should be a raising of the D level and whether the necessary machinery may be used, whether by Order in Council or otherwise, to see that the shoe trade is given a better deal.

We see unemployment and threatened unemployment in our constituencies and a danger to the export trade. We see the sign of what I believe is unfairness between one industry and another. Another former Member of Parliament for Stafford was no less a person than Bradshaw, a revolutionary Member of the House of Commons. When he was asked to sign the death warrant of King Charles I, he merely scrawled across the paper the word, "Now." I ask the Chancellor to consider making concessions soon.

Mr. Barnett Janner (Leicester, North-West)

I do not think the Committee will need more influencing as against the Chancellor. Indeed, I hope that by this time the Chancellor will be convinced himself that there is a strong case for the removal of the tax on boots and shoes: or at least that it is time to return to the position where 98 per cent. of the boots and shoes were untaxed and 2 per cent. bore a certain amount of taxation.

A little while ago I was in New York and I saw some Leicester shoes advertised there. A very brave attempt was being made to build up a good export trade in those shoes. I understand that there was a large store which contained only those shoes and that they were there because they had something different in their style. There was a difference in the craftsmanship put into them which distinguished them from similar shoes generally sold in the States. It may not have been a very great difference, but there was a distinction between the craftsmanship put into those shoes and the craftsmanship put into other shoes which made those particular Leicester shoes saleable in the United States.

I would ask the Chancellor to consider whether he is not making a big mistake if, instead of encouraging the production of the better kind of shoe—I do not mean the best type; I am talking about the better type within what was previously the Utility range—he imposes a tax which, of necessity, must make the firms producing that type of shoe attempt, so far as possible, to compete with those firms producing a cheaper type of shoe.

Taking a long view of the matter, the Chancellor should realise that he is discouraging craftsmanship in this industry and that ultimately, if this type of taxation continues, he will eliminate the best type of craftsmanship. The result will be that the only type of boot and shoe produced will be that which does not bear a tax. That kind of product will not be marketable abroad and will not be as useful as it might be at home. As the right hon. Gentleman knows, there is a considerable amount of unemployment in those centres where boots and shoes are produced. In Leicester itself, a city which has a variety of industrial interests, the figures are indicative of the present trend.

I should like to quote some of the figures. For example, in the two industries hosiery and boots, in March, 1951, there were only 29 registered unemployed. But on 17th March, 1952, the answer to a Question put down by my hon. Friend the Member for Leicester, South-West (Mr. Bowden) revealed that the number of unemployed was 1,351. A few weeks ago that figure was increased to 2,767. It is a significant increase. Operatives in many factories are today working only 75 per cent. of full time in order that the work available may be shared out.

This is a very serious matter, and I suggest it is not in the interests of the Treasury that any further bar should be put in the way of production in those centres. The right hon. Gentleman will find on the contrary, as I have already said, that he will lose on the exports side and he will lose by having to support those put out of employment in consequence of an action of this sort.

It has been correctly stated that the question of health is one which has to be considered when the boot and shoe industry is discussed. A good, reliable pair of boots or shoes affords a considerable amount of protection to the wearer. A poor type of boot or shoe can not only do injury to the feet, but also to the general health of the wearer because it is not reliable. In addition, it means that the person who buys the cheaper grade of shoe will find himself saddled with doubled expense. He will have to buy more shoes within a shorter period than would be the case if he had bought a pair of the higher quality. I hope that the question of health will be taken into consideration by the Chancellor and his advisers as an additional reason for conceding the requests made in the series of Amendments that we are considering.

There is another matter. The Chancellor had not the opportunity before of hearing fully the case for those who produce and sell boots and shoes. It is obvious that the Douglas Committee had not and did not seek the opportunity of inquiring fully into what the trade and its operatives thought about the matter or hearing their representatives. The Douglas Committee made certain suggestions which have been hurriedly accepted before the trade and the operatives were given an opportunity of placing their views before either that Committee or the Treasury.

Since the publication of their Report the Chancellor has had memoranda placed before him and has heard verbal arguments which have given him an idea of the circumstances in this industry, and I think he would now agree that the case for the industry has been made out. In the existing circumstances there are a number of districts in this country which, if this tax is imposed on the levels at present suggested, will begin to experience largely increased unemployment, apart from the present serious unemployment, and the cost of living will be further increased to the users of these commodities. He will not gain any benefit in tax and the exports from this trade, which is even now not a very large one, will suffer. This is a trade which should be encouraged by the Chancellor rather than discouraged in the interests of the consumer, the producers and the Treasury. In those circumstances, I hope that the right hon. Gentleman will concede the points that are requested in the various Amendments.

Mr. Douglas Marshall (Bodmin)

I hope that the Chancellor of the Exchequer and the Financial Secretary will have been impressed by the strong and reasonable arguments of my right hon. and gallant Friend the Member for Leicester, South-East (Captain Waterhouse), which were put forward at the beginning of the debate, as well as by those of hon. Members in all parts of the Committee who have supported the principle that my right hon. and gallant Friend put before them. I have been impressed and delighted by the arguments advanced by several hon. Members opposite who have supported the principle that it is objectionable to tax craftsmanship and quality. 'That is an argument with which I shall deal briefly before I sit down.

The only method we can adopt to overcome our economic and financial difficulties is the expansion of our export trade. Therefore, any view that there should be a temporary collection of taxes on certain commodities to help the Budget is not a principle which we consider right, because, ultimately, it will hurt our main objective and is, indeed, hurtful to our trade generally and to the maintenance of the standard of life we want to see in this country. I trust that the Chancellor and the Financial Secretary will approach this matter in the same sense as when they decided to lower the percentage level of taxation instead of raising the level of the D scheme as a principle. By that method our exports can get a greater crack of the whip. That is what the Chancellor said in support of what he did, and I want him to apply the same principle to these Amendments.

5.45 p.m.

The boot and shoe industry is building up an extremely good export trade both to the Empire and to hard currency countries. The one thing which the Chancellor should not wish to do is to raise the global figure of taxation on that industry above the actual taxation at the present moment which would hurt the export trade. I was a little alarmed just now when the Chancellor, in answer to a question put from the opposite benches, pointed out that boots and shoes which are exported do not carry tax. All Members in the Committee are fully aware of that, but they are equally aware that unless the trade is supported by the actual home consumption of the industry, then our export trade cannot compete in the world markets. I am applying myself to that argument only, and in order to take up as little time of the Committee as possible. I will content myself by saying that I sincerely trust that the Chancellor and the Financial Secretary will approach this matter reasonably and give us some hope about the future export trade of this industry.

Sir Lynn Ungoed-Thomas (Leicester, North-East)

I hope the Chancellor of the Exchequer is impressed by the very cogent arguments which have been addressed to him from all sides of the Committee. What I shall be interested to see is how far the cogency of the arguments put forward from the benches behind him will be matched by action when it comes to a Division. I was particularly interested in the new technique of Government back benchers produced by the right hon. and gallant Gentleman the Member for Leicester, South-East (Captain Waterhouse). Apparently he learned a lesson from the right hon. Gentleman the Member for Blackburn, West (Mr. Assheton). He committed himself to a bold Motion and then did not follow it up, exposing himself to some ridicule.

The right hon. and gallant Gentleman the Member for Leicester, South-East was not running that risk. He confined his strong words to a speech in the Committee, but when it comes to putting something on paper all he does is put down a very inadequate proposal when compared with the argument put forward.

Captain Waterhouse

I do not know whether the hon. and learned Gentleman has noticed the new Clause which I have put down on the Order Paper, to which my right hon. Friend referred yesterday, and on which he has based the concession which he has already given.

Sir L. Ungoed-Thomas

I am dealing with the three Amendments which the right hon. and gallant Gentleman put down and to which he has just spoken. The right hon. and gallant Gentleman brings a big rod to the Committee which is worthy of a really big fish, but, when he comes to use it, he is merely dealing with tiddlers. That may be because he is fishing in troubled waters, as he perfectly well realises.

The trouble which has been concerning hon. Gentlemen supporting the Government, and some on this side of the Committee as well, and which has been voiced in more than one speech, is that they are really not satisfied that the Government have properly considered the strong arguments which exist in this case. My hon. and learned Friend the Member for Kettering (Mr. Mitchison) referred to the Douglas Committee, and said quite rightly that it was primarily a textile committee. Shoes only come into this Purchase Tax question because two per cent. of them have been subject to Purchase Tax.

That is a very small, almost minute, element in the Purchase Tax problem, and the Government cannot really attempt to cloak themselves with the Douglas Report and then say that all they have done is to adopt that Committee's conclusions. They must meet the strength of the arguments that have been addressed to them from all sides of the Committee. and they must, if they turn down these arguments, give specific reasons why they are turning them down.

The two objections to this tax are against the weight of the tax and also against the distribution of the tax. To take the weight of the tax first, my figures are different from those which have been quoted by the right hon. and gallant Member for Leicester, South-East. My figures show that, so far as we can calculate it, the tax paid under the old scheme was rather more than the figure which the right hon. Gentleman gave, and, correspondingly, what will be obtained by the new tax is also rather more than the figure he gave, but the relationship is approximately the same, and that relationship is something in the region of an increase of between 800 and 1,000 per cent.

That is an enormous proportionate increase to impose on this industry at this time, and on an industry in which the tax collected is only a comparatively small amount in relation to the Treasury's general taxation position. Therefore, these arguments result in the conclusion that a comparatively small concession by the Treasury would mean a substantial advantage to the industry with which we are dealing.

Secondly, on the distribution of the tax, previously, of course, it was only on about 2 per cent. of the industry, whereas now it is proposed to distribute it over a large proportion of the remaining 98 per cent. What are the consequences of these two proposals—an additional weight of tax and this new distribution of the tax? I will deal shortly with the consequences of these changes.

First, there is unemployment and loss of production, with everything which it means. It is most unfortunate—and this is a matter of general argument, and not applicable only to the boot and shoe industry—that the Government should be seeking to increase the taxation on the whole of the industry, and should be distributing it in such a way that a large part of that industry which never paid tax before will have to pay it now, and that that should happen at the very time when serious unemployment is beginning to develop in the industry. It is, in fact, a course which is the very opposite of the course which any responsible Government with the welfare of the industry at heart would pursue in present circumstances.

My hon. Friend the Member for Leicester, North-West (Mr. Janner), referred to the drop in productivity, as did some other hon. Members. My figures for Leicester show that the drop from the production figures of last year is something in the region of 18 per cent., and that is a very serious matter when the industry is centred in comparatively few localities. But what is important, of course, is not the figure of unemployment in the industry, but the fall in productivity, coupled with the concealed unemployment which is actually taking place.

I am dealing with the fact that this unemployment is often concealed, and does not show itself in the unemployment figures, largely for the reason that the activities of the industry consist, in any factory, of a number of separate operations, all of them highly skilled, all requiring to preserve, as something of the utmost value to that particular factory, the sequence of manufacture. That means the sequence of skill, and, therefore, of the team of skilled workers in that factory.

Therefore, rather than discharge anyone, which action might result in the disruption of the production of that factory, the manufacturer will, if he possibly can, hold on to his workers to the very last moment. We have tested this on the productivity figures which I have given, and also on the guaranteed week. The industry is working the guaranteed week, but, although the workers are receiving the wages for the guaranteed week, they are not working up to that level, and this fact is shown in the accumulation of stocks.

The hon. Member for Somerset, North (Mr. Leather), who is no longer in his place, challenged my hon. and learned Friend the Member for Kettering and my hon. and learned Friend the Member for Northampton (Mr. Paget), on the fact that stocks are being accumulated in retailers' premises. I have been informed by one of the largest retailer organisations in the country that they now have an accumulation of stock one-third more than they should carry, and would normally carry, and one-third more than is economically prudent for them to carry. Not only have they done that in the last few weeks, when there has been an accumulating increase, but they have given instructions to the manufacturers who supply them telling them to reduce their orders by one-third. This is a very serious position.

Mr. D. Marshall

Has the hon. and learned Gentleman any information as to how stocks compare with pre-war stocks?

Sir L. Ungoed-Thomas

Yes, I gather that there are much more than pre-war stocks; that is my information.

In addition to that, at the moment we have the further fact that leather is selling at an extremely low price, and the position will be still worse if leather makes a recovery and the price goes up, which will add again to the difficulties of the industry. Further, we have the general effect of the Government's economic policy, which is affecting the cost of living, and directly affecting this industry, because in this industry wages are on a sliding scale based on the cost of living. It is because we are reducing the food subsidies, which means an increase in wages, that further difficulties are being created for the industry itself.

6.0 p.m

Now I come to the points on the quality markets which have been developed so fully by so many hon. Members on both sides of the Committee. My hon. Friend the Member for Kilmarnock (Mr. Ross) rightly emphasised that the important point to realise in dealing with quality production and the export market is that it was the top Utility range, which previously was free from tax, that was the quality production which was sold in the United States and Canadian markets.

It is vital to appreciate that. It is not the 2 per cent. top luxury goods which were bearing tax before which supplied the bulk of our returns from Canadian and American markets. It was the top Utility grades and the Chancellor is, for the first time, now proposing to put a tax on those very grades which provided us with dollars from the export markets.

But the general result of this policy is even more serious than losing what is perhaps a temporary advantage in the dollar market. It really is a blow at quality production generally, as was so fully explained from the benches opposite. What happens is that manufacturers inevitably try to secure a home market as a basis for their export markets. In attempting to secure a home market they continually tend to press down the cost of the boot or shoe below the D level. What is apt to go on under a tax of this kind is that the manufacturer, continually pressing down below the taxation level, is chased by the Treasury trying to tax him, as well they may.

That is exactly what has happened in the French market, with very bad results. Time was when French design was the model of quality and was followed everywhere. That is no longer so, and I understand that it is due to a system of taxation in that country which bears the same kind of fault as is inherent in the type of taxation which the Chancellor proposes to introduce here.

Once that happens one cannot recover quality production. One cannot switch men on and off from highly skilled quality production of this kind. It is a skilled job in which a high standard of workmanship is required. One cannot tell a man one year to produce goods of a certain quality and then have him produce goods of a higher quality the following year. The same quality and standard of production must be maintained and the whole working team must adhere to that standard.

In our boot and shoe trade we have in different factories the appropriate quality and standard of production being pursued. This tax interferes with and scrambles that pattern in the industry which has been worked out over the years and which produces the quality articles now made in this country. Therefore, there are very serious considerations affecting the whole future welfare of the industry involved in the introduction of this scheme which exacts a bigger tax from the industry as a whole and spreads a tax over a large part of the industry that never bore it before.

I hope the Financial Secretary will consider seriously these strong arguments addressed to him from all sides of the Committee, based on quality production for the export trade and upon the cost of living, and founded upon the strong suspicion that really inadequate consideration has been given to the position and to the future of this industry. I hope the Financial Secretary will be able to give the Committee some strong reassurances about this industry.

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

The hon. and learned Member for Leicester, North-East (Sir L. Ungoed-Thomas) began by saying that this has been an impressive debate, the sort of debate one would associate with this rather impressive industry. As the hon. Member for Bosworth (Mr. A. Allen) said, I had the pleasure a short time ago of receiving representatives of both sides of this industry and, as the hon. Gentleman I think appreciates, they put their views with the moderation, skill and courtesy which one would expect of so ancient an industry.

The position of the goods covered by this Amendment is in some degree, of course, unusual, by reason, in particular, of the fact which was mentioned by my right hon. and gallant Friend the Member for Leicester, South-East (Captain Waterhouse), in moving the Amendment. It is the fact that at the conclusion of the Utility scheme 98 per cent. of the output of this industry was free from tax. That, of course, is a feature of the matter which very properly has to he borne in mind.

But there is another facet to the picture. It is that while the leather boot and shoe industry have reached the stage to which my right hon. and gallant Friend the Member for Leicester, South-East, referred, at the same time the rubber footwear industry—which manufacture, for example, the agricultural labourer's Wellington boots or Plimsolls—had no Utility scheme at all and bore the full rate of tax even on the cheapest of their products. That is not a state of affairs that, in particular from the point of view that has been urged throughout these debates from the benches opposite, could be described as wholly satisfactory.

One has one form of footwear with virtual exemption from tax, even on quite expensive products, and another form, serving ordinary necessities just as well. with no tax exemption at all. That, from the point of view put in these debates by hon. Members opposite and put in this debate by the hon. and learned Member for Kettering (Mr. Mitchison)—the effect on the poorer section of the community—was obviously not a satisfactory position.

It was no doubt satisfactory from the point of view of the leather boot and shoe industry, but I think it is essential that we should get the matter a little into proportion. The right hon. and learned Member for Leicester, North-East, referred once or twice to imposing tax where it had never been borne, and I think my hon. Friend the Member for Stafford and Stone (Mr. H. Fraser) suggested that it is a matter of deliberate policy that the greater part of this leather boot and shoe industry should be left out of taxation.

That is not a wholly accurate impression. The state of affairs in which 98 per cent. of its products was clear of tax a few months ago was not the state of affairs that existed throughout the duration of the tax by any manner of means. It was the result of a steady widening of specifications that took place throughout a large part of the Utility scheme, but perhaps most conspicuously in this industry. In 1948, when right hon. and hon. Members opposite were responsible, the total output of this industry exempt from tax was only 62 per cent. It was in the years since 1948 that the change took place that resulted largely in exempting leather boots and shoes.

It is wrong to assume that there was a deliberate policy carried out over the years of all but complete exemption. On the contrary, the state of affairs at which we have now arrived was arrived at largely accidentally, due to the extreme difficulties administratively of laying down precise specifications under the old Utility scheme.

As has been pointed out by my right hon. and gallant Friend the Member for Leicester, South-East, the result of the changes that have been made is to leave substantially the same the total tax burden on the footwear industry as a whole —leather and rubber together—but to transfer a good deal of the burden from rubber—which gets an exemption below the medium point and the concession which the D scheme involves above it—while putting leather into the same position, with the lower half exempt but with the D scheme operating in the upper half.

But, from the point of view of the consumer, the position is that the total tax burden on footwear remains, in substance, the same. The difference is that instead of having one category of footwear in which even quite expensive makes bear no tax, while in the other category even the cheapest types bear tax, we now have a system under which the consumer who decides to buy in the cheaper half of the range can buy, free of tax, either in leather or rubber. That is the effect of the change as it was before my right hon. Friend announced his general concession, about which I shall say a word in a moment.

Mr. Douglas Jay (Battersea, North)

I take it that the hon. Gentleman is not denying that the Government are making a switch in tax gains from the more expensive to the least expensive footwear?

Mr. Boyd-Carpenter

It depends whether the right hon. Gentleman confines his gains to the leather industry or looks over the industry as a whole. If one looks over the industry as a whole, over half of the total types of rubber boots or shoes—every one of which bore tax prior to this change—is to be exempt. Looking at the question from the point of view of the consumer, we are making available in the bottom half of the scale more types of tax-free footwear than there were before. That is a very serious consideration from the point of view of the consumer.

Captain Waterhouse

Surely, in bringing rubber footwear into juxtaposition with what he calls the boot and shoe trade the hon. Gentleman is doing a quite artificial thing? It is as if he were comparing the herring fishing industry with dairy farming because they both produce food. There is no connection between the rubber boot industry and the leather boot industry.

Mr. Boyd-Carpenter

I had hoped that I had made it clear that I was dealing with the question not from the point of view of the industry but of the consumer—to which aspect of the matter several hon. Members have referred. I think my right hon. and gallant Friend will agree that the comparison is relevant from that point of view. Just as in the analogy which he used dairy farming and fishing both provide food, so in this case both are articles which people wear on their feet.

Mr. Paget

Will the hon. Gentleman tell us what proportion of rubber boots he is releasing from taxation is imported and what proportion is home-produced?

Mr. Boyd-Carpenter

I have not the import figures with me. It may well be that they can be obtained in the course of this debate and, if so, they will be given to the hon. and learned Gentleman. I would prefer not to speculate, and I think that the hon. and learned Gentleman would agree with me about that. From the consumer point of view, the question whether the goods be imported or home-produced is not really in issue. What is in issue is the relationship to the cost of living, to which a number of hon. Members have devoted their arguments

Mr. M. Follick (Loughborough)

Although it is not an issue from the consumer point of view, it is certainly an issue from the unemployment point of view.

6.15 p.m.

Mr. Boyd-Carpenter

If the hon. Gentleman had followed me he would have appreciated that I have been dealing with the consumer argument which some of his hon. Friends have raised. I did undertake—and I will now do so—to come to the particular aspect of the matter which affects the leather boot and shoe industry as a whole.

The first factor which I would ask the Committee to bear in mind—because it affects the whole industry—is the substantial concession which my right hon. Friend the Chancellor announced last night—the reduction in the rate of Purchase Tax from 33⅓ per cent. to 25 per cent. upon that part of the output of the industry which bears tax. As was pointed out by the right hon. and gallant Member for Leicester, South-East, that is a very appreciable factor. All the arguments that have been used in relation to the effect of this tax on the industry have stressed the effect of increased price. To some extent that effect must be mitigated by the reduction in the tax and to that extent, over the whole of the output of this industry, the point urged by a number of hon. Members has been met.

My right hon. and gallant Friend the Member for Leicester, South-East, in his very authoritative and interesting speech, dealt not only with the general aspect but with certain particular and specific questions, to which I should now like to refer. He referred to the position of safety shoes. As he said, most protective boots are cleared in one way or another. Miners' and quarrymen's protective boots are exempt by statute in any case; but the question of safety shoes is a rather special and more difficult one. Representations have already been submitted to us on this particular point and, in view of what the right hon. and gallant Gentleman said this afternoon, my right hon. Friend the Chancellor is prepared to look further into this matter to see whether a satisfactory solution can be arrived at. The Chancellor authorises me to say that he feels that that specific point is one—in the light both of what has been said this afternoon and the representations he has received—should be looked into further.

My right hon. and gallant Friend the Member for Leicester, South-East, also referred to another and somewhat wider matter of specific importance, namely, the question of the particular D level for men's slippers. A number of hon. Members have pointed out that as the Schedule now stands there is a substantial disparity between the respective charges with regard to men's slippers and women's slippers. I do not want to get involved in a feminist or anti-feminist riot on the subject, but that point is a material one and my right hon. Friend has been looking into the matter.

The disparity arises from the fact that women's slippers are not given a separate D figure in the Schedule as it stands at present, for the reason that it is rather difficult, in the case of certain women's slippers, to distinguish them from women's shoes. What has been done in the Schedule is to give them three separate D figures, in the same category as different kinds of women's shoes. Slippers and shoes have been amalgamated for that purpose. But the position of men's slippers is a serious one and the D figure of 15s. given in the Schedule is undoubtedly low.

On reconsideration my right hon. Friend has come to the conclusion that it would be right, when we come to the Report stage, to table an Amendment which would raise the D level for men's slippers from 15s. to 25s. That would meet the charge of disparity between men's and women's shoes to a very considerable extent and—which is perhaps much more important—it would provide a more adequate figure.

Mr. John Rankin (Glasgow, Tradeston)

I wonder if the hon. Gentleman could clear up one point in relation to men's slippers. There is a form of slipper known as a house boot, which is largely worn by men. Can we take it that such footwear will be included in the concession which the hon. Gentleman has just announced?

Mr. Boyd-Carpenter

I do not know whether, in using that expression, the hon. Gentleman is referring to the article which is described in the Schedule by the rather less eloquent expression "bootee."

Mr. Rankin

No. I understand that the bootee applies solely to incipient man and not to the completed article.

Mr. Boyd-Carpenter

I must contradict the hon. Gentleman on that. I am advised that the bootee is worn not only by those of tender years but by mature persons, including even, I understand, right hon. and hon. Gentlemen. On that point I correct the hon. Gentleman. I am not clear as to the precise definition of the article to which he has referred, and I do not know into which category it falls, but I will look the matter up and will communicate with him.

I now turn to the other item to which my right hon. and gallant Friend referred, which is perhaps the largest in scale of the specific matters he raised. My right hon. Friend the Chancellor has been looking into the position in the Schedule of the articles which appear for men in item A 19 and for women in item B 22—that is, under the heading "boots and bootees." A good deal of criticism was levied, particularly in respect of men's footwear, at the low D given for various lined footwear, which I understand—and I convey this information to the hon. Member for Tradeston (Mr. Rankin)—are properly described as bootees, a most objectionable term but one which, I gather, one is compelled to use, even in legislation, if one wishes precisely to describe the article concerned.

In looking at this matter my right hon. Friend came to the conclusion that the D for what we generically refer to as bootees was too low—in fact for all the articles in the bootees and boot category other than boots. [Laughter.] I appreciate that that is language worthy of the statute, but it is none the less a precise definition. Sometimes the language of statutes has to be ponderous in order to be precise, and I am afraid that I found it necessary on this occasion to fall into the same way. If. we remove discrimination in respect of the scale and give the same D for bootees and similar articles as for boots—that is to say, £3; and this is a very substantial matter indeed—we feel that we meet the point raised by my right hon. and gallant Friend and others as to the position of this lined footwear. Whether they are fleece-lined, wool, cotton or fur-lined, we get rid of all the detail in item 19 and 22 of the Schedule and give the same D. The full £3 D for boots is applied to all those articles.

That should substantially help to deal with the problem of these articles, in which case as I say, on consideration my right hon. Friend came to the conclusion that the D was placed a little low. I should state, in order that we shall not have any interference with trade because of any delay, that it is intended to bring these changes into effect tomorrow, Wednesday, 14th May. My right hon. Friend hopes, and the Government hope, that these changes will succeed in clearing up what it is quite reasonable to regard as certain anomalies in this complicated scheme, without prejudice to its main structure.

It is our object, in introducing this scheme, to make it as fair, reasonable and efficient as possible. It would be foolish to dispute the fact that where, for the reasons I gave in opening my speech, an industry has enjoyed virtual tax exemption for a year or two, it finds it perhaps difficult and uncomfortable to readjust to a system under which some burden of tax is imposed upon it. It would be foolish to dispute that, but I am sure the Committee will want to apply this scheme fairly, not only as between items inside an industry but also as between industry and industry.

We feel that, having been able, first of all to make my right hon. Friend's major concession on the rates of tax, and, secondly, to make the adjustments of D which I have just announced, we shall be able to meet the real anxieties and the real apprehensions which I appreciate were expressed most sincerely by hon. Members on both sides of the Committee. We feel that this ancient, vigorous industry, with its admirable export trade, will be able to face its difficulties with the knowledge that, however much all of us may dislike taxation, the industry is having substantially fair taxation imposed upon it—and imposed with an understanding of its difficulties.

Mr. Jay

Could the Financial Secretary tell us the cost of the concession which he has just announced?

Mr. Boyd-Carpenter

I am afraid it is not possible to give that figure to the right hon. Gentleman. As he will appreciate, some complex calculations inside three specific categories are involved. If the right hon. Gentleman cares to put down a Question later, I hope to be able to give him the information.

Several Hon. Members

rose

The Chairman (Colonel Sir Charles MacAndrew)

Is not the Committee ready to come to a decision yet?

Hon. Members

No.

Mr. John Paton (Norwich, North)

I do not want to detain the Committee long, but I am sure hon. Members on this side of the Committee, as well as hon. Members opposite who are similarly interested in this most important footwear industry, will agree that we are not wasting a single moment of the valuable time of the Committee in pursuing this matter.

I think nobody who heard the speech of the Financial Secretary and has any definite interest, either in his constituency or elsewhere, in the footwear industry, could protest that he is in the least gratified by the pleas which the Financial Secretary made to the Committee. It must have been obvious, even to the right hon. and gallant Member for Leicester, South-East (Captain Waterhouse), who has been so anxious to find cause for praising both the Chancellor of the Exchequer and the Financial Secretary in their handling of this question of Purchase Tax, that the Financial Secretary has not the remotest understanding of the industry, not even now.

It is, in fact, no concession worthy of the name to lift the D level on bootees. The footwear industry is not built on bootees. The footwear industry is built on the solid leather footwear trade of ordinary boots and shoes worn by the average person throughout the country, and it in no respect begins to meet the claim which we have been pressing, together with Members opposite, to throw us now this miserable little bone of lifting the D level on bootees.

Nor is it of very great value to the trade—and I ask the Chancellor of the Exchequer to appreciate this point—to give, amongst the other trades concerned and the other products concerned, the concession which was announced yesterday because, after all, what we are dealing with here is not the variation, the redistribution, of taxes already imposed on the products of an industry; what we are dealing with is the imposition of a new tax over a large range of products which have been free of tax for at least several years. Whether this dates from 1948 or from the day before yesterday, we are imposing a new tax, and it does not help the selling side of the industry to say that instead of sticking on an extra 6s. to a pair of ladies' shoes, we intend now to stick on only 4s. 6d. That will not solve the problem of selling shoes and boots in difficult circumstances and conditions.

6.30 p.m.

I was much interested in the Financial Secretary's argument—that extraordinary confusion of mind, that abysmal confusion of mind about this industry—in which he jumbled everything together—leather footwear and rubber footwear, plimsolls and all the rest of it. We on this side of the Committee, and hon. Members on the other side who have been pressing him on this matter, are not worrying about Plimsolls. We are worrying about craft-produced footwear, and to put those two together in the same category shows that he has not appreciated in the least the real problem we have been trying to present to him in a reasonable way. He says it is an advantage to spread the taxation from the rubber industry, on which it has been in the past, on now to large sections of footwear that hitherto have been out of tax. He thinks that is an advantage.

What he is actually doing, of course, is giving a premium to the producer to buy shoddy rubber instead of good solid leather. That is what he is doing. He is giving a positive incentive to people to lower the quality of footwear they are accustomed to wear, and that is a very serious thing indeed, and I hope that he will get out of his head the idea that there is something right and proper in transferring a burden from rubber footwear to leather footwear. If he wants to reduce the burden on rubber, he will find it is a simple proposition: give rubber an advantage that it has not had before. That is the way to do it. Do not let him try to balance that by putting an extra burden on boots and shoes.

He made the point also that the 98 per cent. freedom from tax which has hitherto characterised the leather footwear industry was very largely an accidental circumstance. I want to dispute that. I think he said that it had arisen more or less accidentally by continual enlargement of the specification. I want to suggest to him that it arose in an entirely different and far more logical way. He pointed out that it dates from 1948.

The reason why that large exemption applying to footwear since 1948 came about was that it was the result of a deliberate policy pursued by the Labour Government of progressively reducing, as far as possible, the burden of Purchase Tax upon the necessaries of life and transferring it to luxuries; and it was in the course of working out that policy that we arrived eventually at a state of affairs in which 98 per cent. of all the leather footwear in the country was relieved of Purchase Tax.

Mr. William Shepherd (Cheadle)

For the sake of accuracy, let us get this reason correct. The reason why there was an increase in the sphere of boots and shoes coming within the Utility specification arose out of the fact that leather rose very rapidly in price, and so, very properly, the trade applied for increases in the Utility ceiling. In the meantime the price of leather went down. Clearly, that brought as a consequence a larger proportion of the trade into the Utility specification.

Mr. Paton

The price of leather is only one element in the production costs of boots and shoes. While it is true that at the moment the price of leather has fallen, as the hon. Gentleman the Member for Beverley (Mr. Odey) pointed out, other costs are going up—and other costs of the shoe industry will go up automatically because they are tied to the cost of living figure on a sliding scale arrangement which immediately operates, and will continue to operate while the Chancellor pursues a policy of making the cost of living high.

I was making the point that it is quite absurd to try to claim that these concessions already made will have any marked effect upon the leather footwear industry. Let the Financial Secretary for a little while detach himself from this objective of perfectionism that has beset his mind—from thinking, "Now that we are introducing the D scheme, here is an opportunity to iron out all sorts of anomalies that beset the other scheme, for it would be nice to make it apply now in all directions over all the products that we consume. It would be nice to do all those things." Let him get away from that sort of Treasury tidiness, and let him look at the situation in which the leather footwear industry is today. Let him try to take a detached look.

Here is an industry now facing a fierce buyers' resistance; suffering from a recession. Some of my constituents are now knowing again what they knew so well before the war—unemployment: registered unemployment of men and women. Here is an industry that is in a recession much bigger than the statistics reveal, because there is a very large amount of concealed unemployment in the leather footwear industry.

Here we have this industry, hitherto almost wholly untaxed, in that situation of a trade slump, and the Chancellor and the Financial Secretary turn round and say, "Here is a point where we ought to put a tax upon the industry for the first time for several years in order to make the products produced by it still more difficult to sell." If they were looking at it from a detached point of view, they would say at once, "This is economic madness." Yet that is precisely what they are doing at this moment.

I beg both the Chancellor and the Financial Secretary to give the Committee the assurance that they will look once more at this problem of the leather footwear industry—boots and shoes; particularly the quality ranges; for in Norwich it means that 70 per cent. of the whole of its production will now be taxed for the first time in years. I ask them to look at the special circumstances of this industry, and to think again about the need for raising the D line on these particular products from the absurdly low level it is now placed at to something much nearer the realistic figures we have included in our Amendments.

Mr. Paget

The Parliamentary Secretary gave us a most unsatisfactory answer. He said that the lowering of the amount of footwear subject to Purchase Tax to 2 per cent. had been largely accidental. It was nothing of the sort. It was as a result of policy and negotiation. The policy of the late Government was not to tax necessities—not to tax goods which were not luxuries. In point of fact, as we pointed out during those years, £5 a pair of shoes on a mileage basis came as cheap or cheaper than 50s. a pair of shoes. That argument was a perfectly logical argument and appealed to the Government, and, therefore, these quality ranges were included within Utility.

What is largely accidental is the imposition of the new tax which is being put on today. That is what is accidental. The Government had no idea of what they were doing when they put on this tax. I do not believe for one moment that it was their deliberate intention to put a tax on a British manufactured leather shoe in order to take a tax off in a considerable degree an imported rubber shoe—and a rubber shoe which, in any event, carried a very large dollar content. To take taxation off that dollar-content imported article to put it on to a British manufacture—of course, it was not their intention. They had not the foggiest idea what they were doing, and I can tell them why.

Mr. R. A. Butler

Perhaps the hon. and learned Gentleman would like to know that there is a specific reference to this in the Douglas Committee Report on which nearly all our recommendations are based, so that we did have some "foggy idea" because we were following that Report.

Mr. Paget

Will the right hon. Gentleman tell me in what part of their Report the Douglas Committee recommended that taxation should be taken off rubber boots and shoes in order to be put on leather boots and shoes not previously taxed? I venture to say to the Chancellor that there is no word to that effect in the Douglas Report?

Mr. Butler

They did not put it like that, but they did draw our attention to the necessity of including certain articles under this scheme. One article was table oil-cloth and another was rubber Wellington boots, and that is why we have included those articles in this scheme.

Mr. Paget

A great disadvantage of the Douglas Committee was that they knew nothing whatever about the boot and shoe trade; they were in hosiery a committee. [Laughter.] Hon. Members opposite may laugh, but I can tell them that there is the greatest bitterness not only on the trade union side, but on the manufacturers' side in the boot and shoe industry at the way they were treated by the Douglas Committee. There was nobody on that Committee who knew the first thing about this industry. The manufacturers were invited to supply written evidence, but they were not asked to come and give verbal evidence on the points they submitted, and, as I say, there is great bitterness in the trade with regard to that.

Captain Waterhouse

I hope the hon. and learned Gentleman will remember that the Douglas Committee was set up by his own Government, who laid down the terms of reference.

Mr. Paget

In all conscience, we are not dealing with little party bickerings; we are dealing with a great injury that is being caused to an important industry. If hon. Members opposite like to make the point that it was our fault for not putting a boot and shoe man on the Douglas Committee, I will take it. I do not care in the least about that, but what I want to see is something done for an industry which is rapidly going into slump, because let there be no doubt about it that is what is happening.

The first phase is the stocking up by the retailers. That has happened in a very marked degree. The retailers in the boot and shoe industry are carrying stocks such as they have never carried before. Then comes the stocking up of the wholesalers and the manufacturers, and then part-time in the factories. We have had that, and now come the sackings. That is the phase which has already started, and with all the cushioning effect exhausted, unemployment in the industry is going to mount with great rapidity. It is at the stage when it has started downhill that the industry is being given this additional push by a brand new tax imposed on it.

I say again that the Government had not the faintest idea what they were doing when they imposed this tax, and I would refer the Chancellor to an answer he gave me to a Question as recently as 29th April, on which date, I suggest, he still did not know what he was doing. I asked the Chancellor: (1) how much Purchase Tax the present D scheme is estimated to produce from leather footwear products in the United Kingdom; (2) how much Purchase Tax was derived from leather footwear products in the United Kingdom in the financial year 1951–52. I think it must have been very clear to the Chancellor that I wanted comparable figures. His answer was: It was stated in reply to my right hon. and gallant Friend the Member for Leicester, South-East (Captain Waterhouse), that the yield of Purchase Tax from footwear of all kinds is expected to amount to about £3½ million under the D scheme, as compared with about £3.3 million on the previous basis of taxation. I am afraid that the material on which these estimates were based does not permit a detailed analysis to be made as between the different kinds of footwear." —[OFFICIAL REPORT, 29th April, 1952; Vol. 499, c. 69.] 6.45 p.m.

If when the Chancellor gave me the figure of £3.3 million he knew and appreciated that that sum was in respect of over 90 per cent. rubber goods and less than 10 per cent. leather goods, about which I was asking, I submit that it was a most dishonest answer. But I know very well that the Chancellor is not a dishonest man and does not give dishonest answers. I venture to say that when he gave that answer he had not appreciated that the effect of this D scheme was to transfer taxation from rubber to leather which was going into slump. It is not as a result of a deliberate policy that this industry is suffering this injury. It is not a calculated policy, and it is not a policy to transfer labour somewhere else, because it is the old people that the industry will be losing. It is just an injury which this industry is to suffer owing to the incompetence and ignorance of the Government who have by accident placed a heavy tax on it at the worst possible time.

Mr. Anthony Greenwood

In the few remarks I wish to make I shall, I hope, set an example of brevity which will be appreciated on both sides of the Committee. But before we pass to a Division, I want to say how very disappointed we are on this side, as, I think, are some right hon. and hon. Members opposite, at the limited extent to which the Government have been able to meet the demands made upon them.

There has been a most remarkable unanimity of view on both sides of the Committee, and we certainly expected more substantial concessions than have been made. In fact, we felt certain that hon. Gentlemen opposite would not have put their names to Motions and gone so far as to speak on them without having previously had a good guarantee from the Chancellor that their point of view was to be met.

Captain Waterhouse

I can assure the hon. Gentleman that there is not the slightest truth in that. If he says that, then he does not know how the Chancellor works.

Mr. Greenwood

The point I was making was that we felt confident that the Government were going to make more generous concessions because the right hon. and gallant Gentleman opposite had proceeded so far. I have no doubt that he shares the disappointment we feel that the Chancellor has not been more forthcoming.

There are two points which I want to put to the Financial Secretary. The first relates to slippers, a large proportion of

which come from the Rossendale Valley. The Government have come some way towards meeting us on that point. We had put down a D level of £1 10s. in respect of men's slippers, and the Financial Secretary now proposes 25s. That is slightly less than the D level for women's slippers. The second point I wish to make refers to fur boots and bootees. It was not clear from what the Financial Secretary said whether the concession he is making of bringing fur bootees within the D level of £3 also applies to fur boots as well. I should like to know whether he can give us an assurance on that, because hon. Members on both sides of the Committee have said that fur boots are very far from being a luxury in some parts of the country and are a necessity.

Although we realise that there have been some concessions, in view of the fact that there is no concession on the ordinary D level of boots and shoes, we feel it necessary to press some of these Amendments to a Division.

Amendment negatived.

Amendment proposed, in page 75, line 23, leave out "3 0 0," and insert "4 10 0."—[Mr. Anthony Greenwood.]

Question put, "That '3 0 0' stand part of the Schedule."

The Committee divided: Ayes, 284; Noes, 260.

Division No. 124.] AYES [6.52 p.m.
Aitken, W. T. Boyle, Sir Edward Deedes, W. F.
Allan, R. A. (Paddington, S.) Braine, B. R. Digby, S. Wingfield
Alport, C. J. M. Braithwaite, Sir Albert (Harrow, W.) Donaldson, Cmdr. C. E McA.
Amery, Julian (Preston, N.) Brooman-White, R. C. Donner, P. W.
Amory, Heathcoat (Tiverton) Browne, Jack (Govan) Doughty, C. J. A.
Anstruther-Gray, Major W. J. Buchan-Hepburn, Rt. Hon P G T Douglas-Hamilton, Lord Malcolm
Arbuthnot, John Bullard, D. G. Drayson, G. B.
Ashton, H. (Chelmsford) Bullock, Capt. M. Drewe, C.
Assheton, Rt. Hon. R. (Blackburn, W) Bullus, Wing Commander E. E Dugdale, Maj. Rt. Hn. Sir T (Richmond)
Astor, Hon. J. J. (Plymouth, Sutton) Burden, F. F. A. Duncan, Capt. J. A. L.
Baker, P. A. D. Butcher, H. W. Duthie, W. S.
Baldock, Lt.-Cmdr. J. M. Butler, Rt. Hon. R. A. (Saffron Walden) Elliot, Rt. Hon. W E
Baldwin, A E. Carson, Hon. E. Erroll, F. J.
Banks, Col. C. Cary, Sir Robert Fell, A.
Barber, A. P. L. Channon, H Finlay, Graeme
Barlow, Sir John Clarke, Col. Ralph (East Grinstead) Fisher, Nigel
Baxter, A. B. Clarke, Brig. Terence (Portsmouth, W.) Fleetwood-Hesketh, R F
Beach, Maj. Hicks Clyde, Rt. Hon. J. L. Fletcher-Cooke, C.
Beamish, Maj. Tufton Cole. Norman Fort, R.
Bell, Philip (Bolton, E.) Conant, Maj. R. J. E. Fraser, Hon. Hugh (Stone)
Bell, Ronald (Bucks, S.) Cooper, Sqn. Ldr. Albert Fraser, Sir Ian (Morecambe & Lonsdale)
Bennett, F. M. (Reading, N.) Cooper-Key, E M Gage, C. H
Bennett, Sir Peter (Edgbaston) Craddock, Beresford (Spelthorne) Galbraith, Cmdr. T D. (Pollok)
Bennett, William (Woodside) Cranborne, Viscount Galbraith, T G. D. (Hillhead)
Bevins, J. R. (Toxteth) Crookshank, Capt Rt. Hon. H F C Garner-Evans, E H
Birch, Nigel Crouch, R. F. Glyn, Sir Ralph
Bishop, F. P. Crowder, John E. (Finchley) Godber, J. B.
Black, C. W. Crowder, Petre (Ruislip—Northwood) Gomme-Duncan, Col A
Bossom, A. C. Cuthbert, W. N. Gough, C. F H.
Bowen, E. R. Darling, Sir William (Edinburgh, S.) Gower, H. R.
Boyd-Carpenter, J. A. De la Bère, R. Graham, Sir Fergus
Gridley, Sir Arnold Lucas-Tooth, Sir Hugh Ryder, Capt. R. E. D.
Grimond, J. Lyttelton, Rt. Hon. O. Salter, Rt. Hon. Sir Arthur
Grimston, Hon. John (St. Albans) McAdden, S. J. Sandys, Rt. Hon. D.
Grimston, Sir Robert (Westbury) McCorquodale, Rt. Hon. M. S. Savory, Prof. Sir Douglas
Harden, J. R. E Macdonald, Sir Peter (I. of Wight) Schofield, Lt.-Col. W. (Rochdale)
Hare, Hon. J. H. Mackeson, Brig, H. R. Scott, R. Donald
Harris, Frederic (Croydon, N.) McKibbin, A. J. Scott-Miller, Cmdr. R.
Harris, Reader (Heston) McKie, J. H. (Galloway) Shepherd, William
Harrison, Col. J. H. (Eye) Maclean, Fitzroy Simon, J. E. S. (Middlesbrough, W.)
Harvey, Ian (Harrow, E.) MacLeod, Iain (Enfield, W.) Smiles, Lt.-Col. Sir Walter
Harvie-Watt, Sir George MacLeod, John (Ross and Cromarty) Smithers, Peter (Winchester)
Hay, John Macmillan, Rt. Hon. Harold (Bromley) Smithers, Sir Waldron (Orpington)
Head, Rt. Hon. A. H. Maitland, Comdr J. F. W. (Horncastle) Smyth, Brig. J. G. (Norwood)
Heald, Sir Lionel Maitland, Patrick (Lanark) Snadden, W. McN.
Heath, Edward Manningham-Buller, Sir R. E. Spearman, A. C. M
Henderson, John (Cathcart) Markham, Major S. F. Speir, R. M.
Higgs, J. M. C. Marlowe, A. A. H. Spence, H. R. (Aberdeenshire, W.)
Hill, Dr. Charles (Luton) Marshall, Douglas (Bodmin) Spens, Sir Patrick (Kensington, S.)
Hill, Mrs. E. (Wythenshawe) Marshall, Sidney (Sutton) Stanley, Capt. Hon. Richard
Hinchingbrooke, Viscount Maude, Angus Stevens, G. P.
Hirst, Geoffrey Maudling, R. Steward, W. A. (Woolwich, W.)
Holland-Martin, C. J. Maydon, Lt.-Comdr S. L. C. Stewart, Henderson (Fife, E.)
Hollis, M. C. Medlicott, Brig. F. Stoddart-Scott, Col. M.
Holmes, Sir Stanley (Harwich) Mellor, Sir John Storey, S.
Holt, A. F. Molson, A. H. E. Strauss, Henry (Norwich, S.)
Hope, Lord John Monckton, Rt. Hon. Sir Walter Stuart, Rt. Hon. James (Moray)
Hopkinson, Henry Moore, Lt.-Col. Sir Thomas Summers, G. S.
Hornsby-Smith, Miss M. P. Morrison, John (Salisbury) Sutcliffe, H.
Horobin, I. M. Mott-Radclyffe, C. E Taylor, Charles (Eastbourne)
Horsbrugh, Rt. Hon. Florence Nabarro, G. D. N. Taylor, William (Bradford, N.)
Howard, Gerald (Cambridgeshire) Nicholls, Harmar Teeling, W.
Howard, Greville (St. Ives) Nicolson, Nigel (Bournemouth, E.) Thomas, Rt. Hon. J P. L. (Hereford)
Hudson, Sir Austin (Lewisham, N.) Nield, Basil (Chester) Thomas, P. J. M. (Conway)
Hudson, W. R. A. (Hull, N.) Noble, Cmdr, A. H. P. Thompson, Kenneth (Walton)
Hulbert, Wing Cmdr. N. J. Nugent, G. R. H. Thompson, Lt-Cdr. R. (Croydon, W.)
Hurd, A. R. Odey, G. W. Thornton-Kemsley, Col. C. N.
Hutchinson, Sir Geoffrey (Ilford, N.) O'Neill, Rt. Hon. Sir H. (Antrim, N.) Tilney, John
Hutchison, Lt.-Com. Clark (E'b'rgh W.) Ormsby-Gore, Hon. W. D. Turner, H. F. L.
Hutchison, James (Scotstoun) Orr, Capt. L. P. S. Turton, R. H.
Hyde, Lt.-Col. H. M. Orr-Ewing, Charles Ian (Hendon, N.) Tweedsmuir, Lady
Hylton-Foster, H. B. H. Osborne, C. Vane, W. M. F.
Jenkins, R. C, D. (Dulwich) Partridge, E. Vaughan-Morgan, J. K
Jennings, R. Peake, Rt. Hon. O. Vosper, D. F.
Johnson, Eric (Blackley) Perkins, W. R. D. Wade, D. W.
Jones, A. (Hall Green) Peto, Brig. C. H. M. Wakefield, Edward (Derbyshire, W.)
Joynson-Hicks, Hon. L. W. Peyton, J. W. W. Wakefield, Sir Wavell (Marylebone.)
Kaberry, D. Pickthorn, K. W. M. Walker-Smith, D. C.
Keeling, Sir Edward Pilkington, Capt. R. A. Ward, Hon. George (Worcester)
Kerr, H. W. (Cambridge) Pitman, I. J. Ward, Miss I. (Tynemouth)
Lambert, Hon. G. Price, Henry (Lewisham, W.) Waterhouse, Capt. Rt. Hon. C.
Lambton, Viscount Prior-Palmer, Brig. O. L. Watkinson, H. A.
Lancaster, Col. C. G. Profumo, J. D. Webbe, Sir H. (London & Westminster)
Law, Rt. Hon. R. K. Raikes, H. V. Wellwood, W.
Leather, E. H. C. Rayner, Brig. R White, Baker (Canterbury)
Legge-Bourke, Maj. E. A. H Redmayne, E. Williams, Rt. Hon. Charles (Torquay)
Legh, P. R. (Petersfield) Remnant, Hon. P. Williams, Gerald (Tonbridge)
Lindsay, Martin Renton, D. L. M. Williams, R. Dudley (Exeter)
Linstead, H. N. Roberts, Peter (Heeley) Wills, G.
Llewellyn, D. T. Robertson, Sir David Wilson, Geoffrey (Truro)
Lloyd, Maj. Guy (Renfrew, E.) Robinson, Roland (Blackpool, S.) Wood, Hon. R.
Lookwood, Lt.-Col. J. C. Robson-Brown, W. York, C.
Longden, Gilbert (Hurts, S.W.) Rodgers, John (Sevenoaks)
Low, A. R. W. Roper, Sir Harold TELLERS FOR THE AYES:
Lucas, Sir Jocelyn (Portsmouth, S.) Ropner, Col. Sir Leonard Mr. Studholme and Mr. Oakshott
Lucas, P. B. (Brantford) Russell, R. S.
NOES
Acland, Sir Richard Benn, Wedgwood Burton, Miss F. E
Adams, Richard Benson, G. Butler, Herbert (Hackney, S.)
Albu, A. H. Beswick, F. Callaghan, L. J.
Allen, Arthur (Bosworth) Bing, G. H. C. Carmichael, J.
Allen, Scholefield (Crewe) Blackburn, F. Castle, Mrs. B. A
Anderson, Alexander (Motherwell) Blenkinsop, A. Champion, A. J.
Anderson, Frank (Whitehaven) Blyton, W. R. Chapman, W. D.
Attlee, Rt. Hon. C. R Boardman, H. Chetwynd, G. R.
Awbery, S. S. Bowden, H. W. Clunie, J.
Ayles, W. H. Bowles, F. G. Cocks, F. S.
Bacon, Miss Alice Braddock, Mrs. Elizabeth Coldrick, W.
Baird, J. Brockway, A. F. Collick, P. H.
Balfour, A. Brook, Dryden (Halifax) Cook, T. F.
Barnes, Rt. Hon. A. J. Broughton, Dr. A. D. D. Cove, W. G.
Bartley, P. Brown, Rt. Hon. George (Belper) Craddock, George (Bradford, S.)
Ballenger, Rt. Hon. F. J. Brown, Thomas (Ince) Crosland, C. A. R
Bence, C. R. Burke, W. A. Cullen, Mrs. A.
Daines, P. Johnson, James (Rugby) Rhodes, H.
Dalton, Rt. Hon. H. Johnston, Douglas (Paisley) Richards, R
Darling, George (Hillsborough) Jones, David (Hartlepool) Robens, Rt. Hon. A.
Davies, Ernest (Enfield, E.) Jones, Frederick Elwyn (West Ham, S.) Roberts, Albert (Normanton)
Davies, Harold (Leek) Jones, Jack (Rotherham) Roberts, Goronwy (Caernarvonshire)
Davies, Stephen (Merthyr) Jones, T. W. (Merioneth) Robinson, Kenneth (St. Pancras, N.)
de Freitas, Geoffrey Keenan, W. Rogers, George (Kensington, N.)
Deer, G. Kenyon, C. Ross, William
Delargy, H. J. Key, Rt. Hon. C. W. Royle, C.
Dodds, N. N. King, Dr. H. M. Schofield, S. (Barnsley)
Donnelly, D. L. Kinley, J. Shackleton, E. A A.
Driberg, T. E. N. Lee, Frederick (Newton) Shawcross, Rt. Hon. Sir Hartley
Dugdale, Rt. Hon. John (W. Bromwich) Lee, Miss Jennie (Cannock) Shinwell, Rt. Hon. E.
Ede, Rt. Hon. J. C Lever, Harold (Cheetham) Short, E. W.
Edwards, Rt Hon. Ness (Caerphilly) Lever, Leslie (Ardwick) Shurmer, P. L. E.
Edwards, W. J. (Stepney) Lewis, Arthur Silverman, Julius (Erdington)
Evans, Albert (Islington, S.W.) Lindgren, G. S. Simmons, C. J (Brierley Hill)
Evans, Edward (Lowestoft) Lipton, Lt.-Col. M. Slater, J.
Evans, Stanley (Wednesbury) Logan, D. G. Smith, Ellis (Stoke, S.)
Ewart, R. MacColl, J. E. Smith, Norman (Nottingham, S.)
Fernyhough, E. McGhee, H. G. Sorensen, R. W.
Field, W. J McGovern, J. Soskice, Rt. Hon Sir Frank
Fienburgh, W. Mclnnes, J. Sparks, J. A
Finch, H. J. McKay, John (Wallsend) Steele, T.
Fletcher, Erie (Islington, E.) McLeavy, F. Stewart, Michael (Fulham, E.)
Follick, M. MacMillan, M. K. (Western Isles) Stokes, Rt. Hon. R R
Foot, M. M. MacPherson, Malcolm (Stirling) Strachey, Rt. Hon. J.
Forman, J. C. Mainwaring, W. H Strauss, Rt. Hon. George (Vauxhall)
Fraser, Thomas (Hamilton) Mallalieu, E. L. (Brigg) Summerskill, Rt. Hon. E.
Freeman, John (Watford) Mallalieu, J. P. W. (Huddersfield, E) Swingler, S. T.
Gibson, C. W Mann, Mrs. Jean Sylvester, G. O.
Glanville, James Manuel, A. C. Taylor, Bernard (Mansfield)
Gordon Walker, Rt. Hon. P. C. Marquand, Rt. Hon. H. A. Taylor, John (West Lothian)
Greenwood, Anthony (Rossendale) Mellish, R. J. Taylor, Rt. Hon Robert (Morpeth)
Greenwood, Rt. Hon. Arthur (Wakefield) Messer, F. Thomas, David (Aberdare)
Grenfell, Rt. Hon. D. R. Mikardo, Ian Thomas, Iorwerth (Rhondda, W.)
Grey, C. F. Mitchison, G. R Thorneycroft, Harry (Clayton)
Griffiths, David (Rother Valley) Monslow, W. Thurtle, Ernest
Griffiths, William (Exchange) Moody, A S. Timmons, J.
Hale, Leslie (Oldham, W.) Morley, R. Tomlinson, Rt Hon. G
Hall, Rt. Hon. Glenvil (Colne Valley) Morrison, Rt. Hon. H (Lewisham, S) Tomney, F.
Hall, John (Gateshead, W.) Mort, D. L. Turner-Samuels, M.
Hamilton, W W. Moyle, A. Ungoed-Thomas, Sir Lynn
Hardy, E. A. Murray, J. D. Viant, S. P.
Hargreaves, A. Neal, Harold (Bolsover) Watkins, T. E.
Harrison, J. (Nottingham, E.) Noel-Baker, Rt. Hon. P. J Webb, Rt. Hon M. (Bradford, C.)
Hastings, S O'Brien, T. Weitzman, D.
Hayman, F H. Oldfield, W. H Wells, Percy (Faversham)
Healey, Denis (Leeds, S.E.) Oliver, G. H. Wells, William (Walsall)
Henderson, Rt. Hon A. (Rowley Regis) Orbach, M. West, D. G.
Herbison, Miss M. Oswald, T. Wheatley, Rt. Hon. John
Hewitson, Capt. M. Padley, W. E. White, Mrs. Eirene (E Flint)
Hobson, C. R. Paget, R. T. White, Henry (Derbyshire, N.E.)
Holman, P. Paling, Rt. Hon. W. (Dearne Valley) Whiteley, Rt. Hon. W.
Holmes, Horace (Hemsworth) Paling, Will T. (Dewsbury) Wigg, George
Houghton, Douglas Pannell, Charles Willey, Frederick (Sunderland, N.)
Hoy, J. H. Pargiter, G. A. Willey, Octavius (Cleveland)
Hubbard, T. F Parker, J. Williams, David (Neath)
Hudson, James (Ealing, N.) Paton, J. Williams, Rev. Llywelyn (Abertillery)
Hughes, Cledwyn (Anglesey) Pearson, A Williams, Ronald (Wigan)
Hughes, Emrys (S. Ayrshire) Pearl, T. F. Williams, Rt. Hon. Thomas (Don V'll'y)
Hynd, H. (Accrington) Porter, G. Wilson, Rt. Hon Harold (Huyton)
Hynd, J. B. (Attercliffe) Price, Joseph T. (Westhoughton) Winterbottom, Ian (Nottingham, C.)
Ivine, A. J. (Edge Hill) Price, Philips (Gloucestershire, W.) Winterbottom, Richard (Brightside)
Irving, W. J. (Wood Green) Proctor, W. T Woodburn, Rt. Hon. A.
Isaacs, Rt. Hon. G. A. Pryde, D. J. Wyatt, W. L.
Janner, B. Rankin, John Yates, V. F.
Jay, Rt. Hon. D. P. T. Reeves, J. Younger, Rt. Hon. K.
Jeger, George (Goole) Reid, Thomas (Swindon)
Jenkins, R. H. (Stechford) Reid, William (Camlachie) TELLERS FOR THE NOES:
Mr. Wilkins and Mr. Hannan.

Amendment proposed: In page 75, line 29, leave out "2 0 0," and insert "3 5 0."—[Mr. Anthony Greenwood.]

Question put, "That '2 0 0' stand part of the Schedule."

The Committee divided: Ayes, 284; Noes, 260.

Division No. 125. AYES [7.3 p.m.
Aitken, W. T. Amory, Heathcoat (Tiverton) Assheton, Rt. Hon. R. (Blackburn, W.)
Allan, R. A. (Paddington, S.) Anstruther-Gray, Major W. J Astor, Hon. J. J (Plymouth, Sutton)
Alport, C. J. M. Arbuthnot, John Baker, P. A. D.
Amery, Julian (Preston. N) Ashton, H (Chelmsford) Baldock, Lt.-Cmdr. J M
Baldwin, A. E. Hare, Hon, J. H. Molson, A. H. E.
Banks, Col. C. Harris, Frederic (Croydon, N. Monckton, Rt. Hon. Sir Walter
Barber, A. P. L. Harris, Reader (Heston) Moore, Lt.-Col. Sir Thomas
Barlow, Sir John Harrison, Col. J. H. (Eye) Morrison, John (Salisbury)
Baxter, A.B. Harvey, Ian (Harrow, E.) Mott-Radclyfle, C.E
Beach, Maj. Hicks Harvie-Watt. Sir George Nabarro, G. D. N.
Beamish, Maj. Tufton Hay, John Nicholls, Harmar
Bell, Philip (Bolton, E.) Head, Rt. Hon. A. H. Nicolson, Nigel (Bournemouth, E.)
Bell, Ronald (Bucks, S.) Heald, Sir Lionel Nield, Basil (Chester)
Bennett, F. M.(Reading, N.)( Heath, Edward Noble, Cmdr. A. H. P.
Bennett, Sir Peter (Edgbaston) Henderson, John (Cathcart) Nugent, G. R. H.
Bennett, William (Woodside) Higgs, J. M. C. Oakshott, H. D
Bevins, J. R. (Toxteth) Hill, Dr. Charles (Lutton) Odey, G. W.
Birch, Nigel Hill, Mrs. E. (Wythenshawe) O'Neil, Rt. Hon Sir H. (Antrim, N.)
Bishop, F. P. Hinchingbrooke, Viscount Ormsby-Gore, Hon, W. D.
Black, C. W. Hirst, Geoffrey Orr, Capt. L.P.S.
Bossom, A. C. Holland-Martin, C. J. Orr-Ewing, Charles Ian (Hendon, N.)
Bowen, E. R. Hollis, M. C. Osborne, C.
Boyd-Carpenter, J. A Holmes, Sir Stanley (Harwich) Partridge, E.
Boyle, Sir Edward Holt, A. F. Peake, Rt. Hon. O
Braine, B. R. Hope, Lord John Perkins, W. R. D.
Braithwaite, Sir Albert (Harrow, W.) Hopkinson, Henry Peto, Brig. C. H. M
Brooman-White, R. C. Hornsby-Smith, Miss M. P. Peyton, J. W. W
Browne, Jack (Govan) Horobin, I. M. Pickthorn, K. W. M
Bullard, D. G. Horsbrugh, Rt. Hen. Florence Pilkington, Capt. R A
Bulllock, Capt. M. Howard, Gerald (Cambridgeshire) Pitman, I. J.
Bullus, Wing Commander E. E. Howard, Greville (St. Ives) Price, Henry (Lewisham, W.)
Burden, F. F. A. Hudson, Sir Austin (Lewisham, N.) Prior-Palmer, Brig O. L.
Butcher, H. W. Hudson, W. R. A. (Hull, N.) Profumo, J. D.
Butler, Rt. Hon. R.A. (Saffron Walden) Hulbert, Wing Cmdr. N. J. Raikes, H. V.
Carson, Hon. E. Hurd, A. R. Rayner, Brig. R
Cary, Sir Robert Hutchinson, Sir Geoffrey (Ilford, N.) Redmayne, E.
Channon, H. Hutchison, Lt.-Com. Clark (E'b'rgh W.) Remnant, Hon. P
Clarke, Col. Ralph (East Grinstead) Hutchison, James (Scotstoun) Renton, D. L. M.
Clarke, Brig. Terence (Portsmouth, W.) Hyde, Lt.-Col. H. M. Roberts, Peter (Heeley)
Clyde, Rt. Hon. J. L. Hylton-Foster, H. B. H. Robertson, Sir David
Cole, Norman Jenkins, R. C. D. (Dulwich) Robinson, Roland (Blackpool, S.)
Conant, Maj. R. J. E. Jenkins, R. Robson-Brown, W.
Cooper, Sqn. Ldr, Albert Johnson, Eric (Blackley) Rodgers, John (Sevenoaks)
Cooper-Key, E. M. Jones, A. (Hall Green) Roper, Sir Harold
Craddock, Beresford (Spelthorne) Joynson-Hicks, Hon. L. W. Ropner, Col. Sir Leonard
Cranborne, Viscount Kaberry, D. Russell, R. S.
Crookshank, Capt. Rt. Hon. H. F. C Keeling, Sir Edward Ryder, Capt. R. E. D.
Crosthwaite-Eyre, Col. O. E. Kerr, H. W. (Cambridge) Salter, Rt. Hon. Sir Arthur
Crouch, R. F. Lambert, Hon. G. Sandys, Rt. Hon. D.
Crowder, John E. (Finchley) Lambton, Viscount Savory, Prof. Sir Douglas
Crowder, Petre (Ruislip—Northwood) Lancaster, Col. C. G. Schofield, Lt.-Col. W. (Rochdale)
Cuthbert, W. N. Law, Rt. Hon. R. K. Scott, R, Donald
Darling, Sir William (Edinburgh, S.) Leather, E. H. C. Scott-Miller, Cmdr. R.
De la Bère, R. Legge-Bourke, Maj. E. A. H Shepherd, William
Deedes, W. F Legh, P. R. (Patersfield) Simon, J. E. S. (Middlesbrough, W.)
Digby, S. Wingfield Lindsay, Martin Smiles, Lt.-Col. Sir Walter
Donaldson, Cmdr. C. E. McA Linstead, H. N Smithers, Peter (Winchester)
Donner, P. W. Llewellyn, D. T. Smithers, Sir Waldron (Orpington)
Doughty, C. J. A. Lloyd, Maj. Guy (Renfrew, E.) Smyth, Brig. J. G. (Norwood)
Douglas-Hamilton, Lord Malcolm Lockwood, Lt.-Col. J. C. Snadden, W. McN
Drayson, G. B. Longden, Gilbert (Herbs, S.W.) Spearman, A. C. M
Duncan, Capt. J. A. L Low, A. R. W. Speir, R. M.
Duthie, W. S. Lucas, Sir Jocelyn (Portsmouth, S.) Spence, H. R. (Aberdeenshire, W.)
Elliot, Rt. Hon. W. E. Lucas, P. B. (Brantford) Spens, Sir Patrick (Kensington, S.)
Erroll, F. J. Lucas-Tooth, Sir Hugh Stanley, Capt. Hon. Richard
Fell, A. Lyttelton, Rt. Hon. O. Stevens, G. P.
Finlay, Graeme McAdden, S. J. Steward, W. A. (Woolwich, W.)
Fisher, Nigel McCorquodale, Rt. Hon. M. S. Stewart, Henderson (Fife, E.)
Fleetwood-Hesketh, R. F. Macdonald, Sir Peter (I. of Wight Stoddart-Scott, Col M.
Fletcher-Crooke, C. Mackeson, Brig. H. R. Storey, S.
Fraser, Hon. Hugh (Stone) McKibbin, A. J. Strauss, Henry (Norwich, S.)
Fraser, Sir Ian (Morecambe & Lonsdale) Mckie, J. H. (Galloway) Stuart, Rt. Hon. James (Moray)
Gage, C. H. Maclean, Fitzroy Summers, G. S.
Galbraith, Cmdr. T.D. (Pollock) MacLeod, Ian (Enfield, W.) Sutcliffe, H
Galbraith, T. G. D. (Hillhead MacLeod, John (Ross and Cromarty) Taylor, Charles (Eastbourne)
Garner-Evans, E. H Macmillan, Rt. Hon, Harold (Bromley) Taylor, William (Bradford, N.)
George, Rt. Hon. Maj. G. Lloyd Maitland, Comdr. J.F.W. (Horncastle) Teeling, W.
Glyn, Sir Ralph Maitland, Patrick (Lanark) Thomas, Rt. Hon. J. P. L. (Hereford)
Godber, J. B. Manningham-Bulter, Sir R. E. Thomas, P. J. M. (Conway)
Gomme-Duncan, Col. A. Markham, Major S. F. Thompson, Kenneth (Walton)
Gough, C. F. H Marlowe, A. A. H. Thompason, Lt.-Cdr. R. (Croydon, W.)
Gower, H. R. Marshall, Douglas (Bodmin) Thornton-Kemsley, Col, C. N.
Graham, Sir Fergus Marshall, Sidney (Sutton) Tilney, John
Gridley, Sir Arnold Maude, Angus Turner, H. F. L
Grimond, J. Maudling, R. Turton, R. H.
Grimston, Hon. John (St. Albans) Maydon, Lt-Comdr. S.L.C. Tweedsmuir, Lady
Grimston, Sir Robert (Westbury) Medlicott, Brig. F Vane, W. M. F.
Harden, J.R.E. Mellor, Sir John Vaughan-Morgan, J K
Vosper, D. F.
Wade, D. W. Watkinson, H. A. Wills, G.
Wakefield, Edward (Derbyshire, W.) Webbe, Sir H. (London & Westminster) Wilson, Geoffrey (Trure)
Wakefield, Sir Wavell (Marylebone) Wellwood, W. Wood, Hon R.
Walker-Smith, D. C. White, Baker (Canterbury) York, C.
Ward, Hon. George(Worcester) Williams, Rt. Hon Charles (Torquay)
Ward, Miss I. (Tynemouth) Williams, Gerald (Tenbridge) TELLERS FOR THE AYES:
Waterhouse, Capt. Rt. Hon C. Williams, R. Dudley (Exeter) Mr. Studholme and Mr. Drewe.
NOES
Acland, Sir Richard Fienburgh, W MacMillan, M. K. (Western Isles)
Adams, Richard Finch, H. J. MacPherson, Malcolm (Stirling)
Albu, A. H. fletcher, Eric (Islington, E.) Mainwaring, W. H
Allen, Arthur (Bosworth) Follick, M Mallalieu, E. L. (Brigg)
Allen, Schofield (Crewe) Foot, M. M. Mallalieu, J. P. W. (Huddersfield, E.)
Anderson, Alexander (Motherwell) Forman, J. C. Mann, Mrs. Jean
Anderson, Frank (Whitehaven) Fraser, Thomas (Hamilton) Manuel, A. C.
Attlee, Rt. Hon. C. R. Freeman, John (Watford) Marquand, Rt. Hon H A.
Awbery, S. S. Gibson, C. W. Mellish, R. J.
Ayles, W. H. Glanville, James Messer, F.
Bacon, Miss Alice Gordon Walker, Rt. Hon. P. C. Mikardo, Ian
Baird, J. Greenwood, Anthony (Rossendale) Mitchison, G. R.
Balfour, A. Greenwood, Rt. Hon. Arthur (Wakefield Monslow, W.
Barnes, Rt. Hon. A. J Grenfell, Rt. Hon. D. R. Moody, A. S.
Bartley, P. Grey, C. F. Morley, R.
Bellenger, Rt. Hon. F. J Griffiths, David (Rother Valley) Morrison, Rt. Hon. H. (Lewisham, S.)
Bence, C. R. Griffiths, William (Exchange) Mort, D. L.
Benn, Wedgwood Hale, Leslie (Oldham, W.) Moyle, A.
Benson, G. Hall, Rt. Hon. (Oldham, W.) Murray, J. D.
Beswick, F. Hall, Rt. Hon. Glenvil (Colne Valley) Neal, Harold (Bolsover)
Bevan, Rt. Hon. A. (Ebbw Vale) Hall, John (Gateshead, W.) Noel-Baker, Rt. Hon. P. J.
Bing, G. H. C. Hamilton, W. W O'Brien, T.
Blackburn, F. Hardy, E. A. Oldfield, W. H.
Blenkinsop, A. Hargreaves, A. Oliver, G. H.
Blyton, W. R. Harrison, J. (Nottingham, E.) Orbach, M.
Boardman, H. Hastings, S. Oswald, T.
Bowden, H. W Hayman, F. H. Padely, W. E.
Bowles, F. G. Healy, Denis (Leads, S.E.) Paget, R. T
Braddock, Mrs. Elizabeth Healy, Cahir (Fermanagh) Paling, Rt. Hon. W. (Dearne Valley)
Brockway, A. F. Henderson, Rt. Hon. A. (Rowley Regis) Paling, Will T. (Dewsbury)
Brook, Dryden (Halifax) Herbison, Miss M. Pannell, Charles
Broughton, Dr. A. D. D. Hewitson, Capt. M. Pargriter, G. A.
Brown, Rt. Hon. George (Belper) Hobson, C. R. Parker, J.
Brown, Thomas (Ince) Holman, P. Paton, J.
Burke, W. A. Holmes, Horace (Hemsworth) Pearson, A.
Burton, Miss F. E Houghton, Douglas Peart, T F.
Butler, Herbert (Hackney, S.) Hoy, J. H. Porter, G.
Callaghan, L. J. Hubbard, T. F. Price, Joseph T. (Westhoughton)
Carmichael, J. Hudson, James (Ealing, N.) Price, Phillips, (Gloucestershire, W.)
Castle, Mrs. B. A. Hughes, Cledwyn (Anglesey) Proctor, W. T.
Champion, A. J. Hughes, Emrys (S. Ayrshire) Pryde, D. J.
Chapman, W. D. Hynd, H. (Accrington) Rankin, John
Chetwynd, G. R. Hynd, J. B. (Attercliffe) Reeves, J.
Clunie, J. Irvine, A. J. (Edge Hill) Reid, Thomas (Swindon)
Cocks, F. S. Irving, W. J. (Wood Green) Reid, William (Camlachie)
Coldrick, W. Isaacs, Rt. Hon. G. A. Rhodes, H.
Collick, P. H. Janner, B. Richards, R.
Cook, T. F. Jay, Rt. Hon. D. P. T Robens, Rt. Hon. A.
Cove, W. G. Jeger, George (Goole) Roberts, Albert (Normanton)
Craddock, George (Bradford, S.) Jenkins, R.H. (Stechford) Roberts, Goronwy (Caernarvonshire)
Crosland, C. A. R. Johnson, James (Rugby) Robinson, Kenneth (St. Pancras, N.)
Cullen, Mrs. A. Johnston, Douglas (Paisley) Rogers, George (Kensington, N.)
Danies, P. Jones, David (Hartlepool) Ross, William
Dalton, Rt. Hon. H. Jones, Frederick Elwyn (West Ham, S.) Royle, C.
Darling, George (Hillsborough) Jones, Jack (Rotherham) Schofield, S, (Barnsley)
Davies, Ernest (Enfield, E.) Jones, T. W. (Merioneth) Shackleton, E. A. A.
Davies, Harold (Leek) Keenan, W. Shawcross, Rt. Hon. Sir Hartley
Davies, Stephen (Merthyr) Kenyon, C. Shinwell, Rt. Hon. E.
de Freitas, Geoffrey Key, Rt. Hon. C. W. Short, E. W.
Shurmer, P. L. E.
Deer, G. King, Dr. H. M. Silverman, Julius (Erdington)
Delargy, H. J. Kinley, J. Simmons, C. J. (Brierley Hill)
Dodds, N. N. Lee, Frederick (Newton) Slater, J.
Donnelly, D. L. Lee, Miss Jennie (cannock) Smith, Ellis, (Stoke, S.)
Driberg, T. E. N. Lever, Harold (Cheetham) Smith, Norman (Nottingham, S.)
Dugdale, Rt. Hon. John (W. Bromwich) Lever, Leslie (Ardwick) Sorensen, R. W.
Ede, Rt. Hon. J. C Lewis, Arthur Soskice, Rt. Hon. Sir Frank
Edwards, Rt. Hon Ness (Caerphilly) Lindgren, G. S. Sparks, J. A
Edwards, W. J. (Stepney) Logan, D. G. Steele, T.
Evans, Albert (Islington, S.W.) MacColl, J. E. Stewart, Michael (Fulham, E.)
Evans, Edward (Lowestoft) McGhee, H. G. Stokes, Rt. Hon. R. R.
Evans, Stanley (Wednesbury) McGovern, J. Strachey, Rt. Hon J.
Ewart, R. McInnes, J. Strauss, Rt. Hon George (vauxhall)
Fernyhough, E Mckay, John (Wallsend) Summerskill, Rt. Hon. E.
Field, W. J. McLeavy, F.
Swingler, S. T. Watkins, T. E. Williams, Rev. Llywelyn (Abertillery)
Sylvester, G. O. Webb, Rt. Hon. M. (Bradford, C.) Williams, Ronald (Wigan)
Taylor, Bernard (Mansfield) Weitzman, D. Williams, Rt. Hon. Thomas (Den V'll'y)
Taylor, John (West Lothian) Wells, Percy (Faversham) Wilson, Rt. Hon. Harold (Huyton)
Taylor, Rt. Hon. Robert (Morpeth) Wells, William (Walsall) Winterbottom, Ian (Nottingham, C.)
Thomas, David (Aberdare) West, D. G. Winterbottom, Ian (Nottingham, C.)
Thomas, Iorwerth (Rhondda, W.) Wheatley, Rt. Hon. John Winterbottom, Richard (Brightside)
Thorneycroft, Harry (Clayton) White, Mrs. Eirone (E. Flint) Woodburn, Rt. Hon. A
Thurtle, Ernest White, Henry (Derbyshire, N. E.) Wyatt, W. L.
Timmons, J. Whitley, Rt. Hon. W. Yates, V. F.
Tomney F. Wigg, George
Turner-Samuels, N. Willey, Frederick (Sunderland, N) TELLERS FOR THE NOES:
Ungoed-Thomas, Sir Lynn Willey Octavius (Cleveland) Mr. Wilkins and Mr. Hannan.
Viant, S. P. Williams, David (Neath)
The Temporary Chairman (Mr. Arthur Colegate)

Before I call the next Amendment, I would remind the Committee that under the arrangements which have been agreed to we are dealing with Group 4, which relates to men's and women's hats. The Amendments standing in the name of the hon. Member for Stalybridge and Hyde (Mr. Blackburn)—in page 75, column 1, to leave out line 39; and in line 40, column 1, to leave out "sou'westers or industrial hats"—are out of order. They are outside the Ways and Means Resolution. Therefore, I shall call the Amendment, in page 75, line 42, in the name of the right hon. Member for Leeds, South (Mr. Gaitskell), and that will be discussed with the Amendments in page 78, line 7, column 1, to leave out "sou'westers or industrial hats," and in line 9, at the end, to insert:

s. d.
(b) of wool felt 13 0 per article
(c) of fur felt 22 6 per article
(d) of any other description 13 0 per article

7.15 p.m.

Mr. F. Blackburn (Stalybridge and Hyde)

I beg to move, in page 75, line 42, at the end, to insert:

s. d.
(b) of wool felt 13 0 per article
(c) of fur felt 22 6 per article
(d) of any other description 13 0 per article

I hope that hon. Members, after several hours of debating boots and shoes, will be able to transfer their attention to the other end of the human frame. I believe this Amendment is in the interests of the trade, of workers and management, and I believe it is also in the interest of the Chancellor, because if he grants these concessions I think we shall have increased sales and increased production, which will considerably ease the position in regard to the export market.

I should have liked my hon. Friend the Member for Droylsden (Mr. W. R. Williams) to move this Amendment.

He has been closely associated with all the inquiries which have gone forward and has a great constituency interest, for he represents possibly the most important hat centre in the country. At any rate, within his constituency is the largest hat factory in Europe. Unfortunately, he is unavoidably absent today, and I hope that I shall be able to put before the Committee all the points which he would have made.

I am certain that the Chancellor is not surprised at seeing this Amendment on the Order Paper, because I believe representations have already been made. I hope that the Chancellor is looking forward with keen anticipation to the pleasure which he will have in a very short time of casting aside the mantle of Molotov and granting us this concession.

I think all Members of the Committee will agree that this is a very skilled craft which at the present time, unfortunately, is undergoing very serious difficulties. I am certain that we should all regret it if the great skill which has been acquired in this country should be lost because of difficulties which are being experienced at the moment. The industry is at the present time losing workers because of the under-employment in the industry. However, I shall return to that point later.

I should, first of all, like to deal with group 22 as it stands in the Schedule. This group does not make any great concession to the hat industry as a whole. In fact, there cannot be very many men who wear knitted headwear. I do not know whether the Prime Minister wears one with his siren suit, but there cannot be many men who wear them. I think a mistake has been made by the Government in the second line, which says: … either articles suitable only for infants' wear…

In reply to my hon. Friend the Member for Stockton-on-Tees (Mr. Chetwynd), the President of the Board of Trade said that all children's wear was exempt from Purchase Tax. Therefore, there does not seem any great point in including those words in that group. It would have been helpful is sou'westers, industrial hats and, in fact, all industrial clothing were totally exempt from tax.

Now let me turn to the Amendment which has been put down in order to cover other types of hats. The purpose of this Amendment is quite different from the other Amendments we have been considering. This is an attempt to bring within the D scheme articles which were outside the old Utility scheme. Hon. Members will appreciate that the reason that hats of wool felt and fur felt were outside the Utility range was that it was most difficult to put down exact specifications. Since there are no specifications within the D scheme, it is possible to bring these hats within it.

We are grateful to the Chancellor for the concession which has been made, in the reduction from 33⅓ to 25 per cent., but I think he will agree that it does not go very far where the whole range of hats is bearing Purchase Tax. It is not a new principle to bring within the D scheme articles which were outside the Utility range. Woven scarves, which were outside the Utility scheme, have been brought into it. I seem to remember that the Chancellor, speaking yesterday about the religious favour of the Conservative Party, included surplices. Therefore, it is not a new principle that we should ask for these articles to be brought within the D scheme.

As has been mentioned already, I think by the Financial Secretary to the Treasury, this matter has been envisaged by the Douglas Committee. In paragraph 49, the Douglas Report says.: Any reorganisation of the Purchase Taxi Utility arrangements should be such as to enable the removal as far as possible of anomalies of the kind we have mentioned, particularly those which result in the subjection to Purchase Tax of articles largely bought by the lower income groups.

Therefore it is not a new principle that we are asking for in the Amendment.

There is a serious contraction in the industry, compared with the position before the war. Let me quote the com- parative figures. What I have said is clearly indicated by those figures. If we express the sales of 1951 as a percentage of the sales of 1937, the figure in the case of men's fur hats is 70 per cent. and of wool hats 61 per cent.; in the case of women's hats, fur hats 56 per cent. and wool hats 58 per cent.

If we turn to the employment position. we find that the number of workpeopie today is just over 50 per cent. of what it was pre-war. Of course, the improvements and the rapidly changing methods of production would account for the major drop. A much more serious aspect is demonstrated by the continual short-time working during recent months. In the eight months which ended in February of this year, the labour force in the industry fell by 9 per cent., a very serious drop.

The industry has been suffering from the burden of Purchase Tax on all wool felt and fur felt hats, and on straw hats —I hope that the Chancellor will realise that the fur felt hat is quite distinct from the fur hat—the industry has been suffering also from an import duty of 10 per cent. on all imported fur while its competitors for exports have not had to suffer that burden. It is possible that if we gave the industry the help for which we are asking this afternoon, it would be able to do even better than it has done up to the present time.

Of the production of the industry, 50 per cent. has been exported during the past few years. The Chancellor has stressed the importance of a sound, healthy home trade in order to keep a healthy export trade. That point was strongly stressed in the Douglas Report. Since I am trying to bring these articles within the Douglas D scheme, I hope I shall be excused for making further quotations from the Douglas Report. In paragraph 59 (a), the report says: For any article, there is a minimum quantity which it is economic to produce. Unless a manufacturer can be reasonably assured of selling that quantity he will not make it at all. If it is unreasonable to expect that the whole of that minimum quantity can be exported, and the Purchase Tax is likely to prevent the sale at home of the unexported balance, then the goods will not be produced.

Again, in paragraph 59 (e) the report says: The home market serves as a permanent showplace in which the reputation of the goods is maintained; our export trade in many items of men's wear has been built up on the Englishman's reputation of being the best-dressed man in the world.

That has been true from the days of woad.

Since approximately 50 per cent. of the products of the industry is exported, there is great danger that consumer resistance in this country might endanger competitive capabilities in overseas markets. I would stress the point that there has already been consumer resistance in this country, judging by the number of people who have joined the "no-hat brigade" and a number of women who, instead of wearing hats, have been wearing scarves. It would be possible for the Chancellor to give some slight help to the industry in this way.

The D scheme covers us from the feet to the neck. Why not the head? I hope there is no indication here of the relative importance the Government place upon the different parts of the body. I am certain that this is not true of the Chancellor, because before he sank to his very low position of sitting at the receipt of custom he held very high office as President of the Board of Education. I am sure that he has a true appreciation of the importance of the head and of the necessity for protecting it. I am sorry that the Minister of Education is not here. She might have supported me in this argument.

Neither the classification in the Amendment nor the figures have been obtained as the result of a social survey, but after consultation with the industry and with wholesalers and retailers. I understand that the classification "wool felt and "fur felt" is quite clear to the trade and presents no difficulty. We have produced figures which are fair to the trade, to the consumer and, I sincerely believe, to the Chancellor. I hope he will appreciate that we have tried to incorporate within the Amendment figures reasonably fair to all those parties. If he accedes to our request, he will not be losing much of the revenue that he expects in this direction, while the help given to the trade at the present time might bring to an end its serious recession and the consumer resistance which is going on, and might lead to increased production and increased revenue for the Chancellor.

7.30 p.m.

Coupled with this Amendment on men's hats is a later Amendment—in page 78, line 9, at the end, to insert:

s. d.
(b) of wool felt 13 0 per article
(c) of fur felt 22 6 per article
(d) of any other description 13 0 per article

No one moving an Amendment dealing with men's hats dare leave out women's hats. It would be quite wrong to ask women to endure unequal pay and then to tax their hats more heavily than men's. I am sure the Committee will appreciate that we had some doubts when it came to the classification of women's hats. We thought we should have to tread very warily. We were assured by the trade that if we classified them under the same headings as we have classified men's hats, that classification would meet the need, because whatever the final result may be the base is the same: either fur felt, wool felt or straw. Therefore, we included the same classification and the same median as for men's hats.

I hope the Chancellor will be able to make this concession to this trade in order to keep alive this very important craft, so that he will thus be able to give help to an industry which is in some difficulty at the present time, and which unfortunately is losing its trained craftsmen at a rather alarming rate because of short-time working.

Mr. George Chetwynd (Stockton-on-Tees)

I am very pleased to be able to support my hon. Friend the Member for Stalybridge and Hyde (Mr. Blackburn), who moved this Amendment in so clear and persuasive a way. I do this with no direct constituency interest in the hat trade, but because, for the greater part of my earlier life, I was brought up in an area whose two main industries were coal mining and hat manufacturing. Whereas today the coal mining industry is in a flourishing condition, the hat making industry is suffering a decline, and it is in the hope that the Committee will today be able to do something to arrest that decline that I wish to support this Amendment.

We wish merely to give the felt hat trade certain concessions which have hitherto been enjoyed by other parts of the hat industry with regard to woven cloth hats and wool knitted hats. Our main purpose is to bring the felt hat industry within the scope of the D scheme. I think that that ought to be done, first of all, on the broad principle that there is no justification for having one section of this industry outside the scheme.

It is unfair and unreasonable to single out felt hats for exclusion, while seeming to discriminate in favour of woven or knitted hats. As a point of interest, I would remark that, whereas the velvet riding cap comes within the scheme, the trilby is outside, so that the rich fox-hunting squire can get his velvet riding cap at a concession rate, whereas the poor man's trilby is outside the scheme, and he is to that extent penalised. That does not seem to me a just reason for leaving felt hats out of this scheme.

Another factor is that the industry needs an adequate home market to enable it to carry on the excellent work it has done so far with its exports. I believe that 50 per cent. of all men's felt hats produced are for export. That is a considerable advantage to the nation, and we ought to do everything in our power to enable that to be increased. One of the first essentials is to see that there is a wider basis for the home market, and I believe that can be done if the concession for which we ask is given today.

My hon. Friend made it quite clear that, while under the old Utility scheme there were technical reasons why felt hats could not be included, with the change over to the D scheme, with a price level for taxation purposes, those difficulties have disappeared, and there seems to be no technical ground now why felt hats or fur felt hats should not come within the D scheme.

It is quite clear to everyone in the industry that there has been a serious decline in the sale of felt hats over the past 10 or 12 years. When we compare the position today with that of pre-war we find that, whereas pre-war men's felt hats were selling at the rate of 600,000 to 700,000 dozen a year, today, even when we push it up to the maximum, we are selling only 450,000 dozen. On top of the sales resistance caused through high prices, there is the growing craze of many people to do without hats, and we ought to take every step we can to halt that by bringing down the price of hats as much as possible.

One of the main things about which I am worried personally is the fact that the skilled craftsmen are leaving this industry at a rapid rate. This is one of our oldest craft industries, yet today the factories in North Warwickshire, with which I am concerned, are working an average of four days a week. As a result of that there has been a serious decline in employment in this industry. There is some unemployment today, but more significant than that is the short-time working.

I understand that in 1937 there were 13,000 men employed in the industry, but today there is only half that—a cut of 50 per cent. That has been intensified in the last two years, so that today one of our skilled crafts is endangered because the price of hats is beyond the range of many people's pockets. We ask that this industry should be given the same advantages and privileges of the D scheme that are now given to other hats.

One argument which I think should appeal to the right hon. Gentleman is that the felt hatting industry makes a big contribution in war time, and at other times, in equipping our troops, particularly those serving in tropical and semitropical areas where the felt hat is most important. The North Warwickshire industry has all along made a big contribution in supplying this military equipment, and if they are to continue helping the national need it is essential for the industry to be in a flourishing condition, which I think is a very good reason why the right hon. Gentleman should give favourable consideration to this Amendment.

There is a genuine need for Purchase Tax relief in this field over and above the welcome reduction to 25 per cent. which has already been announced. It is unfair that this section of the industry should be left out of the D scheme. We could argue about the D level which we have selected, but it would satisfy me and, I think, those in the industry, if it could be brought at this stage within the D scheme. I hope that the Government will see fit to accept the Amendment.

Mrs. Eirene White (Flint, East)

I am afraid that the Financial Secretary has not noticed, because of the pressure of his Parliamentary duties, that there has been a most delightful summer day outside, but I hope that the weather will have the effect of making him and his right hon. Friend feel that they can meet us in this matter.

I would hardly suggest that any hon. or right hon. Member on the Treasury Bench had a roving eye, but I hope that each and every one of them can feel that quickening interest and slight stirring of the pulse which the sight of a pretty hat should induce. We have, after all, been dealing with these matters of dress in a rather prosaic way. Yesterday we disposed of Julia's silks in a very matter of fact manner, and I think it would be a most charming and delightful gesture for the Treasury on this occasion to make a concession in this matter on hats.

I am sure that the Financial Secretary himself feels the appropriateness of such a gesture. I am sure he realises what effect on the affairs of men a pretty hat may have, and I am sure that in his youth at least he read that charming verse: I intended an Ode, And it turned to a Sonnet. It began à la mode I intended an Ode; But Rose crossed the road In her latest new bonnet … I think he will remember what went after that: Rose kissed me today. Will she kiss me tomorrow? I am not I hope appealing in vain in the cause of feminine charm and beauty when I suggest it really would be desirable that this particular article of wear should be included in the scheme and that we should obtain such a concession as may seem fit.

We have made a suggestion on the Order Paper and it would be regrettable if this concession were not made. My hon. Friends have pointed out that under the conditions of the Utility scheme it was not possible, because we could not define the quality of a hat. It has to be seen. The taste with which the trimmings are arranged, rather than the value of the trimmings may make all the difference, but, as my hon. Friends have pointed out, whatever the nature of the hat, the basic material can be defined and it is measurable in terms of price. Straw hats are included in the third item of the proposed Amendment with the felt hats already mentioned. Therefore, I think that the most sensible and proper thing for us to do is to include hats of all kinds.

I have spoken with feeling, which I am sure would be shared by any woman, on the subject of ladies' hats. On the other hand, they would not wish to be ungenerous. A well dressed man should have a becoming hat. I like to see my male companions also well attired, and I hope that the concession will be extended to them. The arguments seem to me to be unimpeachable on grounds of justice and economics, and we have also to bear in mind the difficult state of exports. which are declining.

Therefore, the considerations which apply to the other articles of dress which we have been discussing during these last few days apply equally to hats, and it would be Most regrettable if the Chancellor failed to take the opportunity of putting right something which the introduction of the D scheme makes possible for the first time. For all these reasons I hope we shall have a generous and forthcoming answer from the Financial Secretary.

Mr. Boyd-Carpenter

The hon. Lady, in the course of a very agreeable speech, indicated that the sight of a pretty hat could have an effect upon the pulses, but if stern, fiscal matters were to be effected by such considerations, I should find it necessary to assure the hon. Lady that it is quite possible for that phenomenon to occur even when the cause of it is not wearing a hat.

The hon. Gentleman the Member for Stalybridge and Hyde (Mr. Blackburn) appreciated that he was doing an unsual thing. Whereas most of the previous Amendments put down by his hon. Friends have sought to take out of the D scheme certain industries or to limit the effect of the D scheme upon their products, he takes exactly the opposite course and comes forward to demand that the industry with which he is concerned should be given the benefits of the D scheme.

Mr. Blackburn

I should like to say that the industry with which I am most concerned is the textile industry, but there is a difference about felt and wool hats in that they have a 33⅓ per cent. Purchase Tax levy over the whole range. There are no Utility hats at all, and that is the reason why we are trying to bring them within this scheme. If the Government scrap the whole of the D scheme and the whole of the Purchase Tax, I should be very well content indeed.

7.45 p.m.

Mr. Boyd-Carpenter

The hon. Gentleman's intentions are perfectly clear, but the industry with which he is concerned in this Amendment is one which he wants brought within the structure of the D scheme. That is rather an agreeable contrast to certain other hon. Members who have hardly a good word to say for the D scheme. It is rather nice to find that this particular dog can be given a good name when convenient.

We have here followed the line of the old Utility demarcation. We have not, as the hon. Member for Stockton-on-Tees (Mr. Chetwynd) suggested, discriminated in any major sense against any one kind of headgear. What we have done is that, in bringing the Utility scheme to an end, we have taken that part of what might be called the headgear industry and brought it within the ambit of its successor, namely, the D scheme. We have not, and I am afraid we cannot, bring within the beneficent ambit of the D scheme the part of the headgear industry which never was within the Utility scheme at all. The line of demarcation adopted—

Mr. Blackburn

rose

Mr. Boyd-Carpenter

I will give way in a moment, but the hon. Gentleman made a reasonable speech and I am sure he would like to listen to the answer.

Mr. Blackburn

It is the word "cannot."

Mr. Boyd-Carpenter

Yes, and if the hon. Member will allow me I will tell him why.

The line of demarcation adopted with the Utility scheme remained the line of demarcation to the end of that scheme for the articles set out in paragraph 22 of the Schedule. If hon. Members look at that, they will see that they are articles of the category which makes them comparable with most of the other articles for which there were Utility lines. That, no doubt, was the reason why successive Governments kept these articles within the Utility scheme while not extending the Utility scheme to the type of headgear referred to in this Amendment.

Mr. Chetwynd

Does the hon. Gentle. man put forward the point that a trilby felt hat is a luxury whereas a woollen knitted hat or a woven hat is essential, because if he looks into this he will find that the real reason why felt hats were not brought within the Utility range was not on that score at all, but because it was completely impossible on technical grounds to define for Schedule purposes under the Utility scheme where a line could be drawn about felt hats? As we got rid of the difficulties by the D scheme, it should be possible to remove an injustice.

Mr. Boyd-Carpenter

The hon. Gentleman misunderstood me. I did not say a felt hat was a luxury. I carefully did not use that expression, because I dislike introducing an element of prejudice into these discussions by describing something as a luxury. It is my experience that what some people regard as luxuries others regard as necessities and vice versa. All that I was saying was that previous Administrations have confined the limits of Utility to these categories, and no doubt had thought that in so doing they were following the general principles of the Utility scheme.

The hon. Gentleman is suggesting that the merits of the D scheme should now be extended both to felt hats and others. I can say to the hon. Lady in this connection that I am also remembering the type of hat to which she referred, not generally constructed of felt but of more decorative substances—

Mr. John Edwards (Brighouse and Spenborough)

Exotic.

Mr. Boyd-Carpenter

Very well, more exotic substances if the hon. Gentleman prefers it.

Mr. Edwards

I think the hon. Gentleman will agree that it is the trimmings on the felt that are the important consideration.

Mr. Boyd-Carpenter

Yes, and the trimmings are made of more exotic materials and are much more relevant to the line of argument which the hon. Lady adopted.

Generally speaking, the proposal in the Bill is not to extend the D scheme generally beyond the Utility range. We have taken advantage of the opportunity given to bring within the D scheme certain articles such as Wellington boots, which were specifically referred to in the Douglas Report as anomalies which for some reason had not been included before. In general, my right hon. Friend is not undertaking in this Finance Bill a general review of the entire ambit of the Purchase Tax. Hon. Members who have been discussing this for the last two days will appreciate that it is a complex subject giving rise to a good deal of debate, and the general proposals in the Bill are confined to what was the old Utility range with certain marginal additions.

Once one departs from that, it is possible to put forward, as the hon. Gentleman has done, admirable arguments for extending this further to certain subject matters with which he is concerned. No doubt other hon. Members could put forward similar arguments, but we must deal with this in a businesslike way. At the moment we are dealing with the old Utility sphere plus certain marginal anomalies. We cannot, this year at any rate, be led into further extensions by way of reforming the Purchase Tax generally. For that reason, admirably though the argument has been put and although I have much sympathy for this industry, I am afraid that we cannot accept the Amendment.

Mr. Edwards

I do not think there is any necessity for me to repeat the arguments fully deployed by my hon. Friend the Member for Stalybridge and Hyde (Mr. Blackburn) or the extra arguments advanced by my hon. Friend the Member for Flint (Mrs. White). We can agree as to the importance of hats. Many instances have been quoted but, as we were talking about this, it occurred to me that George Bernard Shaw said something about this subject in "Pygmalion." Eliza Dolittle, explaining the demise of one of her relatives, said with great emphasis: Them as done her in would have done her in for a hatpin, let alone a hat. We can all be agreed as to the importance of hats, or "crowns" as they are called in the trade. What I find rather remarkable is the absence of the two hon. Gentlemen who sit for Stockport the hon. and gallant Member for Stockport, North (Wing Commander Hulbert) and the hon. Member for Stockport, South (Sir A. Gridley). I should have expected them to be in their places, because of all the areas of Britain where the hat industry is important, Stockport is pre-eminent.

The point I want to argue is that the introduction of the D scheme creates an entirely new situation. On this side of the Committee we have been consistent in arguing for the removal of Purchase Tax from all forms of textiles. If we must have the D. scheme, if our pleas fall on deaf Conservative ears, then clearly, whether on grounds of expediency merely or on more substantial grounds of the real needs of the industry, we are entitled to say," Let us make the best of this situation, and, granted the D scheme, let us see if we cannot get from it some help for this industry."

After all, Utility is dead and if we examine the corpse we shall find the finger-prints of the right hon. Gentleman and his hon. Friends. We start from where we are. The simple question, which I am putting again to the Financial Secretary and to the Chancellor, is: can we help this industry by altering the incidence of Purchase Tax? As to the needs of the industry there has been no argument. The Financial Secretary did not even begin to question the needs of the industry. He did not imply in any way that my hon. Friend the Member for Stalybridge and Hyde had produced an exaggerated picture. The industry is in difficulties and the considered view of those who speak for it is that this change would help them.

To this point the Financial Secretary has addressed no reply. On this point he is completely quiet. He takes his stand on the line that what was in the old Utility scheme was in it and we must not interfere with it although we have produced an entirely new scheme. So I ask the Chancellor of the Exchequer to consider whether what is proposed in this Amendment could not be a means of helping the industry concerned in the making of hats. I do not say that this Amendment is necessarily the last word. It may not be that this is precisely what is wanted. I am sure, however, that by and large it is what is wanted. Would not the right hon. Gentleman agree to think about this between now and the Report stage, to see whether he cannot do something of this kind? The amount in- volved is not large and I am sure it would help an industry that is very hardly pressed.

The reply of the Financial Secretary means that Her Majesty's Government are not prepared to do this, although they are not contesting that it would help the industry. If the Chancellor will give us the assurance for which I have asked, we shall be happy and the industry will be relieved. If, however, we cannot have anything more than what has been said by the Financial Secretary, I shall have to advise my hon. Friends on this side to divide the Committee.

Mr. Boyd-Carpenter

Perhaps I may reply briefly to one point made by the hon. Gentleman? What I ventured to say to the Committee was right, I am sure, namely, that we cannot by stages extend the general ambit of the D scheme. However I should not like to leave him or the Committee with the feeling that we were not anxious, insofar as Purchase Tax is a material factor at all in this matter. to assist this industry.

If the hon. Gentleman is right and Purchase Tax adjustment can help it, then indeed we have helped it, because the announcement which my right hon. Friend made as to the general reduction in the rate of Purchase Tax covers the hats dealt with in this Amendment, even though they are not within the general ambit of the D scheme. So insofar as the argument of the hon. Gentleman is that we can help this industry by adjustments of Purchase Tax, the reduction from 33⅓ to 25 per cent. of the general rate of tax is, on his own argument, a substantial contribution to its well-being.

8.0 p.m.

Mr. Blackburn

I am sure that the industry and the workers within it will find the reply of the Financial Secretary most unsatisfactory. Where the Government had an opportunity to help an industry but turn it down, they ought to be condemned. After all, it is not a great amount of money which is involved, and the Chancellor could make this concession without ruining his Budget. As I said earlier, the possibility is that the right hon. Gentleman might get even more revenue by this means than he would under the present scheme.

It is useless for the Financial Secretary to suggest that this category was outside the ambit of the old Utility scheme and that, therefore, it cannot be brought into the D scheme. The Government themselves have already brought within the D scheme certain items which were outside the old Utility scheme. Surely. when a change of this type is being made, one of the things that ought to be done is to tidy things up.

The only reason why fur felt hats, wool felt and straw felt hats were not included in the Utility scheme, was the difficulty of specification. But for that difficulty, the argument which the Financial Secretary has put forward could not have been used. What sense is there in excluding from the D scheme range of goods hats alone, when everything else from the feet to the neck is covered by the D scheme?

For a small amount of money it is possible to help the industry, an industry which, as I said before, has made a good contribution, according to its ability, to the export market. Fifty per cent. of its products are being exported. The Government should have shown greater consideration, and in any case, if the proposal was being turned down, a much more considered reply could have been given.

Mr. Chetwynd

May I make this last-minute appeal to the Prime Minister, who is well noted, and rightly so, for his headgear, to have a word with his hon. and right hon. Friends to make sure that this ancient craft can continue with great skill to provide him with such adornments in the future? I am sorry to say that unless we get this intervention, the craft may die out and we shall be deprived of seeing that article of headgear in such a wonderful position.

Mr. J. Edwards

May I ask the Prime Minister, since he is now gracing our assembly: Does he really think that it is right to tax hats to the extent which his right hon. Friend proposes? It is most unfortunate, and it strikes at all the traditions which the Prime Minister has established for so long.

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

The Committee divided: Ayes, 254: Noes, 282.

Division No.126.] AYES [8.4 p.m.
Acland, Sir Richard Grenfell, Rt Hon D. R Oliver, G. H.
Adams, Richard Grey, C. F. Orbach, M.
Albu, A. H. Griffiths, David (Rother Valley) Oswald, T.
Allen, Scholefield (Crewe) Griffiths, William (Exchange) Padley, W. E
Anderson, Alexander (Motherwell) Hale, Leslie (Oldham, W.) Paget, R. T.
Anderson, Frank (Whitehaven) Hall, Rt. Hon. Glenvil (Colne Valley) Paling, Rt. Hon. W. (Dearne Valley)
Attlee, Rt. Hon. C. R. Hall, John (Gateshead, W.) Paling, Will T. (Dewsbury)
Awbery, S. S. Hamilton, W. W. Pannell, Charles
Ayles, W. H. Hannan, W. Pargiter, G. A
Bacon, Miss Alice Hardy, E. A. Parker, J.
Baird, J. Hargreaves, A. Paton, J.
Balfour, A. Harrison, J. (Nottingham, E.) Peart, T. F
Barnes, Rt. Hon. A. J. Hastings, S. Porter, G.
Bartley, P. Hayman, F. H. Price, Joseph T (Westhoughton)
Belenger, Rt. Hon. F. J Healey, Denis (Leeds, S. E.) Proctor, W. T.
Bence, C. R. Henderson, Rt. Hon. A. (Rowley Regis) Pryde, D. J.
Benn, Wedgwood Herbison, Miss M. Pursey, Cmdr. H
Benson, G. Hewitson, Capt. M Rankin, John
Beswick, F. Hobson, C. R. Reeves, J
Bevan, Rt. Hon. A. (Ebbw Vale) Holman, P. Reid, Thomas (Swindon)
Bing, G. H. C. Holmes, Horace (Hemsworth) Reid, William (Camiachie)
Blackburn, F. Houghton, Douglas Rhodes, H.
Blenkinsop, A. Hoy, J. H. Richards, R
Blyton, W. R. Hubbard, T. F. Robens, Rt. Hon. A
Boardman, H. Hudson, James (Ealing, N.) Roberts, Albert (Normanton)
Bottomley, Rt. Hon. A. G Hughes, Gledwyn (Anglesey) Roberts, Goronwy (Caernarvonshire)
Bowden, H. W. Hughes, Emrys (S. Ayrshire) Robinson, Kenneth (St. Pancras, N.)
Braddock, Mrs. Elizabeth Hynd, H. (Accrington) Rogers, George (Kensington, N.)
Brockway, A. F. Hynd, J. B. (Attercliffe) Ross, William
Brook, Dryden (Halifax) Irving, A. J. (Edge Hill) Royle, C.
Broughton, Dr. A. D. D. Irving, W. J. (Wood Green) Schofield, S. (Barnsley)
Brown, Rt. Hon, George (Belper) Janner, B. Shackleton, E.A.A.
Brown, Thomas (Ince) Jay, Rt. Hon. D. P. T. Shawcross, Rt. Hon. Sir Hartley
Burke, W. A. Jeger, George (Goole) Shinwell, Rt. Hon. E.
Burton, Miss F. E. Jenkins, R. H. (Stechford) Short, E.W.
Butler, Herbert (Hackney, S.) Johnson, James (Rugby) shurmer, P.L.E
Callaghan, L. J. Johnston, Douglas (Paisley) Silverman, Julius (Erdington)
Carmichael, J. Jones, David (Hartlepool) Simmons, C J. (Brierley Hill)
Champion, A. J. Jones, Frederick Elwyn (West Ham, S.) Slater, J.
Chapman, W. D Jones, Jack (Rotherham) Smith, Ellis (Stoke, S.)
Chetwynd, G. R. Jones, T. W. (Merioneth) Smith, Norman (Nottingham, S.)
Clunie, J. Keenan, W. Sorensen, R.W.
Cocks, F. S. Kenyon, C. Soskice, Rt. Hon. Sir Frank
Coldrick, W. Key, Rt. Hon. C. W Sparks, J.A.
Collick, P. H. King, Dr. H. M. Steele, T.
Cove, W. G. Kinley, J. Stewart, Michael (Fulham, E.)
Craddock, George (Bradford, S.) Lee, Frederick (Newton) Stokes, Rt. Hon R. R.
Crosland, C. A. R Lee, Miss Jennie (Cannock) Strachey, Rt. Hon J.
Cullen, Mrs. A. Lever, Leslie (Ardwick) Strauss, Rt. Hon. George (Vauxhall)
Daines, P. Lewis, Arthur Swingler, S.T.
Dalton, Rt. Hon. H. Lindgren, G. S. Sylvester, G.O.
Darling, George (Hillsborough) Lipton, Lt.-Col. M. Taylor, Bernard (Mansfield)
Davies, Ernest (Enfield, E.) Logan, D. G. Taylor, John (West Lothian)
Davies, Harold (Leek) MacColl, J. E Taylor, Rt. Hon. Robert (Morpeth)
Deer, G. McGhee, H. G Thomas, David (Aberdare)
Delargy, H. J McGovern, J. Thomas, Iorwerth (Rhondda, W.)
Dodds, N. N. McInnes, J. Thomas, Iver Owen (Wrekin)
Driberg, T. E. N. McKay, John (Wallsend) Thorneycroft, Harry (Clayton)
Dugdale, Rt. Hon. John (W. Bromwich) McLeavy, F. Thurtle, Ernest
Ede, Rt. Hon. J. C. MacMillan, M. K. (Western Isles) Timmons, J.
Edelman, M. MacPherson, Malcolm (Stirling) Tomney, F.
Edwards, John (Brighouse) Mainwaring, W H. Turner-Samuels, M.
Edwards, Rt. Hon. Ness (Caerphilly) Mallalieu, E. L. (Brigg) Ungoed-Thomas, Sir Lynn
Edwards, W. J (Stepney) Mallalieu, J. P. W. (Huddersfield, E) Viant, S.P.
Evans, Albert (Islington, S. W.) Mann, Mrs. Jean Watkins, T.E.
Evans, Edward (Lowestoft) Manuel, A. C Webb, Rt. Hon. M. (Bradford, C.)
Evans, Stanley (Wednesbury) Marquand, Rt Hon H. A Weitzman, D.
Ewart, R. Mellish, R. J. Wells, Percy (Faversham)
Fernyhough, E Messer, F. Wells, William (Walsall)
Field, W. J. Mikardo, Ian West, D. G
Fienburgh, W. Mitchison, G. R Wheatley, Rt. Hon. John
Finch, H. J. Monslow, W. White, Mrs. Eirene (E. Flint)
Fletcher, Eric (Islington, E.) Moody, A. S. White, Henry (Derbyshire, N.E.)
Follick, M. Morley, R. Whiteley, Rt Hon W.
Foot, M. M. Morrison, Rt. Hon. H (Lewisham, S) Wigg, George
Forman, J. C. Mort, D. L. Wilkins, W.A.
Fraser, Thomas (Hamilton) Moyle, A. Willey, Frederick (Sunderland, N.)
Freeman, John (Watford) Mulley, F. W Willey, Octavius (Cleveland)
Gibson, C. W. Murray, J. D. Williams, David (Neath)
Glanville, James Neal, Harold (Bolsover) Williams, Rev. Llywelyn (Abertillery)
Gordon Walker, Rt. Hon. P. C. Noel-Baker, Rt Hon P [...] Williams, Ronald (Wigan)
Greenwood, Anthony (Rossendale) O'Brien, T. Williams, Rt. Hon Thomas (Don V'll'y)
Greenwood, Rt. Hon Arthur (Wakefield) Oldfield, W. Wilson, Rt. Hon Harold (Huyton)
Winterbottom, Ian (Nottingham, C.) Wyatt, W.L.
Winterbottom, Richard (Brightside) Yates, V.F. TELLERS FOR THE AYES:
Woodburn, Rt. Hon. A. Mr. Pearson and Mr. Arthur Allen.
NOES
Aitkin, W.T. Fletcher-Cooke, C. McAdden, S. J.
Allan, R.A. (Paddington, S.) Fraser, Hon. Hugh (Stone) McCorquodale, Rt. Hon. M. S.
Aiport, C.J.M. Fraser, Sir Ian (Morecambe & Lonsdale) Macdonald, Sir Peter (I. of Wight)
Amery, Julian (Preston, N.) Gage, C. H. Mackeson, Brig. H. R.
Amory, Heathcoat (Tiverton) Galbraith, Cmdr. T D. (Pollok) McKibbin, A. J.
Anstruther-Gray, Major W.J Galbraith, T G. D. (Hillhead) McKie, J. H. (Galloway)
Arbuthnet, John Garner-Evans, E. H. Maclean, Fitzroy
Ashton, H. (Chelmsford) George, Rt. Hon. Maj. G. Lloyd MacLeod, Iain (Enfield, W.)
Assheton, Rt. Hon. R. (Blackburn, W.) Godber, J. B. MacLeod, John (Ross and Cromarty)
Astor, Hon. J.J. (Plymouth, Sutton) Gomme-Duncan, Col. A. Macmillan, Rt. Hon. Harold (Bromley)
Astor, Hon. W.W. (Bucks, Wycombe) Gough, C. F. H. Macpherson, Maj. Niall (Dumfries)
Baker, P.A.D. Gower. H. R. Maitland, Cmdr. J. F. W.(Horncastle)
Baldock, Lt.-Cmdr. J.M. Graham, Sir Fergus Maitland, Patrick (Lanark)
Baldwin, A.E. Gridley, Sir Arnold Manningham-Buller, Sir R. E.
Banks, Col. C. Grimond, J. Markham, Major S. F.
Barber, A. P. L Grimston, Hon. John (St. Albans) Marlowe, A. A. H.
Barlow, Sir John Grimston, Sir Robert (Westbury) Marshall, Douglas (Bodmin)
Baxter, A.B. Harden, J. R. E. Marshall, Sidney (Sutton)
Beach, Maj. Hicks Hare, Hon. J. H. Maude, Angus
Beamish, Maj. Tufton Harris, Frederic (Croydon, N.) Maudling, R.
Bell, Philip (Bolton, E.) Harris, Reader (Heston) Maydon, Lt.-Cmdr. S. L. C.
Bell. Ronald (Bucks, S.) Harrison, Col. J. H. (Eye) Medlicott, Brig. F.
Bennett, F. M. (Reading, N.) Harvey, Ian (Harrow, E.) Mellor, Sir John
Bennett, Sir Peter (Edgbaston) Harvie-Watt, Sir George Molson, A. H. E.
Bennett, Dr. Reginald (Gosport) Hay, John Moore, Lt.-Col. Sir Thomas
Bennett, William (Woodside) Head, Rt. Hon. A.H. Morrison, John (Salisbury)
Bevins, J. R. (Toxteth) Heald, Sir Lionel Mott-Radclyffe, C. E.
Birch, Nigel Heath, Edward Nabarro, G. D. N.
Bishop, F. P. Henderson, John (Cathcart) Nicholls, Harmar
Black, C. W. Higgs, J. M. C. Nicolson, Nigel (Bournemouth, E.)
Bowen, E. R. Hill, Dr. Charles (Luton) Nield, Basil (Chester)
Boyd-Carpenter, J.A. Hill, Mrs. E. (Wythenshawe) Noble, Cmdr. A. H. P.
Boyle, Sir Edward Hinchingbrooke, Viscount Nugent, G.R.H.
Braine, B. R. Hirst, Geoffrey Oakshott, H.D.
Braithwaite, Sir Albert (Harrow, W.) Holland-Martin, C. J. Odey, G.W.
Brooman-White, R. C. Hollis, M. C. O'Neill, Rt. Hon Sir H (Antrim, N.)
Browne, Jack (Govan) Holmes, Sir Stanley (Harwich) Ormsby-Gore, Hon. W.D.
Bullard, D. G. Holt, A. F. Orr, Capt. L.P.S.
Bullock, Capt. M. Hope, Lord John Orr-Ewing, Charles Ian (Hendon, N)
Bullus, Wing Commander E. E. Hornsby-Smith, Miss M. P Partridge, E.
Burden, F. F. A. Horobin, I. M. Peake, Rt. Hon. O
Butcher, H. W. Horsbrugh, Rt. Hon. Florence Perkins, W. R. D
Butler, Rt. Hon. R. A. (Saffron Walden) Howard, Gerald (Cambridgeshire) Peto, Brig. C. H. M.
Carson, Hon. E. Howard, Greville (St. Ives) Peyton, J W. W.
Cary, Sir Robert Hudson, Sir Austin (Lewisham, N.) Pickthorn, K W M.
Channon, H. Hudson, W. R. A. (Hull, N.) Pilkington, Capt. R.A.
Churchill, Rt. Hon. W. S. Hulbert, Wing Comdr. N. J. Pitman, I.J.
Clarke, Col. Ralph (East Grinstead) Hurd, A. R. Powell, J. Enoch
Clarke, Brig. Terence (Portsmouth, W.) Hutchinson, sir Geoffrey (Ilford, N.) Price, Henry (Lewisham, W.)
Clyde, Rt. Hon. J. L. Hutchison, Lt.-Com. Clark (E'b'rgh W.) Prior-Palmer, Brig. O.L.
Cole, Norman Hutchison, James (Scotstoun) Profumo, J.D.
Conant, Maj. R. J. E. Hyde, Lt.-Col. H. M. Raikes, H.V.
Cooper, Sqn. Ldr. Albert Hylton-Foster, H. B. H. Rayner, Brig. R.
Craddock, Beresford (Spelthorne) Jenkins, R. C. D. (Dulwich) Redmayne, E.
Cranborne, Viscount Jennings, R Remnant, Hon. P
Crookshank, Capt. Rt. Hon. H. F. C. Johnson, Eric (Blackley) Renton, D.L.M.
Crosthwaite-Eyre, Col. O. E. Jones, A. (Hall Green) Roberts, Peter (Heeley)
Crouch, R. F. Joynson-Hicks, Hon, L.W. Robertson, Sir David
Crowder, John E. (Finchley) Kaberry, D. Robinson, Roland (Blackpool, S.)
Crowder, Petre (Ruislip—Northwood) Keeling, Sir Edward Robson-Brown, W.
Cuthbert, W.N. Kerr, H. W. (Cambridge) Redgers, John (Sevenoaks)
Darling, Sir William (Edinburgh, S.) Lambert, Hon. G. Roper, Sir Harold
Davies, Rt. Hn. Clement (Montgomery) Lambton, Viscount Ropner, Col. Sir Leonard
De la Bère, R. Lancaster, Col. C. G. Russell R.S.
Deades, W. F. Law. Rt. Hon. R. K. Ryder, Capt. R.E.D.
Digby, s. Wingfield Leather, E. H. C. Salter, Rt. Hon. Sir Arthur
Donaldson, Cmdr. C. E McA. Legge-Bourke, Maj. E. A. H. Sandys, Rt. Hon. D.
Donner, P. W. Legh, P. R. (Petersfield) Savory, Prof. Sir Douglas
Doughty, C. J. A. Lindsay, Martin Schofield, Lt.-Col. W. (Rochdale)
Douglas-Hamilton, Lord Malcolm Linstead H. N. Scott, R. Donald
Drayson, G. B. Llewellyn, D. T. Scott-Miller, Cmdr. R.
Drewe, C. Lloyd, Maj. Guy (Renfrew, E.) Shepher, William
Dugdale, Maj. Rt. Hn. Sir T. (Richmond) Lockwood, Lt.-Col J. C. Simon, J.E.S. (Middlesbrough, W)
Duncan, Capt. J. A. L. Longden, Gilbert (Herts, S. W.) Smiles, Lt.-Col, Sir Walter
Duthie, W. S. Low, A. R. W. Smithers, Peter (Winchester)
Fell, A. Lucas, Sir Jocelyn (Portsmouth, S.) Smithers, Sir Waldron (Orpington)
Finlay, Graeme Lucas, P. B. (Brentford) Smyth, Brig. J.G. (Norwood)
Fisher, Nigel Lucas-Tooth, Sir Hugh Snadden, W. Mcn.
Fleetwood-Hesketh, R. F. Lyttelton, Rt. Hon. O Spearman, A.C.M.
Speir, R.M Teeling, W. Ward, Miss I (Tynemouth)
Spence, H R. (Aberdeenshire, W.) Thomas, Rt. Hon. J. P. L. (Hereford) Waterhouse, Capt. Rt Hon. C.
Spens, Sir Patrick (Kensington, S.) Thomas, P. J. M. (Conway) Watkinson, H. A.
Stanley, Capt. Hon Richard Thompson, Kenneth (Walton) Webbe, Sir H. (London & Westminster)
Stevens, G. P. Thornton-Kemsley, Col. C. N Wellwood, W.
Steward, W. A. (Woolwich, W) Tilney, John White, Baker (Canterbury)
Stewart, Henderson (Fife, E.) Turner, H. F. L Williams, Rt. Hon. Charles (Torquay)
Stoddart-Scott, Col. M Turton, R. H. Williams, Gerald (Tonbridge)
Storey, S. Tweedsmuir, Lady Williams, R. Dudley (Exeter)
Strauss, Henry (Norwich, S.) Vane, W. M. F. Wills, G.
Staurt, Rt. Hon. James (Moray) Vaughan-Morgan, J K Wilson, Geoffrey (Truro)
Studholme, H. G. Wade, D. W. Wood, Hon. R.
Summer, G. S Wakefield, Edward (Derbyshire, W.) York, C.
Sutcliffe, H. Wakefield, Sir Wavell (Marylebone)
Taylor, Charles (Eastbourne) Walker-Smith, D. C. TELLERS FOR THE NOES:
Taylor, William (Bradford, N.) Ward, Hon. George (Worcester) Mr. Vosper and
Mr. Richard Thompson
Mr.John Peyton (Yeovil)

I beg to move, in page 75, to leave out lines 44 to 50, and to insert:

£ s. d.
(a) articles which, apart from any stitchings, fastenings or trimmings are wholly knitted or made wholly of woven or knitted cloth, other than asbestos 4 3 per pair
(2 1½per article)
(b) articles for dress (apparel) wear, which, apart from any stichings, fastenings or trimmings, are made wholly or partly of leather; unlined 14 0 per pair
(7 0 per article)
(c) articles for dress (apparel) wear, which, apart from any stitchings, fastenings or trimmings, are made wholly or partly of leather: lined 17 0 per pair
(8 6 per article)
(d) articles for dress (apparel) wear which are made of fur skin or woolled lambskin, with leather palms; or made wholly of leather, fully lined with fur skin or woolled lambskin 1 6 0 per pair
(13 0 per article)
(e) articles of any other description 12 0 per pair
(6 0 per article)
I should like to add my welcome to the concessions that the Chancellor has already found it possible to make, particularly the one relating to fur-backed gloves, which is a valuable move forward and is appreciated and welcomed by the industry. I think I can say to the Chancellor that it is taken by the industry as an earnest of his good intentions towards them and his appreciation of the difficulties of their present position. I hope that the Chancellor will take the opportunity, as the industry most earnestly hopes he will, to allay the anxiety and distress which have been current on both sides of the Committee since the original proposals were made.

This Amendment is founded on the most reliable information which the National Association of Glove Manufacturers could produce. The figures contained in it represent a conscientious effort to arrive at the median price within the principles of the D Scheme. They have two principal aims. The first is to raise the level of D. It may be argued that the Utility scheme was particularly generous towards the glove industry, but I would ask the Chancellor if he does not think that a bad reason for inflicting such sever punishment on the industry as it would receive under the proposals of the Bill. I suggest to him that it is no ground at all for doing so and for inflicting this sudden and very drastic change.

Under the Utility scheme, 97 per cent. of fur-backed gloves were entirely free of tax, but now no fur-backed gloves will be free of tax. Whereas under the Utility scheme 90 per cent. of leather gloves were free, now only 5 per cent. will be free. In the case of fabric gloves 75 per cent. were free and only 24 per cent. will now be free. In the case of knitted gloves 75 per cent. were free and now none will he free of tax.

This Amendment seeks to raise the level of D only to the median price. The second aim, which I believe to be of fundamental importance and strictly in accordance with the scheme set out in the Douglas Report—to which the Chancellor has rightly declared his adherence—is to distinguish adequately between various categories of gloves. Is it not clumsy to lump unlined leather gloves with lined leather gloves and fur-backed gloves and make no distinction at all between them? In the Schedules to this Bill a distinction is clearly made between coats, jackets, waterproofs, waistcoats, and the rest, lined and unlined. Where is the difference in the case of gloves? Cannot the Chancellor see his way to giving us this distinction in the case of gloves as well?

8.15 p.m.

May I put to the Chancellor some of the results which have already followed from the proposals embodied in the Bill? Orders to this industry in April, 1951, amounted to 600,000 dozen leather gloves. This year they are down to one-third of that figure, approximately 200,000 dozen. In the case of fur-backed gloves the position is far worse. Whereas last year the figure was 112,000 dozen, in April this year it was down to 2,800 dozen, one-fortieth of the orders against which the industry was cutting last year.

A further factor touching these orders is that they are mostly for the lowest quality for many years. Production at the moment is largely for stock which, I know the Chancellor will appreciate, is undesirable and speculative. Already, a number of firms have been obliged to close down, and many more at the present moment are working short time.

I should like to read a telegram which I received today from the President of the Northern Association of Glove Manufacturers, which reads: Imperative that D level on fur gloves be raised. Lowering Purchase Tax no solution to present crisis in fur glove trade.

Mr. Butler

Does my hon. Friend claim that a reduction from 100 per cent. to 25 per cent. is no contribution? If so, I think it must very much alter the value of the case which he is putting forward.

Mr. Peyton

I am not claiming that it is no contribution, but I am saying, and saying very strongly, that it would be a very much more effective contribution if my right hon. Friend could raise the D level to a reasonable point. This particular telegram, which has been addressed to me from the North country—from somebody I have never met—continues: Unless this is done, the complete closing down of this trade will result. I admitted at the beginning of my speech that the Chancellor's concession is a valuable one, and is appreciated by the industry, but I say, very sincerely and earnestly indeed, that it does not go far enough. I repeat the point that I made just now—that there can be little justification for putting fur-backed gloves on the same D basis as unlined leather gloves.

At present, as the Chancellor is probably aware, this industry—the fur-backed glove industry—has virtually closed down, and it is for the Chancellor tonight to give some encouragement about its future. May I also say to my right hon. Friend that, since these proposals were first put forward, the industry has been capable of making only the most limited plans directed towards the production of solid and first-class articles. These proposals will have one effect, and that is to lower the standard of the products of the industry.

I should also like to say a word about the effect of these proposals on employment. Already, there has been a substantial decrease in employment, and here I would mention the peculiar position of out-workers in this industry. So far as I am aware, no other industry has such a large proportion of people who are self employed and working in their own homes. When they have no work, they are not registered as unemployed by the Ministry of Labour, and are not entitled to draw unemployment benefit. I do suggest to the Chancellor that these people are not the ones who ought to bear the full brunt of the effect of these proposals.

Another factor is the loss of skilled workers in an industry which depends enormously on hand work. I have met and have discussed this matter with both sides of the industry, and on both sides I find that there is complete agreement in expressing dismay at the prospect which now faces them. I beg the Chancellor most earnestly to reconsider this proposal. In my own constituency of Yeovil, and in other parts of the West Country, this old craft industry has been established for 400 years, and it would be so easy to deal it a blow from which recovery would be difficult, if not impossible. In this particular instance, so little is needed to give the industry a chance to breathe again and make its own way.

I should like to go back to the Douglas Report, and, particularly, to the main principle of that Report, namely. the removal of blind spots and the substitution of a general rising level of taxation. That is the declared intention of the Douglas Report, but I would say to the Chancellor that I believe that, if these proposals are carried through. apart from eliminating a blind spot, they will be introducing something like total blindness, particularly in the fur-backed glove industry.

I know how familiar the Chancellor must be by now with the Douglas Report, but may I draw his attention to paragraph 131 (c) on page 38, which says: that the deductions be fixed in such a way that a given proportion of current purchases of goods covered by the scheme would be free of tax; this proportion should, as far as possible, be the same for all the classes of goods concerned and be not less than one-half in each case; I suggest to the Chancellor that these intentions have been undermined by these proposals, and that they lead one to the inevitable conclusion that there has been a mistake.

I want to ask the Chancellor if he is really satisfied that the evidence on which these proposals were based was anything like adequate for the purpose. Does he know that it is the belief of, and information in, the industry that these proposals were based on a social survey, which was, in its turn, based upon information collected in March, April and September? Is he aware that, during these months, hardly any gloves, in the sense of being products of this industry, are purchased at all? I understand, also, that rubber gloves were taken into account, and I would say that there is absolutely no connection between rubber gloves or the protective type of gloves and the gloves which are produced in this industry, which are entirely used as clothing.

These Amendments do not seek any special concession for the glove industry. We are not asking the Chancellor to make an exception of part of the glove industry; we are simply asking him fairly to implement the recommendations of the Douglas Report, and, if he does that, it is my very strong conviction that he must, quite apart from raising the D level, distinguish between these very different categories of lined leather gloves, unlined leather gloves and fur-backed gloves.

If he does so, I know very well that he will be giving new heart to a very ancient industry, and, what is more, to an industry which has had a very good record for doing all, and more than all, that was expected of it. I therefore ask the Chancellor very earnestly to go as far as he possibly can towards accepting this Amendment.

Brigadier Christopher Peto (Devon, North)

I do not think that anybody in the Committee could possibly feel other than moved by the speech to which we have just listened from my hon. Friend the Member for Yeovil (Mr. Peyton). It was a genuine speech, delivered right from the heart, by somebody who understands the industry and who put the case of the industry in Yeovil.

I wish to refer to the Amendments which have been put down by my hon. Friend the Member for Yeovil, because I have been in close consultation with him on the subject of the glove industry, and, like him, I believe that a genuine mistake has been made. I think that it has probably arisen from the method adopted, which was intended to be fair, by seeking advice from a social survey rather than obtaining the advice and the recommendations of the people concerned in the industry itself.

8.30 p.m.

One of the complaints made was that there had been no consultation with the trade. I, too, should like to tell the Chancellor that the trade, so far as I know it in North Devon—it is mainly the fabric trade—is grateful for the concession he has already made. Speaking for the fabric side of the industry, we feel that we are not so hard hit as those who are concerned with fur-backed and leather gloves. At the same time, there has been a great recession. It is not a recession such as has continued in the textile industry for 12 months but a definite recession since March this year when the D levels were originally made known.

In the fabric glove industry there was practically no difference in the employment figures for either in-workers or out-workers in March, 1951, and March, 1952. They were almost identical, but in March and April, 1952, the number of those employed as out-workers fell by 50 per cent. Over 2,000 were taken off the books in one month. The change was not so noticeable in the case of in- workers, who, of course, are entirely indispensable. They are the skilled craftsmen and cutters. They have been kept on not because there is work for them to do, but because they are indispensable.

I would impress upon the Committee that this is an industry which consists in the main of small firms which very largely are situated in agricultural areas where other employment is not easy for skilled men to obtain. These skilled men have been retained by the expenditure of capital. In some firms that capital has already run out, and some firms have closed down. The grave danger is that unless the Chancellor can see his way to raise the D level to somewhere near the level proposed in the Amendments on the Order Paper, other firms will have to close down too within a matter of weeks.

Once these indispensable in-workers have gone the industry will suffer a blow from which it can never recover. That, of course, is not the whole story. I could enlarge very much on this subject, but I will be very brief. It is not the first time that this industry has nearly collapsed. As a matter of interest I was looking back in HANSARD and I found that in 1933 a Question was put down by the then hon. Member for Barnstaple, who was my father. Though the matter then was one of tariffs, if I could make the speeches which were made at that time they would be extraordinarily applicable today.

In answer to a speech made by my father on 1st March, 1933, the then Secretary, Overseas Trade Department, said: … we have fully in mind the desire of the fabric glove industry to know what future is in front of them." —[OFFICIAL REPORT, 1st March, 1933; Vol. 275, c. 514.] He realised, as we all do, that there is nothing worse than uncertainty in industry, and I would urge the Chancellor to realise that the industry is now again in great danger and that it must know what the future holds for it.

Mr. Blackburn

I should like to support this Amendment from this side of the Committee. As has already been said, the Amendment was movingly moved by the hon. Member for Yeovil (Mr. Peyton). I am afraid that possibly the only person he has not moved will prove to be the Chancellor of the Exchequer. If this Amendment had not been put down, I should have put one down on somewhat similar lines, though perhaps I should have been a little more generous to the trade. My figures would have been slightly higher. However, when I saw this Amendment on the Order Paper, I thought it best not to strain the Chancellor too much, which I think is a clear indication to the Chancellor how reasonable we are on this side of the Committee and how he can accept our Amendments without suspicion.

As has been stated, the figures in the D scheme were obtained as a result of a social survey. I believe the Chancellor will agree that the social survey went wrong when it came to gloves. I am sure he will admit frankly that there is no connection at all between the figures in the D scheme and the actual pricing of gloves.

Hon. Members representing West Country constituencies may be surprised at my speaking on this subject. There are people who think the only manufacturing areas are in the West. But I would remind them that there is a very important glove manufacturing area in the part of the country from which I come. It is a very important industry in my constituency and I have a great interest in the fate of this Amendment. However, I must tell the hon. Member for Yeovil that I am not quite as hopeful about the outcome of this Amendment as I was before I moved the previous Amendment relating to hats.

The social survey obviously has gone wrong. The figures do not match with the statement made by the President of the Board of Trade on 13th March, when he said: Put very briefly, it amounts to this: that about half the goods which are manufactured in any particular category will fall into the Purchase Tax free groups …"— [OFFICIAL REPORT, 13th March, 1952; Vol. 497, c. 1580.] That is quite untrue in the case of gloves.

To stress that point I should like to quote figures, to some of which the hon. Member for Yeovil has referred already. Under the old Utility scheme 90 per cent. of leather gloves were free of tax. Under the suggested D scheme, 5 per cent. are free.

Ninety-seven per cent. of fur-backed gloves were free of tax under the old Utility scheme; under the D scheme none are free. Under the old scheme 75 per cent. of fabric gloves were free of tax, compared with 34 per cent. under the D scheme, and under the old scheme 100 per cent. of knitted gloves were free of tax compared with none under the D scheme. I think that hon. Members on both sides of the Committee will agree that those figures make nonsense of the idea that the statement which the President of the Board of Trade made has been followed with regard to gloves.

The most serious position in the trade at present is that with regard to fur-backed gloves. The trade will be very grateful to the Chancellor of the Exchequer for the Ways and Means Resolution which has been moved today and which will bring some relief to that section of the industry. I was rather apprehensive before that, because the Chancellor had put down an Amendment in relation to fur-trimmed articles and, unfortunately. in order to comply with it not more than one-fifth of the total area could be covered with fur. I had visions of manufacturers of fur gloves endeavouring to come within that category by producing gloves which looked like French poodles. But the trade will be grateful to the Chancellor for the Resolution which he moved and which will help the fur-backed glove trade.

That, however, is not enough. When details of the D scheme were published the fur-backed glove trade virtually came to an end. Manufacturers just could not compete with the prices. Under the old scheme fur-backed gloves were retailed up to almost £2 a pair tax-free, but under the D scheme they are subject to tax above 12s. As has been mentioned by the hon. Member for Yeovil, when the social survey was made rubber gloves and plastic gloves were taken into account; but these articles are not recognised as gloves by the trade because they are moulded gloves. In any case, I submit that rubber and plastic gloves should be free of tax entirely, because they are used in industry and, as I stated in a previous debate, I think that all articles of clothing which are used for industrial purposes or in hospitals should be free of tax. I regard a tax in this case as an additional imposition upon industry.

It is quite reasonable to differentiate between different types of gloves, as has been done in the Amendment put down by the hon. Member for Yeovil, and I hope that the Chancellor, on looking through it, will realise that by lumping all types of gloves together, as he has done, a serious mistake has been made with regard to this trade.

I will not repeat what I said in connection with hats, but many of the things I said have a direct bearing on this Amendment. Just as the hat trade is in difficulties at present, so is the glove trade; just as increased sales in the hat trade would help the export trade, so would it in the case of gloves. The arguments I used about building up a sound and healthy home trade to create a healthy export trade apply to gloves just as much as to hats. I shall not weary the Committee by going over what I said then or by repeating the quotations I gave; but what I said with regard to hats and head-wear applies equally to gloves.

If the levels remain unaltered I am afraid that production of the better types of gloves—particularly those required for export—will cease. Short time is already in evidence in the industry, and if the present D levels are not amended this may well develop into acute unemployment and the industry will be dealt a blow from which it may never recover. I was unsuccessful in my last appeal to the Chancellor, but I hope that I shall be more successful on this occasion. I hope that he will give very serious consideration to the needs of this industry and give it the help it requires in the interests of employment, in the interests of his own revenue—I tried that argument in regard to hats, but it did not work—and of our export trade.

I understand that there are one or two other articles which are grouped with gloves and that in this particular section we are dealing also with scarves, shawls and handkerchiefs.

The Deputy-Chairman (Mr. Hopkin Morris)

No: we are dealing with gloves alone.

Mr. Blackburn

I was under a misapprehension. In any event, I hope the Chancellor of the Exchequer will be able to give some help to this industry.

8.45 p.m.

William Darling (Edinburgh, South

I want to support the Chancellor of the Exchequer in this matter, although I doubt whether he will count my support as particularly worth having. I support him this year because we are passing through a crisis, following six years of Socialist mismanagement, and because we have to get the money to help us out of our difficulties.

Mr. Blackburn

Does not the hon. Gentleman think it better to obtain the money by being fair to all industries, rather than by penalising one more than others?

Sir W. Darling

I find myself in ready agreement with many of these plausible ideas which the hon. Member for Stalybridge and Hyde (Mr. Blackburn) puts forward. They are the kind of arguments which a defaulting debtor frequently makes. I am, however, sufficiently alive to the fact that the Chancellor is facing a real crisis, and my one challenge to him is that he does not emphasise that fact sufficiently and act with sufficient boldness on these occasions. He allows himself from time to time to be influenced by the arguments of hon. Gentlemen and the seductions of hon. Ladies.

Mr. Peyton

I should like to ask my hon. Friend what grounds he has for supposing that, in opposing this Amendment, he will increase the Chancellor's revenue, particularly from fur-backed gloves? What I have been suggesting is that opposition to the Amendment, far from increasing the Chancellor's revenue will decrease it very substantially.

Sir W. Darling

I shall be prepared on another occasion to discuss that view. It may well be the Chancellor's view, and I think it is, that there are many industries which, in this time of crisis, we cannot afford—and we are a well-to-do nation. It may well be that the production of fully fur-backed gloves is one of these. I am not saying that it is, but it may well be that there is, in a year of stringency and difficulty, much that we appreciate, that we want, that we admire, that we desire, but that we have to sacrifice in order to secure our solvency.

If the only sacrifice which we have to make is the sacrifice of the fur-backed glove industry, which is not a very large industry, in order to attain national solvency, then, grim though the prospect is—and I deeply sympathise with my hon. Friend the Member for Yeovil (Mr. Peyton)—I should be prepared to face it. We are in a very grave and serious crisis. Gloves are important, but there is a supreme importance which overrides even their importance.

Mr. Jay

As I know the opinions of the hon. Member for Edinburgh, South (Sir W. Darling), are very weighty and very well informed, may I ask him this: is he still in favour, as he was last year, of a large reduction in the duty on whisky?

Sir W. Darling

I think if I ventured to enlarge upon the subject which the right hon. Member has raised I should be out of order, but if you give me the slightest indication of your indulgence in this connection, Mr. Hopkin Morris—

The Deputy-Chairman

I do not think the hon. Gentleman is entitled to any indulgence here.

Sir W. Darling

I feel I must have the advantage of your protection against the allurements, the challenges, the throwing down of the gauntlet, from the right hon. Member for Battersea, North (Mr. Jay), and I shall not, therefore, discuss whisky.

Reverting to the grievous misfortunes of the glove industry, I think it is deplorable that a business which brings so much art and craftsmanship to our general industry and which has a not inconsiderable export business, particularly with the United States of America, where they follow English fashions—

Sir L. Ungoed-Thomas

Is the hon. Member talking about gloves or about whisky now?

Sir W. Darling

It is deplorable that such an industry should fall under the axe of the Chancellor of the Exchequer. Nonetheless, the responsibility is not with him. The deplorable state of our finances is due to the somewhat light-minded and light-hearted people who sit on the other side of the Committee. I want to tell the Chancellor that I shall support him in the Division Lobby if a Division is called. If we are driven, as we may well be, not only to a gloveless society but to a hatless society, a stockingless society and a shoeless society, the responsibility will not be upon my right hon. Friend. It will lie with hon. and right hon. Gentlemen opposite, and what I admire in my right hon. Friend is his courage in facing the situation.

I say—and I have said it before—that it is surely beneath the dignity as well as the competence of the Chancellor of the Exchequer—I put them in proper order—to deal with matters of this detail, and it should not be the business of the Chancellor of the Exchequer, or, indeed, of the President of the Board of Trade, to go into these small niceties which only highly expert people like my hon. Friend the Member for Yeovil can go into—these intricacies of design and manufacture of scores of commodities.

I have told the Chancellor before. that the simpler way, the easier way, the better way to get the revenue that he requires is to have a universal sales tax of equal level upon all commodities from engineering products to gloves or whisky or any other commodity, and the Chancellor of the Exchequer next year will have my support if he brings forward such a project. We should then be prevented from discussing these intermittent, curious details which no Chancellor can ever possibly be fully informed about.

He must be aware of the difficulties he has to face. For at one hour he will be defending waterproofs, and in the next hour asbestos gloves, and in another hour lambskin backed gloves. It is beyond the compass of my right hon. Friend to have all this detailed knowledge, and he should not be put in that position. He does not ask for any details as to the kind of profession or industry that a man or woman follows in order to produce the Income Tax that he wants from them, and I do not see why we should expect him to have all this detailed knowledge on every one of the many items in this Schedule.

I support the Chancellor of the Exchequer. He has to get this revenue. It is, in my opinion, tragic that six years after the war we have been driven to this desperate strait by Socialist maladministration. If we have to go shoeless, hatless, gloveless, or, for that matter, without whisky, in order to pay the price of the maladministration during the last six years, and if we can pay that in one year, I willingly would pay it in one year rather than five; but next year, I warn the Chancellor of the Exchequer, I shall be joining hon. and right hon. Gentlemen opposite in protesting against these detailed imposts which are so obscure in their origins—

The Deputy-Chairman

I do not think the hon. Gentleman should say now what he will do next year. He must deal with the Amendment.

Sir W. Darling

I entirely bow to your Ruling, Mr. Hopkin Morris, and especially to a Ruling from you, for I know that you and I have less to look forward to than most. It is right that I should bring myself to the matter of the Amendment, and I say that I shall support the Chancellor of the Exchequer in this matter. He has no argument to justify it—but only the supreme overriding argument that the country must be made solvent. The trivial arguments, the counter arguments of hon. and right hon. Gentlemen opposite, and, indeed, of my hon. Friends, are slow, indeed, against the overriding consideration, and the overriding consideration is that if the taxing of fur-backed gloves or gloves with lambskin wool faces can help to save us, then it will be worth doing.

Mr. R. A. Butler

I am sure that we have heard more sense from my hon. Friend the Member for Edinburgh, South (Sir W. Darling), than we have heard for a long time, and if he could in any way shield me from having to become the master of so many different subjects, and, at the same time, share with me some of his future untaxed whisky, I should feel myself in a much stronger position.

My hon. Friend the Member for Yeovil (Mr. Peyton) has made a case on behalf of the glove industry which, I think, it can rightly be said, both interested and moved the Committee. He is one of those hon. Members for whom I had the honour to speak in the last General Election, and one of the few who survived that event. I have every reason to feel a certain sympathy with him in his present troubles. I do not think that anyone could possibly better represent his own constituency in such a matter, in which he himself is deeply interested. My hon. and gallant Friend the Member for Devon, North (Brigadier Peto), who supported the case, also brought forward some interesting arguments.

First, I should like to get clear, in answer to the arguments that have been raised, the nature of the very considerable concession which has already been given to the glove industry, namely, the reduc- tion from 100 per cent. to, not 33⅓ per cent. but 25 per cent. in the tax on fur-backed, rabbit-backed, or whatever you like to call it, gloves. I should like to give the Committee some figures to illustrate the nature of the concession which has been made in this matter—on which I frankly think there was a mistake in the original scheme.

The retail prices of such gloves, upon which this concession has been given, ranged from about 22s. 8d. to about 33s. 4d., and under the 100 per cent. rate the tax was to have been 4s. 8d. on the lower end of the range and no less than 13s. on the upper end. Therefore, I can quite believe what my hon. Friend has said, that this had a disastrous effect upon the industry, and definitely had an effect on production.

At any rate, I have made it my business to go into this to the best of my ability. I should like to draw the attention of the Committee and of the trade, and of the gentleman who sent my hon. Friend telegrams, to the fact that the tax on the lower end of the range has now been reduced, being now only 25 per cent., to only 1s. 2d., and the 13s. has come down to 3s. 3d. That is a very major change for the whole outlook for this industry.

The Committee should realise that in giving these detailed figures I am trying to indicate that we have made an effort to put right an anomaly which did exist in the glove trade, and which I frankly think was not right in the original Schedule. It will mean that this industry will have a better outlook, so that this will have an effect on employment, and so on.

I should now like to answer the general point which has been raised by several hon. Members, as I am taking part in the discussion on this Amendment, knowing its importance as compared with many others—although if I could I would take part in all of them, including answering the hon. Member for Stalybridge and Hyde (Mr. Blackburn), who spoke so well on an earlier Amendment. I would observe—and this takes up the gist of the point made by my hon. Friend the Member for Edinburgh, South—that the background against which all this taxation has been introduced, and against which it is necessary, should be realised.

The Committee should also realise that, although we have in six months succeeded in restoring the position in regard to our gold and dollar reserves, and so fostering confidence in sterling, we are by no means through the wood. There is a long and painful task before us, as I have frequently said both inside and outside this Committee. It is against that background that we have to work. We have also to remember that it is only through greater production and confidence at home that we shall pull through—by the very old-fashioned and simple device of earning by our exports enough to pay for our imports.

I am sorry to make these very simple statements, but they are as eternally true today as they were before. I honestly and sincerely ask hon. Members on both sides of the Committee not to make exaggerated remarks about their own industries, and to say that they are in a state of immediate decay. That has been the tendency on some sides, and so great has been the sincerity of hon. Members that I think they have exaggerated the effects of Purchase Tax as a deterrent.

Purchase Tax is only one feature of the life of an industry. In the case of gloves, for example, I have taken as much trouble as I possibly can about the industry, and I find that its difficulties are by no means due only to Purchase Tax. Part of the trouble is that gloves are not an absolutely essential feature of our make-up. They may not even be so effective as the adornments which the hon. Ladies the Members for Leeds, North-East (Miss Bacon) and Peckham (Mrs. Corbet) have imported to our Chamber. Gloves are useful articles, and the trade is one of the most honourable and traditional in our country, and I am convinced that it has a great future.

9.0 p.m.

It will not pay hon. Members who represent the glove industry, the hat industry, the texile industry, the hoot and shoe industry or any other industry to exaggerate the importance of Purchase Tax as such. I do sincerely hope that they will continue with the work, which they can do much better than I can, of working in other ways, to improve the conditions and prospects of their industries as well as pressing the Government on Purchase Tax. If they will do that, they will have combined their services to their own districts with their legitimate interventions in this debate.

I want to follow that up with some practical examples. In the case of gloves, the hon. Member for Yeovil quoted paragraph 131, which, of course, I know, of the Douglas Committee's Report, which says that the proportion of gloves kept free, of tax is not less than one-half. I think that he claims, and it has been claimed by others in the course of this debate, that the fixing of D levels for gloves was, first of all, not done on sufficient evidence and, secondly, it has been so fixed that there is not an adequate proportion outside and below the D level of popular prices which will be free from tax.

Let me take examples of the cheaper, popular lines on which the D figure, for example, is 3s. of men's knitted and fabric gloves with a popular price range of between 4s. 6d. and 7s. 6d. The tax burden on the cheaper part of that range is only 1d. and it goes up to a limit of 8d. at the top of that range. That is under our 25 per cent. concession made yesterday, and it shows the result of what we have tried to do under the Purchase Tax.

In the case of women's knitted and fabric gloves with a D figure of 3s. and a popular price of 3s. 6d. to 8s. 6d., again the lowest part of that range pays no Purchase Tax and the top limit is 10d. Then take men's leather gloves with a D figure of 12s. and a popular price range of 13s. to 35s. At the lowest range the Purchase Tax in my table is nil at the new 25 per cent. concession which I announced yesterday and asked the Committee to pass this afternoon. The top range of tax even on the 35s. ones is now reduced to 3s. 6d. and on the bottom ones is nil.

For women's leather gloves with a Dfigure of 12s. and a popular price range of 11 s. 6d. to 30s., again we find the lowest part of that range is nil in Purchase Tax and the top part is 2s. 6d. When we come to women's fur-backed gloves with a D figure of 12s. and a price range of 17s. 6d. to 40s., again we find there is no Purchase Tax at the bottom of the range and at the top range it amounts to 3s. 8d. These are the reductions caused by the concession which the Government have already made of 25 per cent., and in the case of the fur-backed glove industry that is allied with the reduction of 25 per cent. from 100 per cent. The Committee will see that we have most sincerely tried to help the glove industry more than it has ever been helped under the scheme before.

Mr. Frederick Lee (Newton)

Will the right hon. Gentleman say what is the affect of his reductions of yesterday as distinct from what they were before?

Mr. Butler

I have not got the figures with me, but I can no doubt get them shortly and I will let the hon. Gentleman have them. It is the difference between 25 per cent. and 33⅓ per cent., with the exception of fur-backed gloves which were at 100 per cent. One thing said by hon. Members opposite yesterday was that even with the concession of 25 per cent. the tax would be very heavy. But those who have examined the tax since know that on many other articles besides gloves in the popular range at the top of the old Utility scheme the tax is not very heavy.

I have not been able to start carving up the types of gloves into categories, such as leather, lined and unlined, dress gloves—the ordinary ones that we wear when we walk about—industrial gloves, rubber gloves and fabric gloves. I could not accept the Amendments in the form in which they have been drafted even if I had wanted to accept them, because they do not seem to make clear the differentiations which we have been unable to draw. The position of fabric gloves under the Amendment is unsatisfactory.

In his speech my hon. Friend drew attention to the fact that under the old Utility scheme it was the industrial glove which "caught it" in the tax range. Under this scheme it is the dress glove which gets the tax, and the industrial glove is virtually removed from tax. There is a further point in regard to rubber gloves. As has been said, these are used by surgeons, nurses and so forth. I am assured that rubber gloves will be virtually free from tax under the operation of the Schedule of this Bill.

Consequently, I see very considerable advantages to the glove trade as the result of the concessions that have been made. The fur-backed trade, in so far as it was menaced by the Purchase Tax, has now been saved, and I hope that it will build up again as a result of this. In the case of the other types of gloves, I have not hitherto been able to devise different schedules. It is very difficult to differentiate between one article and another. There is a difference between gloves and hats in that they have a different history in regard to the old Utility scheme. As has already been explained, it is very difficult to draw a distinction between them in the case of manipulation of the Ds. Therefore, I am afraid that I cannot accept the Amendment.

The most I can say to hon. Gentlemen who are interested in the glove trade is that I am aware that the trade regards itself as not having been sufficiently consulted. This arose from the fact that in all these financial matters one has to be very careful about consultation. One has to treat these matters almost as Budget secrets. The hon. Member opposite who said that I had been in collusion with my right hon. and hon. Friends would have been disappointed even if he had put on a private detective. He would have found that I have been like an oyster. In my position I cannot go about sharing concessions with all and sundry; that would make my position as Chancellor of the Exchequer quite impossible.

This may account in a general way for the reason why the authorities who serve me have not been able to seem to give sufficient attention to the glove trade. We apologise for that. The only thing I can say to the hon. Member, though I fear this will not give him very much satisfaction, is that if, during the next week or two, he wants to bring to us any further representatives from the glove trade—although we think our proposals fair—we shall, of course, consider them between now and the Report stage.

Mr. Jay

I have listened as carefully as I could to the speeches of the Chancellor of the Exchequer, the hon. Member for Edinburgh, South (Sir W. Darling), the hon. Member for Yeovil (Mr. Peyton), the hon. and gallant Gentleman the Member for Devon, North (Brigadier Peto), and my hon. Friend the Member for Stalybridge and Hyde (Mr. Blackburn). I thought the Chancellor spoke with a certain complacency, the hon. Member for Edinburgh, South, with a certain levity, and the other hon. Members with great wisdom and persuasiveness.

The Chancellor is attempting to put over the Committee in each of these debates two contradictory arguments. He tells us that the Purchase Tax is having very little effect on the situation at all and that its influence as a deterrent is greatly exaggerated, and he also tries to argue that a reduction in it by 25 per cent. will have a very great effect. However great the total effect may or may not be, 25 per cent. of it must be very much less. The hon. Member for Edinburgh, South, tried to persuade us that the tax on gloves ought to go up and that the tax on whisky ought to come down.

Sir W. Darling

The Committee will note that the reference to whisky has not been made by me but by the right hon. Gentleman the Member for Battersea, North (Mr. Jay).

Mr. Jay

I am making every effort to remain strictly within the terms of this Amendment. I take that to be the implication of the hon. Gentleman's remarks about the average level of tax which he gave us notice he is going to advocate next year. The hon. Member for Yeovil and the other hon. Gentlemen made very cogent speeches. The hon. Member for Yeovil and the hon. and gallant Member for Devon, North, represent not merely industrial but very agreeable parts of this country with which I am proud to have some familiarity. I hope we shall have further speeches from these hon. Gentlemen in the course of our debates. I found the speech of the hon. Member for Yeovil so cogent that I can assure him we shall give him our support in the Division Lobby tonight.

His speech was a very great tribute to the general policy and administration of the recent Labour Government. He told us—and I hope I have got the figures correctly—that under the administration of the Labour Government 97 per cent. of fur-backed gloves were free of tax; under the scheme of the present Chancellor none would be free of tax We are very glad to have that tribute from the hon. Gentleman.

In the case of leather gloves 90 per cent. under our scheme were tax free, and under the scheme now proposed only 5 per cent. are to be tax free. Knitted gloves, which are obviously very important, under the previous scheme of the Labour Government were tax free to the extent of 100 per cent.; under the scheme now proposed none are to be tax free. Finally—

Mr. Frederic Harris (Croydon, North)

Can the right hon. Gentleman explain why the Socialist Government did not remain in power for a few more years to carry on this extraordinary good work?

Mr. Jay

That again is another very interesting subject. I should be induced to take the gloves off and get outside the bounds of order if I followed the hon. Gentleman. I was going to say that in the case of fabric gloves 75 per cent. were previously tax free, while under the Chancellor's proposals, even as amended, only 34 per cent. are tax free. If we leave everything else out of account, those figures, which are not contradicted, are a further interesting comment on what was said during the recent Election, to which the hon. Member for Croydon, North (Mr. F. Harris), referred, about the subject of the cost of living in this country.

The hon. Member for Yeovil paid a further tribute to the previous administration. He told us that in April, 1951, orders for leather gloves were running at the rate of 600,000 dozen per month, whereas they are now running at only 200.000 dozen a month, a reduction of two-thirds in orders. Therefore, presumably before long production will be down by that amount this year compared with last. In the case of fur-hacked gloves, lie said that the reduction was from 112,000 dozen to a figure about one-quarter of that level. That again is rather a dismal situation under the present administration compared with a year ago. He also told us that production was seriously diminished.

The Chancellor said that he wished to make some references to the general background to all this. I presume that when he did so he was in order. He said that our home situation today would only be improved—we all agree with this—by a general increase in production. On the evidence of the hon. Gentleman, which the Chancellor did not controvert, his proposals as they affect the glove industry have had the result of a very serious reduction indeed.

9.15 p.m.

Secondly, the Chancellor claimed—and here he got rather back-handed or left-handed support from his hon. Friend the Member for Edinburgh, South (Sir W. Darling)—that the really important consideration was that he bad to have this revenue or the solvency of the nation and the Budget would be in danger. The remarkable thing about that, if the argument is based on revenue, is the Chancellor did not tell us how much revenue he would lose—I do not know whether he can do so now—if he accepted the proposal of his hon. Friend the Member for Yeovil and his hon. and gallant Friend the Member for Devon, North. I do not imagine it can be more than £1 million or £2 million or something of that kind.

He has already told us that the total amount of the concessions he is making by way of Income Tax for people with incomes of more than £1,000 a year is £50 million. I only mention that figure in order to compare it with £17 million, which is the total of the concessions he announced last night by way of Purchase Tax on all types of goods. When we put those two figures together they form an interesting and instructive comment on the statement that no more help can be given to the glove, the boot and shoe or the textile industries on grounds of revenue.

Sir W. Darling

Is it not a fact that the Chancellor is releasing £50 million of spending and purchasing power which can be spent on the goods which have been relieved to the extent of £17 million in Purchase Tax?

Mr. Jay

If the hon. Gentleman's argument relates to the release of purchasing power, I suggest that the release could have been effected by the reduction of Purchase Tax proposed in the Amendment. I presume that we shall have the hon. Gentleman's support as well as that of the hon. Member for Yeovil in the Division Lobby in a few minutes' time. For all those reasons, because the Chancellor seems to have been unduly complacent in his attitude to this very important industry, and because a case has been made out for further relief, we shall have the greatest satisfaction in giving our support to the hon. Member for Yeovil.

Mr. F. A. Burden (Gillingham)

The Committee have been surprised at the attitude of some hon. Gentlemen opposite. I am filled with amazement at the remarks made by the right hon. Member for Battersea, North (Mr. Jay). I have never heard such attempts to coerce and invite other hon. Members of the Committee to commit an indiscretion.

My right hon. Friend last night announced very considerable concessions to a great number of industries. The glove trade will benefit with the other industries. Many of us would like to see the D level raised because we consider that there are some comparatively insignificant anomalies. My right hon. Friend has already intimated that those anomalies can be ironed out with the aid of the trade. He has shown already that he is prepared to invite representations where the trade consider that there are anomalies.

The trade in general will agree that the Chancellor has shown by his general reduction in Purchase Tax a much more realistic outlook to the taxation of merchandise than was shown by hon. Gentlemen opposite, in everything that they were able to suggest. I am perfectly sure that the right hon. Member for Battersea, North, and his hon. Friends would have been very happy if it had been as the result of an Amendment they had put forward that the announcement of a general reduction in Purchase Tax had been made.

Mr. Hector Hughes (Aberdeen, North)

Why then did the Chancellor impose the tax at the rate he did in the first instance?

Mr. Burden

In order that hon. Members opposite could make the mistakes they have made and my right hon. Friend could please the trade and show that the Tories believe in a reduction of tax.

Mr. Jay

May I ask the Chancellor whether he accepts the interpretation of his motives which we have just heard from the hon. Member?

Mr. Burden

My right hon. Friend is always inspired by the best of motives. That does not always appear to be evident from what Hon. Gentlemen opposite do.

Mr. Hughes

Has the right hon. Gentleman not beaten a hasty and most ignominious retreat in this matter of which he ought to be ashamed?

Mr. Burden

If my right hon. Friend has beaten a retreat it has been with all his flags flying and not, as hon. Gentlemen opposite did at the last General Election, with their tails down. There is no doubt whatever that as a result of the concessions announced by my right hon. Friend there will be an improvement not only in the glove trade but in other trades. The glove trade has suffered a serious setback during recent months, but right hon. Gentlemen opposite know full well that the symptoms of a decline in the trade, as in other industries, were already there before they went to the country, and they went to the country in order to be able to say that the recession had not taken place then.

Mr. Follick

As a matter of fact—

The Deputy-Chairman

Order, order. This discussion is getting a little too wide.

Mr. Burden

I will now come right down to the question of gloves. The right hon. Member for Battersea, North, remarked that the output of leather gloves had dropped since last year. That decline my right hon. Friend is doing his best to halt. Quite apart from whether there may or may not be some disappointment at the amount of the concessions he announced, there is no doubt the glove trade is highly conscious of their psychological effect on the public.

My right hon. Friend has for the first time slashed taxation vigorously, which is something right hon. Gentlemen opposite have not done. The Press have already stated that Purchase Tax has been reduced, and that will be a far greater inducement to the public to buy than if it were announced that separate concessions had been made at the D level which the public do not appreciate. These measures will help the glove trade considerably, and I believe that the House, the trade and the country will be grateful for the concessions made.

Mr. Blackburn

I presume that the hon. Member for Gillingham (Mr. Burden) has now fulfilled the purpose for which he rose and that there are now sufficient Members on the Government side to save the Division. What his speech has been about, very few Members in the Committee will know. I have been in the Chamber for the best part of six hours, and we have had some good contributions to the general debate. The speech which we have just heard has been the only one which has been of no use whatever, except to the Government, whose Whips have brought in sufficient Members to vote for them.

I have risen again because something should be made clear in order to keep the record straight. The Chancellor of the Exchequer made it appear, when explaining the Ways and Means Resolution, which he moved today about the reduction from 100 per cent. to 25 per cent. tax for fur-backed gloves, that he was giving a concession of 75 per cent. to the trade, whereas the real position is that the trade is having to bear 25 per cent, more than it bore under the old Utility scheme. The case has been presented, however, in the way that the glove trade is to be better off than before.

It is always useful when quoting figures to quote those which help one's case. Certainly, that is what the Chancellor did when he was quoting his figures. I should like Members, however, to look at the D scheme as it appears in the Bill, noting the figures of 3s. and 12s. for the D levels and comparing them with the figures under the Utility scheme.

I have with me the Utility Gloves (Distributors' Maximum Prices) Order, 1952, dated 11th February. For men's leather gloves, unlined, the range is from 13s. 9d. to 21s. 5d. These are the wholesale prices, the same as in the D scheme. The range for men's gloves, lined, is from 15s. 1d. to 23s.; women's leather gloves, unlined, 12s. 6d. to 19s. 2d.: lined, 14s. 3d. to 21s. 7d.; women's fur backed gloves, lined, 22s. 3d. to 31s. 11d.; women's fabric gloves, 2s. 9d. to 11 s. 9d. If those figures under the old Utility scheme are borne in mind, I am sure that every Member of the Committee must agree that the figure of 3s. for the fabric glove and 12s. for other gloves bears no relation to the present position in the trade.

Mr. Stephen Mc Adden (Southend, East)

I do not—[HON. MEMBERS: "Divide."] I do not follow—[HON. MEMBERS: "Divide."] I do not propose to begin until Members opposite behave themselves. It is important that one or two of the statements which have been made by the right hon. Member for Battersea, North (Mr. Jay), should not be allowed to go unchallenged. As I understood him, the right hon. Gentleman was arguing, with the support of figures which have been brought forward during the debate, that formerly, in 1951, production of gloves was running at the figure of 600,000 dozen per month whereas now it is 200,000 dozen pairs per month.

Mr. Peyton

The orders were 600,000 dozen at this time last year.

Mr. McAdden

That is what I said. I said 600,000 dozen per month in 1951.

Mr. Peyton

It was not "per month."

Mr. Jay

May I say that I am entirely in agreement with the hon. Member for Yeovil?

9.30 p.m.

Mr. McAdden

I am extremely glad that the right hon. Gentleman accepts the figures given by my hon. Friend the Member for Yeovil, because when he quoted them and made an argument on them he did know what the figures meant and went so far as to say, "I presume this means per month." If he now admits that he did not know what he was talking about and that he was relying on the figures of my hon. Friend to draw wrong conclusions, I am prepared to accept his withdrawal.

If, in fact, it be true, as the right hon. Gentleman proceeded to argue, that there has been a two-thirds reduction in the rate of orders, I do not think it can be seriously contended that the whole of that reduction is exclusively due to the Chancellor's proposals. [Interruption.] Now the right hon. Gentleman mutters that he did not say so. So the whole edifice of the argument he built up rapidly collapses. He addressed his remarks to showing that the present position of the glove industry was due to the Chancellor's proposals whereas now, sitting down, he admits that his argument was falsely based.

I am sure that hon. Members on both sides of the Committee are anxious to do all they can to assist the glove industry and are grateful to my hon. Friend the Member for Yeovil for having put before the Committee these extremely interesting figures. I am glad that fact is appreciated by the right hon. Member for Battersea, North, even though he drew a false argument from them.

Nevertheless, I feel that the Chancellor is to be congratulated on his general approach to the question, which gives a greater measure of justice over the broad field than was available in the original scheme. Although it may present certain difficulties here and there which may be ironed out in our experience of the working of the scheme, it is better to give it a fair chance than to condemn it out of hand, because it is agreed on all sides of the Committee that the original scheme was not a success and it was on the advice of hon. Members opposite that the Douglas Committee investigated the matter and found that that view was correct.

Mr. Peyton

I do not wish to take up too much of the time of the Committee but I think that it would be ungracious if I did not reply to the thanks I have received for my so-called tributes to the late Administration offered by the right hon. Gentleman the Member for Battersea, North (Mr. Jay). I do not know whether it would help him if I added the tribute that I am certain the discussion we are having in this Committee would not be necessary if it had not been for the wretched legacy he and his friends left us. [HON. MEMBERS: "What legacy?"] I am quite sure that you would rule me out of order if I attempted to deal with that question, Sir, but I would be delighted to satisfy hon. and right hon. Members opposite as opportunity offers.

The concession which the Chancellor has made with regard to fur-backed gloves has gone further than the proposal in the new Clause, which stands in my name and the names of my hon. Friends. It has brought it down to 25 per cent. but I do ask the Chancellor to accept that the D figure of £1 6s. contained in the Amendment before the Committee was based on the reduction of 33⅓ per cent. and I say to the Chancellor that welcome as this concession has been and valuable as it is nevertheless at this moment the fur-backed glove industry is now dead.

I am asking my right hon. Friend to bring new life not only to the industry, but into his own concession by considering an adjustment of the D level. I do so very earnestly. As a new hon. Member I would not consider it right to press this matter. [Interruption.] I welcome the remarks of hon. Members opposite, but I shall continue what I have to say.

I am saying that, as a new Member I would not have pressed this Amendment as strongly as I have done, or worried the Chancellor so persistently as I have done since he announced his Budget proposals. unless I attached very considerable importance to it, and I am therefore asking him very earnestly to give a clear undertaking to leave this matter open until the Report stage, and to hear further representations from the industry which, it may well be, will convince him where, I regret to say, I have failed myself. I ask him for that assurance.

Mr. Butler

I will certainly respond to the invitation, whether my hon. Friend is a new hon. Member or not. I would certainly respond to any hon. Member's request. I cannot go any further than what I said in my speech, namely, that the hon. Member has said that there was a grievance in the industry, that it felt that its case had not been properly heard, and that, if the industry liked to continue to put their case between now and the Report stage, as they are entitled to do, they could do so, but that it would not be right for me to give the Committee any undertaking which would mislead either my hon. Friend or the trade. I am sorry that I cannot go further than that.

Mr. Peyton

I beg to ask leave to withdraw the Amendment.

Hon. Members

No.

The Chairman

Is it the Committee's pleasure that the Amendment be withdrawn?

Hon. Members

No.

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

The Committee divided: Ayes, 276 Noes, 257.

Division No. 127.] AYES [9.39 p.m.
Aitken, W. T. Galbraith, T. G. D. (Hillhead) Manningham-Buller, Sir R. E
Allan, R. A. (Paddington, S.) Garner-Evans, E. H. Markham, Major S. F.
Alport, C. J. M. Glyn, Sir Ralph Marlowe, A. A. H.
Amery, Julian (Preston, N.) Godber, J. B. Marshall, Douglas (Bodmin)
Amory, Heathcoat (Tiverton) Gomme-Duncan, Col. A. Marshall, Sidney (Sutton)
Anstruther-Gray, Major W. J. Gough, C. F. H. Maude, Angus
Arbuthnot, John Gower, H. R. Maudling, R.
Ashton, H. (Chelmsford) Graham, Sir Fergus Maydon, Lt.-Comdr. S. L. C
Assheton, Rt. Hon R. (Blackburn, W.) Gridley, Sir Arnold Medlicott, Brig. F.
Astor, Hon. J. J. (Plymouth, Sutton) Grimond, J. Mellor, Sir John
Astor, Hon. W. W. (Bucks, Wycombe) Grimston, Hon. John (St. Albans) Molson, A. H. E.
Baker, P. A. D. Grimston, Sir Robert (Westbury) Monckton, Rt. Hon. Sir Walter
Baldock, Lt.-Cmdr J M Harden, J. R. E. Moore, Lt.-Col. Sir Thomas
Baldwin, A. E. Hare, Hon. J. H. Morrison, John (Salisbury)
Banks, Col. C Harris, Frederic (Croydon, N) Mott-Radclyffe, C. E
Barber, A. P. L. Harrison, Col. J. H. (Eye) Nabarro, G. D. N.
Barlow, Sir John Harvey, Ian (Harrow, E.) Nicholls, Harmar
Baxter, A. B. Harvie-Watt, Sir George Nicholson, Godfrey (Farnham)
Beach, Maj. Hicks Hay, John Nicolson, Nigel (Bournemouth, E.)
Beamish, Maj. Tufton Head, Rt. Hon. A. H. Nield, Basil (Chester)
Bell, Philip (Bolton, E.) Heald, Sir Lionel Noble, Cmdr. A. H. P
Bell, Ronald (Bucks, S.) Heath, Edward Nugent, G. R. H.
Bennett, P. M. (Reading, N.) Henderson, John (Cathcart) Oakshott, H. D.
Bennett, Sir Peter (Edgbaston) Higgs, J. M. C. Odey, G. W.
Bennett, Dr. Reginald (Gosport) Hill, Dr. Charles (Luton) O'Neill, Rt Hon. Sir H (Antrim, N)
Bennett, William (Woodside) Hill, Mrs. E. (Wythenshawe) Ormsby-Gore, Hon. W. D
Bevins, J. R. (Toxteth) Hinchingbrooke, Viscount Orr, Capt. L. P. S.
Birch, Nigel Hirst, Geoffrey Orr-Ewing, Charles Ian (Hendon. N.)
Bishop, F. P. Holland-Martin, C J. Partridge, E
Black, C. W. Hollis, M. C. Peake, Rt. Hon. O
Bossom, A. C. Holmes, Sir Stanley (Harwich) Perkins, W. R. D.
Bowen, E. R. Holt, A. F. Pickthorn, K. W. M
Boyd-Carpenter, J. A Hope, Lord John Pilkington, Capt. R A.
Boyle, Sir Edward Hornsby-Smith, Miss M. P Pitman, I. J.
Braine, B. R Horobin, I. M. Powell, J. Enoch
Braithwaite, Sir Albert (Harrow, W.) Horsbrugh, Rt. Hon. Florence Price, Henry (Lewisham, W.)
Brooman-White, R. C. Howard, Gerald (Cambridgeshire) Prior-Palmer, Brig. O L
Browne, Jack (Govan) Howard, Greville (St. Ives) Profumo, J. D.
Buchan-Hepburn, Rt. Hon P. G. T Hudson, Sir Austin (Lewisham, N.) Raikes, H. V.
Bullard, D. G. Hudson, W. R. A. (Hull, N.) Rayner, Brig. R
Bullock, Capt. M. Hulbert, Wing Cmdr. N. J. Remnant, Hon. P.
Bullus, Wing Commander E E Hurd, A. R. Renton, D. L. M.
Burden, F. F. A. Hutchinson, Sir Geoffrey (Ilford, N.) Roberts, Peter (Healey)
Butcher, H. W. Hutchison, Lt.-Com. Clark (E'b'rgh W.) Robertson, Sir David
Butler, Rt Hon. R. A. (Saffron Walden) Hutchison, James (Scotstoun) Robinson, Roland (Blackpool, S.)
Carson, Hon. E. Hyde, Lt.-Col. H. M. Robson-Brown, W.
Cary, Sir Robert Hylton-Foster, H. B. H Rodgers, John (Sevenoaks)
Channon, H. Jenkins, R. C. D. (Dulwich) Roper, Sir Harold
Clarke, Col. Ralph (East Grinstead) Jennings, R. Ropner, Col. Sir Leonard
Clarke, Brig. Terence (Portsmouth, W.) Johnson, Eric (Blackley) Russell, R. S.
Clyde, Rt. Hon. J. L. Jones, A. (Hall Green) Ryder, Capt. R. E. D.
Cole, Norman Joynson-Hicks, Hon. L. W. Salter, Rt. Hon. Sir Arthur
Cooper, Sqn. Ldr. Albert Kaberry, D Sandys. Rt. Hon. D.
Craddock, Beresford (Spelthorne) Keeling, Sir Edward Schofield, Lt.-Col. W. (Rochdale)
Crookshank, Capt. Rt. Hon. H. F. C. Kerr, H. W. (Cambridge) Scott, R. Donald
Crosthwaite-Eyre, Col. O E Lambert, Hon. G. Scott-Miller, Cmdr. R.
Crouch, R. F. Lambton, Viscount Shepherd, William
Crowder, John E. (Finchley) Lancaster, Col. C. G. Simon, J. E. S. (Middlesbrough, W.)
Cuthbert, W. N. Leather, E H. C. Smiles, Lt.-Col Sir Walter
Darling, Sir William (Edinburgh, S.) Legge-Bourke, Maj E. A. H Smithers, Peter (Winchester)
Davies, Rt, Hn. Clement (Montgomery) Legh, P. R. (Petersfield) Smithers, Sir Waldron (Orpington)
De la Bère, R. Lindsay, Martin Smyth, Brig. J. G. (Norwood)
Deedes, W. F. Linstead, H. N. Snadden, W. McN.
Digby, S. Wingfield Lloyd, Maj. Guy (Renfrew, E.) Spearman, A. C. M
Donaldson, Cmdr. C. E. McA. Lockwood, Lt.-Col. J. C. Speir, R. M.
Donner, P. W. Longdon, Gilbert (Herts, S.W.) Spence, H. R. (Aberdeenshire, W.)
Douglas-Hamilton, Lord Malcolm Low, A. R. W. Spens, Sir Patrick (Kensington, S.)
Drayson, G. B. Lucas, Sir Jocelyn (Portsmouth, S.) Stanley, Capt. Hon. Richard
Drewe, C. Lucas, P. B. (Brentford) Stevens, G. P.
Dugdale, Maj. Rt. Hn. Sir T. (Richmond) Lucas-Tooth, Sir Hugh Steward, W. A (Woolwich, W.)
Duncan, Capt. J. A. L. Lyttelton, Rt. Hon O. Stewart, Henderson (Fife, E.)
Duthie, W. S McAdden, S. J. Stoddart-Scott, Col. M.
Erroll, F. J. McCorquodale, Rt. Hon. M. S. Storey, S.
Fell, A. Macdonald, Sir Peter (I. of Wight) Strauss, Henry (Norwich. S.)
Finlay, Graeme Mackeson, Brig. H. R. Studholme, H. G.
Fisher, Nigel McKibbin, A. J. Summers, G. S.
Fleetwood-Hesketh, R. F McKie, J. H. (Galloway) Sutcliffe, H.
Fletcher, Walter (Bury) Maclean, Fitzrey Taylor, Charles (Eastbourne)
Fletcher-Cooke, C. MacLeod, Iain (Enfield, W.) Taylor, William (Bradford, N.)
Fraser, Hon. Hugh (Stone) MacLeod, John (Ross and Cromarty) Teeling, W.
Fraser, Sir Ian (Morecambe & Lonsdale) Macpherson, Maj. Niall (Dumfries) Thomas, Rt. Hon. J. P. L. (Hereford)
Gage, C. H. Maitland, Comdr. J. F. W. (Horncastle) Thomas, P. J. M. (Conway)
Galbraith, Cmdr. T D. (Pollok) Maitland, Patrick (Lanark) Thompson, Kenneth (Walton)
Thompson, Lt.-Cdr R. (Croydon, W) Wakefield, Edward (Derbyshire, W.) Williams, Rt. Hon. Charles (Torquay)
Thornton-Kemsley, Col C. N. Wakefield, Sir Wavell (Marylebone) Williams, Gerald (Tonbridge)
Tilney, John Walker-Smith, D. C. Williams, R Dudley (Exeter)
Turner, H. F. L Ward, Hon. George (Worcester) Wills, G
Turton, R. H. Ward, Miss I (Tynemouth) Wilson, Geoffrey (Truro)
Tweedsmuir, Lady Waterhouse, Capt Rt. Hon. C. Wood, Hon R
Vane, W. M. F. Watkinson, H. A. York, C.
Vaughan-Morgan, J K Webbe, Sir H. (London & Westminster)
Vosper, D. F. Wellwood, W. TELLERS FOR THE AYES:
Wade, D. W White, Baker (Canterbury) Mr. Conant and Mr. Redmayne.
NOES
Acland, Sir Richard Fienburgh, W. McKay, John (Wallsend)
Adams, Richard Finch, H. J. McLeavy, F.
Albu, A. H. Fletcher, Eric (Islington, E.) MacMillan, M. K. (Western Isles)
Allen, Arthur (Bosworth) Follick, M. MacPherson, Malcolm (Stirling)
Allen, Scholefield (Crewe) Foot, M. M. Mainwaring, W. H.
Anderson, Alexander (Motherwell) Forman, J. C. Mallalieu, E. L. (Brigg)
Anderson, Frank (Whitehaven) Fraser, Thomas (Hamilton) Mallalieu, J. P. W. (Huddersfield, E.)
Attlee, Rt. Hon. C R. Freeman, John (Watford) Mann, Mrs. Jean
Awbery, S. S. Gibson, C. W Manuel, A. C.
Ayles, W. H. Glanville, James Marquand, Rt. Hon. H A.
Bacon, Miss Alice Gordon Walker, Rt. Hon. P. C. Mellish, R. J.
Baird, J. Greenwood, Anthony (Rossendale) Messer. F.
Balfour, A Greenwood, Rt. Hon. Arthur (Wakefield) Mikardo, Ian
Barnes, Rt. Hon. A J. Grenfell, Rt. Hon. D R. Mitchison, G. R
Bartley, P. Grey, C. F. Monslow, W
Bellenger, Rt. Hon F. J Griffiths, David (Rother Valley) Moody, A. S
Bence, C. R. Griffiths, William (Exchange) Morley, R.
Benn, Wedgwood Hale, Leslie (Oldham, W.) Morrison, Rt. Hon. H. (Lewisham, S.)
Benson, G. Hall, Rt. Hon. Glenvil (Colne Valley) Mort, D. L.
Beswick, F. Hall, John (Gateshead, W.) Moyle, A.
Bevan, Rt. Hon. A (Ebbw Vale) Hamilton, W. W Mulley, F. W.
Bing, G. H. C Hannan, W. Murray, J. D.
Blackburn, F Hardy, E. A. Neal, Harold (Bolsover)
Blenkinsop, A. Hargreaves, A. Noel-Baker, Rt. Hon. P J
Blyton, W. R. Harrison, J. (Nottingham, E) O'Brien, T
Boardman, H. Hastings, S. Oldfield, W. H
Bottomley, Rt. Hon A. G. Hayman, F. H. Oliver, G. H.
Bowden, H. W. Healey, Denis (Leeds, S.E.) Orbach, M.
Bowles, F. G. Henderson, Rt. Hon. A. (Rowley Regis) Oswald, T
Braddock, Mrs. Elizabeth Herbison, Miss M. Padley, W E
Brockway, A F. Hewitson, Capt. M. Paget, R. T.
Brook, Dryden (Halifax) Hobson, C. R. Paling, Rt Hon W (Dearne Valley)
Broughton, Dr. A. D. D Holman, P. Paling, Will T. (Dewsbury)
Brown, Rt. Hon George (Belper) Houghton, Douglas Pannell, Charles
Brown, Thomas (Ince) Hoy, J. H. Pargiter, G. A.
Burke, W. A. Hubbard, T. F. Parker, J.
Burton, Miss F. E. Hudson, James (Ealing, N.) Paton, J
Butler, Herbert (Hackney, S) Hughes, Cledwyn (Anglesey) Peart, T. F
Carmichael, J. Hughes, Emrys (S. Ayrshire) Porter, G.
Champion, A J. Hughes, Hector (Aberdeen, N.) Price, Joseph T. (Westhoughton)
Chapman, W D Hynd, H. (Accrington) Price, Philips (Gloucestershire, W.)
Chetwynd, G. R Hynd, J. B. (Attercliffe) Proctor, W. T.
Clunie, J. Irvine, A. J. (Edge Hill) Pryde, D. J.
Cocks, F. S. Irving, W. J. (Wood Green) Pursey, Cmdr. H
Coldrick, W. Isaacs, Rt. Hon. G. A Rankin, John
Collick, P. H. Janner, B. Reeves, J.
Cook, T. F. Jay, Rt. Hon. D. P T Reid, Thomas (Swindon)
Cove, W. G. Jeger, George (Goole) Reid, William (Camlachie)
Craddock, George (Bradford, S.) Jenkins, R. H. (Stechford) Rhodes, H.
Cullen, Mrs. A Johnson, James (Rugby) Richards, R.
Daines, P. Johnston, Douglas (Paisley) Robens, Rt. Hon. A
Dalton, Rt. Hon. H Jones, David (Hartlepool) Roberts, Albert (Normantan)
Darling, George (Hillsborough) Jones, Frederick Elwyn (West Ham. S.) Roberts, Goronwy (Caernarvonshire)
Davies, Ernest (Enfield, E.) Jones, Jack (Rotherham) Robinson, Kenneth (St. Pancras, N.)
Davies, Harold (Leek) Jones, T. W. (Merioneth) Rogers, George (Kensington, N.)
Deer, G. Kennan, W. Ross, William
Delargy, H. J Kenyon, C. Royle, C.
Dodds, N. N Key, Rt. Hon. C W. Schofield, S. (Barnsley)
Donnelly, D. L King, Dr. H. M. Shackleton, E. A. A
Driberg, T. E. N Kinley, J. Shawcross, Rt. Hon Sir Hartley
Dugdale, Rt. Hon. John (W. Bromwich) Lee, Frederick (Newton) Shinwell, Rt. Hon. E.
Ede, Rt. Hon. J. C. Lee, Miss Jennie (Cannock) Short, E. W.
Edelman, M. Lever, Harold (Cheetham) Shurmer, P. L. E
Edwards, John (Brighouse) Lever, Leslie (Ardwick) Silverman, Julius (Erdington)
Edwards, Rt. Hon. Ness (Caerphilly) Lewis, Arthur Simmons, C J. (Brierley Hill)
Edwards, W. J. (Stepney) Lindgren, G. S. Slater, J.
Evans, Albert (Islington, S.W.) Lipton, Lt.-Col M. Smith, Ellis (Stoke, S.)
Evans, Edward (Lowestoft) Logan, D. G. Smith, Norman (Nottingham, S)
Evans, Stanley (Wednesbury) MacColl, J. E Sorensen, R. W.
Ewart, R. McGhee, H. G. Soskice, Rt Hon Sir Frank
Fernyhough, E McGovern, J Sparks, J. A.
Field, W. J. McInnes, J. Steele, T.
Stewart, Michael (Fulham. E.) Ungoed-Thomas, Sir Lynn Willey, Octavius (Cleveland)
Stokes, Rt. Hon. R. R Viant, S. P. Williams, David (Neath)
Strachey, Rt. Hon. J. Watkins, T. E Williams, Rev. (Llywelyn (Abertillery)
Strauss, Rt. Hon George (Vauxhall) Webb, Rt. Hon. M. (Bradford, C.) Williams, Ronald (Wigan)
Swingler, S. T. Weitzman, D. Williams, Rt. Hon. Thomas (Don V'll'y)
Sylvester, G. O. Wells, Percy (Faversham) Wilson, Rt. Hon. Harold (Huyton)
Taylor, Bernard (Mansfield) Wells. William (Walsall) Winterbottom, Ian (Nottingham, C.)
Taylor, John (West Lothian) West, D. G. Winterbottom, Richard (Brightside)
Taylor, Rt. Hon. Robert (Morpeth) Wheatley, Rt. Hon. John Woodburn, Rt. Hon A
Thomas, David (Aberdare) White, Mrs. Eirene (E. Flint) Wyatt, W. L.
Thomas, lorwerth (Rhondda, W.) White, Henry (Derbyshire, N.E.) Yates, V. F
Thurtle, Ernest Whiteley, Rt. Hon. W.
Timmons, J. Wigg, George TELLERS FOR THE NOES:
Tomney, F. Wilkins, W. A. Mr. Pearson and Mr. Holmes.
Turner-Samuels, M Willey, Frederick (Sunderland, N.)
The Chairman

The next group—group 6 of the Schedule—goes from items B.1, to B.9 inclusive. Group 6 will have to be divided into two parts—one excluding and one including fur. On the first Amendment, in the names of the right hon. Gentleman the Member for Leeds, South (Mr. Gaitskell) and his hon. Friends—in page 76, line 10, column 1, leave out "42″," and insert "36″."—fur will not be discussed. At the end of the discussion on that and relative Amendments the Committee will divide. I shall then call the hon. Member for Billericay (Mr. Braine), his Amendment on fur will be discussed, and, at the end, I shall call for Divisions on the four Amendments selected in group 6.

Mr. Eric Fletcher (Islington, East)

It was not very easy to hear what you said, Sir Charles. Is it the fact that we are discussing the non-fur Amendments first; then we are to have a Division, and then a discussion on the Amendments dealing with fur, after which there will be a general discussion on fur?

The Chairman

That is so. On the first Amendment, in the names of the right hon. Gentleman the Member for Leeds, South and his hon. Friends, fur will not be discussed. I have no doubt that we will have a Division on that. At the end of the discussion of all the non-fur Amendments, I shall then call the Amendment in the name of the hon. Member for Billericay, and on that Amendment we shall only discuss fur. After that, the other Amendments which are required on the whole group will be called. Who is going to move the Amendment?

Miss Alice Bacon (Leeds, North-East)

I beg to move, in page 76, line 10, column 1, to leave out "42″," and to insert "36″."

I understand that, together with this Amendment, the whole of the Amend- ments on women's outerwear and dresses, and, in fact, everything but women's underwear and furs, will be discussed as one group. The main purpose of the Amendments which are down in the names of my right hon. Friends, my hon. Friends and myself, is to raise the level of the D in order that it shall be equal to the old Utility level. The first Amendment in our names, however, which I have moved, is a separate Amendment designed to put certain coats out of one category in the Schedule into another category.

For some time before I entered the House I was a schoolteacher, and I therefore believe in visual aids. I always think it is much better to be able to give one practical demonstration than to talk for a long time. It will have been noticed that my hon. Friend the Member for Peckham (Mrs. Corbet) and myself have been sitting here wearing identical coats—at least, not quite identical, for there is one slight difference. These two coats both cost the same to manufacture and both have the same wholesale price. My hon. Friend's coat is under 42 in. and mine is over 42 in. I think hers is 40 in. and mine is 44 in. in length. But the curious thing is this: because my hon. Friend is short and, therefore, wears a shorter coat, she has to pay 12s. 6d. more tax on her coat than I paid on mine. Hon. Members on the Front Bench opposite look as if they do not believe that, and I shall have to go into a few figures to show that is true.

Under the Schedule, coats of over 42 in. have a D figure of £6 10s., whereas coats of under 42 in. have a D figure of £4. My hon. Friend, therefore, in buying her coat, would have to pay tax on everything over a wholesale figure of £4, whereas in the case of the coat which I am wearing, I should have to pay tax only on the wholesale price over £6 10s. I think it is quite clear, therefore, that to serve the needs of short women—and I have here both my hon. Friend the Member for Peckham and my hon. Friend the Member for Lanarkshire, North (Miss Herbison)—it would be much fairer to alter 42 in. to 36 in.

The tax on the coat which I am wearing is 7s. 5d. under the D scheme and the tax on the coat which my hon. Friend the Member for Peckham is wearing is 19s. 1 1 d. Under the Utility scheme, of course, both coats were tax free. In each case, this is an extra tax and not merely a difference in tax. Yesterday, we discussed outsizes, and some concession was promised for outsizes, but it is rather strange to think that, under the Finance Bill, not only my hon. Friend for Liverpool, Exchange (Mrs. Braddock), and my hon. Friend the Member for Gorbals (Mrs. Cullen) are being penalised, but also my two hon. Friends the Members for Peckham and for Lanarkshire, North.

Yesterday, the hon. Gentleman the Member for Bury and Radcliffe (Mr. W. Fletcher) talked about what he called the "Fatties." I wan', to speak tonight on behalf of the "Shorties." Of course, if under this Government one happens to be both short and fat, then, of course, it is just too bad.

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

What about the Minister of State for Economic Affairs?

Miss Bacon

My hon. Friend the Member for Lanarkshire, North, sitting beside me, is wearing a coat that is referred to in the trade as a three-quarter coat. It is a little too big for her, but that rather strengthens my argument. A three-quarter coat is, in effect, very much like an ordinary overcoat except that it is a little shorter. It is worn by both tall women and short women—the kind of coat that comes to three or four or five inches of the hemline. The length of the coat that my hon. Friend is wearing is 38 inches. Therefore, being under the line of 42 inches, that also has to be in the category of the D figure £4, and not £6 10s

. It therefore appears that the various coats that my hon. Friends are wearing ought not to be classified with other costume coats, as they are under this Schedule, but that they ought to be classified in the overcoat section, and this would come about if the Financial Secre- tary would accept this Amendment and change the 42 inches in the Schedule to 36 inches. Then both the short person wanting the full size coat and any woman wanting a three-quarter length coat would not have to pay such additional tax.

Perhaps I had better clear up one misunderstanding before going any farther, and state quite definitely that these coats came off the peg yesterday and that they are going back on the peg tomorrow. I want also to make one further thing clear, and that is that there will be no more demonstrations under this Schedule. I come to the other points which there are in these 20 or more Amendments in our names. As I say, the main purpose of these Amendments in each case is to raise the D figure to the figure which was the old top Utility level, and I think that if we go through the whole of these items, and compare the prices that were and the prices that will be, we can see that every woman in the country will have an additional expense because of the D scheme adopted by the Government.

It will be seen, for instance, that the full length overcoat is to have a D figure of £6 10s. The old top Utility wholesale figure was £10. Therefore, there is going to be a very great additional tax on every woman's coat that is within this range. Let me just give one or two examples. A coat which previously cost £13 6s. 8d. is now, even taking account of the Chancellor's concession of last night—and one thing about that concession I was not pleased with was, that I had to do my arithmetic all over again between last night and now—a coat with the ceiling price under Utility of £13 6s. 8d. will have a new selling price under the D scheme of £14 7s. 11d.

Even a cheaper coat which was £10 under the old Utility scheme is going to carry tax of 7s. 10d. and cost £10 7s. 10d under the new D scheme. There is something rather curious, even with the £6 lOs coat. The coat with a wholesale price of £6 10s. is supposed to be free from tax, but because of what in the trade is called the uplift—which is a sort of notional wholesale value—that coat will carry a tax, and right hon. Gentlemen opposite and the trade ought to go into this question of the uplift, and this rather false wholesale figure which is being given.

10.0 p.m.

Coming to the next category, I would point out that in the Amendment as printed on the Order Paper there is a misprint, because the second £4 12s. should be £4. These items are overcoats, coats, capes, mackintoshes and raincoats, and we do not wish to alter these except for the outsizes, which I am not discussing tonight. The question of outsizes was discussed yesterday.

Yesterday my hon. Friend the Member for Leeds, West (Mr. Pannell) talked of the very great variety of articles of men's wear which were grouped together. That is also true of women's wear in group 3, in which we see grouped together jackets, blazers, coats, cloaks, capes, overalls with sleeves, cycling capes, waistcoats with sleeves, blouses, shirt-blouses, shirts, cardigans of woven or knitted cloth and jumpers of woven or knitted cloth. Somehow or other they are all put into the same category with the same D figure. How the Treasury arrived at this classification I just do not know. They have said something about finding a median line to fit the D figure. It is very strange that that median should come up in exact pounds like £4 and £2. If the true median had been fixed I should not have expected it to come to whole pounds like that.

There is a very wide variety in this group, and what puzzles me is that there are included cardigans of woven or knitted cloth and jumpers of woven or knitted cloth, with a D figure of 16s. for not fully lined nor double texture cloth, and for class A material, which is wool, not fully lined the figure is £2. Yet under group 5, we see blouse-type jackets, sleeveless waistcoats, knitted jumpers, knitted cardigans, jerseys, sweaters and bed jackets. Why some cardigans and jumpers are in one category and other cardigans and jumpers in another, with a different D level, I am not sure. Perhaps whoever replies will be able to give us some enlightenment on that.

I should here like to mention a point dealt with admirably yesterday by my right hon. Friend the Member for Huyton (Mr. H. Wilson) when we were discussing men's wear, namely, the allowance for lining. It really is ridiculous that the D figure for a fully lined jacket should be £4 and for a not fully lined jacket £2. As my right hon. Friend pointed out yesterday, under this classification it would be possible to have an unlined coat costing more than a lined coat because of the tax. Yesterday, the Financial Secretary said that this matter would be looked into with regard to men's wear, and I hope that it will also be looked at with regard to women's wear.

The Committee will notice that we propose to raise the D level in every case. We propose to raise the D level of a jacket from £6 to £6 12s. 6d. I think that in group 5 where we get knitted cardigans, jerseys, and so on, it would be a good thing if we had two categories of material—Class A and Class B—and that is what we propose.

Now I come to dresses. Dresses, pinafore dresses, gym tunics, housecoats, dressing gowns and bathrobes, are all put together in one category, and then we have, in another category, overalls exceeding 42 inches in length, boiler suits and overall gowns. I have gone into this list very carefully and have done quite a bit of work on it in the last few weeks, but I cannot understand what is happening with regard to overalls. In one Schedule, we have overalls lumped with jackets not exceeding 42 inches in length, and further down in the Schedule we have overalls exceeding 42 inches in length, boiler suits and overall gowns with quite different D levels.

I do not propose to comment on this, because I do not really know what is the intention. The Minister will notice that we are asking that for overalls, too, the length should be altered from 42 inches to 36 inches, because there is a kind of smock overall which costs just as much as the long type overall but which is less than 42 inches in length. For dresses we get in Class B material a D figure of £2, but just think what a variety of materials there are under Class B—everything except wool—and we feel that the D figure of £2 is much too low.

I should like to give two further examples of the way in which the new tax will work in regard to a woman's suit and dresses. A woman's suit which sells wholesale at £10 8s. 9d. and which was free of tax at £13 8s. 4d. under the old Utility scheme will now cost £15 3s. 1d. under the D scheme. The Chancellor last night tried to say that he was giving a great concession. From that suit he has taken off 8s. 3d. but he has left a tax on of £1 4s. 9d. and our proposal would take off not 8s. 3d. but the whole of the 33s. A dress which cost £6. Class B material, will in future cost £6 12s. 6d. Again the Chancellor last night, with great benevolence, gave 4s. 2d. of that back, but he still leaves 12s. 6d. tax to be paid on a £6 12s. 6d. dress.

Before I sit down, there are one or two general remarks I should like to make about this Schedule. First, I want to stress the point which I stressed on men's clothes, and to which we have not yet had any satisfactory answer, namely, the discrepancy between the price levels which have been fixed for cloth and clothes. In some instances, the level on cloth has gone up and the level on garments made from that cloth has gone down.

Let me give one example which I quoted yesterday, but which was not answered at all by the hon. Gentleman who replied; so I will repeat it. A certain type of Utility cloth was 21s. 11d. The D figure now puts that cloth up to 22s. 2d., but the strange thing is that a coat made of that cloth goes down from £8 16s. 9d. to £6 10s. That is a point which is worrying the trade a great deal.

I want again to stress that our main objection to the Schedule is that it puts taxes on goods which were never taxed before, a heavy tax in some cases. It is no use saying, "What does 5s. or 6s. amount to?"; 5s. or 6s. is a great deal these days when a woman is buying a dress.

The Chancellor said yesterday that as we went through the Schedules he would make concessions or adjustments if there were any to be made. I hope I have shown that in regard to certain sizes as well as in regard to cost there are many adjustments which ought to be made in women's outer wear, and I hope that some concessions will be made this evening.

Mr. Burden

We have had a very interesting dissertation from the hon. Lady the Member for Leeds, North-East (Miss Bacon). Most of us are very pleased to see her hon. Friends in their party clothes. A demonstration on some of the earlier Clauses might have been extremely interesting, if rather brief.

Some of the points made by the hon. Lady were very good ones, but in some of her remarks she was on very unsure ground. She complained that an increased D allowance was given for coats over 42 inches in length and suggested that that D level should be paid for garments 36 inches in length. If we reduce the length to 36 inches and still have the same D level, there will be a tendency on the part of manufacturers to make garments shorter than they should. It is a very good thing for garments to be made on the long side and for the D level to be such as to encourage manufacturers to make a full length a really full length. It is easy for women to have a coat shortened, but it is not nearly so easy for them to have it lengthened.

The hon Lady brought along her hon. Friend the Member for Lanarkshire, North (Miss Herbison), in a three-quarter length coat and said that that coat had a lower D level than a coat of 42 inches. It is a well-known fact in the trade that a three-quarter length coat uses less material than a full-length coat and the cost of production is generally less than for a full-length coat, and therefore the wholesale selling price of the garment is less. Although the D level may be less in relation to the cost of the garment. the D level is—

Miss Bacon

Perhaps I might explain to the hon. Member, who does not seem to know what he is talking about, that the wholesale manufacturer's price for each coat is £7 19s. 6d. Both coats are the same wholesale price, but the three-quarter length coat of my hon. Friend has a bigger wholesale price.

10.15 p.m.

Mr. Burden

The hon. Lady is not on sound ground. Generally speaking, the three-quarter length coat is cheaper than the full length coat. The hon. Lady when she was speaking pointed to her hon. Friend on her left and then to her hon. Friend on her right, and said that one garment, the three-quarter length coat, was more costly than the other. They are entirely different materials, and that is nothing unusual. Again, she is on weak ground.

If the lengths in the D scheme are not maintained and the higher D levels are going to shorten lengths and measures that are worked out with the trade, it will encourage skimping and faulty manufactures, which was one of the failures of the Utility scheme, and it will be debasing and not improving garments made in this country. There is also the important factor that the failure of the Utility scheme was made perfectly clear by hon. Members opposite over a considerable period and they were demanding a revision.

There is no doubt that there was a debasement in woollen material and in the definition of what was called wool. For instance, the right hon. Gentleman the Member for Huyton (Mr. H. Wilson) on one occasion defined wool material as a material containing more than 15 per cent. of wool and on another occasion as material that contained not more than 15 per cent. wool.

There is every need for this revision, and the D scheme in general has been approved and accepted by the trade. The trade are convinced that, as a result of the new D scheme and the abolition of the old Utility scheme, free competition and free marketing will result in an improvement in quality from which the public generally will benefit.

Mr. H. Wilson

Is the hon. Gentleman suggesting that because the statutory definition of wool material a year or two ago was a material containing not less than 15 per cent. of wool there has been debasement in the Utility scheme? If that is his suggestion—and it seems to be implied by what he says—may I remind him that, in the first place, that has been the definition of wool materials for many years in Statutory Instruments; and, secondly, unless he is trying to suggest this is an improvement on the Utility scheme, in the very Schedule we are debating tonight the Government have defined Class A material, which is taken for this purpose as wool, as: textile material containing more than 15 per cent. by weight of fibre including a fibre such as wool.

Mr. Burden

The right hon. Gentleman has risen to the bait perfectly, because what I was complaining about was that he made two different statements. On the first occasion when he spoke about the wool material—and I ask him to look up his own words—he said it was material containing not more than 15 per cent. wool. On the second occasion, as I pointed out in an Adjournment debate in this House, he said it was material containing more than 15 per cent. The right hon. Gentleman should make up his mind.

Generally, this is an improvement. The trade accepts that it means intensive competition, and they are not tied as they were by the old Utility schedules, which many manufacturers tried to get round. There have been complaints about this matter from the British Standards Institution, and the hon. Gentleman the Member for Dartford (Mr. Dodds) not so very long ago said that the whole Utility scheme had failed and spoke of the shocking manufacture of some of the garments.

Mr. Norman Dodds (Dartford)

Does not the hon. Gentleman appreciate that no one doubts or disagrees with that? Does it now show the hollowness of his argument that he has to flog something that we all agree about? Why does he not get on with the argument?

Mr. Burden

Hon. Gentlemen opposite have condemned the D scheme, but the scheme has not had a chance. The Utility scheme has had a chance, and the right hon. Member for Huyton (Mr. H. Wilson) has this very minute shown what a failure this scheme was at the end

The hon. Lady the Member for Leeds, North-East, drew a harrowing picture of how ladies are going into shops and have to pay so much more money for a costume that they could buy more cheaply when the Utility scheme was in being. The fact is that general suits and ladies' costumes costing £9 wholesale before the D scheme paid £3 in Purchase Tax and now pay only 12s. 6d. The hon. Lady shakes her head, but that happens to be true. I ask her to work it out for herself. If the D level is £6 10s., on a coat which sold at £9 before the D scheme came into operation and paid tax at 331 per cent.—[Interruption.] The hon. Lady agrees with that?

Miss Bacon

No.

Mr. Burden

I assure her that it is correct. If the wholesale value was £9 it paid a tax of £3.

Miss Bacon

I am not quarrelling with the hon. Gentleman's arithmetic. I was a teacher of mathematics before I came into this House. I have just added together the old Utility levels of jacket and skirt to make a suit, and they come to £9 18s. 9d. How could a suit at the wholesale price of £9 pay any tax at all?

Mr. Burden

The hon. Lady does not understand. Surely she will accept that there were general garments and Utility garments and that the general garments were not in the Utility scheme at all.

Miss Bacon

The general garments that paid the tax were at the higher price.

Mr. Burden

The hon. Lady does not realise the facts.

Mrs. Jean Mann (Coatbridge and Airdrie)

Did the hon. Member for Gillingham (Mr. Burden) ever buy a lady's costume in his life? If he did, he would realise that the Utility range went right up to £20. The top Utility was £20. Now, under the new cost of living that we are getting from his party, the £25 costume will be reduced in price but the £6 10s. costume will go up.

Mr. Burden

There was no top Utility price of £20, never. I may not have bought costumes, but I have been manufacturing them for quite a number of years. [Interruption.]

Hon. Members

Now we know.

Mr. Burden

If the hon. Lady were—

Mr. A. C. Manuel (Central Ayrshire)

On a point of order, Sir Charles. Since the hon. Gentleman has made that candid admission, he ought now in all fairness to the Committee to declare his interest in this matter.

Mr. Burden

Further to that point of order. I said that I had been—I do not manufacture them myself now. [HON. MEMBERS: "Ah."] I have an interest If hon. Ladies opposite will consult with the right hon. Member for Huyton, he will inform them that there was no question of a D level in regard to the Utility and general specifications. A general garment had no portion free of tax under the Utility scheme, and it paid tax on the whole amount of the wholesale value.

As I pointed out before to the hon. Lady, if a general garment cost £9, it attracted 33⅓ per cent. tax under the old Utility scheme, paying £3 in tax. Now, under the D scheme, it pays 12s. 6d. tax. So there is this levelling out which has been welcomed by the trade. Although some of the garments under the old Utility scheme were either tax free or paid only a small tax, the better quality garments were denied to the general public because of the high tax of 331 per cent. imposed by the previous Government. Now, because of the D scheme, the public are able to buy those better-class garments much more cheaply.

The hon. Lady said that she and her hon. Friends had taken the garments they are wearing off the peg and that they would be going back tomorrow. I hope that they will be marked "shop soiled"—[HON. MEMBERS: "That is cheap."] It is not meant in that way.

Mr. Manuel

Changed your mind?

Mr. Burden

There are certain anomalies which must be studied, but it is better for my right hon. Friend to go into them in consultation with the trade in order to arrive at reasonable levels in regard to measurements which the trade may want, rather than that questions of measurement should be argued across the Floor of the House.

The trade will know the most acceptable way of curing these anomalies, and if my right hon. Friend will give an assurance that this will be done, the trade and the public will benefit. There are certain points on other categories which my hon. Friends and myself have raised in Amendments to this Schedule. I hope that, when my right hon. Friend is considering the question of anomalies, he will take into consideration the further anomalies we have indicated to him. If he will do that, he will find the trade responsive. They will recognise that revenue has to be maintained, and any concessions he may give will not only please the trade but will help to maintain the revenue of this country.

10.30 p.m.

Mrs. Freda Corbet (Camberwell, Peckham)

Thank you for calling me, Sir Charles. May I say that I find the atmosphere of the Chamber rather warm, for this debate has taken a long time and I feel that this demonstration by my hon. Friends and myself has been the cause of some suffering on our part. We hope it will make an appeal to the Chancellor and the Minister of State for Economic Affairs, who is now on the Front Bench opposite.

I want to make another appeal to the hearts of Ministers. I have been described as a little lady, which is better than being dubbed a "shortie." All my life I have been faced with the awful handicap of trying to get clothes which fit me—and I can assure hon. Gentlemen, and also hon. Ladies who are of a normal size, that the problem in the case of small people is as bad as in the case of out-sizes. It is a little unfortunate, too, if, on the rare occasions on which I find a coat to fit me, I have to pay more for it.

I am an unfortunate person altogether, really, and after what has been said tonight I am not at all sure how I am going to face the future. The hon. Member for Gillingham (Mr. Burden) says he has been a manufacturer, but he must be a little out of touch with things now, judging by what he said in the debate, and I can assure him that I speak from the consumer's point of view—and I should have thought that he, too, would have looked at the problem from the point of view of the person who is to wear the coat.

Take the problem of fitting the short person. What about the fit of the shoulders and across the back? This coat is obviously a perfect fit—not too long in the sleeves, the exact length and, therefore, the sort of coat I should want to buy. It is true, as the hon. Member for Gillingham said, that if I buy a coat which is too long for me I can turn it up, but the great probability is that it will be completely out of proportion. If I have to wear a short coat, the same sort of trouble arises.

Mr. Burden

If the hon. Lady is fair, she will admit that there are very few occasions on which anyone, even with the slightest difficulty in figure, can go into a shop and buy something which does not need an alteration at all. That is the case unless they have a perfect figure. If the hon. Lady goes into a shop, even when the D scheme is in full operation, she will find that she will get fitted just as well as, if not better than, under the old Utility scheme and will pay no more.

Mrs. Corbet

That is not so. An alteration in length is not very serious, but alterations in the sleeves, the shoulders, the waist line, are very serious matters indeed. I hope the Minister will consider this point very seriously, and particularly the fact that we have to pay more for an identical coat, the wholesale price for which is exactly the same. The coat for the short person needs less material and, to be fair, she should pay less, but it is certainly wrong that she should pay substantially more.

The principal point we are making, however, concerns the level at which the D is fixed. Hon. Members opposite are happy to impose upon the people of this country a still further increase in the cost of living, but I would remind them that they made a promise in October about the cost of living. I warn them to be very careful about how much they raise the cost of living.

Captain J. A. L. Duncan (South Angus)

I am not going to be rash enough to argue about women's clothes with any of the lady Members of the Committee, and certainly not with a covey of them, or a flock or gaggle, whichever they like to call themselves. Nor am I going to be dressed for the part, although I have beside me the garment to which I wish to refer. [HON. MEMBERS: "Put it on."] The hon. Member for Leeds, North-East (Miss Bacon) mentioned a whole lot of garments, but she did not allude to the last Amendment on the Paper, which refers to aprons.

It is to nurses' aprons that I wish to refer. This matter has been brought to my attention by a firm in Dundee, many of whose members live in my constituency, which borders that city. This firm has specialised for many years in making nurses' dresses, aprons and uniforms. It is a specialised trade, and in the past it has been specially treated by the Board of Trade under the Utility scheme. If one feels the material of this garment, one has a strange suspicion that it ought never to have been classed as high-grade Utility. In my opinion it is far too good for the Utility range. [HON. MEMBERS: "No."] It is a very high class material. Speaking as a layman, it seems to me that it should never have been the subject of one of the wangles of the right hon. Gentleman the Member for Huyton (Mr. H. Wilson). [Interruption.] I think that the hon. Member for Dartford (Mr. Dodds) admitted just now that the Utility scheme had become in a way a sort of wangle. [HON. MEMBERS: "No."]

This article is a Utility white nurse's apron. It was priced at 12s. 6d. and was tax-free high-grade Utility. The same apron still costs 12s. 6d., but under the D scheme, even with the 25 per cent. reduction announced last night, it will cost 14s. 3d. These Utility standards, which were a safeguard and support for manufacturer, supplier and buyer—so my manufacturer informs me—for a minimum quality and guarantee of standard, are re-acting unfavourably on manufacturers who have tried in the past to give hospitals first-class service and a guaranteed quality which would stand up not only to hard work in the hospitals but to the hard conditions suffered in laundries today.

Hospital buyers are now tending, since the D level came in, to buy on the keenest market a grade of apron which is tending to put out of business those who are trying to keep up the standard of the quality. The bulk of our hospitals today are national hospitals. Therefore the Government, in an attempt to deal with the expenses of the National Health Service, and waste in the National Health Service, are quite rightly asking all hospital boards to economise, and one of the methods of economy is that the buyers of nurses' aprons and other goods for the hospitals are taking the aprons at the keenest price and cutting out my manufacturer because he is trying to maintain his standard and quality and now has to charge a higher price than the new D level.

Mr. J. Edwards

I am following the hon. and gallant Gentleman's argument with very great interest. Am I understanding him aright when he says that the first consequence of the new D scheme in respect of nurses' aprons is debasement of the quality?

Captain Duncan

That is what my manufacturer says is happening. They are buying an article which is of lower quality than he has been in the habit of manufacturing under the Utility scheme.

Those are the facts, and I submit that this is in the nature of a special case, because if we are to maintain the stan- dard and the hard-wearing qualities we ought to raise the D level. If that is done, it is not a question of charging the public more or the taxpayer losing money, because the taxpayer is paying for the hospital service anyway, and the bulk of these aprons go to the national hospitals. It is true that there may be a few private nurses who will possibly benefit, but the bulk of these aprons go to regional hospitals boards and hospital management committees, which is the main market for this specialised trade run by this factory.

If the Chancellor cannot agree to the figure I have put in my Amendment, of £1, I am quite prepared to alter it to a figure which he considers more on the median level. Either I will alter it or ask him to alter it by the Report stage. This seems to be a special case in which the taxpayer gets hit whichever way it goes. Alternatively, would the Chancellor submit this type of case to the Order procedure under Clause 8 (3) and allow an inquiry to see what the right D level is, so that when an inquiry has been held an Order can be laid later on this year to put this matter right?

I remind the Committee that yesterday the Chancellor said this: I would remind the Committee—and I say this in a constructive spirit—that there are powers under the Bill to renew and alter the Ds by Order. I will give this undertaking: that this matter will always be kept under consideration, and, while I can give no date and therefore create no uncertainty, if there are difficulties at any time we can lay an Order and thereby correct a D if we find it to be wrong."—[OFFICIAL REPORT. 12th May. 1952; Vol. 500, c. 985.] I therefore ask whoever replies, either to give me the right figure if mine is wrong, or to suggest himself a figure on the Report stage, or to give an undertaking that it will come under the procedure of Clause 8 and be put right in the end.

10.45 p.m.

Mr. H. Wilson

I thought from his first two or three sentences that the hon. and gallant Member for South Angus (Captain Duncan) was going to demonstrate his unfitness to contribute to the Committee's discussion on this matter. When he said he was surprised that a garment of high quality had been allowed in the Utility scheme he appeared to be one of the many Tories who appear to think the Utility scheme is synonymous with something cheap and nasty, whereas if he confers with the majority of his constituents he will find that those who have had to do the buying—the housewives—regard the Utility scheme as one of their best protections.

The hon. and gallant Member suggested, perhaps rather fancifully, that the inclusion of that garment in the Utility scheme was a wangle on our part. But, of course, we went very fully into the question of extending the Utility scheme from time to time, and if there was any wangling the result was that the nurses in his constituency and elsewhere obtained these garments very much cheaper than if there had not been a Utility scheme.

However, before he finished, the hon. and gallant Member well justified his claim to contribute to the discussion, because he made the very powerful point some of us have been making for the last few weeks—that the replacement of the Utility scheme by the D scheme will lead to serious debasement of quality and standards. He was quite frank about that. I take back all my first thoughts about the hon. and gallant Member, and my only regret is that he did not contribute to the debate yesterday when we were discussing men's wear from the same point of view.

Captain Duncan

I only talk on what I know about.

Mr. Wilson

I am glad to hear that, because it is a quality not shared by the hon. and gallant Member's hon. Friend, the hon. Member for Gillingham (Mr. Burden). If ever there was an example of anyone who has been in the trade—I am not sure whether he is still in it: he was not very clear about that—knowing so little about it when it comes to practical debate, the hon. Member for Gillingham is a case in point.

Mr. Burden

I am still in the trade, though not manufacturing myself. The right hon. Gentleman talks about debasement. During the later years of the Utility scheme, the right hon. Gentleman will surely admit that the word "wool" was debased when the then President of the Board of Trade defined it as cloth which contains not less than 15 per cent. of that commodity.

Mr. Wilson

The hon. Member will keep on referring to that subject. I recall that for many years it was almost impossible for him to open his mouth in this Chamber without returning to the problem of 15 per cent. wool. I have a certain amount of sympathy with him on that point. I know he is concerned with the Act relating to merchandise marks. I recall that when we first de-rationed wool we de-rationed those garments which were 15 per cent. wool or more. I also remember buying a pair of pyjamas coupon-free. I shall not pursue that point, because it would be out of order as they were men's pyjamas. But they are still tickling me when I wear them, so I understand the hon. Member's embarrassment and difficulty.

I thought he was less than fair to my hon. Friend the Member for Leeds, North-East (Miss Bacon), particularly on her very powerful argument about 42″ and 36″ length coats. He said that if the length were altered, as in the Amendment, the result would be that many manufacturers would be tempted to make goods too short, and that it would be more difficult to alter them upwards than it would be to shorten them if they had been made too long. That is really a fantastic argument. It does not place very much faith in the manufacturers of this country. I hope it is not representative of his own practices in his own business.

I was always told that manufacturers made these garments to meet consumers' needs, but now the hon. Gentleman is suggesting that that is not so. If there is anything in his argument, all I can say is that as a result of maintaining 42 inches instead of 36 manufacturers will, perhaps, make the garments too long, and that that would be a waste of material which the country cannot afford at the present time, as the Minister of State for Economic Affairs will agree.

The hon. Gentleman used one or two other strange arguments. He said—and I do not think anyone on this side of the Committee contested it—that because we are easing up on certain restrictions on Utility in the interests of the export trade there was undoubtedly some debasement of some Utility goods. He seemed to proceed from that to suggest that, because there was some debasement in the Utility scheme, that was an argument for supporting the D scheme, under which debasement will be a great deal more marked.

Mr. Burden

The right hon. Gentleman has absolutely no foundation for saying that. It is pure hypothesis.

Mr. Wilson

I would back up the hypothesis by two points: first, by the speech of the hon. and gallant Gentleman the Member for Angus, South; second, by this very simple argument. If, in fact, under the fairly rigid specifications, qualities were not all they might have been, what quality does the hon. Gentleman think he is doing to get with no specification at all? It is exactly like the argument of the Government Front Bench, when right hon. Gentlemen say that textiles are not selling in the shops that are tax free. That is the burden of their argument on the Purchase Tax. So now they are suggesting that if they put up the tax on a large range of goods previously tax free there may be a better chance of selling them.

We have had over the last day or two debated a number of other groups. It is right, of course, to remind the Committee that some of the considerations we have advanced in connection with men's wear apply to the group at present before the Committee, but I am not going to weary the Committee by repeating all the arguments deployed yesterday, because that was understood, certainly by the Front Benches. However, I should like to give one or two figures to show what will be the effect on this Group of the Government's proposals.

Yesterday I gave some figures on men's wear derived from a number of representative Co-operative societies, taking the percentage of goods which were previously tax free and which will now carry tax. I take now a couple of figures of women's wear. A Co-operative society on the South Coast suggested 40 per cent. OF the women's wear previously tax free will now carry tax. An East Midlands society thought 33 per cent. OF coats would carry tax and 50 per cent. of other goods. A South Midlands society reckoned 30 per cent. of those which were previously tax free would now carry tax. So I could go on with more details, but I will not weary the Committee, because I am sure the right hon. Gentleman appreciates the point I am making.

It is also clear—though once again I shall not give all the details it would be possible to give—that there are many anomalies in this scheme. I sympathise with the right hon. Gentleman. There are bound to be anomalies in any scheme of this kind, and it must be the duty of this Committee to remove at any rate some glaring anomalies, seeing that we are unable to persuade the Government to drop the scheme as a whole, which is the only way of getting rid of all the anomalies.

For instance, I think there should be in the matter of women's dresses a real differentiation between cotton and rayon, and in that connection I think many people in the trade would support a separate figure for silk—£5, I think, has been suggested. If the hon. and gallant Gentleman the Member for Macclesfield (Air Commodore Harvey) were here, I am sure he would support that idea of separate treatment for silk dresses, though it may be that after last night, when he joined the cohorts of the right hon. Gentleman the Member for Blackburn, West (Mr. Assheton), who wished to wound but not to strike, he would not support us in any Amendment in favour of silk.

Another anomaly is between the price of overalls at £2 in the D scheme compared with aprons at 5s. That is a very serious difference, and my hon. Friend the Member for Leeds, North-East, has pointed out quite correctly that the example, of which I gave very full details to the Committee last night, about lined and unlined coats applies as much to women's as to men's coats. Last night I indicated to the Committee—and the Chancellor undertook to look into it—that as a result of the inconsistent D levels the unlined men's coats cost more in the shops than the fully lined men's coats. That was obviously an anomaly, and I have sent the full particulars this afternoon to the right hon. Gentleman. Of course, the same applies to women's coats, and I hope that any redress that the Chancellor is able to give when he studies the details I have sent him about men's coats will be applied to women's coats as well.

The last point I want to make about this—and it is a very serious point—relates to the fixing of these D levels on which we had a little discussion last night. My hon. Friend the Member for Leeds, North-East pointed out the extra- ordinary thing that, although the Chancellor and other Ministers have told us that this was fixed on a sort of scientific basis, these scientific calculations always seem to come to round figures at the close. It might be £4, £3 or £2 10s. I think the Chancellor would be the first to admit that they had not got very much information, that it was a shot in the dark, and that shot in the dark resulted in the round figures of £3 or £4.

All this adds weight to the argument that we used last night. I asked the Financial Secretary about the basis of these calculations of the group we were then discussing, and tonight I should like to ask the Minister of State about the basis of fixation of these D levels for the group we are discussing tonight. We were told by the Chancellor that a survey covered 1,500 families and that was a sample of the whole country; that for fixing these figures a further sample was taken from the 1,500. How many families were taken for this group? How many figures were obtained from the samples for nurses' aprons or three-quarter length coats?

I do not think the Financial Secretary last night quite got my point, when he said that it had been fixed in as fair a manner as possible and that it was not good enough for me to suggest that the figures were wrong. But these are not figures of mine. The Government fixed this D level, and they admitted frankly last night that they did it without any consultation with the trade or anyone who knows anything about it. My comments on the figures were not to say that they were automatically wrong, but it would be really remarkable if they were right considering the method used. Such information as one can obtain from the trade in the light of the trade's experience suggests that many of them at any rate are wrong.

11.0 p.m.

Some are not right. Some appear to me, if we accept the D scheme in principle, to be fair and reasonable. The Chancellor will have noticed that we have not put down Amendments to those which we consider fair and reasonable. It has not been the desire of my hon. Friends and myself to waste time on the Schedule or to put down time-consuming Amendments. What we have been doing is simply to put down Amendments where. After close study and discussion with the trade, we have thought that the figures were anomalous and wrong.

I hope that the Minister of State for Economic Affairs will tell us how the figures for the group which we are discussing were reached. All we have heard so far is that there was this mysterious social survey. Apparently the first part of it was taken last May—a year ago. Buying and selling conditions have changed very considerably since then.

The second part was taken in September or October. In October or November there was something of a depression already in the clothing trade. Hon. Gentlemen opposite have been at great pains to accuse my right hon. Friend the Member for Bishop Auckland (Mr. Dalton) of having precipitated it, which attributes to him greater powers than he would claim. I think his very timely speech last year perhaps had a slight effect on an already rather rickety structure. But I will not go into that point in detail.

The important thing is that there was at that time some recession already in buying. A lot of people in the country had got it into their heads that there would be a Conservative Government, and the extraordinary thing is that a lot of people at that time thought that a Conservative Government would bring prices down. They had seen the posters on the hoardings. Some people obviously believed them and, as a result, said, "We will wait until the new Government has been in a few months and then we shall get the things more cheaply." I suggest that the time at which the social survey was taken was highly unrealistic and that its figures do not give a proper pattern for calculating the D levels.

I am extremely suspicious about the whole method of fixing the D levels. I am not attributing to the Government any desire to wangle the figures; I just think that in regard to the figures which the Chancellor said had to be fixed at the official level—I understand that—the staff were told to produce the scheme and they simply did not have the facts and figures on which to produce the right answer.

I did not understand why the Financial Secretary said that they could not consult the trade. The Douglas Report was out on 24th February, but it was not until 11th March that the Chancellor announced that it would be put into force. Consultations were already going on about the quality aspects. I do not see why there could not have been discussions in those few days, without prejudice, on the question of what would have been a fair D level.

I still feel that the figures of the group that we are discussing—the same argument applies to the other groups—have been produced in an arbitrary and capricious manner. There has been no attempt to justify them. The Minister of State is asking the Committee to introduce what is, in effect, a new system of taxation in this country on a very wide range of consumer goods, clothing and household textiles, and to take on trust the so-called median figures which the trade—not I—say are quite wrong.

As he is asking the Committee to do so much for the Government, I wonder if he will agree to publish or put in the Library the report of the social survey, item by item, on which the median figures were based. If the figures were based, as simply as the Chancellor said last night, on the results of the Social Survey, then he has nothing to hide. I suggest to him that these figures are at least put in the Library. If he will do that, perhaps the Government will get rid of the suspicions which rise in my breast—although I try to repress them—that many of these median figures were based on a token sample of garments of five, six, seven, eight or nine purchases. Someone then took a shot in the dark and selected a middle figure. If, however, the figures were realistic, the Government cannot object to giving them.

We are being asked to agree to this special change in taxation without any information, apart from the trade, on which to base our decision. I hope the right hon. Gentleman is going to tell us that he will make the figures available to the Committee and, for the benefit of the trade, I hope it will be possible to publish them.

The Minister of State for Economic Affairs (Sir Arthur Salter)

I rise with a good deal of diffidence on this subject, because I do not claim to have any intimate commercial knowledge of this class of article, and my personal experience is limited. I am also the more diffident because we have had this evening a debate which has been made the more interesting and vivid by the unusual form of evidence produced by the hon. Ladies opposite. I have in my time seen dress parades, but never quite one of this character or one produced for this purpose. I have never, for example, heard anyone in a dress parade state, as one hon. Lady did, that she wanted to demonstrate how badly an article fitted. That is not the usual object.

Miss Bacon

I think the right hon. Gentleman has misunderstood my hon. Friend. She said that the coat fitted her perfectly but that she usually finds it difficult to obtain good fitting coats.

Sir A. Salter

I am sorry if I misunderstood the argument. What has been shown quite clearly is that there are special difficulties in dealing with the articles which come under this scheme—difficulties which in some respects are similar to those we faced in dealing with men's outerwear, but greater in the case of women's outerwear for several reasons, which I hope I can mention without offence.

In the first place, there is a greater variety in women's dress. Man is, after all, the uniform sex. It is man's desire and pride so to dress that he will not be distinguishable among other men. That is probably the opposite of woman's ambition. That means a greater variety of articles. It also, of course, leads to a greater mutability of fashion; and it means that the differentiation between one article and another is less clear and stable. While we men have just our coats, waistcoats and trousers, B.3 shows, as has been pointed out, the extraordinary variety of the corresponding women's articles of dress, which cannot be clearly or definitely, or for any length of time, distinguished one from the other. That is the difficulty of the task, and it is the explanation of the very long list which was adversely criticised just now.

Before I answer the questions asked me and deal with the particular claims made, I should like to recall to the Committee the framework within which we must consider any Amendments, and which also should determine the perspective in which the judge the weight and importance of each Amendment. First there is the D scheme and its purposes and general character. I do not propose at this stage to go over those again, but we have to remember what is its purpose and character, as distinct from the older system which it superseded.

Secondly, running through all these claims for concessions is the general concession made by my right hon. Friend last night in reducing the rate of tax over practically all these articles by a quarter. Taking the D scheme and this concession together, it is not only true that the tax borne by the trade and by the consumer is less than it was before, but it is also true to say that that would also apply to the lower income group purchasers.

That does not mean every single one, still less does it mean in respect of every article, but taking the D scheme with its shading gradually above the point at which the D level comes, and taking the 25 per cent. general reduction and the extent to which people who largely bought Utility now buy just about Utility range, I think it will be found that the total result of all that is to make the burden of tax both to the trade and the consumer, and including the great bulk of the lower income customers, less than it was before. I think that is an accurate statement.

Mr. J. Edwards

Would the right hon. Gentleman be more precise and say what he means by the lower income groups. This generalisation is interesting, but it does not mean anything unless some precision is given to it. Would he give us the exact figures?

Mr. Ellis Smith

Before the Minister resumes, is it his intention to address himself to the case presented, namely, the contradiction in the taxes with regard to the sizes?

Sir A. Salter

I am coming to those. I said that I wanted to make a few general remarks first. No, I cannot give a precise definition of the lower income groups, but for the great bulk of the lower income, as well as for the other people, the combination of the small tax above the D level, the gradually sliding upward tax, and the concession of the 25 per cent., it means on the whole a relief by comparison with their previous experience.

Mr. H. wilson

If the statement of the right hon. Gentleman is true—and I am surprised to hear him suggest that it could be true—it would imply that the lower income group, however buying, has been up to this time making a fairly substantial part of its purchases above the top Utility price or goods below the top Utility price which were carrying Purchase Tax, and that the gain on the revision from 33⅓ to 25 per cent. on that will offset the increase they will now have to pay on the goods previously untaxed which now carry tax. That must be the case if there is any truth in what the right hon. Gentleman has said.

Will the right hon. Gentleman tell the Committee what proportion of the goods in this group was bought above the old Utility price? In other words, what proportion does he assume of all their purchases paid tax before. because, without that, it would be impossible for that statement to be true?

Sir A. Salter

I cannot profess to base myself upon more than a general impression of those who have been concerned with the working of the old system and constructing the new system for a considerable time. I do not desire to press that point further.

11.15 p.m.

There is another comment I want to make, because it refers to several arguments put forward by hon. Members on both sides: the suggestion that there should be a distinction with regard to certain materials other than the simple distinction that appears here, in accordance with the recommendation of the Douglas Committee, between wool and non-wool materials. We were very definitely recommended that it would be extremely difficult to have further distinctions, for example with regard to silk, lace, linen, or other materials, beyond this major one between wool and non-wool, which was relatively simple.

Woollen goods, for example, are suitable for winter wear, non—wool goods for summer wear, and we do not get the same kind of competition and all the complica- tions, too, of admixture in different forms and different degrees. Of course, there are and must be certain anomalies. Before I come to the particular cases put before us today, I would remind the Committee that of course the anomalies are now not so serious as they would have been under the old system, under which we jumped straight from Utility into the full rate of tax. One of the ways in which we are, not removing the anomalies, but making them less serious, is by having this sliding scale.

I now come to the question of the hon. Member for Huyton (Mr. H. Wilson). He called attention to the percentage of articles that were previously free and are now taxed. Of course, it is possible to get rather impressive percentages by assuming that the real distinction is between the taxed article and the untaxed article and ignoring the extent to which the scale now slides so gradually that a large part of the articles that are now taxed but which were untaxed before are taxed on a very small rate indeed.

Mr. Jay

That would, of course, be equally true if the Government were to adopt our suggestion and raise the D levels. That argument is quite irrelevant to the proposal we are raising.

Sir A. Salter

I agree that it would be true. But I want to make this more general remark: not only must I confine myself to what is directly relevant to this group of articles, but I do not think it is very useful now to deal with questions which have been adequately and fully dealt with before in this debate.

It is part of the purpose of this Amendment that the level should be so raised that no articles would now carry any tax whatever that did not carry a tax before under the old Utility scheme. It is of the very essence of the D scheme—at any rate, we could not really have introduced the D scheme if we had subjected it to that disability from the revenue point of view. That case has been put before the Committee in regard to other articles, and the arguments that prevailed then must prevail now.

As regards the method of fixing D levels, I cannot add anything to what was explained yesterday. The Committee has been told of the method of the social surveys, which, of course, were supplemented by the evidence available to the Departments concerned, including the Board of Trade. We have not the evidence in such a form that we could present it for each article as the basis upon which we arrived at the present figure for the D level.

Sir L. Ungoed-Thomas

Is that because you have not got it?

Sir A. Salter

The method has been explained. I was asked why the result came out in round figures like £2 or £3. We have not pretended for a moment that we have the kind of information on which one could reach an exact arithmetical conclusion amounting to, say, 19s. 6d. or some such figure. To have taken a figure upon the public in pretending to a scientific precision which, of course, these figures do not possess. I remember very well how suspicious I used to be when the Egyptologists used to argue between themselves as to whether a certain dynasty was 4004 or 2520 B.C. Obviously they were guessing within a wide margin of error. We have not wide margins of error of that kind, but it would be a deception of the public if we presented that in each one of these articles we had a calculation which arrived at £2 rather than £1 19s. 6d.

Mr. Jay

The right hon. Gentleman says it would be a deception of the public to say that the Government were proceeding in a scientific manner, but I think "scientific" was exactly the word used by the Chancellor of the Exchequer yesterday. He said there was a scientific basis for the D level. Is the right hon. Gentleman now throwing the Chancellor's argument over?

Sir A. Salter

No, Sir. I said, if we pretended that we had a scientific basis carried to a point of precision at which we could say that the result, arithmetically, was £1 19s. 6d. rather than £2. That is all I said.

Mr. Dodds

This is very important. It has been mentioned that in arriving at some of these fantastic D levels the social survey was concerned. I understand that it came under the Central Office of Information, and that information was obtained through 1,500 inquiries and re- ferred to the appropriate Departments. Was the D level fixed by the Treasury or by those people of the Central Office of Information or by the officials of the Board of Trade, or did they all sit in a room and decide these fantastic D levels? Who did it?

Mr. H. Wilson

Before the right hon. Gentleman answers that, may I put a point to him? Will he bear in mind what the Chancellor said last night? After describing the random sample of 1,500 inquiries and a random sample from the sample, he said: That shows that there is some basis for this scheme which is not political, and whether hon. Members agree with it or not, it was meant to be scientific."—[OFFICIAL. REPORT, 12th May, 1952; Vol. 500, c. 983.] Now the right hon. Gentleman says it is not much more than guesswork. How was the figure reached?

Sir A. Salter

I cannot answer more about the method tonight. The method has been described, and it is not in the least inconsistent to say that the method was scientific and also to say that it was not carried to a point of precision which would enable us to say that the arithmetical calculation was £1 19s. 6d. rather than £2. That was the point I was answering. That was all I said.

I should like to come to some particular examples which were put to me by the hon. Lady the Member for Leeds, North—East (Miss Bacon). She gave us the ocular demonstration to which I have referred, and she argued that if we did not change the length which determines the difference between the D levels one result would be that the coats worn by herself and her hon. Friends would bear a different rate of tax and would result in considerably different prices to the consumers.

This is in some respects the converse to the case which was argued yesterday—that about outsize persons. This is the case of the hardship of the person of less than normal size. I think that we were all moved by that case and were interested in the evidence and the arguments. But I would like to remind the hon. Ladies of the purpose of this provision in the Schedule. It is a reasonable and necessary purpose, namely, to draw a line between two quite different articles—the ordinary full-length coat, and the three—quarter length and half—length coat. It is reasonable to make a distinction, because it is clear that the half—length coat would normally be the cheaper coat. It uses less material. It ought therefore to have a lower D level.

There is, I think, truth in what the hon. Member for Gillingham (Mr. Burden) argued on that point, although in certain respects he pushed his argument rather too far. Having said that, I think that there remains something in the hon. Ladies' arguments which merits special consideration. The present purpose and effect of the provision is to draw a line between the ordinary full length and the three—quarter or half—length coats. There are, however, perhaps three different kinds of coat, rather than two. I can see the difficulties with regard to the particularly short person, when it is a question of the three—quarter—length as against the half-length coat.

I should like to have the matter, especially the case of coats from the peg, looked into, and if hon. Members will send me the evidence of the cases put forward tonight, I will see that these matters are looked into urgently and sympathetically.

I turn now to the case brought before the Committee by the hon. and gallant Member for South Angus (Captain Duncan). It was, I think, a real case, but one which is very difficult from the point of view of classification and administration; but there ought to be careful consideration with regard to the wrap-round apron. That also will be looked at carefully, to see whether we can make a distinction. I am not quite sure whether that can be done in time for the Report stage, but, if not, it would be possible before the next Budget to deal with such cases by administrative action.

Before the Committee considers whether what I have said gives reasonable satisfaction, I should like to remind hon. Members of what the Chancellor of the Exchequer said regarding a similar Amendment concerning men's outerwear yesterday. He had, of course, announced his general concession, which was intended to be an alternative to giving relief through successive small concessions in a great number of cases. The Chancellor said that he maintained that it would be wrong to concede a number of points about Ds unless we were satis- fied there were genuine grievances or abuses.

If anomalies exist—and many do, and must—and if they are also serious and can be changed without creating other anomalies not less great, I think we ought to consider them carefully. But, in view of the general concession in the reduction of the rate, we cannot have a great number of separate concessions. Some have been made, but my right hon. Friend was not able to regard the Amendment in relation to men's outerwear as justifying a special concession. On the whole, the difficulties of our making such concessions are greater, while the reasons for making them are not greater, in the case of women's outerwear because of the special complications to which I referred in the course of my remarks.

11.30 p.m.

Mr. H. Rhodes (Ashton-under-Lyne)

Would the right hon. Gentleman answer this question about the fixing of the D level? The survey was made in September-October. The D levels were not announced until March. Which level of prices was taken into consideration, the September—October prices or the prices ruling about the time of the Budget?

Sir A. Salter

The survey in May and the other survey in September were important sources of evidence and information. They were evidence only, as I explained just now, and what they produced was examined and commented upon, and used by the Departments in the light of the conditions and prices at the time when the Departments devised the actual D levels which we have now decided upon.

Miss Margaret Herbison (Lanarkshire, North)

I think most hon. Members on this side of the Committee will be pleased that perhaps we have obtained a little concession. I hope before sitting down to be able to show the Minister of State for Economic Affairs a very easy way in which he can make a complete concession on what my hon. Friend the Member for Leeds, North-East (Miss Bacon) has been asking.

The right hon. Gentleman said that with the concession the Chancellor made last night the tax borne by the trade and the consumers would be almost the same as before this D line was introduced. It may be true that the tax borne by the trade and the consumers will be almost the same as before, but what concerns us is that the lowest wage earners and the middle wage earners or salary earners will have to bear a far greater tax under this Government scheme than they did under the scheme operated when the Labour Government was in power.

Tonight we have been offered no proof but just general statements from the right hon. Gentleman that, by and large, even the lowest wage earner will be paying no greater amount of tax. I live in a working-class district; I live amongst the workers of that district, and I would be hard put to it to find one woman from those working-class homes who in the past years has bought anything, either textiles for her home or clothing for herself or her elder daughters, and paid any Purchase Tax on it.

These women have not been able to buy either textiles for their homes or clothes for themselves or their daughters in the range in which Purchase Tax applied before this Budget. Most of them, possibly because of the amount of money they had, had to be discriminating shoppers. Even those women who might at times have been able to buy a non-Utility suit or frock went, if they were discriminating shoppers, for a good class Utility garment, usually in the top or second top range. Now all these people will have to pay tax under the D scheme.

On the other hand, it means that those who are very well off indeed, who rarely bought any Utility article but bought in the luxury ranges and could well afford to do so, will now have a rebate on the tax. It seems to me a most inequitable thing for a Government to do at the present time. This Government were returned on a policy of bringing down the cost of living. Indeed, in the pamphlet "Britain Strong and Free" the Tories told the electors any Government would be judged by their effect on the cost of living. This Government have been judged seriously already in the country. and I have no doubt that in the counties of Scotland today our people will be judging them.

I remember that when I made one of our political broadcasts I spoke about what the Tories might do with our Utility ranges of goods. After that speech there was a great deal of criticism in the Tory Press that one should dare to suggest that if the Tories were returned to power they would interfere with our Utility scheme. But it is only one of the many promises that the Tories have broken. I am very glad the hon. Member for Gillingham (Mr. Burden) is in his place.

Mr. Burden

rose—

Miss Herbison

No, I have no intention at the present moment of giving way to the hon. Member. He made a most excited and noisy speech today, the sort of speech one always expects from someone who is not very sure of his ground. He has tried to tell the Committee that he knows everything that should be known about the trade. He told us the trade accepted this D scheme as a good thing. That is very different information from that which we on this side of the Committee have been able to obtain from the trade.

I would say to the hon. Member, who has a vested interest as one of the traders, that we are concerned about the effect of the D scheme on our constituents as consumers. It is definitely having a very bad effect on the lowest wage earners and the middle income groups. I do not know whether the hon. Member for Gillingham is married. I do not know whether his wife is tall or short or whether she is normal in size.

Mr. Burden

rose—

Miss Herbison

In due course I will give way to the hon. Member. He knows very little about the problems of the short woman when she goes out to buy something. He suggested it was very simple to cut a piece off when a short woman bought a coat. When one buys a straight coat that has no line it may be a simple thing to cut a little off the bottom. Under this D scheme we short women will have to pay extra Purchase Tax. But that is not the only thing. That does not worry the hon. Member for Gillingham.

Mr. Burden

rose—

Miss Herbison

He is so impetuous. this hon. Gentleman the Member for Gillingham. I have already said that I will give way to him in due course. We are not only going to have to pay this extra Purchase Tax, but we are going to have to pay for the alterations, and payment for alterations adds to the price the small woman has to pay. If we buy a coat that is shaped, then it is not a simple matter of just getting a bit cut off the bottom. If there is a waist, we may find it a hit too far down, and that would not be stylish. If it has pockets we may find the pockets at our knees, and no woman would want that. The hon. Member for Gillingham has shown very clearly that, although he may be a director of the manufacturers, in this case he just does not begin to know anything about the problems of the short woman when she goes to buy a coat.

Mr. Burden

I thank the hon. Lady for giving way, but I think her own views on this subject are not very sound, because she calls it "our" Utility scheme, whereas the Utility scheme was in being long before the Labour Government came in. It was never their Utility scheme at all. The party opposite debased the Utility scheme, and that is why the D scheme is coming in. I should like to inform the hon. Lady that I am married, and very happily so, too.

Miss Herbison

The hon. Gentleman has taken great objection to my talking about "our" Utility scheme. Well, I will give way on that. It was a Coalition Government that brought in the Utility scheme, and it was a Coalition Government in which very excellent representatives of ours sat in the Cabinet and had excellent representatives of ours in the Ministries that had something to do with the Utility scheme, and, of course, they gave some of the best ideas to that scheme. Then we formed the Government for six and a half years, and we continued what the Coalition Government introduced. Immediately the Tories were returned to power they found ways and means of putting it out of court altogether.

Mr. Burden

The Socialists set up the Douglas Committee.

Mr. Arthur Lewis (West Ham, North)

The Tories did not have to accept its Report. [Interruption. ]

The Temporary Chairman (Mr. George Thomas)

Order. I hope hon. Gentlemen will allow me to hear the hon. Lady.

Miss Herbison

This is something that really gets under the skin of hon. Members opposite. Such trifling remarks as "our" scheme or committee upset them. I remember one committee that was set up—the Sankey Commission—that put forward some excellent ideas, but when they were presented to the Tories they did not accept the ideas.

The Temporary Chairman

The hon. Lady is straying from the Amendment.

Miss Herbison

I accept your Ruling, Mr. Thomas. I was using that only as an illustration. But no Government at any time are forced to accept in toto or in part the results of any committee set up. The Government are the policy-making body in the country, and they decide the policy that is to be followed. I would say to the Chancellor of the Exchequer that we were very proud of the great im- provement that took place in the dress of the ordinary people. During the war and after the war it was very difficult indeed to find any class difference between our women who worked in factories and our ladies who had nothing whatever to do but look after their dress. That was due to the fine Utility clothes our women could buy without payment of Purchase Tax.

The object of this Amendment is to bring completely out of the Purchase Tax range all the goods that previously carried no Purchase Tax, and if it is not accepted, then we will return to the days we knew once in Britain when there will be a great difference in the dress of the women and the men of the lower income groups and those people many of whom never wet a finger or do any work at all to produce any of the goods that are bought.

11.45 p.m.

A very strong case has been made out for this Amendment. The Minister has gone some way to meet us in the matter, but something more is needed. This is a three-quarter length coat that I am wearing, and it is classed in the same category as the costume jacket worn by my hon. Friend the Member for Flint, East (Mrs. White). Mine is an overcoat, even though it may be three-quarter length, and it would save difficulty in searching for ways and means to try to get over the problem of these two coats which are identical except for length if the three- quarter length coat was put into the same category as that worn by my hon. Friend the Member for Leeds, North-East and not in the category of that worn by my hon. Friend the Member for Flint, East. I hope what I have said will help the Minister of State to solve the problem with which he is faced.

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

Will the hon. Lady tell us who is sponsoring this programme we have heard so much about?

Miss Herbison

I do not think it matters a bit who sponsors it as long as what we are trying to prove has been clearly thought out.

Captain Duncan

May I put my point more briefly and more gratefully than the hon. Lady for Lanarkshire, North (Miss Herbison), by saying that the Minister has to a large extent met the point raised and that we hope that on the Report stage we shall see the results of his speech tonight.

Mr. Glenvil Hall (Colne Valley)

After sitting through the whole of this debate, I cannot help wondering how Members on the other side of the Committee view the speech of the Minister of State for Economic Affairs. I listened with great care to what he had to say. Almost before he had got 10 words out of his mouth I thought it was a pity that the hon. and gallant Member for Angus, South (Captain Duncan) did not hand that white garment he had to the Minister of State, because if anybody—

Captain Duncan

He had it already.

Mr. Hall

—should appear before this Committee in a white sheet it is the Minister of State. He said that his right hon. Friend the Chancellor of the Exchequer would look at this question, raised so vividly by my hon. Friends the Members for Leeds, North-East (Miss Bacon), Lanarkshire, North (Miss Herbison) and Peckham (Mrs. Corbet).

I feel that there is little more that one need add to those speeches and the demonstrations which accompanied them. Obviously and demonstrably, the absurdity of the scales was made plain. When the Minister of State said that the Chancellor would look at them, I wondered why they had not been looked at before. It is astonishing that those who advise him had not been aware of these anomalies when they came to build up the schedules. understood him to say that they would be looked at. Perhaps the right hon. Gentleman will say whether he meant before the Report stage or before next year's Budget.

Sir A. Salter

We will look into it before the Report stage in the hope of reaching a decision then. If that should be impossible, there is an intermediate possibility between that and next year's Finance Bill. It is possible to act by administrative order where a case proves to need alteration.

Mr. Hall

That is what I understood the right hon. Gentleman to mean, with the emphasis on its being looked at before the Report stage is reached. To leave the matter where it is is quite unrealistic. We get constant complaints from the trade that they are left in a state of complete uncertainy. They have already been in a state of uncertainty for several weeks. The Chancellor resolved their uncertainty to some extent by the concessions he made last night.

But we are now putting them into a state of uncertainty again in a very substantial fashion, and I urge the Chancellor not to wait but to do something about it when we reach the Report stage. To the satisfaction, I thought, of every quarter of the House, my hon. Friend the Member for Leeds, North-East showed beyond any doubt that something should be done and that in any case the Government should not be allowed to get away with it without registering our protest against what is a gross piece of inefficiency, in that they have put into this Schedule scales which are obviously absurd.

My right hon. Friend the Member for Huyton (Mr. H. Wilson) asked the Minister of State if the Government would place in the Library the social survey upon which these Schedule scales were based. I have heard some astonishing things said at that Despatch Box, but few have been more astonishing than the reply which the right hon. Gentleman made to that request. The answer amounted to this, that the Government were really guessing when the D levels were laid down and that there really is nothing which could be placed in the Library upon which a sensible view could be based.

The right hon. Gentleman said that he could not add to anything that the Chancellor had said. When my right hon. Friend interjected to remind him as to what it was that the Chancellor had said, the Minister of State rode off on a different tack. That just will not do. Either what the Chancellor said last night is correct, that the Schedule has been built on something like scientific data, or else the Minister of State for Economic Affairs is correct and they have not been built on anything tangible but were arrived at by guess and by God. There must be something on which the figures were based, and I would press the Government to put in the Library what they have so that we can judge for ourselves just what the evidence is.

I do not want to detain the Committee any longer, because we have had a number of speeches, particularly from this side, which have covered the ground completely. We also last night argued the case for a very long time, and I do not want to go over that ground again either. But I do want to inform the Government that, in view of the undertaking the right hon. Gentleman has given—vague though it is—so far as this particular Amendment is concerned, we do not propose to divide the Committee. But we do reserve our right to divide on other Amendments which are on the Order Paper, and which I take it we shall be discussing either later tonight or when we meet again.

Mr. James H. Hoy (Leith)

Before we pass from this Amendment, may I put one question to the Minister. I was interested in the speech of the hon. and gallant Member for South Angus (Captain Duncan). For the first time he said something with which I agreed, but he made it perfectly clear that as far as nurses' aprons were concerned the quality was going to be debased if this scheme is carried through. The State will have to provide nurses with an inferior article to what they now get. I thought the Minister of State said that he would be able to consider this matter in time for this year's Report stage of the Bill.

Sir A. Salter

That was not quite what I said. I said we would consider it at once in the hope of being able to deal

with it on Report. If that proved impossible there was a later procedure, but I said we would try to look into it before Report.

Mr. Hoy

I would point out, as the hon. and gallant Gentleman said, that this matter is urgent not only from the point of view of the article itself but because here is a manufacturer of good quality cloth attempting to keep a business going, and unless there is some quick decision that type of trade is likely to go out of existence. In view of that we want a firm undertaking, and I hope we may take it the Minister of State's words were intended as such, that a firm which produces good quality manufactured goods will be encouraged to do so.

Amendment negatived.

12 m.

Mr. Jay

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

I move this Motion in order again to give the Chancellor an opportunity to tell us his intentions tonight. I am not sure after some of the speeches we have heard from the Treasury Box this evening whether I should not ask what are the intentions of the Government. I think we have had in the Committee up to now serious, solid and constructive debates, with perhaps one or two exceptions. I do not think it will be suggested that there has been anything in the nature of time-wasting, at any rate on this side of the Committee. Even the hon. Member for Gillingham (Mr. Burden) was doing his best in his own way to help the Chancellor.

It seems to us desirable to continue these debates in that spirit. We are, after all, discussing serious and sweeping changes in taxation, and these issues are not of a character on which one would like to take light or hasty decisions. I think it will be agreed that sometimes when we get to three, four or five o'clock in the morning there is a tendency for discussions even in this Committee, to become perhaps a little less serious and constructive, and even on occasions perhaps somnolent or even hilarious.

Therefore, we see some case for following the precedent of recent nights and ending our discussions about this tax. We ought also to remember that there is a shadow overhanging this debate, and that is the shadow of unemployment in the textile areas. That is really what is behind these discussions, and it is a reason for not undertaking them in any lighthearted way.

Finally, after the last two hours it seems to me that the Government themselves need more time to reconsider some of these matters. We are discussing the whole structure of D levels fixed at exact figures throughout all these different types of garments and cloths. It is rather startling that we heard from the Chancellor yesterday that these were fixed on a scientific basis, yet we heard from the Minister of State for Economic Affairs this evening that they were not fixed on a scientific basis. That, in itself, seems good ground to give the Government, in their own interests, rather more time—at least the rest of tonight and tomorrow morning—to think this matter over. For those reasons, I ask the Chancellor whether he is willing to accede to a suggestion of that kind.

Mr. R. A. Butler

I do not have any complaint at the nature of the debates we have had or the spirit in which they have been conducted. However, it would be a great mistake if we were to allow the Fourth Schedule—Purchase Tax—to continue into another day. The position is that we have only three more groups. One deals with furs, which were not included in the Ways and Means Resolution, and on which I should like to give my hon. Friend the Financial Secretary an opportunity of making a statement. Another is on women's underwear, and the third is on the general furnishing fabric question.

As almost every argument in the world has been canvassed by both sides of the Committee, I do not see any reason why we should need to take very long on those subjects. We have to remember that the financial business of the country has by long practice over many years to be finished by a certain date, and that we cannot indefinitely protract the discussions on the Finance Bill, on which we still have a great deal of work to do on the later Clauses.

We have dealt only with Clause 9 and one big Schedule. I did not anticipate that we should get further than this, so I have no complaint to make on that score, but I did anticipate that we should finish the discussion of the Purchase Tax. Therefore, as we are allowing plenty of time in which to consider the other vital Clauses of the Finance Bill—Clause 9 to the end—in the remaining days we have available, and as I do not believe that right hon. and hon. Gentlemen opposite have reason to complain of the time we are allotting to the Bill, the only course possible is to finish our work on this tonight.

The right hon. Gentleman raised two other matters: the question of unemployment and the question of Government uncertainty. On the question of uncertainty generally, this argument has been used a good deal in our debates and, if there really is uncertainty, the sooner we put an end to it by our debates tonight the better. And that is all the more reason for finishing it and not waiting until next week, thereby prolonging the uncertainty referred to by right hon. and hon. Gentlemen opposite.

Lastly, in regard to the uncertainty of the Government. I have been quite astonished by some of the arguments put by right hon. and hon. Gentlemen opposite. Just because my right hon. Friend the Minister of State for Economic Affairs accedes to the charms and arguments of the hon. Ladies who have put their case so decorously attired tonight, and says that the Government will give consideration to a point put, at once the right hon. Gentleman says that the Government do not know their own mind. What is Parliament for? Are we or are we not to listen to the arguments of hon. Members? When we listen to them we are told the Government is uncertain; when we do not, we are told we are obdurate. I am brought up in the ordinary Parliamentary tradition of our free democracy, and I consider that Parliament ought to have a say on schemes of this sort and that the Government ought to listen, especially when matters are so clearly and cheerfully put as they have been this evening.

Therefore, if we are to continue in the same sort of spirit of give and take as hitherto, there is no reason why we should unduly delay hon. Members. It is essential to finish Purchase Tax tonight.

Mr. Jay

That is not my question at all. The question is whether or not D levels have been fixed on a scientific basis. I thought that in the interests of both himself and the Minister of State for Economic Affairs, the Chancellor might want longer to think over that question.

Mr. Ede (South Shields)

I am very glad to see that we now have the Leader of the House and the Chief Patronage Secretary with us. It is a great pity they were not here with us a little earlier, because they might then have exercised a restraining influence on the exuberance of their supporters, when undoubtedly the debate was unduly prolonged, not by speeches on this side, but by speeches, which probably seemed longer than they really were, from the hon. Member for Gillingham (Mr. Burden). I would commend to the Leader of the House the possibility of reducing that hon. Gentleman to comparative silence by seeing that he is appointed to the vacant post of Secretary for Overseas Trade. His speeches would sound much better when translated into German or Russian than when left in the vernacular.

It is no use the Chancellor adopting the line of ending uncertainty. This Schedule and its component parts have been before the country and the Government for some time, and each discussion leads to the statement that. "We will consider them further and we will make some statement at a further stage of the Bill," or, as the right hon. Gentleman has hinted on one or two rather important matters, "We are rather afraid that we shall not be able to deal with it then, but we shall have to carry the matter on and possibly deal with it by administrative order at some unspecified date in the future."

One would have hoped that on a matter of this kind, in view of all the consideration that has been given to it some of these Amendments could have been accepted during the course of the Committee stage, if only as an earnest that we are going to see some fruit for our labours.

I begin to fear that, in a manner not unusual with the Chancellor of the Exchequer, there will always be a promise of something good to come in the not too distant future, but never at the precise moment when we are discussing the matter. I have had some very consider- able experience not merely of, but with, the right hon. Gentleman, and I know how skilled he is as a Parliamentarian in pushing off any decision until we come to the conclusion that the decision ought to have been taken at an earlier stage, when he was not really quite satisfied with the arguments that had been heard.

I would have thought that, inconvenient as it is for most of us now to leave off our labours and convenient as it might be to continue for another five hours, it would be a good thing in the interests of the Bill if we could now adjourn. As the right hon. Gentleman has said, he really has no complaint about the way in which the debates on this Schedule have been conducted, at any rate from this side of the Committee. A Bill of this complexity really ought to be considered at hours when it is possible for the Committee to give its undivided and quite wide awake attention to the matters before it.

Mr. Butler

I should like to reply to the speech of the right hon. Member for South Shields (Mr. Ede), whom I might describe as my right hon. Friend, for we served for so long together in a distinguished office of State. It would be much more convenient to finish the Bill tonight—

Mr. Ede

The Bill!

Mr. Butler

It would be convenient, rather, to finish the Schedule tonight. We have the matter fresh in our minds and to leave it would be dangerous, because we should have to renew all our discussion on the Purchase Tax and we should probably delay the progress of the Bill.

It is remarkable that in a Committee of this size, with so many different human considerations and so many points of view put forward from one's constituency and area and district, that it has been possible to make so much progress without the use of a single Closure and on terms of considerable amity and common sense. The fact that we have one late Sitting on the Finance Bill is not unusual: sometimes we have more. If we can approach the matter in the spirit I have mentioned, I do not see why the Committee need be unduly delayed.

Mr. Ede

Is that a promise that this will be the only late Sitting?

Mr. H. Wilson

The Chancellor said it would be convenient to finish the Schedule tonight, but that is not the only point before us. It is not only a question of whether it is convenient, but a question of whether the Schedule and the Bill will be better or worse as a result of the discussion.

I want to support the point made by my right hon. Friend the Member for Battersea, North (Mr. Jay). The Chancellor said, and I agree with him, that the debates have been extremely good up to now, and he added that it was remarkable that we should get through so quickly. I think he was quite fairly paying a tribute to this side of the Committee as well as to his own Front Bench in what he said, but I am bound to point out that we on this side are a little disappointed about the way in which the Schedule has gone so far. The Chancellor knows that the suggestion that it should be taken in groups came from this side of the Committee because we felt that that would lead to more helpful debates on the various groups.

Of course, in suggesting that we were helping the work of the Government forward and speeding the Bill, and I am sure the right hon. Gentleman is grateful to us for making the suggestion, but when we surrendered our rights to debate Amendment by Amendment, or at least those Amendments which you, Mr. Hopkin Morris, and the Chairman, selected, we hoped that at the end of the debate on the whole group of perhaps 20 or 25 Amendments we should get some concession—certainly more than we have had so far.

We have debated something like five or six groups of the Fourth Schedule and, as the Chancellor says, there are still three groups to come, of which one is quite small and one is very big, the latter affecting the cloth group. I noticed that the right hon. Gentleman referred to it as the furnishing fabrics group, and we are interested to know why he should call the whole cloth group "the furnishing fabrics group", but we shall come to that later.

We have three groups ahead of us. We have had few concessions, and we on this side of the Committee feel that there has not been an adequate explanation by the Government of the method by which they calculated the D level. I made a perfectly serious suggestion to the Minister of State for Economic Affairs a few minutes ago—that Members of the Government should make available to the Committee the methods by which they calculated the median level.

As has been made clear, they did not consult the trade, and the Government, in fact, said that they could not consult the trade before they got the figures. I suggest that in order that we can make a better job of the last three groups of the Schedule than we did of the first five or six groups, the Government should see whether they cannot make available this information from the Social Survey and place it in the Library of the House. Then, on the last three groups, we can have all the information available to us and perhaps come to better decisions about the D level.

If the Chancellor cannot agree, then I am bound to say, if he insists on pushing ahead with the Bill, that we must be very suspicious of what we are still forced to regard as a hit-or-miss, capricious, shot-in-the-dark method of fixing the D level which, as has been said, will condition the taxation of cloth and household textiles for the vast majority of our people in the year to come.

12.15 a.m.

Mr. Jay

We are disappointed with the Chancellor of the Exchequer's attitude. He agrees that he has no complaint about the manner in which these debates have been conducted, and that he is gratified by the spirit of what he calls the amity which has prevailed up to now; but I think he could have done more to enhance that spirit if he had acceded to our suggestion. I do not think anything can be gained by dividing the Committee on this issue. Therefore, I beg to ask leave to withdraw the Motion.

Motion, by leave, withdrawn.

Mr. Bernard Braine

I beg to move, in page 76, line 11, column 1, to leave out "or of fur skin."

It would be proper for me to declare that I have a small interest in this matter, although it is an indirect one. I am connected with a firm engaged in the import and export of raw fur skins. The object of the Amendments which I and my hon. Friends have put down is not to secure any particular favour for the fur trade, but to raise the D level on a variety of fur garments to ensure that the trade is fairly treated, that its contribution to exports is maintained, and that its yield to the revenue is continued. I would imagine that the Financial Secretary will agree that all these are worthy objects.

I readily confess that it is curiously difficult, even in times when the fur trade is going through difficulties, to conjure up sympathy for it. One can make emotional speeches on textiles, on kilts or corduroy trousers, and rightly so; but to claim any sympathy for furs seems wrong, in the view of some people, because they are a luxury difficult to defend in times of austerity. To get this debate into perspective, I must say at the outset that that is a mistaken view.

In recent years, nine out of every 10 full-length fur garments sold in this country have been in the Utility range, commanding a modest retail price of £40 or less, including tax. By no stretch of the imagination can prices of that kind be regarded as luxury prices, particularly when one remembers the durability of fur garments. I am sorry that the three hon. Ladies who earlier delighted us so much with their fashion parade are not present now, because I am certain that they would agree that an ordinary fur garment would have outlived the three coats which they were wearing.

I want to plead for fair treatment for the trade. I have been impressed with the extremely fair and objective way in which the Chancellor has dealt with the representations made to him from all sides of the committee. On Thursday he said that he would consider representations made in detail. He believed that the Ds had been fairly fixed, but if mistakes had been made he was prepared to have a look at them. Yesterday he said, We made up our mind by following the general philosophy and the principle of the Douglas Committee, which was to take a genuine D at the median point."—[OFFICIAL.REPORT, 12th May, 1952; Vol. 500, c. 984.] I am not prepared to argue whether the Ds we have been talking about a little earlier tonight have been fixed precisely or not at the right level. But I do say that for fur garments the D level has not been fixed at the right median point, because for a full length fur coat the median point is £14 and not £6 10s. Yet looking at the Schedule we find that full length fur garments have been lumped in with woollens. Furs are in a class by themselves, and even if the Chancellor is prepared, as a result of representations made to him, to make a concession, fur garments will still be the only articles formerly included in the Utility scheme which the public will be unable to buy without paying tax. In all other cases the D line has been fixed at a level which ensures that a goodly proportion—in most cases half—of the goods covered by the Scheme will be free of tax. That does not apply to fur garments.

Now I make no complaint of that, because ever since the introduction of Purchase Tax furs have been subjected to tax. Nine-tenths of the fur garments sold in this country were sold as Utility garments up till the Budget and attracted 33ࡩ per cent. tax. The remaining one-tenth were the more expensive kind and were subject to 100 per cent. tax. I wish to make it plain that the D lines in our Amendments have been designed to ensure that furs pay much the same tax as before the Budget. Furthermore, they have been designed—and I hope this will command the sympathetic consideration and support of my hon. Friend the Financial Secretary—to yield revenue on much the same basis.

That requires some explanation. Under the old scheme, the wholesale price of a full length Utility coat at, say, £23 plus 33⅓ per cent. tax would give a figure of £30 13s. With a D line fixed at £14 the same coat would attract tax at £9, so that the wholesale price plus tax would be £32, which involves an increase of 26s. 8d. in tax. I have suggested this figure quite deliberately in order to safeguard the Revenue. The sales of non-Utility garments in 1951 totalled round about 50,000. As I have already explained, they attracted 100 per cent. Purchase Tax. If a D line of £14 is allowed—and it would be less for smaller garments—it would involve the Revenue in a loss, according to my calculations, of some £255,000 in a full year.

On the other hand sales of Utility garments in 1951 totalled round about 200,000, and the additional tax which I have suggested of 26s. 8d. on the full length garment, and less for smaller garments, would yield to the Revenue an additional £285,000 in a full year. Assuming—and I admit that this is a rash assumption—that sales remain at a constant level and do not fall, the Chancellor would not lose anything at all by accepting my proposals.

Let us consider how these proposals compare with those in the Bill. The wholesale maximum price, plus tax, of a former full length Utility coat will jump from £32 to £41. That is an increase of £9 in tax and an increase in the wholesale price of 30 per cent. I have no hesitation in saying that that increase is savage and unfair because it puts out of reach of the poorer elements of the community the cheaper garments—which are quite durable and attractive and which any woman ought to be able to buy.

The cheapest rabbit coat—and a rabbit coat is both durable and attractive—which formerly paid £3 18s. tax will now pay £5 10s. tax. That may make all the difference in the world between that garment being sold and being left on the shelf. It is not only unfair but unwise, because towards the end of last year the public were beginning already to show reluctance to buy even Utility garments. I have made very careful inquiries and find that in the last six months of 1951 there was a decline in retail sales of Utility ranging between 25 and 29 per cent. In other words, the trade was depressed well before the Budget.

I submit—and I hope I carry the Committee with me here—that the proposed tax will kill the trade altogether. That means the Revenue will suffer—a factor the Chancellor cannot ignore. There is another factor that he cannot ignore. In 1951 the total value of exports and re-exports of raw skins and manufactured furs—and I am excluding personal exports—totalled nearly £23 million.

What precisely does that figure mean? It means that this country is the centre of the world's fur trade. There is, however, no reason why it should be. Furs are brought here from Russia, North America, Australia and South Africa and are sold here at world-famous auctions, some of which have been going on in the last week or two. We owe this position to the fact that the merchant venturers who founded the Hudson's Bay Company in the 17th century started the first fur sales in this country. And for three centuries the trade has developed here. But there is no reason at all why it should stay here. Buyers travel from all over the world because they know that here they will see the world's finest collection of furs and that nowhere else can they obtain the pick of what the world has to offer.

If the conditions which have enabled this great international trade to flourish here were undermined, then overnight the market could move to New York, Montreal or Frankfurt. I hope the Committee will forgive me if I repeat in this context something which was said a little earlier about high-grade textiles. The most important condition of all is the existence here of a reasonable home market. I said at the outset that furs were in a different category to any other article included in the Schedule.

12.30 a.m.

There are special reasons for saying this. First, a home market is necessary for the fur trade because overseas demand is highly seasonal—much more seasonal than that of any other trade. It does not provide continuous employment, which is necessary if skills are to be maintained and if workers are to be retained. But not only is overseas demand highly seasonal; it is highly selective, too. The buyer wants the best. That is why he comes to London, because he knows that here he will get the best.

The quality of furs varies. There are no two skins in a collection that are the same. The value fluctuates, and fluctuates not only from season to season and from sale to sale, but, literally, from day to day. It is hardly surprising, therefore, that the flow of business is highly erratic. What is not sold overseas at the time of the sales must be disposed of on the home market, or else manufacturers will suffer, and suffer severely. But, without a home market dealers cannot stock a large enough range to justify the foreign buyer making the long journey to this country for the sales.

There is a second reason why the borne market is vital. In recent years, especially since the years just before the war, we have developed here a very highly efficient trade in the export of manufactured furs. The bulk of our exports is of raw skins and of dressed or dyed furs, but we have been developing a very fine trade in manufactured garments. This is an entirely new development since the 'thirties, and already we have been enabled to wrest the Continental market from the Americans. But without a home market it is absolutely impossible to ensure production for export. Indeed, the situation in many manufacturing firms now is that it is becoming increasingly impossible to maintain production at all.

The third reason why a home market is so essential is that there must be an outlet to try out new ideas, new processes, new colours, so necessary if Britain is to remain the leader of the world's fur trade. All these points were clearly recognised by the Douglas Committee.

My right hon. Friend did say earlier tonight that he hoped that hon. Members would not exaggerate conditions in particular trades, and I hope that I am going to be fair and objective. I must tell my right hon. Friend, however, that the home market in furs has already collapsed. There is considerable unemployment. There are some 1,500 manufacturers in this country employing about 6,000 or 7,000 workers. In addition to these there are 150 gentlemen called chambermasters who employ an average of about 500. Chambermasters are out of door workers who have little capital, carry no stock and employ an average of four or five workers each. They depend entirely upon the work of the larger manufacturing houses for the maintenance of work and employment.

The measure of the gravity of the situation is that the majority of the chamber-masters have already had to dispense with their workers. Firms making Utility —the Committee will remember that I said that 90 per cent. of the sales on the home market were of Utility garments—have not sold a single garment since the Budget. There are other firms whose production is divided equally between Utility and non-Utility and whose business has dropped since the Budget to about 20 per cent. of that done during the same period last year.

I should like to give the Committee some examples relevant to my argument. I have got extracts here from two letters which I will read to the Committee. The first states that: Forty per cent. of my firm's turnover was with Canada. I am endeavouring to keep my key workers for the time being, but my three chambermasters have had to discharge their 20 workpeople. In addition, since the Budget I have sold three coats only and these were for export. The second letter says: The majority of our workers have been with us for periods of 20 years and over. It has always been the policy of this firm to keep its employees so far as we have been able to do so. We cannot pursue this policy for much longer. Our total sales since the Budget are 21 per cent. of what they were for the same period in 1951. Here is a very fine industry embodying the highest standards of craftmanship and which has won an enviable reputation for this country. It is facing grave difficulties which are largely the result of the impossible burdens imposed upon it by successive Chancellors.

My last word is this. If the skilled labour is dispersed and the international fur market leaves London and goes to New York, Montreal or Frankfurt, there is no reason in the world why it should ever come back. Therefore, I earnestly ask my hon. Friend to give sympathetic consideration to the proposals which I and my hon. Friends have made, since they will not only have the effect of breathing new life into this important trade, but they will safeguard the revenue which the Treasury are going to lose any-way unless some steps are taken to remedy the situation. It is on those grounds that I make my appeal to my hon. Friend.

Mr. E. Fletcher

The hon. Member for Billericay (Mr. Braine) quite properly began his interesting and eloquent speech by disclosing his interest in the trade, and no doubt because of that interest he has been able to inform the Committee with so much detail and knowledge of the very serious effects on the trade which the Budget proposals will have. I have no interest in the fur trade other than that my attention was directed to the consequences of these Budget proposals by a number of persons in my constituency who have already been thrown out of work, because it so happens that these highly skilled craftsmen of the fur industry are very largely centred in the parts of North London represented in the House by my hon. and learned Friend the Member for Stoke Newington and Hackney, North (Mr. Weitzman) and myself.

It is perfectly true that the results of the Budget proposals will be quite disastrous for the industry, and I will be supporting the hon. Member's Amendment which I hope he will press to a Division. There is an alternative series of Amendments which we put down and which provide a better result and a better alternative than those proposed by the hon. Member.

I invite the attention of the Financial Secretary to the difference in the proposals which we have put down. We believe that it would be preferable to fix rather higher D figures than those suggested by the hon. Member, but, in addition to that, we believe that it is desirable to remove any D figures at all from the sales of fur goods of the more expensive category. We have chosen those having a wholesale selling value of £100.

As the hon. Gentleman said, there are considerations applicable to the fur industry which are quite different in their nature, and certainly in their degree, from those applicable to all the other ranges of Utility goods which we have been considering. Hitherto even Utility fur goods have suffered Purchase Tax at 33ቓ per cent., whereas non-Utility fur goods have suffered Purchase Tax at 100 per cent. Those figures are quite different from the rates of tax applicable to all other goods.

Hitherto, even Utility fur goods have suffered some Purchase Tax. The manufacturer claiming the concession for Utility goods supplied to the home market had to show that he had sold a quota of fur goods for export. In other words, the scheme has been so devised as to secure three results in the fur trade.

It has been designed to secure the considerable revenue which is attracted by 100 per cent. Purchase Tax on expensive furs, all of which are non-Utility—mink and ermine and so on; it has also been designed to provide Utility furs attracting 33ࡩ per cent. tax; and the general blend of those two markets has also enabled the trade to develop a very considerable export market. The result has been that out of a total volume of £9 or £10 million a year, considerably more than £2 million has represented the export trade.

A curious result of the Chancellor's proposals—I do not know whether it was deliberate—is that the tax of 100 per cent. on all the expensive furs is being reduced, for they will get the benefit of the D level because of the Budget proposals, whereas the cost to the public of Utility fur garments is being increased to a degree which is disproportionate to all the other the other increases proposed by the Budget.

12.45 a.m.

The hon. Gentleman gave one figure. I can give another. Hitherto Utility fur coats have been sold retail at a controlled price of £44. Under the Budget proposals the figure will rise to £60, and it will not be controlled. The result of these proposals has already had its effect. The whole market in Utility fur coats and garments has completely vanished. It is not an uncommon experience to find a manufacturer say that since Budget day he has not sold a single Utility fur garment. One firm which has been in existence since 1794 told me that they had to reduce the work given to their chambermasters by 75 per cent., and the total sales since the Budget have fallen to 20 per cent. Of what they were last year.

I do not know whether these results were intended by the Chancellor. I hope the Financial Secretary will tell us. Was this a deliberate plan of the Government? If so, I should have thought it was very difficult to justify. I imagine it is due to muddle and lack of forethought. I shall be interested to hear what the scientific basis of it was, but it has had the result of completely knocking the bottom out of the industry. It will reduce the export sales both of manufactured and partly manufactured fur goods, and a great many foreign buyers have been attracted.

It has also had the serious effect of causing widespread unemployment among the very specialised number of persons who either dye, dress or cut furs, and curiously enough they are middle-aged or elderly people who have acquired a great deal of skill and expertise over a long period. Is all this to be dispersed because of the Government's decision? Already some of these men have gone in the short space of time since the Budget. One firm tells me that 59 per cent. of their employees have been thrown out of work. This cannot continue.

Of course the third result of the Chancellor's proposals will be a considerable shrinkage of revenue. I support the plea of the hon. Gentleman. I can only hope we shall hear that these results were not intended by the Chancellor, that they were not foreseen, and as a result of representations from both sides of the Committee the concessions for which we are asking in the Amendments down in the name of the right hon. Gentleman the Member for Leeds, South (Mr. Gaitskell) and other hon. Gentlemen will be accepted by the Government.

Mr. H. A. Price (Lewisham, West)

I wish to support the case so ably and eloquently presented by the hon. Member for Billericay (Mr. Braine). Indeed, so ably and eloquently was it presented that the hon. Gentleman has not left much else to say except at the risk of repetition. But there is one rather important point to which he did not refer, which is an additional argument I should like to submit to the Financial Secretary. Like the hon. Member for Islington, East (Mr. Fletcher), I have no interest in this trade. I neither buy, sell or wear furs. My wife has a fur coat, but within the comparative safety of this Chamber I hereby give her notice that it will be an awfully long time before she gets another.

Mr. Lewis

Under this Government she will never get another one.

Mr. Price

I shall welcome the support of the hon. Gentleman when I meet her next. The point to which my hon. Friend did not refer, and which is worthy of consideration, is that the trade are especially concerned about Utility garments, not luxury garments. As evidence of that, I am informed that they would be willing to accept a position under which, for goods of which the wholesale price is £100, the D figure should be abolished altogether. It is a fact that under the D scheme as it exists, the tax on these garments is reduced. A coat costing £100 wholesale will now bear tax of only £93 10s.instead of £100 as was the case before the introduction of the D scheme.

The trade would be perfectly happy for that anomaly to be removed and to continue to pay tax of 100 per cent. On these goods if only they could get some concession on Utility garments. My hon. Friend said he would not exaggerate, and he did not exaggerate. He mentioned a coat of which previously the wholesale price was £32 and today is £41 10s. That is the most moderate example he could have chosen. It would have been possible for him to have quoted many others which would have illustrated his point much more graphically.

I want to support his point about employment. I have no interest in furs, but I have an interest in employment in this industry as some of my constituents are employed in it. To quote one example—and if my hon. Friend would like the name of the firm I shall be happy to give it to him—one of my constituents has been employed for 22 years by a well known firm of furriers. Prior to the introduction of the D scheme the firm employed just over 100 people; today they employ 14. No fewer than 86 to 88 employees of that firm have been dismissed as a direct result of its introduction.

The price range of Utility coats to which we have been referring are no longer saleable. The customers will not pay the extra £9 10s.,£11 10s.or £13 10s.as the case may be. Unless my hon. Friend is able to announce some concession this evening, my constituent who has been regularly employed by that firm for 22 years will be dismissed. That is the position in the trade which my hon. Friend has the power to do something about, and I support the request of my hon. Friend to the Minister that something should be done.

Mr. Percy Holman (Bethnal Green)

As my constituency is one of the very old centres of the fur trade of London, I want to say that I consider the Government did not give any serious consideration to this trade when they introduced the D scheme. In fact, I understand that it was apparently only by an afterthought of the Customs and Excise that fur coats were included with other coats in the D line at £6 10s.

Mr. Braine

I know the hon. Member would be the last person in the world to be unfair. Repeatedly my right hon. Friend has made it clear that when we came to this stage of discussing the matter on the Schedules very careful consideration would be given to these matters. Whatever the scheme was that the Government inherited, the Chancellor has made it plain from time to time that this was the stage when he would give consideration.

Mr. Holman

I agree that the Government are now giving the matter serious consideration. But the present position does not arise out of the position which they inherited; it is of their own making. They inherited the Utility scheme, as the hon. Gentleman pointed out in his own speech, with a duty of 331 per cent. on a vast line of Utility garments. In fact,90 per cent. of home market sales were Utility. The truth is that the Government inherited a scheme in which the trade was allowed to sell on the home market three times the amount they exported in made-up fur garments. The Budget introduced at first, apparently, 100 per cent. on the whole wholesale price. Second thoughts by Customs and Excise brought the fur coats into the overcoat section and gave them a D line of £6 10s.

I do not say the new scheme is responsible for the trade's depression wholly, because there was a tendency to depression in a very large group of trades, some of which were affected by Purchase Tax and others of which were entirely independent of it. The tendency began in the early months of this year. This scheme was the last straw for the fur trade in my constituency. A woman writing to me the other day said that she had been for 21 years continuously working in the trade and, although she had occasionally had short-time, this is the first time she has been unemployed. That is typical.

Mr. Braine

The hon. Member said there was a tendency before the Budget, and I nodded agreement. Then he said in the early months of this year there was a tendency towards depression. He should be aware that the tendency was most marked in the latter half of 1951: in fact before this Government took office, as Board of Trade figures show.

Mr. Holman

The hon. Member has a more detailed knowledge of the fur trade than I, but full employment still existed in the fur trade in my district up to the end of last year.

I have not yet seen a single shop advertising or even mentioning any fur garments that bear the new rate of Purchase Tax. The whole emphasis is on the cheaper garments under the old scheme. Therefore, I hope the Financial Secretary to the Treasury will be able to give us and the fur trade some satisfaction in the proposals modifying the thoughtless, inefficient, and disastrous policy of the Budget in regard to this trade.

Sir Wavell Wakefield (St. Marylebone)

I support the Amendment. I have a number of constituents engaged in the fur trade, and they have expressed to me very grave anxiety about the position in which they find themselves. What my hon. Friend and other hon. Members have said is in no way exaggerated, from what I have been told. I want to impress on the Financial Secretary that something will have to be done if this trade is to be saved.

It is difficult to over-exaggerate the position, and no one wants to do so, or to exaggerate the difficulties of the trade at the moment, but I am sure, from what my constituents have told me, that the situation is very grave indeed. I hope it will be possible to do something to help this trade, which is so valuable to the country.

1 a.m.

Mr. David Weitzman (Stoke Newington and Hackney, North)

My interest, like that of my hon. Friend the Member for Islington, East (Mr. E. Fletcher), lies in the tact that I have received many corn-plaints from constituents about unemployment resulting from the present situation. I notice that, astonishingly enough, the Amendment of the hon. Member for Billericay (Mr. Braine) has the support of the hon. Member for Edinburgh, South (Sir W. Darling), who appears at present to be in a somewhat secluded part of the Chamber. That is an astonishing fact, when one takes note of the sort of speeches he has been making. On one occasion he said that, having regard to the financial situation, no concessions of any kind should be made, and I am perfectly certain that in this case the Financial Secretary will at once rise to say that he will meet the case made by this Amendment when it has the support of the hon. Member for Edinburgh, South.

The fur trade has been treated quite differently from the textile trade, because, whereas there has been a concession in the case of textiles, there has been no concession in this case and the 100 per cent. Tax applies. The only allowance given to the fur trade is the £6 10s. D line, but I think it should be emphasised that the £6 10s.in this case is not a median at all; apparently it has been granted only because of the adverse effect on exports which must be expected from the withdrawal of the Utility scheme.

If it were contended that the fur trade is a luxury trade and does not benefit the country, I suppose no one on this side of the Committee would support this Amendment, or the Amendment in the name of my right hon. Friend the Member for Leeds, South (Mr. Gaitskell). The truth of the matter is that, if the Fourth Schedule stands unaltered, the fur trade will be gravely handicapped and, as I understand it, a great deal of damage will be done to the export market. I have little personal experience of this, but I am told that the British fur trade is a highly complex organisation. It consists of the brokers, who import and dispose of the skins, the skin merchants, the manufacturers, the skin dressers and the skin dyers. I am told that the export and re-export trade has been built up to an amount in the region of £20 million, and that in respect of manufactured furs the export figure is about £1 million.

Mr. Braine

Perhaps the hon. and learned Gentleman would like the figures, because he is underestimating their importance. The total value of the exports of skins is something in the region of £22 million, or nearly £23 million, and that of the exports of manufactured furs about £1,750,000.

Mr. Weitzman

I am grateful for the figures, which emphasise the point I am making. If my information is correct, the export trade has been established on the basis of the home trade, and the home trade has apparently been built up because the trade has been able to deal in furs manufactured in accordance with the Utility specifications, on which the Purchase Tax was 33.1 per cent. I gather that the ordinary retailer would find it far too expensive to stock the sort of furs which carry the 100 per cent. tax and that, therefore, the moderately successful business existing has resulted from the sale of furs manufactured within the range of the Utility specification.

Labour is employed all the year round in the manufacture of furs of that type. It is because the manufacturers and dealers have been able to do business in that way that the export business has been possible. The hon. Member for Billericay mentioned that of the home trade approximately 90 per cent. is in respect of moderately priced coats. I take it that that means in respect of coats which came within the Utility specification. If that is so, it illustrates the importance of the position as it existed under the Labour Government.

I hope the hon. Member for Billericay will remember that under the Labour Government, from 1945, there was the concession of 331 Purchase Tax in respect of Utility fur garments and that from 1946 there was a quota allowing £3 of home trade to £1 of export. It was on that basis that the export trade was built up. And I would remind the Committee that fur goods were not only exported to the Continent, but also, because of their high grade, to America and Canada.

If the Fourth Schedule proposals remain unaltered there is a danger that those export markets will go. It has already been pointed out that this country, and London in particular, is the centre of the fur trade. We ought to do everything we can to preserve that position. We have been given employment figures of six or seven thousand. In addition, there are chambermasters. A chambermaster, I gather, is an out-worker who deals with work in the manufacture of furs, and who employs four or five people in that work.

Today there is considerable unemployment, and I understand that if the proposals set out in the Schedule are not altered there will be a considerable increase of unemployment. The balance of the trade will be upset. The position would be that not only would the Treasury not gain as a result of its proposals but, in all probability, through trade falling, manufacture declining and unemployment increasing, the revenue itself would fall. If that is a true statement of the position, and the trade says that it is, surely something ought to be done.

A number of us feel that the best thing that could happen would be to leave matters as they were; that is, to leave the trade with the benefit of the 33⅓ per cent. Purchase Tax upon goods manufactured within the Utility specification. But if that cannot be done, then I suggest that the Amendment put down by my right hon. Friend and others would help considerably; that is, the D line be raised, not to £14 as proposed by the hon. Member for Billericay, but to £16.

There is another important difference which I would emphasise, because I think it illustrates that the trade desire to play fairly. In our Amendment we suggest that if the wholesale selling price exclusive of tax is £100 no D line should apply. That would mean that there would be no D line for goods which might be described as luxury goods; that is, no concession to the dearer fur garments. The cheaper furs, with the increased allowance, would enable the home trade to continue; that would sustain employment and thus permit a chance of the export market continuing.

I trust that the Financial Secretary, who has been listening to what has been said, will go into this matter carefully and if satisfied that what has been said is true, will see that something is done. If he does not make any concession, I hope that the hon. Member for Billericay and other hon. Members opposite will not adopt the course that was adopted earlier, but will in this case be bold enough not merely to strike but also to vote.

Mr. Boyd-Carpenter

My hon. Friend the Member for Billericay (Mr. Braine) put the case for his Amendment most persuasively, even though he did not envelop himself in its subject-matter. He made clear, as did the hon. Member for Islington, East (Mr. E. Fletcher), that we are concerned with a rather special category of article, rather apart, in the past, from the main Utility scheme, though with a Utility scheme of its own carrying a rate of 33⅓ per cent. Purchase Tax. We are also dealing with what is, speaking from memory, the only case under the D scheme of an article carrying with it Purchase Tax at the rate of 100 per cent.

I very much dislike the expression "luxury" in application to articles of one sort or another, since it is very often a matter of personal opinion, or indeed personal prejudice, whether that epithet is attached. All the same, these are articles that have in the past been treated, for the purpose, for example, of the old Utility scheme, as not being in the sort of basic necessity class where it was considered public policy to preserve a fairly large area of completely tax free goods. It was a very special case in many ways.

This is, of course, a very important industry, and I agree with the hon. Member for Islington, East, about the great importance of the fact that we have built up in this country an international centre in the marketing of furs. That is a very important factor, to which hon. Members on both sides of the Committee have very rightly, if I may so, drawn attention.

Another point which I ought to make clear, in fairness to the Committee, is that my right hon. Friend's general concession with respect to the rates of Purchase Tax does not apply in this case. One objection which I think will probably leap at once to the minds of hon. Members to the problems of the fur trade being dealt with in that way is that we are here dealing with articles some of which run up to very large values. A reduction in the specific rates of Purchase Tax applicable would involve making financially large concessions in the case of valuable articles, highly priced fur goods, and in present circumstances there would seem to be some objection to doing that.

That is the factor, as I understand it, which has caused the tabling of the Amendment standing in the name of the right hon. Member for Leeds, South (Mr. Gaitskell), to which the hon. Member for Islington, East spoke, to insert a limit to the relief which he would give of a wholesale value of £100. There is, however, a difficulty even when we are approaching the matter, not from the point of view of Purchase Tax rates but, as indeed we must on these Amendments, from the point of view of a value limit for D. As hon. Members will appreciate immediately, such a limit recreates the blind spot which all hon. Members will agree was one of the weaknesses of the old Utility scheme and will introduce it, most unfortunately, into what is a most important export industry.

1.15 a.m.

It works in this way. If one takes a fur coat selling wholesale at £100, it would, under the precise proposals put forward from the benches opposite, result that the tax would be £84. But in the case of a coat of £101 in value the tax would rise by £17. In fact, one would be recreating the blind spot. Whether that is avoidable or not I am not disposed to argue, but it was one of the weaknesses of the old Utility scheme from the point of view of supporting the export trade.

My hon. Friend the Member for Billericay proposes simply to deal with the matter by variations in the levels of D. On previous Amendments there has been some discussion as to how the D levels were arrived at, and indeed some discussion of the point of principle involved in fixing D at the median point. The Committee will be relieved to know that that issue does not arise on this group of Amendments because, quite frankly, in this case—and I believe this is the only case in all these Schedules—the D level was not arrived at by the process which my right hon. Friends have described. In this case it was arrived at simply by placing it at the figure applicable to cloth garments of the same kind.

Therefore, if there appears on general grounds to be a case for increasing the D level, one would not be going back on the principle involved in the fixing of D which arise on most other articles. We are to that extent a little freer to tackle the matter as an individual case. My right hon. Friend has considered very carefully the representations made.

Mr. Joseph T. Price (Westhoughton)

Will the hon. Gentleman explain how one can describe as a well-established principle something that is only in an experimental state and has been shown to be hopelessly inadequate to the task it is supposed to perform?

Mr. Boyd-Carpenter

The hon. Member tempts me into controversy, but I will endeavour to resist the temptation because I am trying to deal with this matter on its merits. It is, of course, a matter of opinion what adjectives one attaches to particular principles. I like to attach that one, perhaps the hon. Member does not, but I do not think we should take up the time of the Committee in arguing who is right because I fear neither of us would convince the other.

My right hon. Friend has been giving consideration to the possibility of some adjustment to the D level because there are some important factors in connection with this trade, particularly its great importance from the point of view of exports. My right hon. Friend, therefore, has come to the conclusion that some advance in the D figures will be justified. He has decided to preserve the main structure of the application of the tax —that is to say, that the categories to which D is attached shall be the same categories as at present; that is, substantially, overcoat, long coat, as category one, and short coat, jacket—call it what you will, Mr. Colegate—as category two, and the smaller articles, stoles and—if I may dare try to pronounce the word—boleros in the third category.

Mr. Follick

Quite right.

Mr. Boyd-Carpenter

I am obliged. One of the attractions of this Committee is that there is almost always an hon. Member expert in whatever subject happens to arise, however obscure it may be.

My right hon. Friend, therefore, has come to the conclusion he could go some way—indeed, a substantial way—to meet the proposals which appear in the two Amendments now before the Committee. So far as the category of what we may call the long coats is concerned, my right hon. Friend takes the view that it would be right to raise the D figure from its present level of £6 10s.to £12. In the short, or second, category, where the D figure is at present, as hon. Members will be aware, £4, he feels that a reasonable figure would be £8. In the third category, capes, stoles, and the articles with the pronunciation of whose name the hon. Gentleman the Member for Loughborough (Mr. Follick) assisted me just now, where at present D is £1, my right hon. Friend feels that it should be £4 10s.

My right hon. Friend feels that those adjustments will go a long way to meeting the difficulties that have given rise to genuine concern in the trade and those interested in its prosperity. It has been decided that those changes shall apply from what is now today by the calendar—Wednesday, 14th May; and it will be possible for them, therefore, to be brought into operation forthwith. I think hon. Members will agree that that cuts out any possible criticism that a delay in the adjustment would cause any temporary hold-up in the trade; because I hope that it will be known by the time that those in the trade, who do not, perhaps, keep the same hours as hon. Members, are going about their duties.

The hon. Lady wanted to ask me a question just now, but kindly waited. Would she like to ask it now?

Miss Herbison

That statement does not mean that the assurance given by the Minister of State for Economic Affairs, that the outsizes of coats would be examined, is not to be carried out?

Mr. Boyd-Carpenter

Oh, no. I am obliged. It is not, of course, at all inconsistent with the undertaking my right hon. Friend gave. While the structure of the Schedule is as at present, with these three categories as at present devised, the only way we can operate this variation is by attaching the new figures to the old items; but, of course, my right hon. Friend's undertaking stands, and if there were, as a result of that review, some readjustment of the categories, then obviously the changes which I have announced with respect to articles of that kind made with fur will follow that readjustment.

I hope that my hon. Friend and the hon. Gentleman opposite, who respectively spoke to their own Amendments, will see that we have given very careful consideration to what they have said and to the representations that have been made to us, and I hope that the Committee will agree that the Government are trying to meet difficulties that have arisen in this trade, and that the proposals which my right hon. Friend authorises me to put forward will strike the Committee as a fair and proper solution of the difficulties of a trade which, I repeat, has a most valuable part to play in our national economy and in our export drive.

Mr. D. Jay

I am bound to say I was most relieved to hear the Financial Secretary and the Chancellor were willing to go some way to meet the case put forward in these Amendments. I should not like to say at this minute, since this is a technical, complicated matter, that we are quite sure this goes far enough, but, clearly, we would not for our part wish in the circumstances to press this Amendment to the extent of a Division tonight. We reserve the right to examine between now and the Report stage—sometimes the Opposition as well as the Government have to consider matters between the Committee and the Report stages—the proposals put forward by the Government.

I was much impressed by the case advanced by the hon. Member for Billericay and others who spoke on this matter. I am not one who is in the habit of buying or selling furs, but it has been my job at the Board of Trade and the Treasury to examine the case put forward by this trade which is so important to the national economy. There is much truth in what the hon. Member for Billericay said, that the fur trade is of great value to us both as an invisible export and in other ways. The policy of the last Government was to encourage the trade by cheaper Utility furs and to strengthen the home market on the basis of which the export trade could be developed.

There is no doubt that, from the evidence brought forward, the initial effect of the D scheme as included in the Budget was having a very serious effect on the fur trade. One hon. Member said it was disastrous. I do not want to put it too high, but there is no doubt whatever that it has had a very serious effect. The hon. Member for St. Marylebone (Sir W. Wakefield) put forward very persuasive arguments on this point, and I am bound to have sympathy with him about the effects of this Budget. He found the taxi drivers of his constituency were hard hit by it and they had to be rescued. Then there was the unfortunate plight of the cricketers, and now apparently in this instance the fur coat dealers in Marylebone are in trouble. It almost seems as if it is now a depressed area as a result of the Budget.

We were disappointed that we did not have a speech from the hon. Member for Edinburgh, South (Sir W. Darling). He lectured us earlier in the evening about the necessity for not reducing any taxes because that would be a threat to national solvency. When it comes to furs, however, we find that he is in favour of reducing the tax on furs but not in the case of gloves. I was surprised to see the hon. Member lurking in the shadows at the end of the Chamber instead of coming forward and putting forward his case to the Committee. We shall examine this matter further during the next two weeks and will not press it further now.

Mr. Braine

I should indeed be churlish if I did not say how much I appreciate the way in which my right hon. Friend has been so quick to respond to the needs of this industry. Perhaps I might have hoped for concessions a little more generous, but those that have been offered will be of great encouragement to the trade and to those manufacturers and workpeople engaged in it. For that reason, I beg—

Mr. E. Fletcher

Before we part with the matter, may I say one word? I also appreciate the spirit in which the Financial Secretary has met the points from both sides of the Committee. I am still not clear about one thing. The Financial Secretary conceded that in fixing the level no kind of principle was applied. Fur coats were merely incorporated with other cloth coats as a matter of convenience.

1.30 a.m.

It was not clear from the statement which he has just made whether any scientific principle has been applied in fixing the new figure at £12, or whether it is a mere guess at what might be convenient to the trade. I hope that before the Report stage opportunities will be given for the trade to prove, if it can, that £12 is not a scientific figure and that the figure should be either £14 as suggested by the hon. Member for Billericay or £16 as we have suggested.

Mr. Braine

I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Amendment proposed: In page 76, line 11, leave out "6 10 0 per article," and insert:

per article
(a) exceeding 44" hip measurement 11 10 0
(b) not less than 42" but not exceeding 44" hip measurement 10 15 0
(c) less than 42" hip measurement 10 0 0

—[Mr. Jay.]

Question put, "That '6 10 0 per article' stand part of the Schedule."

The Committee dividied: Ayes, 214; Noes, 190.

Division No. 128.] AYES [1.34 a.m.
Aitken, W. T. Garner-Evans, E. H. Nield, Basil (Chester)
Allan, R. A. (Paddington, S.) Glyn, Sir Ralph Noble, Cmdr. A. H. P
Alport, C. J. M. Godber, J. B. Nugent, G. R. H.
Amory, Heathcoat (Tiverton) Gomma-Duncan, Col. A. Oakshott, H. D.
Anstruther-Gray, Major W. J. Gough, C. F. H Odey, G. W.
Arbuthnot, John Gower, H. R. Ormsby-Gore, Hon. W. D.
Ashton, H. (Chelmsford) Graham, Sir Fergus Orr, Capt. L. P. S.
Assheton, Rt. Hon. R. (Blackburn, W.) Grimond, J. Orr-Ewing, Charles Ian (Hendon, N.)
Astor, Hon. J. J. (Plymouth, Sutton) Grimston, Hon. John (St. Albans) Perkins, W. R. D.
Astor, Hon. W. W. (Bucks, Wycombe) Grimston, Sir Robert (Westbury) Pete, Brig. C. H. M.
Baker, P. A. D. Harris, Frederic (Croydon, N.) Peyton, J. W. W.
Baldock, Lt.-Cmdr. J. M. Harris, Reader (Heston) Pickthorn, K. W. M.
Baldwin, A. E. Harrison, Col. J. H. (Eye) Pilkington, Capt. R. A.
Banks, Col. C. Harvey, Ian (Harrow, E.) Pitman, I. J.
Barlow, Sir John Hay, John Powell, J. Enoch
Baxter, A. B. Head, Rt. Hon. A. H. Price, Henry (Lewisham, W.)
Beach, Maj. Hicks Higgs, J. M. C. Prior-Palmer, Brig. O. L.
Beamish, Maj. Tufton Hill, Dr. Charles (Luton) Profumo, J. D.
Bell, Philip (Bolton, E.) Hill, Mrs. E. (Wythenshawe) Raikes, H. V.
Bell, Ronald (Bucks, S.) Hinchingbrooke, Viscount Rayner, Brig. R.
Bennett, Sir Peter (Edgbaston) Hirst, Geoffrey Redmayne, E.
Bennett, Dr. Reginald (Gosport) Holland-Martin, C. J. Remnant, Hon. P.
Bennett, William (Woodside) Hollis, M. C. Renton, D. L. M.
Birch, Nigel Holt, A. F. Roberts, Peter (Heeley)
Bishop, F. P. Hope, Lord John Robinson, Roland (Blackpool, S.)
Black, C. W. Hopkinson, Henry Rodgers, John (Sevenoaks)
Bossom, A. C. Horobin, I. M. Roper, Sir Harold
Boyd-Carpenter, J. A. Howard, Gerald (Cambridgeshire) Ropner, Col. Sir Leonard
Boyle, Sir Edward Howard, Greville (St. Ives) Russell, R. S.
Braine, B. R. Hudson, Sir Austin (Lewisham, N.) Ryder, Capt. R. E. D.
Braithwaite, Sir Albert (Harrow, W.) Hudson, W. R. A. (Hull, N.) Salter, Rt. Hon. Sir Arthur
Bromley-Davenport, Lt.-Col. W. H. Hurd, A. R. Schofield, Lt.-Col. W. (Rochdale)
Brooke, Henry (Hampstead) Hutchinson, Sir Geoffrey (Ilford, N.) Scott, R. Donald
Brooman-White, R. C. Hutchison, Lt.-Com. Clark (E'b'rgh W.) Shepherd, William
Browne, Jack (Govan) Hyde, Lt.-Col. H. M. Simon, J. E. S. (Middlesbrough, W.)
Buchan-Hepburn, Rt. Hon. P. G. T. Jenkins, R. C. D. (Dulwich) Smiles, Lt.-Col. Sir Walter
Bullard, D. G. Johnson, Eric (Blackley) Smyth, Brig. J. G. (Norwood)
Bullock, Capt. M. Jones. A. (Hall Green) Spearman, A. C. M.
Bullus, Wing Commander E. E. Joynson-Hicks, Hon. L. W. Speir, R. M.
Burden, F. F. A. Kaberry, D. Stanley, Capt. Hon. Richard
Butcher, H. W. Keeling, Sir Edward Stevens, G. P.
Butler, Rt. Hon. R. A. (Saffron Walden) Kerr, H. W. (Cambridge) Steward, W. A. (Woolwich, W.)
Carr, Robert (Mitcham) Lambert, Hon. G. Stewart, Henderson (Fife, E.)
Cary, Sir Robert Lambton, Viscount Strauss, Henry (Norwich, S.)
Clarke, Col. Ralph (East Grinstead) Law, Rt. Hon. R. K. Studholme, H. G.
Clarke, Brig. Terence (Portsmouth, W.) Leather, E. H. C. Summers, G. S.
Cole, Norman Legge-Bourke, Maj. E. A. H. Sutcliffe, H.
Conant, Maj. R. J. E. Legh, P. R. (Petersfield) Taylor, Charles (Eastbourne)
Craddock, Beresford (Spelthorne) Lindsay, Martin Taylor, William (Bradford, N.)
Crookshank, Capt. Rt. Hon. H. F. C. Linstead, H. N. Tooling, W.
Crosthwaite-Eyre, Col. O. E. Lloyd, Maj. Guy (Renfrew, E.) Thompson, Lt.-Cdr. R. (Croydon, W)
Cuthbert, W. N. Longden, Gilbert (Herts, S.W.) Thornton-Kemsley, Col. C. N.
Darling, Sir William (Edinburgh, S.) Lucas, Sir Jocelyn (Portsmouth, S.) Tilney, John
Deedes, W. F Lucas, P. B. (Brentford) Turner, H. F. L.
Digby, S. Wingfield Lucas-Tooth, Sir Hugh Turton, R. H.
Donaldson, Cmdr. C. E. McA. Macdonald, Sir Peter (I of Wight) Tweedsmuir, Lady
Donner, P. W. Mackeson, Brig. H. R. Vane, W. M. F.
Doughty, C. J. A. McKibbin, A. J. Vaughan-Morgan, J. K.
Douglas-Hamilton, Lord Malcolm McKie, J. H. (Galloway) Wakefield, Edward (Derbyshire, W.)
Drayson, G. B. Maclean, Fitzroy Wakefield, Sir Wavell (Marylebone)
Drewe, C. MacLeod, Rt. Hon Iain (Enfield, W.) Walker-Smith, D. C.
Duncan, Capt. J. A. L. MacLeod, John (Ross and Cromarty) Ward, Miss I. (Tynemouth)
Erroll, F. J. Macpherson, Maj. Niall (Dumfries) Waterhouse, Capt. Rt. Hon. C.
Fell, A. Marples, A. E. Webbe, Sir H. (London & Westminster)
Finlay, Graeme Marshall, Sidney (Sutton) Wellwood, W.
Fleetwood-Hesketh, R. F. Maude, Angus White, Baker (Canterbury)
Fletcher-Cooke, C. Maydon, Lt.-Comdr. S. L. C Williams, Gerald (Tonbridge)
Fort, R. Molson, A. H. E. Williams, R. Dudley (Exeter)
Fraser, Hon. Hugh (Stone) Morrison, John (Salisbury) Wilson, Geoffrey (Truro)
Fraser, Sir Ian (Morecambe & Lonsdale) Mott-Radclyffe, C. E. Wood, Hon. R.
Gage, C. H. Nabarro, G. D. N. TELLERS FOR THE AYES:
Galbraith, T. G. D. (Hillhead) Nicolson, Nigel (Bournemouth, E.) Mr. Vosper and Mr. Heath
NOES
Acland, Sir Richard Glanville, James O'Brien, T.
Adams, Richard Greenwood, Anthony (Rossendale) Orbach, M.
Albu, A. H. Grey, C. F. Oswald, T.
Allen, Scholefield (Crewe) Griffiths, David (Rother Valley) Padley, W. E.
Anderson, Alexander (Motherwell) Griffiths, William (Exchange) Paling, Will T. (Dewsbury)
Bacon, Miss Alice Hale, Leslie (Oldham, W.) Paton, J.
Baird, J. Hall, Rt. Hon. Glenvil (Colne Valley) Peart, T. F.
Barnes, Rt. Hon. A. J Hall, John (Gateshead, W.) Plummer, Sir Leslie
Benn, Wedgwood Hamilton, W. W. Porter, G.
Benson, G. Hannan, W. Price, Philips (Gloucestershire, W.)
Beswick, F. Henderson, Rt. Hon. A (Rowley Regis) Proctor, W. T.
Bevan, Rt. Hon. A. (Ebbw Vale) Herbison, Miss M. Pryde, D. J.
Bing, G. H. C. Hewitson, Capt. M Rankin, John
Blackburn, F. Hobson, C. R. Reeves, J.
Blenkinsop, A. Holman, P. Rhodes, H.
Blyton, W. R. Holmes, Horace (Hemsworth) Roberts, Rt. Hon. A.
Boardman, H. Houghton, Douglas Roberts, Albert (Normanton)
Bottomley, Rt. Hon. A. G. Hoy, J. H. Roberts, Goronwy (Caernarvonshire)
Bowden, H. W. Hughes, Cledwyn (Anglesey) Ross, William
Braddock, Mrs. Elizabeth Hughes, Emrys (S. Ayrshire) Royle, C.
Brookway, A. F. Hughes, Hector (Aberdeen, N.) Schofield, S. (Barnsley)
Brook, Dryden, (Halifax) Hynd, H. (Accrington) Shackleton, E. A. A.
Brown, Rt. Hon. George (Belper) Hynd, J. B. (Attercliffe) Shawcross, Rt. Hon. Sir Hartley
Burke, W. A. Irving, W. J. (Wood Green) Short, E. W.
Burton, Miss F. E. Janner, B. Shurmer, P. L. E.
Butler, Herbert (Hackney, S.) Jay, Rt. Hon. D. P. T. Silverman, Julius (Erdington)
Callaghan, L. J. Jeger, George (Goole) Simmons, C. J (Brierley Hill)
Carmichael, J. Jenkins, R. H. (Stechford) Slater, J.
Champion, A. J. Johnson, James (Rugby) Snow, J. W.
Chapman, W. D. Jones, David (Hartlepool) Sorensen, R. W.
Chetwynd, G. R. Jones, Frederick Elwyn (West Ham, S.) Steele, T.
Clunie, J. Jones, Jack (Rotherham) Stewart, Michael (Fulham, E.)
Cocks, F. S. Jones, T. W. (Merioneth) Stokes, Rt. Hon R. R.
Coldrick, W. Keenan, W. Strauss, Rt. Hon. George (Vauxhall)
Collick, P. H. Kenyon, C. Swingler, S. T.
Cook, T. F. King, Dr. H. M. Sylvester, G. O.
Corbet, Mrs. Freda Lee, Frederick (Newton) Taylor John (West Lothian)
Crosland, C. A. R. Lee, Miss Jennie (Cannock) Taylor. Rt. Hon. Robert (Morpeth)
Cullen, Mrs. A. Lever, Harold (Cheetham) Thomas, David (Aberdare)
Dalton, Rt. Hon, H. Lever, Leslie (Ardwick) Timmons, J
Davies, Ernest (Enfield, E.) Lewis, Arthur Tomney, F.
Davies, Harold (Leek) Lindgren, G. S Ungoed-Thomas, Sir Lynn
Deer, G. MacColl, J. E. Usborne, H. C.
Delargy, H. J. McGovern, J. Watkins, T. E.
Dodds, N. N. McInnes, J. Weitzman, D.
Driberg, T. E. N. McKay, John (Wallsend) Wells, Percy (Faversham)
Dugdale, Rt. Hon. John (W. Bromwich) McLeavy, F. Wells, William (Walsall)
Ede, Rt. Hon. J. C. MacMillan, M. K. (Western Isles) West, D. G.
Edelman, M. McNeil, Rt. Hon. H. White, Mrs. Eirene (E. Flint)
Edwards, John (Brighouse) MacPherson, Malcolm (Stirling) White, Henry (Derbyshire, N.E.)
Edwards, Rt. Hon. Ness (Caerphilly) Mainwaring, W. H. Whiteley, Rt. Hon. W.
Edwards, W. J. (Stepney) Mallalieu, J. P. W. (Huddersfield, E.) Wigg, George
Evans, Stanley (Wednesbury) Mann, Mrs. Jean Willey, Frederick (Sunderland, N.)
Fernyhough, E. Manuel, A. C. Willey, Octavius (Cleveland)
Field, W. J. Marquand, Rt. Hon. H. A. Williams, Ronald (Wigan)
Fienburgh, W. Mayhew, C. P. Wilson, Rt. Han. Harold (Huyton)
Finch, H. J. Mellish, R. J. Winterbottom, Ian (Nottingham, C.)
Fletcher, Erie (Islington, E.) Monslow, W. Winterbottom, Richard (Brightside)
Follick, M. Moody, A. S. Woodburn, Rt. Hon. A.
Wyatt, W. L.
Foot, M. M. Morley, R. Yates, V. F.
Forman, J. C. Moyle, A. Younger, Rt. Hon. K.
Fraser, Thomas (Hamilton) Mulley, F. W.
Freeman, John (Watford) Murray, J. D TELLERS FOR THE NEOS:
Freeman, Peter (Newport) Neal, Harold (Bolsover) Mr. Pearson and Mr. Wilkins.

Amendment proposed: In page 76, line 51, leave out "2 0 0 per article," and insert:

per article
(i) less than 42" hip measurement 3 3 0
(ii) not less than 42" but not exceeding 44" hip measurement 3 7 9
(iii) not less than 44" but not exceeding 46" hip measurement 3 12 6
per article
(iv) exceeding 46" hip measurement. 3 17 3

—[Mr. Jay.]

Question put, "That '2 0 0 per article' stand part of the Schedule."

The Committee divided: Ayes, 213: Noes, 190.

Division No. 129.] AYES [1.43 a.m.
Aitken, W. T. Glyn, Sir Ralph Nugent, G. R. H
Allan, R. A. (Paddington, S.) Godber, J. B. Oakshott, H. D.
Alport, C. J. M. Gomme-Dunoan, Col. A. Odey. G. W.
Amory, Heathcoat (Tiverton) Gough, C. F. H. Ormsby-Gore, Hon W D
Anstruther-Gray, Major W. J. Gower, H. R. Orr, Capt. L. P. S.
Arbuthnot, John Graham, Sir Fergus Orr-Ewing, Charles Ian (Hendon, N.)
Ashton, H. (Chelmsford) Grimond, J. Perkins, W. R. D.
Assheton, Rt. Hon. R. (Blackburn, W.) Grimston, Hon. John (St. Albans) Peto, Brig. C. H. M.
Astor, Hon. J. J. (Plymouth, Sutton) Grimston, Sir Robert (Westbury) Peyton, J. W. W.
Astor, Hon. W. W. (Bucks, Wycombe) Harris, Frederic (Croydon, N.) Pickthorn, K. W. M.
Baker, P. A. D. Harris, Reader (Heston) Pilkington, Capt. R A
Baldock, Lt.-Comdr. J. M Harrison, Col. J. H. (Eye) Pitman, I. J.
Baldwin, A. E. Harvey, Ian (Harrow, E.) Powell, J. Enoch
Banks, Col. C. Hay, John Price, Henry (Lewisham, W.)
Barlow, Sir John Head, Rt. Hon. A H Prior-Palmer, Brig. O. L.
Baxter, A. B. Higgs, J. M C. Profumo, J. D.
Beach, Maj. Hicks Hill, Dr. Charles (Luton) Raikes, H. V.
Beamish, Maj. Tufton Hill, Mrs. E. (Wythenshawe) Rayner, Brig. R
Bell. Philip (Bolton, E.) Hinchingbrooke, Viscount Redmayne, M.
Bell, Ronald (Bucks, S.) Hirst, Geoffrey Remnant, Hon. P.
Bennett, Sir Peter (Edgbaston) Holland-Martin, C. J Renton, D. L. M.
Bennett, Dr. Reginald (Gosport) Hollis, M. C. Roberts, Peter (Heeley)
Bennett, William (Woodside) Holt, A. F. Robinson, Roland (Blackpool, S.)
Birch, Nigel Hope, Lord John Rodgers, John (Sevenoaks)
Bishop, F. P Hopkinson, Henry Roper, Sir Harold
Black, C. W. Horobin, I. M. Ropner, Col. Sir Leonard
Bossom, A. G. Howard, Gerald (Cambridgeshire) Russell, R. S.
Boyd-Carpenter, J. A. Howard, Greville (St. Ives) Ryder, Capt. R. E. D.
Boyle, Sir Edward Hudson, Sir Austin (Lewisham, N.) Salter, Rt. Hon. Sir Arthur
Braine, B. R. Hudson, W. R. A. (Hull, N.) Schofield, Lt.-Col. W. (Rochdale)
Braithwaite, Sir Albert (Harrow, W.) Hurd, A. R. Scott, R. Donald
Bromley-Davenport, Lt.-Col. W. H. Hutchinson, Sir Geoffrey (Ilford, N.) Shepherd, William
Brooke, Henry (Hampstead) Hutchison, Lt.-Com. Clark (E'b'rgh W.) Simon, J E. S. (Middlesbrough, W)
Brooman-White, R. C. Hyde, Lt.-Col. H. M. Smiles, Lt.-Col. Sir Walter
Browne, Jack (Govan) Jenkins, R. C. D. (Dulwich) Smyth, Brig. J. G. (Norwood)
Buchan-Hepburn, Rt Hon. P. G. T. Johnson, Eric (Blackley) Spearman, A. C. M.
Bullard, D. G. Jones, A. (Hall Green) Speir, R. M.
Bullock, Capt. M. Joynson-Hicks, Hon. L. W Stanley, Capt. Hon Richard
Bullus, Wing Cmdr E. E. Kaberry, D. Stevens, G. P.
Burden, F. F. A. Keeling, Sir Edward Steward, W. A. (Woolwich, W.)
Butcher, H. W. Kerr, H. W. (Cambridge) Stewart, Henderson (Fife, E.)
Butler, Rt. Hon. R. A. (Saffron Walden) Lambert, Hon. G. Strauss, Henry (Norwich, S.)
Carr, Robert (Mitcham) Lambton, Viscount Studholme, H. G.
Cary, Sir Robert Law, Rt. Hon. R. K. Summers, G. S.
Clarke, Col. Ralph (East Grinstead) Leather, E. H. C. Sutcliffe, H.
Clarke, Brig. Terence (Portsmouth, W.) Legge-Bourke, Maj. E. A. H Taylor, Charles (Eastbourne)
Cole, Norman Legh, P. R. (Petersfield) Taylor, William (Bradford, N.)
Conant, Maj. R. J. E. Lindsay, Martin Teeling, W.
Craddock, Beresford (Spelthorne) Linstead, H. N. Thompson, Lt.-Cdr. R. (Croydon W.)
Crookshank, Capt. Rt. Hon. H. F. C Lloyd, Maj. Guy (Renfrew, E.) Thornton-Kemsley, Col. C N
Crosthwaite-Eyre, Col. O. E. Longden, Gilbert (Herts, S.W.) Tilney, John
Cuthbert, W. N. Lucas, Sir Jocelyn (Portsmouth, S.) Turner, H. F. L.
Darling, Sir William (Edinburgh, S.) Lucas, P. B. (Brentford) Turton, R. H.
Deedes, W. F. Lucas-Tooth, Sir Hugh Tweedsmuir, Lady
Digby, S. Wingfield Macdonald, Sir Peter (I. of Wight) Vane, W. M. F.
Donaldson, Cmdr. C. E. McA. Mackeson, Brig. H. R. Vaughan-Morgan, J K
Donner, P. W. McKibbin, A. J. Vosper, D. F.
Doughty, C. J. A McKie, J. H. (Galloway) Wakefield, Edward (Derbyshire, W.)
Douglas-Hamilton, Lord Malcolm Maclean, Fitzroy Wakefield, Sir Wavell (Marylebone)
Drayson, G. B. MacLeod, Rt. Hon. Iain (Enfield, W.) Walker-Smith, D. C.
Duncan, Capt J. A. L MacLeod, John (Ross and Cromarty) Ward, Miss I. (Tynemouth)
Erroll, F J. Macpherson, Maj. Niall (Dumfries) Waterhouse, Capt. Rt. Hon. C.
Fell, A. Marshall, Sidney (Sutton) Webbe, Sir H. (London & Westminster)
Finlay, Graeme Maude, Angus Wellwood, W.
Fleetwood-Hesketh, R. F. Maydon, Lt.-Comdr. S L C White, Baker (Canterbury)
Fletcher-Cooke, C. Molson, A. H E Williams, Gerald (Tonbridge)
Fort, R. Morrison, John (Salisbury) Williams, R. Dudley (Exeter)
Fraser, Hon. Hugh (Stone) Mott-Radclyffe, C. E. Wilson, Geoffrey (Truro)
Fraser. Sir Ian (Morecambe & Lonsdale) Nabarro, G. D. N Wood, Hon R
Gage, C. H. Nicolson, Nigel (Bournemouth, E.)
Galbraith, T. G. D (Hillhead) Nield, Basil (Chester) TELLERS FOR THE AYES
Garner-Evans, E. H. Noble, Cmdr. A. H. P Mr. Drewe and Mr. Heath.
NOES
Acland, Sir Richard Barnes, Rt. Hon. A J Blenkinsop, A.
Adams, Richard Benn, Wedgwood Blyton, W. R.
Albu, A. H. Benson, G Boardman, H.
Allen, Scholefield (Crewe) Beswick, F. Bottomley, Rt. Hon. A. G
Anderson, Alexander (Motherwell) Bevan, Rt. Hon A (Ebbw Vale). Bowden, H. W.
Bacon, Miss Alice Bing, G. H. C. Braddock, Mrs. Elizabeth
Baird, J. Blackburn, F. Brockway, A F.
Brook., Dryden (Halifax) Holmes, Horace (Hemsworth) Plummer, Sir Leslie
Brown, Rt. Hon. George (Belper) Houghton, Douglas Porter, G.
Burke, W. A. Hoy, J. H. Price, Philips (Gloucestershire, W.)
Burton, Miss F. E. Hughes, Cledwyn (Anglesey) Proctor, W. T.
Butler, Herbert (Hackney, S.) Hughes, Emrys (S. Ayrshire) Pryde, D. J
Callaghan, L. J. Hughes, Hector (Aberdeen, N.) Rankin, John
Carmichael, J. Hynd, H. (Accrington) Reeves. J
Champion, A. J. Hynd, J. B. (Attercliffe) Rhodes, H.
Chapman, W. D. Irving, W. J. (Wood Green) Robens, Rt. Hon. A.
Chetwynd, G. R. Janner, B. Roberts, Albert (Normanton)
Clunie, J. Jay, Rt. Hon. D. P. T. Roberts, Goronwy (Caernarvonshire)
Cocks, F. S. Jeger, George (Goole) Ross, William
Coldrick, W. Jenkins, R. H. (Stechford) Schofield, S. (Barnsley)
Collick, P. H. Johnson, James (Rugby) Shackleton, E. A. A.
Cook, T. F. Jones, David (Hartlepool) Shawcross, Rt. Hon. Sir Hartley
Corbet, Mrs. Freda Jones, Frederick Elwyn (West Ham, S.) Short, E. W.
Crosland, C. A. R. Jones, Jack (Rotherham) Shurmer, P. L. E.
Cullen, Mrs. A. Jones, T. W. (Merioneth) Silverman, Julius (Erdington)
Dalton, Rt. Hon. H. Keenan, W. Simmons, C. J. (Brierley Hill)
Davies, Ernest (Enfield, E.) Kenyon, C. Slater, J.
Davies, Harold (Leek) King, Dr. H. M. Snow, J. W.
Deer, G. Lee, Frederick (Newton) Sorensen, R. W.
Delargy, H. J. Lee, Miss Jennie (Cannock) Steele, T.
Dodds, N. N. Lever, Harold (Cheetham) Stewart, Michael (Fulham, E.)
Driberg, T. E. N. Lever. Leslie (Ardwick) Stokes, Rt. Hon. R. R.
Dugdale, Rt. Hon. John (W. Bromwich) Lewis, Arthur Strauss, Rt. Hon. George (Vauxhall)
Ede, Rt. Hon. J. C. Lindgren, G. S Swingler, S. T.
Edelman, M. MacColl, J. E. Sylvester, G. O.
Edwards, John (Brighouse) McGovern, J. Taylor, John (West Lothian)
Edwards, Rt. Hon. Ness (Caerphilly) McInnes, J. Taylor, Rt. Hon. Robert (Morpeth)
Edwards, W.J. (Stepney) McKay, John (Wallsend) Thomas, David (Aberdare)
Evans, Stanley (Wednesbury) McLeavy, F. Timmons, J.
Fernyhough, E. MacMillan, M. K. (Western Isles) Tomney, F.
Field, W. J. McNeil, Rt. Hon. H. Ungoed-Thomas, Sir Lynn
Fienburgh, W. MacPherson, Malcolm (Stirling) Usborne, H. C.
Finch, H. J. Mainwaring, W. H. Watkins, T. E
Fletcher, Eric (Islington, E.) Mallalieu, J. P. W. (Huddersfield, E.) Weitzman, D.
Follick, M. Mann, Mrs. Jean Wells, Percy (Faversham)
Foot, M. M. Manuel, A. C. Wells, William (Walsall)
Forman, J. C. Marquand, Rt. Hon. H A West, D. G.
Fraser, Thomas (Hamilton) Mayhew, C. P. White, Mrs. Eirene (E. Flint)
Freeman, John (Watford) Mellish, R. J White, Henry (Derbyshire, N E.)
Freeman, Peter (Newport) Monslow, W. Whiteley, Rt. Hon. W.
Glanville, James Moody, A. S. Wigg, George
Greenwood, Anthony (Rossendale) Morley, R. Wilkins, W. A.
Grey, C. F Moyle, A. Willey, Frederick (Sunderland, N.)
Griffiths, David (Rother Valley) Mulley, F. W. Willey, Octavius (Cleveland)
Griffiths, William (Exchange) Murray, J. D. Williams, Ronald (Wigan)
Hale. Leslie (Oldham, W.) Neal, Harold (Bolsover) Wilson, Rt. Hon Harold (Huyton)
Hall, Rt. Hon. Glenvil (Colne Valley) O'Brien, T. Winterbottom, Ian (Nottingham, C.)
Hall, John (Gateshead, W.) Orbach, M. Winterbottom, Richard (Brightside)
Hamilton, W. W. Oswald, T. Woodburn, Rt. Hon. A.
Henderson, Rt Hon. A.(Rowley Regis) Padley, W. E Wyatt, W. L.
Herbison, Miss M. Paling, Will T. (Dewsbury) Yates, V. F.
Hewitson, Capt. M. Paton, J. Younger, Rt. Hon K.
Hobson, C. R Pearson, A. TELLERS FOR THE NOES:
Holman, P. Pearl, T. F. Mr. Hannan and Mr. Royle.
The Temporary Chairman (Mr. Colegate)

Before calling the next Amendment, I should remind the Committee that group 7, which we shall be taking, provides, as with the other groups, that the discussion should be general and that the Divisions afterwards should be on the selected Amendments.

Miss Bacon

I beg to move, in page 77, line 4, to leave out "1 9," and to insert "2 6."

This group deals with the whole range of women's underwear and, just as was the case with outerwear, we seek to raise the D line to the old top-rate Utility level. If one looks at the amounts in the Schedule and compares them with those in our Amendments, it will be seen that the proportionate increase in the case of underwear is greater than in the case of outerwear. If one looks at the individual items, one can see that that is so. For example, take the case of pyjama jackets and pyjama trousers, which were 15s. per article, or 30s. a pair, under the old Utility scheme, tax free beyond that level, and which are tax free now only beyond 10s. per article.

On the subject of nightdresses and pyjamas, we ought to have had an Amendment on the Order Paper—and I hope the Government will look at this, because we realised it only after the Amendments had been put on the Paper—to see that we had two classes of material. It will be seen, further down the Schedule, that other garments of women's underwear are classified into two types of material—Class A and Class B.

Class A material is, of course, wool, and class B, any other material. I cannot see why in most of the other garments there is provision for both Class A and Class B material, but no such provision for nightdresses and pyjamas. While we have no Amendment on the Paper on this matter, I should like the hon. Gentleman to look into this to see whether between now and the Report stage he can make this distinction in these garments.

If one looks at the other amounts in this Schedule, one sees that No. 13—that is, petticoats and cami-knickers at a D level of 8s. 6d. per article—shows a great increase in tax compared with the old Utility level of 11s. ld. A few days ago I walked round one shop which provides rather cheap underwear. It is a multiple shop. I found that the average price of slips there was 18s. 6d., which is not regarded as a high price for a slip or underskirt. Yet we have a D level of only 8s. 6d. I think there is a case for raising the D level of this article.

In the next group—undervests, etc., of wool—it will be seen that while the D figure is 9s. 0d., the old Utility figure was £1 Is. 8d. That is a greater difference than there has been on anything in outerwear. In the next category, namely, knickers, panties and briefs, in class A material, the new D figure is 6s. per article, whereas the old top Utility figure was as high as 15s. 11d.

I should like to tell the hon. Gentleman here that the trade feels that it is at a great disadvantage under this section in that there is only a distinction between materials, and not in regard to the amount of material which these articles take. I think that in the trade there is a great grievance about directoire knickers, which it is felt ought to have been put into a category by themselves if the D figures are not going to be considerably raised..

With regard to corsets, I understand that hon. Members opposite have put down an Amendment to take roll-on elastic belts out of No. 18 and to make them a separate category. I hope that that plea is going to be made from that side. If the hon. Member for Gorbals (Mrs. Cullen) happens to catch your eye, Sir Charles, I hope that she will have more to say on corsets. I should like to make again a point which I have made on two occasions during discussion of these Amendments in the last few days. I made the point once yesterday on men's outerwear, and again, today, on women's outerwear. Up to now I have heard nothing from the Front Bench opposite about it. It is with regard to the difference between the D level for cloth, and the D level for clothes made from that cloth.

That point applies equally to underwear. A manufacturer tells me that if he makes a slip of tax-free material at 4s. a square yard, that slip comes above the D figure and a tax of 6d. is charged. I should like to hear something about this from the Front Bench opposite, because it seems to be general throughout the range of women's and men's wear that there is this discrepancy between the D level for cloth and the D level for clothes made from that cloth.

2.0 a.m.

I have not gone into too many figures, but if they are worked out it will be seen that on quite ordinary and fairly cheap garments of women's underwear there will be a very great increase in tax on garments which before were tax free. Having regard to the very great increases and differences in some respects between the new D level and the old Utility level, I hope that we shall have some concession on this. There have been a few adjustments as between categories, but up to now we have had hardly any concession on the D level. I would emphasise that it is very important to women not to have to pay such a high tax as they will have to pay in future on these very necessary articles.

Mrs. Alice Cullen (Glasgow, Gorbals)

I wish to say a few words on the question of corsets and the raising of the D level from £1 to £1 5s. We think that the alteration for which we ask is very important and necessary; it probably ought to be more, and we therefore feel it is a very modest request. The Utility level was always too low, and even under the Utility scheme women had to pay a heavy tax on corsets. Also, there are likely to be abuses, because doctors can give certificates for the supplying of tax-free corsets on a variety of ailments, and if a doctor is at all lenient he will say, "You can have a certificate and get your corsets tax free." We feel that our request to raise the D level from £1 to £1 5s. is a very modest one, and I hope that the Financial Secretary will do something about it.

Mr. F. J. Erroll (Altrincham and Sale)

I do not feel it necessary to add to the remarks of the hon. Lady the Member for Glasgow, Gorbals (Mrs. Cullen). When her Amendment was originally tabled it had the support of the names of a large number of hon. Ladies opposite, and it was unfortunate that the exigencies of printing compelled many of those supporting names to be swept off the Order Paper, leaving only six. It was very striking to see so many hon. Ladies opposite getting together on this Amendment.

I rise to speak, if I may, to the Amendment standing in my name dealing with dress collars—in page 77, line 4, column 1, after "shirt" to insert "and dress." Item B.10 gives a D level of 1 s. 9d. per article on shirt collars and shirt neckbands, which I understand to be a collar of a type which goes on a shirt that looks like a man's shirt but which is, in fact, worn by women when wearing a uniform, such as that of the women's police service, or any of the women's services attached to the Armed Services. If it is right for that type of collar to have a D level, I submit it is only right that what is called a dress collar, which is a similar type of detachable collar, only worn with ordinary feminine attire, should also have a similar D level. It is a small point and a small omission, but it is something which I hope can be put right by the Financial Secretary.

Turning to other Amendments standing in the name of my hon. Friend the Member for Langstone (Mr. Stevens) and myself, we have had representations made to us that roll-on elastic belts are in fact of a substantial nature and therefore of higher price than would appear to justify their inclusion under item B.18, where they would attract only a D level of 5s. 6d. per article. On the other hand, they are not as elaborate as full corsets described in item B.17, attracting a D level of 20s. Therefore, we have suggested a compromise whereby the roll-on elastic belts may have a D level of their own of 15s. per article.

I hope the Financial Secretary will be able to accede to this request, because the situation is not satisfactory at present. I understand from the trade that if a roll-on elastic belt is fitted with quite a cheap zip fastener it is by definition turned into a corset and therefore attracts a higher D level. Therefore, by adding a quite redundant fastener costing 2s. one qualifies for a level of 14s. 6d. Obviously it would be better to reclassify and so pass the benefit on to the customer, rather than give an inducement to the manufacturer to try and qualify for a D level appertaining solely to items listed under item B.18. I hope, therefore, that the Financial Secretary will see his way to accede to these two small requests made from this side of the Committee.

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

I want to plead the case of out-sizes and extra out-sizes again. There are on the Order Paper a number of Amendments relating to various items of women's underclothing in which we have suggested that the D level is far too low in the ordinary sizes and which, of course, is very much too low in the out-sizes and extra out-sizes. I do not want to press the case too much, because I think the principle has been established in previous discussions that out-sizes have been forgotten in the D scheme and in the Douglas Report. In view of the fact that a concession has been considered in relation to outer garments of out-size and extra out-size, I think we are entitled to ask for the same promise of an investigation with the manufacturers and the trade in the case of out-sizes and extra out-sizes in women's underclothing.

Mr. Richard Fort (Clitheroe)

I should like to draw the attention of the Financial Secretary to the effect on manufacturing operations of having too low a D level for nightdresses, slips and ladies' knickers. As the D level now stands it would be possible to make these articles at prices below D level only if they were made of the cheapest locknit material. It will not be possible to make these goods tax free if they are made out of the pleasanter, nicer to handle, woven material or by the more recently developed tricot-knitting process.

There is no doubt that if some concession cannot be made on this D level the result will be to discriminate against woven material and the tricot-knitting process in favour of the much cheaper locknit material. I am sure the Financial Secretary will agree that the discouragement of higher quality goods is exactly what we want to avoid. The Douglas Committee in their recommendations set out to avoid that. Therefore, I ask the Financial Secretary to reconsider the D levels so as not to discriminate against higher quality fabrics in this field.

Mr. Boyd-Carpenter

I should be misleading the Committee if I sought to suggest that I was in any sense an expert on a large number of the articles which we are considering in connection with these Amendments, but I should like to reply to a number of the points that have been raised.

The hon. Lady the Member for Leeds, North-East (Miss Bacon) raised again in this debate the general question as to the relationship between the level of D and the old top Utility levels. As the hon. Lady is aware, that aspect of the matter has been fairly frequently discussed during these last few days. I know it is the view held on the other side of the Committee, and expressed with great vigour and pertinacity in the course of these debates, that D should in general be fixed at or above the top Utility level. It is equally the view of hon. Members on this side of the Committee that it is of the essence of the D scheme that D should be placed at the median point.

That is the issue of principle that is to some extent in controversy between us, and I doubt very much whether at this stage, and in answer to this particular debate, I can usefully add to the arguments that have been adduced on a good many occasions during the last few days on this general principle. I doubt very much whether, if I did, I should be able to convince the hon. Lady; any more, I am bound to tell her, than she has been able to convince me, in her agreeably expressed speech, that, on the general principle, she is right and I am wrong.

I should like to pass to another comment of hers which does affect, perhaps, more directly these Amendments. She said that hardly any concession had been made on the D levels during the course of the previous Amendments. That is perfectly true; but, of course, the reason for it relates straight back to the issue of policy, and, indeed, of principle, on which she and I differ. It relates straight back to the view we take that D should be calculated at the median point, and at which, we believe, it has been in fact so calculated. Naturally, therefore, unless it can be shown that the matter has been wrongly calculated—I find myself subject to peculiar competition tonight.

Mr. Ede

The hon. Gentleman must be careful not to speak too loudly lest he disturb the slumbers of the hon. Member for Galloway (Mr. McKie).

Mr. Boyd-Carpenter

I always try to have a sedative effect on the Committee, and it appears that tonight I am having more than usual success.

But that, of course, is the reason why we did not accept on principle the whole basis of the hon. Lady's argument, that the D should be fixed in accordance with the variety of considerations which she brought forward. We believe that it should be fixed on the basis which, on a number of occasions from this Box, has been explained as the median point, and it has not been any obduracy, or unwillingness on our part to be helpful, that in the majority of cases it has not been possible to accept the argument for altering D; but because it would be wholly inconsistent with the general policy which we are recommending to the Committee. I am sure the hon. Lady will understand that.

The hon. Lady the Member for the Gorbals Division (Mrs. Cullen) put a specific point, and she put forward an interesting suggestion. I am afraid the difficulty again is that she is there up against the general principles of the D scheme. I am very sympathetic to the particular case she had in mind, and were it possible to deal with it without wholly violating the general principles of the scheme one would be anxious to do it, but there are real difficulties, and for that reason I am unable to meet her point of view.

2.15 a.m.

My hon. Friend the Member for Altrincham and Sale (Mr. Erroll) raised what was to me a new point in connec- tion with the collars which were of the type normally worn by men, but, in fact, were worn by women. I think I understood his point aright. I do not claim that I can answer him on that point, but it will be on record in HANSARD.

I want in this connection to make one general comment. This enormously elaborate scheme covers, as the Committee is almost painfully aware at this hour of the morning, a very wide variety of articles. It is not the intention of the Government merely to put this scheme through in the Finance Bill and then cease to pay any attention to it. It will be necessary to pay the closest attention to the details so that it shall operate fairly and reasonably consistent with the general principles.

My hon. Friend's point will be on record in HANSARD and will be considered in the general consideration of the scheme. I do not want to mislead the Committee into believing that it will be possible to meet that specific point between now and the Report stage. It may well be that it will not be, but on the other hand it is useful to have on record in the speeches of hon. Members from both sides of the Committee the detailed points of criticism relating to the scheme, and none of the things that have been mentioned will be ignored. We do not propose to go to sleep over this matter, and my hon. Friend's point will be attended to.

Equally the same observations apply to my hon. Friend the Member for Clitheroe (Mr. Fort). I fully appreciate the force of the contention he made about the difficulty in the use of certain materials in the manufacture of the articles concerned, but I think my hon. Friend will appreciate that to make a separate provision would at the very best entail a greatly increased alteration in the scheme.

We are all anxious not to overload the scheme, particularly at the beginning, with too much detail and too much elaboration, and thereby to impose too heavy a burden upon the wholesalers and manufacturers in the trade who have to operate it. That is one of the reasons why we have not been able to break down the various categories into greater detail and into more separate items and units. It is desirable to keep this as simple as possible in order to make sure the scheme will work. My hon. Friend will appreciate that that is a very real difficulty in the early stages of a scheme like this. As I said in connection with the point raised by my hon. Friend the Member for Altrincham and Sale, the subject raised by my hon. Friend the Member for Clitheroe will help us in the detailed supervision of the scheme which will be necessary.

I think I have expressed our attitude towards this group of Amendments. We sympathise with the point of view put forward in a good many of them. We are helped certainly by the points of detail which have arisen in this discussion, and those points of detail will be given the attention which they deserve. They will be available in the OFFICIAL REPORT for us to consult, and they will undoubtedly be of help in the administration of the scheme, but it would be equally wrong at this stage of the Schedule, when a very large part of it has been approved by the Committee, to violate the general principles of the scheme, and thereby introduce complete inconsistency between the sort of provisions that we now have for men's outer wear and underclothes by bringing different considerations and principles into this part of the Schedule.

Mr. J. Edwards

The Financial Secretary began by assuring us that he was not an expert in this field. I suppose that anybody who has been at the Board of Trade must admit to being more familiar with the garments in this field than are ordinary persons.

Mr. Boyd-Carpenter

Not all of them.

Mr. Edwards

With most of them. Most of these items seemed to arise very many times during my experience of the Board of Trade. However, as I listened to the hon. Gentleman I did not feel that he was coming to grips with the detailed points that had been put to him. I felt that he was not taking the points seriatim and really dealing with them. On only one of them was he really precise in an undertaking.

All the arguments go back to the two points, the level of D and the classifications that we are to use. I cannot understand how the D figures can be fixed in this group. If the hon. Gentleman understood, then he has not taken us completely into his confidence. If he insists that the figures are median, that is not only contrary to the experience of ordinary people like ourselves—in this field I speak as one who has two daughters as well as a wife—but I have also to find anybody in the trade who would agree that they are median figures.

I challenge the Government. If what I am saying is incorrect, they had better produce their evidence. In a debate on textiles when we sat all night I referred to an acquaintance of mine, a manufacturer of women's rayon underwear, who had told me that under the new arrangements he would not be able to make a set of women's underwear of the kind that he would regard as really suitable to put on the market, unless it bore tax. Previously he had been able to make sets of underwear of good quality which were free of tax. That is the opinion of an expert.

If that is so, there is something wrong about the notion of the median price having been fixed. If we took all the items in the group we should find that the median would not be the figures given here. In any event, whether we take the median or not, the truth is that fixing the level of D in this way means that a number of articles which were previously free of tax now bear tax.

If I may digress one moment to refer back to what was said a little while ago about furs, the Financial Secretary was then quick to appreciate the significance of the D scheme when it applied to articles that were expensive. Taking it in its extreme case, the argument we had presented he himself put back to us. So I beg him to think again about this.

The Government have had plenty of time in which to take the advice of the trade fully into account. They either have not consulted the trade or not taken their views into account. There has been plenty of time since the Schedule was printed six or seven weeks ago for the Government to have worked out with the trade both the classifications and the D level, and I charge the Government with not having done what they could have done quite readily.

The Amendments hon. Members have put down were not just thought up by them in isolation. They all followed con- sultations and talks with people in the trade, and if what the private enterprise of private Members could do results in this list of Amendments, the Government with all their resources could have made a proper job of this had they wanted. It is all very well to say, as the Chancellor did, that they must take into account all what is said in the Committee. That is so, but I am sure they did not deliberately leave a lot of things here they could consider at various stages. The truth is that they have done a slipshod job of work, and the sooner they get down to the job with the trade on the level of D and the actual classifications in use the better. I am sure both sides of the Committee feel in this particular group that the reply of the Financial Secretary is wholly inadequate.

Mrs. Braddock

Could I once again make a request to the Financial Secretary with regard to outsizes? He made no reply whatever to it. I kept my comments very short, and I could have spoken at greater length on the Amendments, and the reasons why a higher figure is required for outsizes and extra outsizes. Will my comments be looked at carefully by the hon. Gentleman to see what arrangements can be made?

Mr. Boyd-Carpenter

I am sorry the hon. Lady feels that I ought to have replied specifically to what she said on these Amendments about outsizes, but she will recall that we had a discussion on that a short time ago, and that during the course of that discussion I gave a specific assurance, which I am perfectly willing to repeat, that this matter is being looked into with the intention of making special provision, if it is reasonably practical so to do. I am very happy to repeat that assurance.

Miss Bacon

I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Amendment proposed: In page 77, line 7, leave out "8 6 per article," and insert:

per article
(i) women's 15 1
(ii) outsize 16 0
(iii) extra outsize 17 4
—[Mr. J. Edwards.]

Question put, "That 8 6 per article' stand part of the Schedule."

The Committee divided: Ayes, 205; Noes, 188.

Division No.130.] AYES 2.31 a.m.
Aitken, W. T. Gage, C. H. Nield, Basil (Chester)
Allan, R. A. (Paddington, S.) Galbraith, T. O. D. (Hillhead) Noble, Cmdr. A. H. P
Alport, C. J. M. Garner-Evans, E. H Nugent, G. R. H
Amory, Heathcoat (Tiverton) Godber, J. B. Odey, G. W.
Anstruther-Gray, Major W. J. Gomme-Duncan, Col. A Ormsby-Gore, Hon. W.D
Arbuthnot, John Gough, C.F.H. Orr, Capt. L.P.S
Ashton, H. (Chelmsford) Gower, H.R. Orr-Ewing, Charles Ian (Hendon, N.)
Asheton, Rt. Hon. R. (Blackburn, W.) Graham, Sir Fergus Perkins, W.R.D.
Astor, Hon. J.J.(Plymouth, Sutton) Grimston, Hon. John (St. Albans) Peto, Brig. C.H.M
Astor, Hon. W.W. (Bucks, Wycombe) Grimston, Sir Robert (Weslbury) Peyton, J.W.W
Baker, P.A.D. Harris, Frederic (Croydon, N.) Pilkington, Capt. R A
Baldock, Lt.-Cmdr. J M Harrison, Col. J.H. (Eye) Pitman, I. J
Baldwin, A E. Harvey, Ian (Harrow, E.) Powell, J. Enoch
Banks, Col. C. Hay, John Price, Henry (Lewisham, W.)
Barlow, Sir John Heath, Edward Prior-Palmer, Brig. O.L
Baxter, A.B. Higgs, J.M.C. Profumo, J.D
Beamish, Maj. Tufton Hill, Dr. Charles (Luton) Raikes, H.V.
Beach, Maj. Hicks Hill, Mrs. E. (Wythonshawe) Rayner, Brig. R.
Bell, Philip (Bolton, E.) Hinchingbrooke, Viscount Redmayne, M
Bell, Ronald (Bucks, S.) Hirst, Geoffrey Remnant, Hon. P.
Bennett, Sir Peter (Edgbaston) Holland-Martin, C. J Renton, D. L. M.
Bennett, Dr. Reginald (Gosport) Hollis, M. C. Roberts, Peter (Heeley)
Bennett, William (Woodside) Hope, Lord John Robinson, Roland (Blackpool, S.)
Birch, Nigel Hopkinson, Henry Rodgers, John (Seveneaks)
Bishop, F.P. Horobin, I.M. Roper, Sir Harold
Black, C.W. Howard, Gerald (Cambridgeshire) Ropner, Col. Sir Leonard
Bossom, A.C. Howard, Greville (St. Ives) Russell R.S.
Boyd-Carpenter, J.A Hudson, Sir Austin (Lewisham, N.) Ryder, Capt. R. E. D.
Boyle, Sir Edward Hudson, W.R.A. (Hull, N.) Salter, Rt. Hon. Sir Arthur
Braine, B. R. Hurd, A. R. Schofield, Lt.-Col. W. (Rochdale)
Braithwaite, Sir Albert (Harrow, W.) Hutchison Sir Geoffrey (IIford, N.) Scott, R. Donald
Bromley-Davenport, Lt.-Col. W. H. Hutchison, Lt.-Com. Clark (Ebrgh, W.) Shepherd, William
Brooman-White, R. C. Hyde, Lt.-Col. H. M. Simon, J. E. S. (Middlesbrough, W.)
Browne, Jack (Govan) Jenkins, R.C.D. (Dulwich) Smiles, Lt.-Col. Sir Walter
Buchan-Hepburn, Rt. Hon. P.G T Johnson, Eric (Blackley) Spearman, A.C.M
Bullard, D.G. Jones, A. (Hall Green) Speir, R.M.
Bullock, Capt. M. Joynson-Hicks, Hon. L.W Stanley, Capt. Hon. Richard
Bullus, Wing Commander E. E Kaberry, D. Stevens, G.P.
Burden, F.F.A. Keeling, Sir Edward Steward, W.A. (Woolwich, W.)
Butcher, H.W. Kerr, H.W. (Cambridge) Stauss, Henry (Norwich, S.)
Butler, Rt. Hon. R.A. (Saffron Walden) Lambert, Hon. G. Summers, G.S.
Carr, Robert (Mitcham) Lambton, Viscount Sutcliffe, H.
Cary, Robert (Mitcham) Law, Rt. Hon. R.K Taylor, Charles (Eastbourne)
Clarke, Col. Ralph (East Grinstead) Leather, E.H.C. Taylor, William (Bradford, N.)
Clarke, Brig. Terence (Portsmouth, W.) Legge-Bourke, Maj. E.A.H. Teeling, W.
Cole, Norman Legh, P.R. (Petersfield) Thompson, Lt.-Cdr R. (Croydon, W.)
Conant, Maj. R.J.E. Lindsay, Martin Thornton-Kemsley, Col. C.N.
Craddock, Beresford (Spelthorne) Linstead, H.N. Tilney, John
Crookshank, Capt. Rt. Hon. H.F.C. Lloyd, Maj. Guy (Renfrew, E) Turner, H.F.L.
Crosthwaite-Eyre, Col. O.E. Longden, Gilbert (Herts, S.W.) Turton, R.H.
Cuthbert, W.N. Lucas, Sir Jocelyn (Portsmouth, S.) Tweedsmuir, Lady
Darling, Sir William (Edinburgh, S.) Lucas, P.B. (Brentford) Vane, W.M.F.
Deedes, W.F. Lucas-Tooth, Sir Hugh Vaughan-Morgan, J.K
Digby, S. Wingfield Macdonald, Sir Peter (I. of Wight) Vosper, D.F.
Donaldson, Cmdr. C.E. McA. Mackeson, Brig. H.R. Wakefield, Edward (Derbyshire, W.)
Donner, P.W. McKibbin, A.J. Wakefield, Sir Wavell (Marylebone)
Doughty, C.J.A McKie, J.H. (Galloway) Walker-Smith, D.C.
Douglas-Hamilton, Lord Malcolm Maclean, Fitzroy Ward. Hon George (Worcester)
Drayson, G.B. Macleod, Rt. Hon. Iain (Enfield, W.) Waterhouse, Capt. Rt. Hon. C.
Drewe, C. MacLeod, John (Ross and Cromarty) Webbe, Sir H. (London & Westminster)
Duncan, Capt. J.A.L Macpherson, Maj. Niall (Dumfries) Wellwood, W.
Erroll, F.J. Marshall, Sidney (Sutton) White, Baker (Canterbury)
Fell, A. Maude, Angus Williams, Gerald (Tonbridge)
Finlay, Graeme Maydon, Lt.-Comdr S.L.C Williams, R. Dudley (Exeter)
Fleetwood-Hesketh, R.F. Molson, A.H.E. Wilson, Geoffrey (Truro)
Fletcher-Cooke, C. Morrison, John (Salisbury) Wood, Hon. R.
Fort, R. Mott-Radclyffe, C.E.
Fraser, Hon. Hugh (Stone) Nabarro, G.D.N. TELLERS FOR THE AYES:
Fraser, Sir Ian (Morecambe & Lonsdale) Nicolson, Nigel (Bournemouth, E.) Mr. Studholme and Mr. Oaksbott.
NOES
Acland, Sir Richard Benn, Wedgwood Blyton, W.R.
Adams, Richard Benson, G. Boardman, H.
Albu, A.H. Beswick, F. Bottomley, Rt. Hon. A.G.
Allen, Scholefield (Crewe) Bevan, Rt. Hon. A. (Ebbw Vale) Bewden, H.W.
Anderson, Alexander (Motherwell) Bing, G.H.C. Braddock, Mrs. Elizabeth
Bacon, Miss Alics Blackburn, F. Brockway, A.F.
Barnes, Rt. Hon. A.J. Blenkinsop, A. Brook, Dryden (Halifax)
Brown, Rt. Hon. George (Belper) Houghton, Douglas Porter, G.
Burke, W.A Hoy, J.H. Price, Philips (Gloucestershire, W.)
Burton, Miss F. E. Hughes, Cledwyn (Anglesey) Proctor, W. T.
Butler, Herbert (Hackney, S.) Hughes, Emrys (S. Ayrshire) Pryde, D. J.
Callaghan, L. J. Huges, Hector (Aberdeen, N.) Rankin, John
Carmichael, J. Hynd, H. (Accrington) Reeves, J.
Champion, A. J. Hynd, J. B. (Attercliffe) Rhodes, H.
Chapman, W. D. Irving, W. J. (Wood Green) Robens, Rt. Hon. A.
Chetwynd, G. R. Janner, B. Roberts, Albert (Normanton)
Clunie, J. Jay, Rt. Hon. D. P. T. Roberts, Goronwy (Caernarvonshire)
Cocks, F. S. Jeger, George (Goole) Ross, William
Coldrick, W. Jenkins, R. H. (Stechford) Royle, C.
Collick, P. H. Johnson, James (Rugby) Schofield, S. (Barnsley)
Cook, T. F. Jones, David (Hartlepool) Shackleton, E. A. A
Corbet, Mrs. Freda Jones, Frederick Elwyn (West Ham, S.) Shawcross, Rt. Hon. Sir Hartley
Crosland, C. A. R. Jones, Jack (Rotherham) Short, E. W.
Cullen, Mrs. A Jones, T. W. (Merioneth) Shurmer, P. L. E.
Dalton, Rt. Hon. H. Keenan, W. Silverman, Julius (Erdington)
Davies, Ernest (Enfield, E.) Kenyon, C. Simmons, C. J. (Brierley Hill)
Davies, Harold (Leek) King, Dr. H. M. Slater, J.
Deer, G. Lee, Frederick (Newton) Snow, J. W.
Delargy, H. J. Lee, Miss Jennie (Cannock) Sorensen, R W
Dodds, N. N. Lever, Harold (Cheatham) Steele, T.
Driberg, T. E. N. Lever, Leslie (Ardwick) Stewart, Michael (Fulham, E.)
Dugdale, Rt. Hon. John (W. Bromwich) Lewis, Arthur Stokes, Rt. Hon. R.R.
Ede, Rt. Hon. J. C. Lindgren, G. S. Strauss, Rt. Hon. George (Vauxhall)
Edelman, M. MacColl, J E. Swingler, S. T.
Edwards, John (Brighouse) McGovern, J. Sylvester, G. O.
Edwards, Rt. Hon. Ness (Caerphilly) McInnes, J. Taylor, John (West Lothian)
Edwards, W. J. (Stepney) McKay, John (Wallsend) Taylor, Rt. Hon. Robert (Morpeth)
Evans, Stanley (Wednesbury) McLeavy, F. Thomas, David (Aberdare)
Fernyhough, E. MacMillan, M. K. (Western Isles) Timmons, J.
Field, W. J. McNeil, Rt. Hon. H. Tomney, F.
Fienburgh, W. MacPherson, Malcolm (Stirling) Ungoed-Thomas, Sir Lynn
Finch, H. J. Mainwaring, W. H. Watkins, T. E.
Fletcher, Eric (Islington, E.) Mallalieu, J. P. W. (Huddersfield, E.) Weitzman, D.
Follick, M. Mann, Mrs. Jean Welts, Percy (Faversham)
Foot, M. M. Manuel, A. C. Wells, William (Walsall)
Forman, J. C. Marquand, Rt. Hon. H. A. West, D. G.
Fraser, Thomas (Hamilton) Mayhew, C. P. White, Mrs. Eirene (E. Flint)
Freeman, John (Watford) Mellish, R. J. White, Henry (Derbyshire, N.E.)
Freeman, Peter (Newport) Monslow, W. Whiteley, Rt. Hon. W
Glanville, James Moody, A. S. Wigg, George
Greenwood, Anthony (Rossendale) Morley, R. Willey, Frederick (Sunderland, N.)
Grey, C. F. Moyle, A. Willey, Octavius (Cleveland)
Griffiths, David (Rather Valley) Mulley, F. W. Williams, Ronald (Wigan)
Grimond, J. Murray, J. D. Wilson, Rt. Hon. Harold (Huyton)
Hale, Leslie (Oldham, W.) Neal, Harold (Bolsover) Winterbottom, Ian (Nottingham, C.)
Hall, Rt. Hon. Glenvil (Calne Valley) O'Brien, T. Winterbottom, Richard (Brightside)
Hall, John (Gateshead, W.) Orbach, M. Woodburn, Rt. Hon. A
Hamilton, W. W Oswald, T. Wyatt, W. L.
Hannan, W. Padley, W. E. Yates, V. F.
Henderson. Rt. Hon. A. (Rowley Regis) Paling, Will T. (Dewsbury) Younger, Rt. Hon. K.
Herbison, Miss M Paton, J.
Hewitson, Capt. M. Pearson, A. TELLERS FOR THE NOES:
Hobson, C. R. Peart, T. F. Mr. Wilkins and Mr. Holmes
Holman, P. Plummer, Sir Leslie

Amendment proposed: In page 77, line 14, leave out "4 0 per article," and insert:

per article
(i) women's 6 11
(ii) outsize 8 3
(iii) extra outsize 9 7
—[Mr. Anthony Greenwood.]

Question put, "That '4 0 per article' stand part of the Schedule."

The Committee divided: Ayes, 205; Noes, 188.

Division No.131.] AYES [2.40 a.m.
Aitken, W. T. Barlow, Sir John Boyle, Sir Edward
Allan, R.A. (Paddington, S) Baxter, A.B. Braine, B.R.
Aiport, C.J.M. Beach, Maj. Hicks Braithwaite, Sir Albert (Harrow, W.)
Amory, Heathcoat (Tiverton) Beamish, Maj. Tufton Bromley-Davenport, Lt.-Col. W.H.
Anstruther-Gray, Maj W.J Bell, Philip (Bolton, E.) Brooman-White, R.C.
Arbuthnot, John Bell, Ronald (Bucks, S.) Browne, Jack (Govan)
Ashton, H. (Chelmsford) Bennett, Sir Peter (Edgbaston) Buchan-Hepburn, Rt. Hon. P.G.T.
Assheton, Rt. Hon R. (Blackburn, W.) Bennett, Dr. Reginald (Gosport) Bullard, D.G.
Astor, Hon. J.J. (Plymouth, Sutton) Bennett, William (Woodside) Bullock, Capt. M.
Astor, Hon. W.W. (Bucks, Wycombe) Birch, Nigel Bullus, Wing-Commander E.E.
Baker, P.A.D Bishop, F.P. Burden, F.F.A
Baldock, Lt.-Cmdr. J.M Black, C.W. Butcher, H.W.
Baldwin, A.E. Bossom, A.C. Butler, Rt. Hon. R.A. (Saffron Waldon)
Banks, Col. C. Boyd-Carpenter, J.A. Carr, Robert (Mitcham)
Cary, Sir Robert Hurd, A. R. Rayner, Brig. R.
Clarke, Col. Ralph (East Grinstead) Hutchinson, Sir Geoffrey (IIford, N.) Redmayne, M.
Clarke, Brig. Terence (Portsmouth, W.) Hutchison, Lt.-Com. Clark (E'b'rgh W.) Remnant, Hon. P
Cole, Norman Hyde, Lt.-Col. H. M. Renton, D. L. M.
Conant, Maj. R. J. E. Jenkins, R. C. D. (Dulwich) Roberts, Peter (Heeley)
Craddock, Beresford (Spelthorne) Johnson, Eric (Blackley) Robinson, Roland (Blackpool, S.)
Crookshank, Capt. Rt. Hon. H. F. C. Jones, A. (Hall Green) Rodgers, John (Sevenoaks)
Crosthwaite-Eyre, Col. O. E. Joynson-Hicks, Hon. L. W. Roper, Sir Harold
Cuthbert, W. N. Kaberry, D. Ropner, Col. Sir Leonard
Darling, Sir William (Edinburgh, S.) Keeling, Sir Edward Russell, R. S.
Deedes, W. F. Kerr, H. W. (Cambridge) Ryder, Capt. R. E. D.
Digby, S. Wingfield Lambert, Hon. G. Salter, Rt. Hon. Sir Arthur
Donaldson, Cmdr. C. E. McA. Lambton, Viscount Schofield, Lt.-Col. W. (Rochdale)
Donner, P. W. Law, Rt. Hon. R K. Scott, R. Donald
Doughty, C. J. A. Leather, E. H. C. Shepherd, William
Douglas-Hamilton, Lord Malcolm Legge-Bourke, Maj. E. A. H. Simon, J. E. S. (Middlesbrough, W.)
Drayson, G. B. Legh, P. R. (Petersfield) Smiles, Lt.-Col, Sir Walter
Drewe, C. Lindsay, Martin Spearman, A. C. M.
Duncan, Capt. J. A L. Linstead, H. N. Span, R. M.
Erroll, F. J. Lloyd, Maj. Guy (Renfrew, E.) Stanley, Capt. Hon, Richard
Fell, A. Longden, Gilbert (Harts, S.W.) Stevens, G. P.
Finlay, Graeme Lucas, Sir Jocelyn (Portsmouth, S.) Steward, W. A. (Woolwich, W.)
Fleetwood-Hesketh, R. F. Lucas, P. B. (Brentford) Stewart, Henderson (Fife, E.)
Fletcher-Cooke, C. Lucas-Tooth, Sir Hugh Strauss, Henry (Norwich, S.)
Fort, R. Macdonald, Sir Peter (I. of Wight) Studholme, H. G
Fraser, Hon. Hugh (Stone) McKie, J. H. (Galloway) Summers, G. S.
Gage, C. H Maclean, Fitzroy Sutcliffe, H.
Galbraith, T. G. D. (Hillhead) MacLeod, Rt. Hon. lain (Enfield, W.) Taylor, Charles (Eastbourne)
Garner-Evans, E. H MacLeod, John (Ross and Cromarty) Taylor, William (Bradford, N.)
Godber, J. B. Macpherson, Maj. Niall (Dumfries) Tenting, W.
Gomme-Duncan, Col. A. Marshall, Sidney (Sutton) Thompson, Lt.-Cdr. R. (Croydon, W.)
Gough, C. F. H. Maude, Angus Thornton-Kemsley, Col. C. N
Gower, H. R. Maydon, Lt.-Comdr. S. L. C. Tilney John
Graham, Sir Fergus Molson, A. H. E. Turner, H. F. L.
Grimston, Hon. John (St. Albans) Morrison, John (Salisbury) Turton, R. H.
Grimston, Sir Robert (Westbury) Mott-Radelyffe, C. E. Tweedsmuir, Lady
Harris, Frederic (Croydon, N.) Nabarro, G. D. N. Vane, W. M. F.
Harrison, Col. J.H. (Eye) Nicolson, Nigel (Bournemouth, E.) Vaughan-Morgan, J. K
Harvey, Ian (Harrow, E.) Nield, Basil (Chester) Vosper, D. F.
Hay, John Noble, Cmdr. A. H. P. Wakefield, Edward (Derbyshire, W.)
Heath, Edward Nugent, G. R. H Wakefield, Sir Wavell (Marylebone)
Higgs, J. M. C. Odey, G. W. Walker-Smith, D. C.
Hill, Dr. Charles (Luton) Ormsby-Gore, Hon. W. D. Ward, Miss I. (Tynemouth)
Hill, Mrs. E. (Wythenshawe) Orr, Capt. L. P. S. Waterhouse, Capt. Rt. Hon. C.
Hinchingbrooke, Viscount Orr-Ewing, Charles tan (Hendon, N.) Webbe, Sir H. (London & Westminster)
Hirst, Geoffrey Perkins, W R. D. Wellwood, W.
Holland-Martin, C. J. Peto, Brig. C. H. M. White, Baker (Canterbury)
Hollis, M. C. Peyton, J. W. W. Williams, Gerald (Tonbridge)
Hope, Lord John Pilkington, Capt. R. A. Williams, R. Dudley (Exeter)
Hopkinson, Henry Pitman, I. J. Wilson, Geoffrey (Truro)
Horobin, I. M. Powell, J. Enoch Wood, Hon. R.
Howard, Gerald (Cambridgeshire) Price, Henry (Lewisham, W.)
Howard, Greville (St. Ives) Prior-Palmer, Brig. O. L. TELLERS FOR THE AYES:
Hudson, Sir Austin (Lewisham, N.) Profumo, J. D. Brigadier Mackeson and Mr. Oakshott
Hudson, W. R. A. (Hull, N.) Raikes, H. V.
NOES
Acland, Sir Richard Carmichael, J. Fernyhough, E.
Adams, Richard Champion, A.J. Field, W.J.
Albu, A.H. Champman, W.D. Fienburgh, W.
Allen, Scholefield (Crewe) Chetwynd, G.R. Finch, H.J.
Anderson, Alexander (Motherwell) Clunie J. Fletcher, Eric (Islington, E.)
Bacon, Miss Alice Cocks, F.S. Follick, M.
Barnes, Rt. Hon. A.J Coldrick W. Foot, M. M.
Benn, Wedgwood Collick, P.H. Forman, J.C.
Benson, G. Cook, T.F. Fraser, Thomas (Hamilton)
Beswick, F Cook, T.F. Freeman, John (Watford)
Bevan, Rt. Hon. A. (Ebbw Vale) Corbet, Mrs. Freda Freeman, Peter (Newport)
Bing, G.H.C. Crosland, C.A.R. Glanville, James
Blackburn, F. Cullen, Mrs. A. Greenwood, Anthony (Rossendale)
Blenkinsop, A. Dalton, Rt. Hon. H. Grey, C.F.
Blyton, W.R. Davies, Ernest (Enfield, E.) Griffiths, David (Rother Valley)
Boardman, H. Davies, Harold (Leek) Grimond, J.
Bottomley, Rt. Hon. A.G. Deer, G. Hale, Leslie (Oldham, W.)
Bowden, H.W. Driberg, T.E.N. Hall, Rt. Hon. Glenvil (Colne Valley)
Braddock, Mrs. Elizabeth Dugdale, Rt. Hon John (W. Bromwich) Hall, John (Gateshead, W.)
Brockway, A.F. Ede, Rt. Hon. J.C. Hamilton, W.W.
Brook Dryden (Halifax) Edelman, M. Hannan, W.
Brown, Rt Hon. George (Belper) Edwards, John (Brighouse) Henderson, Rt. Hon. A. (Rowley Regis)
Burke, W.A. Edwards, Rt. Hon. Ness (Caerphilly) Herbison, Miss M.
Burton, Miss F.E. Edwards, W. J. (Stepney) Hewitson, Capt. M
Butler, Herbert (Hackney, S) Evans, Stanley (Wednesbury) Hobson, C.R.
Callaghan, L.J. Holman, P.
Holmes, Horace (Hemsworth) Manuel, A. C. Slater, J.
Houghton, Douglas Marquand, Rt. Hon. H. A. Snow, J. W
Hoy, J. H. Mayhew, C. P. Sorensen, R. W.
Hughes, Cledwyn (Anglesey) Mellish, R. J. Steele, T.
Hughes, Emrys (S. Ayrshire) Monslow, W. Stewart, Michael (Fulham, E.)
Hughes, Hector (Aberdeen, N.) Moody, A. S. Stokes, Rt. Hon. R. R.
Hynd, H. (Accrington) Morley, R. Strauss, Rt. Hon. George (Vauxhall)
Hynd, J. B. (Altercliffe) Moyle, A. Swingler, S. T.
Irving, W. J. (Wood Green) Mulley, F. W. Sylvester, G. O.
Janner, B. Murray, J. D. Taylor, John (West Lothian)
Jay, Rt. Hon. D. P. T Neal, Harold (Bolsover) Taylor, Rt. Hon. Robert (Morpeth)
Jeger, George (Goole) O'Brien, T. Thomas, David (Aberdare)
Jenkins, R. H. (Stechford) Orbach, M. Timmons, J.
Johnson, James (Rugby) Oswald, T. Tomney, F.
Jones, David (Hartlepool) Padley, W. E. Ungoed-Thomas, Sir Lynn
Jones, Frederick Elwyn (West Ham, S) Paling, Will T. (Dewsbury) Watkins, T. E.
Jones, Jack (Rotherham) Paton, J. Weitzman, D.
Jones, T. W. (Merioneth) Pearson, A. Wells, Percy (Faversham)
Keenan, W. Pearl, T. F. Wells, William (Walsall)
Kenyon, C. Plummer, Sir Leslie West, D. G.
King, Dr. H. M. Porter, G. White, Mrs. Eirene (E. Flint)
Lee, Frederick (Newton) Price, Philips (Gloucestershire, W.) White, Henry (Derbyshire, N.E.)
Les, Miss Jennie (Cannock) Proctor, W. T. Whiteley, Rt. Hon. W.
Lever, Harold (Cheetham) Pryde, D. J. Wilkins, W. A.
Lever, Leslie (Ardwick) Rankin, John Willey, Frederick (Sunderland, N.)
Lewis, Arthur Reeves, J. Willey, Octaviva (Cleveland)
Lindgren, G. S. Rhodes, H. Williams, Ronald (Wigan)
MacColl, J. E. Robens, Rt. Hon. A Wilson, Rt. Hon. Harold (Huyton)
McGovern, J. Roberts, Albert (Normanton) Winterbottom, Ian (Nottingham, C.)
McInness, J. Roberts, Goranwy (Caernarvonshire) Winterbottorn, Richard (Brightside)
McKay, John (Wallsend) Ross, William Woodburn, Rt. Hon. A
McLeavy, F. Schofield, S. (Barnsley) Wyatt, W. L.
MacMillan, M. K. (Western Isles) Shackleton, E. A A. Yates, V. F.
McNeil, Rt. Hon. H. Shawcross, Rt. Hon. Sir Hartley Younger, Rt. Hon. K.
MacPherson, Malcolm (Stirling) Short, E. W.
Mainwaring, W. H. Shurmer, P. L. E. TELLERS FOR THE NOES:
Mallalieu, J. P. W. (Huddersfield, E.) Silverman, Julius (Erdington) Mr. Royle and Mr. Wigg.
Mann, Mrs. Jean Simmons, C. J (Brierley Hill)

Amendment proposed: In page 77, line 38, leave out "3 0 0," and insert "4 10 0."—[Mr. Anthony Greenwood.]

Question put, "That '3 0 0' stand part of the Schedule."

The Committee divided: Ayes, 207; Noes, 187.

Division No.132.] AYES 2.49 a.m.
Aitken, W.T. Burden, F.F.A Gower, H.R.
Allan, R.A. (Paddington, S.) Butcher, H.W. Graham, Sir Fergus
Alport, C.J.M. Butler, Rt. Hon. R.A. (Saffron Walden) Grimond, J.
Amory, Heathcoat (Tiverton) Carr, Robert (Mitcham) Grimston, Hon. John (St. Albans)
Anstruther-Gray, Major W.J. Cary, Sir Robert Grimston, Sir Robert (Westbury)
Arbuthnot, John Clarke, Col. Ralph (East Grinstead) Harris, Frederic (Croydon, N.)
Ashton, H. (Chelmsford) Clarke, Brig. Terence (Portsmouth, W.) Harrison, Col. J.H. (Eye)
Assheton, Rt. Hon. R. (Blackburn, W.) Cole, Norman Harvey, Ian (Harrow, E.)
Astor, Hon J.J. (Plymouth, Sutton) Conant, Maj. R.J.E. Hay, John
Astor, Hon. W.W. (Bucks, Wycombe) Craddock, Beresford (Spelthorne) Heath, Edward
Baker, P.A.D. Cranborne, Viscount Higgs, J.M.C.
Baldock, Lt.-Cmdr. J.M. Crookshank, Capt. Rt. Hon. H.F.C. Hill, Dr. Charles (Luton)
Baldwin, A.E. Crosthwaite-Eyre, Col. O.E. Hill Mr. E. (Wythenshawe)
Banks, Col. C. Cuthbert, W.N. Hinchingbrooke, Viscount
Barlow, Sir John Darling, Sir William (Edinburgh, S.) Hirst, Geoffrey
Baxter, A.B. Deedes, W.F. Holland-Martin, C.J.
Beach, Maj. Hicks Digby, S. Wingfield Hollis, M.C.
Beamish, Maj. Tufton Donaldson, Cmdr. C.E. McA. Hope, Lord John
Bell, Philip (Bolton, E.) Denner, P.W. Hopkinson, Henry
Bell, Ronald (Bucks, S.) Doughty, C.J.A. Horobin, I.M.
Bennett, Sir Peter (Edgbaston) Douglas-Hamilton, Lord Malcolm Howard, Gerald (Cambridgeshire)
Bennett, Dr. Reginald (Gosport) Drayson, G.B. Howard, Greville (St. Ives)
Bennett, William (Woodside) Drewe, C. Hudson, Sir Austin (Lewisham, N.)
Birch, Nigel Duncan, Capt. J.A.L Hudson, W R.A. (Hull, N.)
Bishop, F.P. Erroll, F.J. Hurd, A.R.
Black, C.W. Fell, A. Hutchinson, Sir Geoffrey (IIford, N.)
Bossom, A.C. Finlay, Graeme Hutchison, Lt.-Com, Clark (E'b'rgh W.)
Boyd-Carpenter, J.A. Fleetwood-Hesketh, R.F Hyde, Lt.-Col. H.M.
Boyle, Sir Edward Fletcher-Cooke, C. Jenkins, R.C.D. (Dulwich)
Braine, B.R. Fort, R. Johnson, Eric (Blackley)
Braithwaite, Sir Albert (Harrow, W.) Fraser, Hon. Hugh (Stone) Jones, A. (Hall Green)
Bromley-Davenport, Lt.-Col. W.H.) Fraser, Sir Ian (Morecambs & Lonsdale) Joynson-Hicks, Hon. L.W.
Brooman-White, R.C. Gage, C.H. Kaberry, D.
Browne, Jack (Govan) Galbraith, T.G.D.(Hillhead) Keeling, Sir Edward
Buchan-Hepburn, Rt. Hon. P.G.T Garner-Evans, E.H. Kerr, H.W. (Cambridge)
Bullard, D.G. Godher, J.B. Lambert, Hon. G.
Bullock, Capt. M. Gomme-Duncan, Col. A. Lambton, Viscount
Bullus, Wing-Commander E.E. Gough, C.F.H. Law, Rt. Hon. R K
Leather, E.H.C. Ormsby-Gore, Hon. W.D Stevens, G. P.
Legge-Bourke, Maj. E.A.H Orr, Capt. L. P. S. Steward, W.A. (Woolwich, W)
Legh, P.R. (Petersfield) Orr-Ewing, Charles Ian (Hendon, N) Steward, Henderson (Fife, E.)
Lindsay, Martin Perkins, W.R.D. Strauss, Henry (Norwich, S.)
Linstead, H.N. Peto, Brig. C.H.M. Summers, G.S
Lloyd, Maj. Guy (Renfrew, E.) Peyton, J W.W. Sutcliffe, H.
Longden, Gilbert (Herts, S.W.) Pilkington, Capt R A Taylor, Charles (Eastbourne)
Lucas, Sir Jocelyn (Portsmouth, S.) Pitman, I.J. Taylor, William (Bradford, N.)
Lucas, P. B. (Brentford) Powell, J. Enoch Teeling, W.
Lucas-Tooth, Sri Hugh Price, Henry (Lewisham, W) Thompson, Lt.-Cdr. R (Croydon, W)
McAdden, S.J. Prior-Palmer, Brig O L Thornton-Kemsley, Col C N
Macdonald, Sir Peter (I of Wight) Profumo, J.D. Tilney, John
Mackeson, Brig. H R Raikes, H. V. Turner, H.F.L
McKibbin, A.J. Rayner, Brig. R Turton, R.H.
McKie, J.H. (Galloway) Remnant, Hon. P Tweedsmuir, Lady
Maclean, Fitzroy Renton, D.L.M. Vane, W.M.F.
Macleod Iain (Enfield W.) Roberts, Peter (Heely) Vaughan-Morgan. J K
MacLeod, John (Ross and Cromarty) Robinson, Roland (Blackpool, S.) Vosper, D.F.
Macpherson, Maj. Niall (Dumfries) Rodgers, John (Sevenoaks) Wakefield, Sir Wavell (Marylebone)
Roper, Sir Harold
Maude, Angus Ropner, Col. Sir Leonard Walker-Smith, D.C.
Maydon, Lt.-Cmdr. S L.C. Russell, R.S. Ward, Miss I. (Tynemouth)
Molson, A.H.E. Ryder, Capt. R.E.D. Waterhouse, Capt. Rt. Hon. C.
Morrison, John (Salisbury) Salter, Rt. Hon. Sir Arthur Webbe, Sir H. (London & Westminster)
Mott-Radclyffe, C.E. Schofield, Lt.-Col. W. (Rochdale) Wellwood, W.
Nabarro, G.D.N. Scott, R. Donald White, Baker (Canterbury)
Nicolson, Nigel (Bournemouth, E.) Shepherd, William Williams, Gerald (Tonbridge)
Nield, Basil (Chester) Simon, J.E.S. (Middlesbrough, W) Williams, R Dudley (Exeter)
Noble, Cmdr. A.H.P. Smiles, Lt.-Col. Sir Walter Wilson, Geoffrey (Truro)
Nugent, G.R.H Spearman, A.C.M. Wood, Hon. R
Oakshott, H. D Speir, R M
Odey, G W Stanley, Capt. Hon. Richard TELLERS FOR THE AYES:
Mr. Studholme and Mr. Redmayne.
NOES
Acland, Sir Richard Edwards, W. J. (Stepney) Lever, Leslie (Ardwick)
Adams, Richard Evans, Stanley (Wednesbury) Lewis, Arthur
Albu, A.H Fernyhough, E. Lindgren, G.S.
Allen, Scholefield (Crewe) Field, W.J. MacColl, J.E.
Anderson, Alexander (Motherwell) Fienburgh, W. McGovern, J.
Bacon, Miss Alice Finch, H. J. Mclnness, J.
Barnes, Rt. Hon. A.J Fletcher, Eric (Islington, E.) MckKay, John (Wallsend)
Benn, Wedgwood Follick, M McLeavy, F.
Benson, G. Foot, M. M. MacMillan, M. K. (Western Isles)
Beswick, F. Forman, J.C. McNeil, Rt. Hon. H.
Bevan, Rt. Hon A (Ebbw Vale) Fraser, Thomas (Hamilton) MacPherson, Malcolm (Stirling)
Bing, G. H. C. Freeman, John (Watford) Mainwairing, W. H.
Blackburn, F. Freeman, Peter (Newport) Mallalieu, J.P.W. (Huddersfield, E.)
Blenkinsop, A. Glanvile, James Mann, Mrs. Jean
Blyton, W. R. Greenwood, Anthony (Rossendale) Manuel, A. C.
Boardman, H. Grey, C. F. Marquand, Rt. Hon. H. A.
Bottomley, Rt. Hon A G Griffiths, David (Rother Valley) Mayhew, C. P.
Bowden, H. W. Hale, Leslie (Oldham, W.) Mellish, R. J.
Braddock, Mrs. Elizabeth Hall. Rt. Hon. Glenvil (Colne Valley) Monslow, W.
Brockway, A. F. Hall, John (Gateshead, W.) Moody, A. S
Brook, Dryden (Halifax) Hamilton, W. W. Morley, R.
Brown, Rt. Hon. George (Belper) Hannon, W. Moyle, A.
Burke, W. A. Handerson, Rt. Hon A (Rowley Regis) Mulley, F.W.
Burton, Miss F. E. Herbison, Miss M. Murray, J.D.
Butler, Herbert (Hackney, S.) Hewiston, Capt, M. Neal, Harold (Bolsover)
Callaghan, L. J. Hobson, C. R. O'Brien, T.
Carmichael, J. Holman, P. Orbach, M.
Champion, A. J. Houghton, Douglas Oswald, T.
Chapman, W. D. Hoy, J. H. Padley, W. E.
Chetwynd, G. R. Hughes, Cledwyn (Anglesey) Paling, Will T. (Dewsbury)
Clunie, J. Hughes, Emrys (S. Ayrshire) Paton, J.
Cocks, F.S. Hughes, Hector (Aberdeen, N) Peart, T.F.
Coldrick, W. Hynd, H. (Accrington) Plummer, Sir Leslie
Collick, P. H. Hynd, J B. (Attercliffe) Porter, G.
Cook, T. F. Irving, W. J. (Wood Green) Price, Philips (Gloucestershire, W)
Corbet, Mrs. Freda Janner, B. Proctor, W.T.
Crosland, C A. R Jay. Rt. Hon D P. T. Pryde, D. J.
Cullen, Mrs. A Jeger, George (Goole) Rankin, John
Dalton, Rt. Hon. H. Jenkins, R. H (Stechford) Reeves, J.
Davies, Ernest (Enfield, E.) Johnson, James (Rughby) Rhodes, H.
Davies, Harold (Leek) Jones, David (Hartlepool) Robens, Rt. Hon. A.
Deer. G. Jones, Frederick Elwyn (West Ham, S) Roberts, Albert (Normanton)
Delargy, H. J. Jones, Jack (Rotherham) Roberts, Goronwy (Caernarvonshire)
Dodds, N. N. Jones, T. W. (Merioneth) Ross, William
Driberg, T. E. N. Keenan, W. Royle, C.
Dugdale, Rt. Hon John (W. Bromwich) Kenyon, c. Schofield, S. (Barnsley)
Ede, Rt. Hon J C. King, Dr. H M. Shackleton, E.A.A.
Edelman, M. Lee, Frederick (Newton) Shawcross, Rt. Hon. Sir Hartley
Edwards, John (Brighouse) Lee, Miss Jennie (Cannock) Short, E.W.
Edwards, Rt. Hon. Ness (Caerphilly) Lever, Harold (Cheetham) Shurmer, P.L.E.
Silverman, Julius (Erdington) Thomas, David (Aberdare) Wilkins, W. A.
Simmons, C. J. (Brierley Hill) Timmons, J. Willey, Frederick (Sunderland, N.)
Slater, J. Tomney, F. Willey, Octavius (Cleveland)
Snow, J. W Ungoed-Thomas, Sir Lynn Williams, Ronald (Wigan)
Sorensen, R. W. Watkins, T. E. Wilson, Rt. Hon. Harold (Huyton)
Steele, T. Weitzman, D. Winterbottom, Ian (Nottingham, C.)
Stewart, Michael (Fulham, E.) Wells, Perey (Faversham) Winterbottom, Richard (Brightside)
Stokes, Rt. Hon. R. R. Wells, William (Walsall) Woodburn, Rt. Hon. A.
Strauss, Rt. Hon. George (Vauxhall) West, D. G. Wyatt. W. L.
Swingler, S. T. White, Mrs. Eirene (E. Flint) Yates, V. F.
Sylvester, G. O White, Henry (Derbyshire, N.E) Younger, Rt. Hon. K.
Taylor, John (West Lothian) Whiteley, Rt. Hon. W.
Taylor, Rt. Hon, Robert (Morpeth) Wigg, George TELLERS FOR THE NOES:
Mr. Pearson and Mr. Holmes.
Mr. Harold Wilson (Huyton)

I beg to move, in page 78, line 36, to leave out "14 6," and to insert "20 0."

I think it would be appropriate in introducing the debate on the last group of Amendments on this Schedule to say, what I am sure will be the view of the whole Committee, that the debates we have had in the last few days on the groups so far taken have been extremely harmonious and constructive. I should like to pay tribute to the extremely courteous way in which the Chancellor, the Minister of State for Economic Affairs, and particularly the Financial Secretary, who has had to carry so much of the debate, have dealt with the points raised fro this side of the Committee.

Naturally, we are not very satisfied with the response to our proposals and Amendments. Some of the arguments put forward just now by the Financial Secretary —which I must raise in their relationship to the group of Amendments now before us—left me rather worried. Despite the Chancellor's assurances at an earlier stage of the Bill that he was prepared to consider sympathetically any suggestions made from this side of the Committee the Financial Secretary, not merely on the last group but on all the groups, sounded as though he was rather bound by the rigid and inflexible principle of the median arrangement and that no matter how strong a case was made from this side of the Committee it would not be possible to alter the D level of the Bill.

I thought I detected in his last remarks a note of the kind against which the Committee have been warned by my right hon. Friend the Member for South Shields (Mr. Ede), who said that at certain points the Chancellor was liable to say, "It is too late to raise this now. It ought to have been raised earlier." The Financial Secretary said it would be a pity to depart from this rigid median line, and that we must not spoil the record set up by the Committee of sticking, on the whole, firmly to that line. I agree that there have been one or two concessions, but they have been very few indeed, and I hope that the Chancellor, who, I think, has given a great deal of his time to this stage of the Billߞand we are deeply indebted to him for thatߞwill make on this last group more concessions proportionately than he has done on the other groups.

3.0 a.m.

He will agree, I think, that the group we are now discussing is by far the biggest and most important group in the whole Schedule. It is the one that raises most of the problems associated with the textile industries, and, of course, it is a very wide group. It is, of course, several groups, and it might have been more logical and convenient to the Committee to have split the whole of Part 11 of the Schedule into a number of groups.

When I was considering this, in connection with the proposals, we suggested to the Chair that this group should be divided, but I found it very difficult to split. We cannot really debate wool independently of cotton and the other materials. Once we start to talk about cotton piece goods there are consequential items to be mentioned, such as pillows, pillow slips, and so on, and when we get on to pillows we get on to bolsters, mattresses, and so onߞand I can see that hon. Gentlemen opposite would like to get on to them now.

Mr. F. Harris

And into pyjamas.

Mr. Wilson

Because we are having to have such a wide and heterogeneous group there will be a number of matters to be raised by my right hon. and hon. Friendsߞand by hon. Gentlemen opposite, too; and so I do not propose in these introductory remarks on the Amendment to cover all the points in this last groupߞwhich seems to surprise the Chancellor. He may be even more surprised to hear that I do not intend to repeat all the arguments that have been advanced during consideration of the other groups, although, obviously, those arguments do apply—or many of them—to a large number of the goods in this group which previously were tax free and now will carry tax, with effects upon the textile industries and with effects upon the consumers.

I want to make four main points, and I shall make them as briefly as I can. The first is that the D level for wool in this Schedule is far too low, and that is why my right hon. and hon. Friends and I have proposed Amendments to raise the level from 14s. 6d. to 20s. 0d. throughout this Part of the Schedule. I think that the reason for the difficulty about wool is the fact that the Schedule makes no distinction between woollen and worsted cloths; therefore, there is no separate D price for woollen and worsted cloths.

Perhaps, I should tell the Chancellor that when my right hon. and hon. Friends and I considered the Amendments we should put down we came to the conclusion that we really ought to distinguish between woollen and worsted goods because the effect of the median figure, whether it is an accurate median figure or not, is to leave a great part of the woollen free of tax but to impose tax on a great part of the worsted cloths which come above that figure. When my hon. Friends got down to the drafting Amendments, however—and we have on this side of the Committee two or three of the greatest experts on wool not only in this Committee but in the country—they found it impossible to get a really watertight definition between wool and worsted: and I am sure that the Chancellor will agree about that difficulty.

So it means that we have to accept the grouping of wool and worsted together, but, as I have said, to fix the median on those two together means unfair discrimination, particularly against worsted. That does mean unfair discrimination against particular materials of quality—a subject hon. and right hon. Gentlemen opposite have often talked about—and it also means discrimination against materials of great value to the export trade.

It is as if the Chancellor had set out in a different part of the Bill—we are glad he has not—a D scheme for motor vehicles and then took on motor cycles and cars, and, taking the median figure, set it at the minimum level. It would have meant that most motor cycles would have been free of tax and most cars would carry a disproportionate amount of tax. That is what he has done in conection with worsted cloth and for that reason we propose that he should set the D figure amount much higher, somewhere near the top worsted price rather than the top wool price or the price that is intermediate between the wool and worsted products of the country.

The second point to which I should like to draw the Chancellor's attention, though. I believe he has a note of it, is that the figure for cotton piece goods which is, therefore, consequential in the other products, is far too low. It is felt by the trade in Lancashire that in fixing this figure the Treasury have gone mad. Lancashire believes that the figure chosen will be ruinous for large and important sections of the textile trade, because here again it is a cliche, as we have often said in debates on textiles, that there is no such thing as the cotton industry, but a whole range of industries coming under the general heading of the cotton industry.

Equally, the various products covered in cotton cloth in Part 11 of the Schedule represents a very wide range of the products of Lancashire, and that means that once again the median figure or the D figure penalises a wide range of household textiles and better quality furnishing fabrics and curtain materials. I would remind the Chancellor, in case it did not sink into his soul earlier, of the comments of the "Manchester Guardian" on furnishing fabrics which appeared in an article under the heading—and I think it is right in spite of what the Chancellor has said and done since—"A Bad Tax" on 4th April. The article said this: It has made most curtain and furnishing fabrics of decent quality prohibitive for the ordinary purse. … The tax free level has been put at 4s. a yard for all cotton and rayon fabrics, which means that all the better fabrics bear a heavy tax. The strongest case in the whole of this Schedule relates to the furnishing fabrics. That point has been argued not only in the trade Press, but in successive debates in this Committee and in the House. It was argued very forcibly last week by my hon. Friend the Member for Blackburn, East (Mrs. Castle), and we are all sorry that she cannot be here with us tonight to put the case with her usual cogency. She is ill and has had to go home, and I am sure that the whole Committee will hope that she will be back with us again shortly.

We know that the right hon. Gentleman the Member for Blackburn, West (Mr. Assheton) also takes a very strong view on the problem of furnishing fabrics and curtain materials, and we all feel that Lancashire requires a concession from the Chancellor. When we were discussing the Motion that the Chairman do report Progress and ask leave to sit again and he referred to Part 11, I thought the Chancellor was going to make a concession on furnishing fabrics, or at any rate he was aware of the fact that the tax problem he would have to deal with in Part 11 was the problem of furnishing fabrics.

We should reasonably expect a substantial concession on furnishing fabrics and curtain materials, but once again we are faced—the right hon. Gentleman the Member for Blackburn, West, will agree —with the almost complete impossibility of defining those materials as a separate entity. Most people know that there is a great deal of common ground between certain dress and curtain materials. What I consider to be the prettiest summer dress of my wife's was bought as curtain material, but was transformed by a competent and skilled craftswoman into a dress. I should have found it difficult to say whether it was curtain or dress material, and so would the Chancellor.

Unless the Chancellor can explain it to us, I do not see how he can give a concession relating to furnishing fabrics and curtain materials alone. We hope that he will accept the Amendment which puts up the D level for all cotton piece goods to a figure which will make it possible to do justice for the furnishing fabrics and the curtain materials.

I wish to remind the Committee of some figures which I gave it a week ago relating to a representative Co-operative society. Although the D price was 5s. 4d., the cost of the cheapest line of casements and brocades 48 inches wide in stock was 6s. The Chancellor's announcement last night makes no difference to the problem. I agree that the reduction from 66 and two-thirds to 50 per cent. will reduce the tax by a quarter, but that will not solve the problems in regard to furnishing fabrics. I am sure that the right hon. Member for Blackburn, West, will agree. These materials need to be dealt with by a higher D line.

My next point refers to linen. In the view of my hon. Friends and myself, many of the linen items should be in a separate category and not grouped as they are at present. Other hon. Members will, no doubt, make the points which should be made about the linen industry. Of all the industries in the country affected by the D scheme, the linen industry has been the least forthcoming in aiding hon. Members who wish to draw the attention of the Chancellor to these matters.

It almost suggests that there is something of a closed corporation between the linen industry and some of the Northern Ireland Tory hon. Members, because it seems to be felt that the problems of the linen industry should be discussed only by Northern Ireland hon. Members. That may he an unfair thing to say, but whereas every other trade in the country has flooded us with information, I cannot say the same of the Northern Ireland linen industry, and that is not in the best interests of that industry.

I am sure that the Chancellor will agree that in all our discussions in the last two days we have been putting forward Amendments on non-party lines on the merits of the case. Most of the industries concerned have given their arguments and discussed their problems equally impartially with hon. Members on both sides, feeling that it was a national problem and not just one which should be regarded as the preserve of one party or group in the House. Therefore, I find myself a little inhibited about putting the arguments for the linen industry, but some hon. Members will be putting the arguments. If my suspicions are correct, Tory hon. Members for Northern Ireland constituencies will be well briefed on the subject and will put the problems before the Chancellor.

3.15 a.m.

My fourth point on this Schedule relates to quilts, mattresses and other household requisites. I have given figures to the Committee showing how against a D level of £2 10s. for down quilts a typical Co-operative society branch had no stocks priced less than £5 I Is. 6d. Again, for down quilts, whereas the retail price before the Budget was £7 8s. 8d. and the new price after the Budget was £9 9s. 8d. Now, after last night, the Chancellor has brought it down, according to my calculations, to £8 19s. 5d.

It is important to recognise that unless the D line is raised, quilts will become too dear, except those filled with inferior material, and I am sure that is not the idea of the Chancellor or his colleagues on the Treasury Bench. I have in mind the Minister of Health, whose Department has a statutory interest in the filling in quilts and other things. I think there is a strong case for splitting this group into different categories, and I think my hon. Friend the Member for Ashton-under-Lyne (Mr. Rhodes) has views on that.

These are some of the main points, and I have no doubt that they will be developed by hon. Gentlemen in all parts of the Committee. I should like to give one example only, as I have done in other groups. My illustration relates to towelling and towels. The Committee will observe that the D line for towelling stands at 4s. a yard while for towels it is 5s. 3d., when one makes appropriate adjustments for width. The Chancellor has been generous in fixing the levels for towels. That generosity is rare and we all welcome it, but it creates certain difficulties.

As the Committee will appreciate, many mothers like to buy in the form of towelling and, by dint of craftsmanship, make it up into nappies for future use. That is an economical and thrifty approach to the problems they are likely to be facing, but this sort of custom is, in fact, stopped by the Chancellor's D scheme. To take one example, Terry towelling pays tax, owing to the very low D figure fixed at 4s. a yard, and it simply does not pay to buy it if one has to pay the tax above the D level for the purpose of making it up into nappies and other personal requirements of the infants because, of course, the nappies themselves of similar material are tax free. I am sure that that was one of the consequences the Chancellor did not have in mind, and I hope that it is one of the anomalies he will be prepared to consider. It illustrates once again the difficulties of any scheme of this sort.

In discussing this particular group of Amendments I said that I would not raise the question of the fixation of the median, although I consider the replies from the Treasury Bench completely unsatisfactory, but I want to endorse what my hon. Friend the Member for Brighouse and Spenborough (Mr. J. Edwards) put to the Government a few minutes ago. I am referring to the need for and the lack of consultation with the trades and industries concerned before these figures were fixed.

It is now two months since these figures were made available to the House, and apparently there has been very little consultation with the trades concerned. We have hardly had a single case on the Schedule of the responsible Minister coming before the Committee and saying that, as a result of consultation with the industries concerned, it had been decided to revise the figures. There has been virtually no Government Amendment down on the Schedule, and I feel that the Chancellor would be well advised in working this scheme to have closer consultations with the trade.

It cannot be a secret from the Chancellor that many businessmen in different parts of the country are saying that Ministers in this Government are highly inaccessible. I am putting this as a serious point and in no way as a party one. I have heard this many times from businessmen who, I imagine, must be of the party of hon. Gentlemen opposite. Many of them are saying that when the previous Government were in power they could generally get their problems considered sympathetically by the Ministers concerned and had a fair right of access to them, but they are not getting it now. Sometimes they add, bitterly, "It is not as if they were so good that they can decide on these things for themselves without consultation."

Hon. Gentlemen opposite behind the Chancellor can confirm that these things are being said widely in trade and industry today. I feel that this D scheme with which we are apparently landed, despite our best efforts to stop it, will be even more of a disaster than we fear it will be if there is not the fullest possible consultation between the Government and trade and industry, and a fair readiness on the part of the Treasury to make changes in D levels whenever they are convinced that a change should be made.

We recognise the difficulties of the Chancellor—he drew attention to them tonight—as between the accusations of obduracy on the one hand and uncertainty on the other. I agree that, after this series of debates and the Report stage are over, there should be some certainty and settlement of the D levels, bad as we consider them to be. At the same time, the Chancellor should be free to make changes from time to time. We recognise the conflict between the two principles he has to observe, but I recommend to him that if he will consult trade and industry as much as possible, they will understand his difficulties and will help to make this scheme as good as it possibly can be.

Mr. Ralph Assheton (Blackburn, West)

I should like first, to join with the right hon. Gentleman the Member for Huyton (Mr. H. Wilson) in thanking the Chancellor and the other Treasury Ministers for the patient way in which they have listened to these debates throughout the night. I have frequently before in this Committee, on the occasion of the Finance Bill, said how regrettable it was that such important matters had to be discussed in the middle of the night, and I still feel that that is unfortunate. It is particularly unfortunate that at such a late hour we should be coming to what is the most important debate of the day.

The right hon. Gentleman has reminded the Committee of the great difficulty in which the Committee is placed by the D level as applied to cloth. I do not wish to cover the whole field, but to deal particularly with furnishing fabrics—a question that affects my own constituency in Blackburn very considerably, and many other constituencies in this country and Northern Ireland. So far as Northern Ireland is concerned, I would tell the right hon. Gentleman opposite that I have had some representations from that source, so that the matter has not altogether been overlooked. The Douglas Committee in their final Report, in paragraph 131, recommended:

That deductions be fixed in such a way that a given proportion of current purchases of goods covered by the scheme would be free from tax. This proportion should, as far as possible, be the same for all the classes of goods concerned and be not less than one half in each class. The inclusion of the products of this furnishing fabrics industry as class B material, with a D figure of 4s. per yard, completely fails to implement the intentions of the Douglas scheme and the Government on this matter. Out of 121 specifications of Utility furnishing cloth only three remain tax free. That conclusively proves the case, and I beg the Chancellor to take this matter into serious consideration. The avowed object of the Douglas Committee was to provide a range of tax-free goods and it simply does not do so in this case.

Lancs is extremely distressed on account of this, and already there have been very serious repercussions in our trade. A very large number of orders placed before this came in have now been cancelled, and it is unlikely that the orders which he and the Government have placed in the textile areas will benefit this trade, because it employs specialised plant and special skills that will not be of use to the Chancellor in placing his £25 million worth of orders. Quality is being degraded to an alarming extent: owing to the fact that the D level for wool is 14s. 6d. against a level for cotton of 4s., manufacturers are weaving into their cloth 15 per cent. of wool to try to avoid this tax. This is not a good thing.

It is a great pity the industry should be forced to concentrate on how to avoid tax rather than on the best type of goods that can be sold abroad. Cotton goods with 15 per cent. wool woven into them are not likely to be suitable for the export trade, for several reasons. One reason is that there are in certain cases special import duties that make it difficult for us to sell these goods overseas.

There is a large number of other points I could bring forward. I do not want to add to the length of this argument, but I want to impress on the Chancellor how very serious indeed this is. There is nothing in the whole Bill to which I attach more importance than to get this particular blemish corrected. The weight of opinion behind what I am saying comes from all parts of the Committee and certainly from every trade organisation that has anything to do with the matter. If the Chancellor is not able to find an immediate answer, I beg that he will consult the Furnishing Fabrics Federation and see whether something can be worked out to meet the difficulty.

There are different possible ways of meeting the difficulty, into which I will not go in detail now; there is, for instance, the question of definition—whether by weight or by some other means. I am not sure that there is any completely satisfactory way, and it may be that we shall have to adopt a solution which is not perfect. I hope that the Chancellor of the Exchequer will not be a perfectionist on this occasion, because if he seeks to be a perfectionist he will probably not be able to deal with the problem. We must deal with the problem somehow, even if we cannot deal with it perfectly.

I shall say no more at this stage, but will leave the matter, with great confidence, in the hands of the Chancellor of the Exchequer.

3.30 a.m.

Mr. Rhodes

I want to follow the right hon. Gentleman the Member for Blackburn, West (Mr. Assheton) a little way in what he said, but I would point out to him that he has overstated the case about the mixture of wool with cotton fabrics. I do not think that that will go very far with wool at its present price, and I do not think that much attention need be paid to the matter.

Mention has been made of the fact that the Chancellor of the Exchequer has attended the debates. He ought to be grateful to us for attending, and for trying to amend this Schedule for him, because, after all, it is a mess. The Chancellor knows the textile industry from an angle which is different from that of most of us. I have been engaged in the manufacture of woollen cloth for many years. Before the right hon. Gentleman took on his present job he was associated with a well-known firm—and I very much want to say something about them which I have not had the opportunity of saying before. This country and the consumers owe a great deal to the firm with which the right hon. Gentleman was connected for the work they did during the past two years in keeping down the cost of textiles in this country. They did a great job and the country should thank them for having done it.

The first point I want to make perhaps breaks new ground—and some of us think it is about time we did break new ground. It concerns the tax itself. The difficulty which the cloth section faces is that the incidence of the tax bears very heavily upon it. I shall try to explain this as clearly as I can—it is a complicated subject—because I should like a reply from the Chancellor of the Exchequer about it.

As I understand, the original idea in fixing the rates of tax was that labour and conversion costs double the price of the cloth when it is made into a garment. That meant that cloth which was sold without the labour and conversion costs should bear twice the tax—and that was accepted by the trade many years ago. It was even accepted by the trade in 1947, when the revision in the level of Purchase Tax was made, and it became known as the two-to-one formula. It was generally accepted by the trade as fair.

It was only fair so long as the prices remained constant and the conversion factor continued to have a reasonable relation to the finished product. Before the war the conversion factor, including labour, the variable costs, fixed charges and overheads connected with manufacture, used to be in the neighbourhood of 50 per cent. It became less as time went on. The higher the price of the material, the smaller the conversion factor. It was accelerated in the years 1949, 1950, and 1951, until in my industry we were fortunate if the conversion factor was as much as 22 per cent. Before the war it ranged between 44 and 50 per cent.

The point I am making is that where in many cases the incidence of tax is not very heavy on made-up garments, on the cloth it is heavy. I will quote three instances. The tax on the cloth of a 3230 shirt—to quote a well-known Utility number—was approximately three times the tax on the garment. On the 3310 boiler suit there was no tax, but the cloth would be taxed at about 7½d. a yard if bought over the counter for making aprons or children's playsuits. The retailer would, naturally, require his normal margin on the tax, so that on a couple of yards of 31-inch cloth, the effect of the tax would be an extra charge of about 1s. 10½d. Those are assessed on the new figure. A 3172 woman's gabardine garment bore tax of 1s. 10½d., while the cloth bought for home dressmaking paid tax at 16s. 9d. Again, the retailer's margin would be heavy.

What is the Chancellor trying to do? He is penalising the thrifty housewife, the mother of young children who buys a few yards of cloth to make into children's garments. Nearly all curtain material is sold over the counter by the yard to be made into curtains. Why should thrifty people who are willing to take that trouble be penalised? It is the same with the home sewer. Why should she be penalised? Does he not want people to sew at home? He is doing his best to discourage them. Why should a person who wishes to make up cloth into a frock or other garment have to go and buy poorer quality cloth to make up for the difference in tax? That is the incidence of the present tax. There is a lower incidence on made-up garments as distinct from cloth which is sold over the counter.

Much play has been made in the last two days about the difficulties experienced by the making up trade. Well, their difficulties are nothing compared with the difficulties of those who sell piece goods. The making up industry has always had a margin. That was demonstrated beyond all doubt when the makers up started the iniquitous system of double invoicing while the Utility scheme was in operation. Anybody who knows the trade knows full well that on many of these clothes the makers up had a nice little margin up their sleeve so that they were able to pay a higher price for cloth as and when they wanted it.

Next I come to the median. It appears that the Furnishing Fabrics Association has briefed us very well. I noticed that the right hon. Member for Blackburn, West, was quoting some of the same figures that I have, and they are very illustrative. I should like to make a comparison which has not yet been made. Not only does this ridiculous D level apply to furnishings, but also to many other things. If the Chancellor were to take the trouble to look up the old Utility schedules he would find many examples of piece goods which will prove the point I am trying to make. All he needs to do is to look up, say. coloured woven striped two-fold poplins. Those are made in Nelson, a town which has been very badly hit, not only on account of the general depression but also on account of the change in fashion.

I draw the Chancellor's attention to the many clothes which are far above the median line besides curtain cloths. I should like to know how the Chancellor views the question of the differential in tax between the made up garment and the cloth. Does he still stick to the two-to-one formula? Or is it as vague as his way of arriving at the median for D? The Government have not inspired in us today much confidence in the way in which they arrive at the D levels. I should like the Chancellor to tell us quite definitely what is the formula for arriving at the tax on 25 per cent. on made-up garments and 50 per cent. on piece goods.

3.45 a.m.

We must look also at this matter from the export angle. We do not export a tremendous amount of made-up garments, so when we are considering the incidence of tax on piece-goods within this Schedule we are thinking directly in terms of exports. Yesterday, the hon. Member for Louth (Mr. Osborne) referred to the Purchase Tax not having much effect on our exports. I will cross swords with him and illustrate my point. Recently, my firm concluded the preliminaries for an order in North America. We had to take into consideration several things apart from the price. One can cover the risk through the Export Credits Guarantee Department if one likes but there is the over-riding risk nowadays that for some reason or other —it may be a fall in the price of raw materials—the customer is upset and he cancels the order.

If the cloth involved is far below the D line one has a reasonable chance of selling the stock at round about two-thirds of its value and no more. If operators know one has such stock one has no chance whatever of liquidating it on the home market at more than two-thirds of its value. In my case it was below the D median because for woollens, at any rate, the median is generous.

But in the case of the manufacturer who is making velvets for the North American market, his cloth can be priced at as much as 26s. a yard, 48 inches wide. He thinks in terms of the risk when it comes to selling on the home market. He is very chary indeed of taking a risky order at the present time which may not only involve him in loss of a third of his capital but also in the possibility of having to face the opposition of possible customers owing to the effect of Purchase Tax.

I suggest that the Chancellor should try to hammer out a formula for frustrated exports. I know it is difficult for him to do anything about the definition of furnishing fabrics as distinct from dresses, but it is his job to do it. If we on this side of the Committee were very astute politically, after making our first demonstration on Purchase Tax we should have left the subject severely alone and left the Chancellor to get on with it, because the arguments we adduce from this side of the Committee are nothing compared with what he will have to face from the trade during the next 12 months as this scheme works itself out.

I just want to mention the question of quilts. The Chancellor will agree that it is absolutely impossible to take any quilts on a yardage basis with all the groupings in this part of the Schedule. It is simply ridiculous. This proposition must just have been thrown in by somebody who said, "Somebody will sort this out in the Committee stage of the Bill." The right hon. Gentleman can easily have a look at this, and ought to. Down quilts, which are the most expensive, are made in a different way from wadded and cotton-wool quilts. Wadded and cottonwool quilts have the padding sewn in, and kapoks have it blown in.

I would suggest to the Chancellor he cannot stick to the exact provisions in the Schedule. He can get over the difficulty by splitting them into five groups. He could put downs and kapoks together because they are made with the same sort of machinery; he could put downs and cotton wools together because they are more competitive with each other; or he could put kapoks and waddeds together because each is in a lower quality against downs and cotton wools respectively. I am willing to give him these particulars. They are rather involved, but I can assure him that they are well worked out. He will realise it is impossible to put this type of article in with the rest of the gigantic group.

I would ask the right hon. Gentleman to consider that group 4 should include cushion covers, chair back covers and mattress covers. There is no real reason why they should be left out at all. I suggest that he should add to group 4 mattress ticks and bolster ticks. It would please many housewives in the North because they use them—I do not know whether this is a peculiarity of the North —more than they do in the South.

The right hon. Gentleman has a hopeless task with this scheme. He knows now he will never see the revenue he hoped for. Personally, I hope he gets it, because it will mean good activity in the textile trades. One will not say in a few months' time, "We told you so," believe me. It is too serious. We are in difficulties. I have never seen anything like it since I started at 12 years of age as an operative. It behoves everybody to give this matter their attention, as we have done in this Committee on both sides. We seem to have shed our East Croydons and Sutton Coldfields, because if we had had that sort of element in this Parliament as we had it in the last it would have been working against improving the position.

Although I have never seen anything like it I am certain of this: we shall pull through, but it will have to be done not on the basis of the rigid mind by Departments such as the Treasury but by being more flexible in dealing with these problems. I still believe that the Chancellor would have served the industry better if he had scrapped the whole scheme.

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

The right hon. Gentleman the Member for Huyton (Mr. H. Wilson), when opening this interesting discussion, referred to our deliberations as having been harmonious, and I hope that we shall not depart from that too far. Last night, however, the hon. Member for Rossendale (Mr. Anthony Greenwood) was a little naughty. He sought to make party capital out of the present difficulties in Northern Ireland, and referred to the unemployment position in Ulster and pointed out how very bad it was. It is very bad and he was perfectly right to point that out. It is serious and we are all greatly perturbed about it.

But the hon. Member suggested that, because my hon. Friends and I from Ulster did not put down a whole string of Amendments to the first part of this Schedule, in some way or another we were guilty of some dereliction of duty or neglect of our responsibilities. I can only think that this was the result of the change of heart which has recently taken place in the Labour Party in Northern Ireland, because for 30 years they were closely allied with the Anti-Partitionists, Nationalists and Republicans, who wanted to put Northern Ireland—

Mr. H. Wilson

On a point of order. what has any alliance with Anti-Partitionists or any other body in Ireland to do with this particular Amendment?

The Deputy-Chairman (Mr. Hopkin Morris)

I did not actually hear the words the hon. and gallant Member was using, but the subject of Anti-Partitionists is not in order on this Amendment.

Captain Orr

If I might develop the point I was making and still remain within order, I was merely trying to seek out the motive behind what the hon. Member for Rossendale said in introducing the subject into our debates tonight. He suggested that in some way we who represent seats in Northern Ireland were guilty of dereliction of duty. I suggest that his allegation was because of a change of heart in the Northern Ireland Labour Party. The hon. Member referred to the subject, and, therefore, I imagine I would be in order in replying to him.

However, I will leave that subject if I am getting a bit near the line. I would only say that the Ulster textile industry would have been very much the sufferer, and might have been completely ruined, had we followed the policy advocated by the Northern Ireland Labour Party in the last 30 years. Their sudden change of heart and their sudden tenderness for Ulster textiles—

4.0 a.m.

The Deputy-Chairman

The hon and gallant Gentleman is now very far from the Amendment.

Captain Orr

I will now return to the subject of the Schedule.

My hon. and gallant Friend the Member for Down, North (Sir W. Smiles), deployed the argument in the textile debate some while ago, before the Finance Bill, and drew attention to the state of the linen industry in Northern Ireland and the recession that it was suffering. On the Committee stage of the Finance Bill my hon. and gallant Friend referred to the incidence of Purchase Tax and its effect on the Ulster textile industry, and he also drew attention to the fact that in order to encourage exports—linen goods largely depend upon an export trade—a sufficiently large cushion in the way of a home trade is needed.

We discussed how best we could put our main grievance, whether we should put down a string of Amendments to the first part of the Schedule—that would probably have kept the Committee here all last night—or whether we should seek a point where we could most effectively draw attention to it. We decided that our case could best be put with reference to the piece goods at the beginning of Part II of the Schedule, which principally affects the Ulster textile industry.

There we find piece goods divided into classes A and B. From a first glance at the definition it would appear that Class C goods are not subject to tax, but, when we look at the definition, at the beginning of the Schedule, we find that Class B automatically includes Class C. We seek by our Amendment to expose the Chancellor's trick. However, we hope that he will not take the exposure in bad part, and that he will try to help us.

There is no linen piece goods category in this section of the Schedule as it is drafted, and that omission is difficult to understand. The Utility scheme admitted the principle that linen is different from other textiles; linen is very expensive to make, and a remission in tax adversely affects linen and benefits its competitors. The principle is, in fact, admitted in section four of the Schedule where bed sheets, tablecloths and table covers are divided into two classes of materials. It is admitted in the case of pillow cases, table napkins, tray cloths, and pillows, and I completely fail to understand why it should not be admitted in the case of cloth.

The Ulster textile industry feels very strongly about this. Linen is more expensive to produce, and if one takes two articles of the same size, one of linen and the other of cotton, with the linen article costing 20s. to produce, and with the D exemption in each case of 4s., the amount chargeable to tax is 16s. for the linen article and 9s. for the cotton article. Therefore, the incidence of tax increases the already existing disparity of price between the two things.

Mr. Wilson

To be fair to the Chancellor, will the hon. Gentleman indicate what difference the Chancellor's concession of last night makes to the differentiation between cotton and linen on the calculations he has just given?

Captain Orr

I do not propose to make any such estimate. The concession the Chancellor made last night of reducing the rate of tax by 25 per cent. does, in fact, benefit linen because it helps the higher quality linen goods, but we asked the Ulster linen industry what their attitude was to the Chancellor's statement last night, and we got back the following telegram: Failure to include category for linen piece goods in Part II item one page 78 of Finance Bill is very serious matter for linen trade. They have completely ignored, so far, what the Chancellor announced last night, although it will benefit them, and they are still harping on this serious omission, and rightly so.

As the hon. Member for Rossendale pointed out, there is serious unemployment in Ulster which is worrying us all a great deal. The economy of Northern Ireland, upon which the prosperity of our people and employment depends, is somewhat unstable. It is based on the two major industries of shipbuilding and textiles. A recession in either causes a dislocation of the labour force, and an enormous number of people are thrown out of work, as is the case at present. It has been suggested that the Chancellor has a soul, and I hope that it will become apparent on this occasion. Any action he can take will be welcome. He has an opportunity here to help us, and I appeal to him to use it. I hope he will consider making a special category for linen, because it is in a separate position, and so help to reduce the distress in Northern Ireland.

Mr. J. Griniond (Orkney and Shetland)

It seems to me that we too readly assume that linen is only made in Northern Ireland. In fact, Scotland taught the Irish to make linen and, of course, by far the best linen is still made in Scotland. Nevertheless, I want to support what was said by the hon. and gallant Member for Down, South (Captain Orr), about the strange treatment which the linen trade seems to have received when this Schedule was drawn up.

If the Chancellor can find such linen goods as sheets and pillow cases at the prices on which the figures in the D scheme are founded, he is a lucky man. It is well known that linen is much superior to rayon, and if it were readily obtainable at such prices there would be an even more severe recession in the rayon trade than there is at the moment because linen would be taken up in large quantities compared with other textiles. I hope that the Chancellor will be able to say how these figures were arrived at,. and will also tell the Committee that he is prepared to give further help to the' linen industry which was extremely hardly dealt with when this Schedule was drawn up.

The only other textile about which I must say a word is wool and cloth. The right hon. Gentleman the Member for Huyton (Mr. H. Wilson) pointed out that the higher grades of cloth, worsteds, and so on, would all be subject to tax if the figure remains at 14s. 6d. per square yard. The Scottish woollen industry provides a fairly high proportion of high quality cloth. Unfortunately, it is an industry which, in the nature of things, cannot benefit greatly from the rearmament orders which the Chancellor has placed in other textile areas as an alternative to assistance by way of reducing the tax or altering the D scheme. In any case, that has not been done to any great extent in Scotland and I much doubt whether, as far as the high grade cloth is concerned, it can be done in quantity.

Mr. David J. Prude (Midlothian and Peebles)

Would the hon. Gentleman tell the Committee where he gets his information that the Scottish woollen industry cannot benefit from the contracts which are about to be placed?

Mr. Grimond

If I gave the impression that it would not benefit at all that was wrong, as I did not mean to give that impression. I only said that the higher grades could not benefit to the extent which other textiles may benefit from the orders which the Government is placing. My impression was based on information from the trade itself. I did not want to suggest that certain grades would not benefit considerably. But, of course, the orders must first be placed.

This is an industry which can play a considerable part in the export drive, and I am glad to know that it is now generally agreed in this Committee that it is quite unreal to separate the home trade from the export trade. I want to draw the attention of the Chancellor to the fact that, if the rate of tax is kept high on this industry, it will not only decrease the home trade, but will also affect the export trade. I entirely agree with what has been said often, that even the total abolition of the Purchase Tax would not by itself pull the textile industry out of its recession. The fact is that there is a big build-up of stocks, and buyers are holding off until they see how world prices move.

But there is no doubt also that some reduction in the tax and particularly on certain categories of clothes would help to stimulate demand and would prevent a distortion of the industry. It is one of the worst features of any Purchase Tax scheme that it encourages distortion. There are attempts to keep within the Utility range or under the D line. The Chancellor must be well aware of that and the right hon. Gentleman the Member for Blackburn, West (Mr. Assheton) has given examples of it in cotton—with the consequent damage to exports. This has been happening in different degrees in other textiles as well. At best, I should like to get rid of Purchase Tax altogether, but if, in the meantime, the Chancellor can give us some further concession on worsted and high-grade woollen goods, then the industry will benefit and the Chancellor's plans for the economy as a whole and for exports will benefit at the same time.

4.15 a.m.

Mr. C. H. Gage (Belfast, South)

I am happy to hear that linen is made in Scotland. I readily accept the word of the hon. Member for Orkney and Shetland (Mr. Grimond) that it is the best linen, but commiserate with him on the fact that that appears to be very little known.

I wish to refer to linen made in Northern Ireland, which, without dero- gating from the textile trade elsewhere, has peculiar difficulties and problems. I was a little surprised to hear the right hon. Gentleman the Member for Huyton (Mr. H. Wilson)—who has, unfortunately, left his place—make a complaint that he had not received literature from the linen trade. It is the first time I have heard that complaint; normally, the complaint is that one receives a great deal too much literature of that nature. Perhaps his hon. Friends will pass it on when I say that I can arrange to remedy it at once. In view of his newly found interest in trade in Northern Ireland I am pleased to say I have ropeworks, shipyards, and a whiskey distillery in my constituency and I shall see in future that he is well supplied—[HON. MEMBERS: "Oh."]—hon. Members should let me finish the sentence —with information on their difficulties. I am sure he will take their case up regardless of any party political advantage it may bring him.

The position about linen—I take up something said in the admirable and sincere speech of the hon. Gentleman the Member for Ashton-under-Lyne (Mr. Rhodes)—is that the Northern Ireland trade goes almost entirely, particularly in the more expensive grades, for export. On the home market, linen is only about 2 per cent. of the whole cotton, linen, and wool trade; it is unfortunate that in this country very little linen is bought. But in the exports of these three textile commodities to dollar countries, particularly U.S.A., linen easily tops them all. The real importance of linen is in the export market.

Of course, every linen manufacturer and worker—of whom a great majority are my constituents—knows that the real cause of unemployment in Ireland and the trade's difficulties is a recession in buying in the U.S.A. That, unfortunately, no Chancellor can remedy. It is true, as the hon. Member for Ashton-under-Lyne said, that that does not end the problem. It is possible, by means of Purchase Tax, to assist the linen trade. I do not altogether agree with all the hon. Member for Ashton-under-Lyne said, but the linen trade take the view that help can be given in this way.

Normally, it is an expensive process to set up a loom, for it may cost up to £500 to turn out a particular line, and, therefore, if a manufacturer has three lines which he wants to sell in the United States, what he does is to turn out the three lines and put them on the home market, not for the purpose of selling a quantity or making money but to obtain a quick reaction and to get a guide on how the lines will go in America. It can only be a guide, of course.

Here I would emphasise a point which has already been made, that the difficalty is that, throughout, linen gas been confused with cotton and the same standard under the D scheme has been applied to both. That is quite wrong, and I agree to some extent with the Amendment put down by right hon. Gentlemen opposite about what is called the C class. On reading through the definition of Classes A, B and C, I feel bound to say that the drafting of Finance Bills becomes more cumbersome as each year passes. I know that that is not the fault of the draftsmen, but is due to the difficulty of translating these matters into English which anyone can understand. I agree with right hon. Gentlemen opposite that the C Class, which refers to linen, should be inserted in paragraph I of Part II, which should consist of Class A, Class B and Class C materials.

The reason is that it gives more chance on the home market to the higher class of linen goods. There is no great loss of revenue involved, because there is never a great quantity sold on the home market. Ususally, it is only enough to provide a guide to what may sell abroad, because unfortunately this quality is out of the reach of most people's purses.

If the difference were made and the D line moved higher in respect of linen, as the Amendment in the name of myself and my hon. Friends seeks, there is no doubt that that would be a great advantage to the linen trade as a whole. That is the whole point of the Purchase Tax as it affects linen and it is the explanation of why hon. Members for Northern Ireland have desired to make this point, and this point only. It is the only point of the Purchase Tax which affects linen.

Mrs. White

I have no doubt that the Financial Secretary would be happier under one of the down quilts which are so dear to the heart of my hon. Friend the Member for Ashton-under-Lyne (Mr. Rhodes), but I am sure that he recognises that this part of the Schedule is of extreme importance to many hon. Members and their constituents. I speak as an hon. Member who, at the moment, has between 4,000 and 5,000 unemployed men and women in my constituency. It would not be necessary to take up so much time on these questions of taxation had the Government any other positive proposals which would assist these workers.

I speak in particular of the rayon industry, in which case the only positive proposal made to assist to deal with the state of unemployment in the industry has been the advancing of certain Service contracts. I was shocked by the reply which I received on this matter from the President of the Board of Trade. In passing, may I say that, in view of the subject which we have been discussing, the lack of attention given to the debates by the Minister responsible for the Board of Trade has been extraordinary. I put down a Question today to ask him what proportion of the £10 million worth of textile contracts, which had already either been made or put out to tender, was devoted to rayon, and the answer was, "None."

Therefore, as no aid is being given to the rayon industry in that respect we are constrained to press strongly the Amendments which are on the paper in the names of myself and my hon. Friends. It is essential that on this point the Chancellor should make some positive concessions. He announced yesterday that he proposed to reduce the rate of taxation, and that he was thereby conceding some £17,000,000 in a full year. My impression is that probably the Chancellor is making the worst of all possible worlds by this decision, because it is not great enough to attract a large number of purchasers. It is not sufficiently dramatic for that. Nor, I would contend, is it sufficient to meet the other problem which the Chancellor may have had in mind, which was to help the better quality goods which are particularly concerned in the export trade.

References were made earlier to furnishing fabrics. I want to spend a little time on that subject, because it is a section of the textile industry in which rayon is particularly concerned. I support the arguments put forward on this occasion by the right hon. Gentleman the Member for Blackburn (Mr. Assheton), who pointed out that there is a difficult situation in the furnishing textile trade. I have studied the figures which he and the hon. Member for Ashton-under-Lyne (Mr. Rhodes) quoted. I also got into touch with one of the best-known manufacturers, who was good enough to send the samples of curtain materials which I have here.

There are 10 samples, the wholesale prices of which range from 5s. to 29s. 6d. a yard for material 48 inches wide. Of these 10 samples, five were previously in the Utility ranges, and were, therefore, free of tax. At present, only one of these samples is free of tax. It is a very cheap fabric, and even that, apparently, to be free of tax, can be made only in one shade. The others, previously tax-free, now pay tax. The lowest rate, with the revision announced last night, is 9 per cent., and the others pay 25 per cent., 30 per cent., and 35 per cent.

I would ask the Financial Secretary whether he supposes that that is going to increase purchases of furnishing fabrics. Will it be of the slightest assistance to the rayon industry, and the other industries concerned? As regards helping the export trades, the manufacturer of the slightly better qualities has to carry a heavy burden. In spite of the Chancellor's concession he has to pay tax ranging from 32 to 44 per cent. A strong case was made out by the hon. Member for Ashton-under-Lyne, who suggested that the whole conception of a 50 per cent. tax for piece goods should be reexamined. If a tariff of 44 per cent. is put up by a foreign country we regard it as very high. Yet we expect our manufacturers to face that kind of burden. It seems to me that the suggestions so far made by the Chancellor are quite inadequate to meet the situation in the textile industry with reference to furnishing fabrics and rayon.

4.30 a.m.

There are various anomalies connected with the distinction between cloth which has a certain percentage of wool and cloth which has les than 15 per cent. of wool. My hon. Friend the Member for Ashton-under-Lyne seemed to think that was not very important. Well, I bow to his superior knowledge, but such information as I have been able to obtain is that it is in fact becoming the practice of manufacturers of furnishing fabric to incorporate a small amount of wool simply with the idea of evading tax. Again, I have here two samples of tapestry, one of cotton tapestry and one of what would normally be cotton tapestry but into which a few threads of wool have been incorporated simply with the idea of bringing it into a different tax range.

The peculiar thing is that fabric which would without this manoeuvre be more expensive by some Is. 9d. has turned out to be less expensive by 3s. 8d. by having a few threads of wool added. The manufacturer himself informs me that this addition of wool makes it no better as a tapestry than if it were all of cotton, and will probably render the fabric unsaleable abroad for the reason given by the right hon. Member for Blackburn, West, because of the higher rates of duty on wool in many countries.

Therefore, we have anomalies and a tax level which is entirely unsatisfactory, and I hope that in dealing with this extremely important part of the Schedule we shall have some positive assurances from the Chancellor that he is proposing to do something definite about it.

I now wish to say one or two words about some of the other items in the Schedule which have not been touched on to any great extent this evening. I might here just point out to those who represent Northern Ireland constituencies that on Class C material we on this side of the Committee anticipated their Amendment by a fortnight or so. They followed the line we had suggested with a difference of 3d. in most cases, and in one case only 1d. is between us. The only case in which there is any major discrepancy is in group 4, bed sheets, table cloths and table covers, where our suggestion is 12s. 6d. and their proposal is only 10s.

That is merely another example of the principle with which we dealt at some length yesterday. Where a number of articles of differing values are put together there is a higher D level to cover them all. The Amendment proposed by the Northern Ireland Members, suggesting a figure of 10s., is rather too high for sheets and not high enough for table cloths.

Now just a word or two about other goods not textile goods, namely, domestic requirements such as mattresses, bolsters, pillows, and so on. For many of these we have put down Amendments. We have been as reasonable as possible; we have not put down Amendments for every item, as we might have done. For example, in group 5, pillows, the Schedule suggests 10s. per article. We have agreed that, as that covers most pillows of small size, we would not put down an Amendment, although we might very well have done for other larger sizes, for which the previous top Utility price was 20s.

But on other items, particularly mattresses, we have put a somewhat higher D level for the reason that with articles of this kind, which for many households are a major capital outlay, it is extremely important to ensure that quality standards are observed. We feel, as we did in the case of other articles in this Schedule, that where items of capital equipment and major expenditure are concerned we have a duty to safeguard the housewife who is making the purchase. That is the justification for a number of Amendments on the Order Paper, the figures in none of which are higher than, and in most cases do not reach the previous top Utility figure for the articles concerned. Where, in other instances, we felt the D level suggested was not unreasonable on the whole, such as in the case of linen towelling, we have not attempted to put down any Amendment merely for the sake of argument.

I hope that on this extremely important part of the Schedule we shall have a much more adequate and satisfactory reply than we have had hitherto on many of the suggestions we have put forward. Many of us feel, and many of our constituents feel, that, after all, these matters could have been looked into with rather more thoroughness before we reached this stage of the Bill. We feel that by now, on many of these points, the Chancellor should be ready with some more definite answers.

Mr. R. A. Butler

Perhaps the hon. Lady would refer to the definite answers given, such as that given only a few hours ago on furs and the one given on gloves. Her generalisations are not quite fair, because we have made very definite concessions in this debate.

Mrs. White

The Chancellor has given definite answers, but perhaps in his absence we have had some less definite answers from the Financial Secretary. I do not think it is unfair to say that, because on many points in which I am interested I have not had certainty or satisfaction. I hope to have more certainty and satisfaction before we end this debate.

Mr. William Shepherd (Cheadle)

We have discussed Part II of the Schedule quite extensively though, in my view, not extensively enough. It is unfortunate that we have to discuss it at so late an hour, because it contains an immense number of complications. The section with which we are now dealing is perhaps the most difficult part of this Schedule and it demands more attention than we can give it at this hour. This section is a condemnation of Purchase Tax and shows how impossible it is as an instrument. My right hon. Friend, even with his social security crystal, has been unable to see through the maze of Part II.

The hon. Member for Ashton-under-Lyne (Mr. Rhodes) and myself are directors of the Manchester Chamber of Commerce and, naturally, we have received a good many representations about all kinds of textiles affected by the D scheme. But there has been no more convincing case than that made on behalf of furnishing fabrics. Perhaps the hon. Member for Ashton-under-Lyne did not emphasise sufficiently the case he put over about the difference between conversion value today and that four or five years ago. It is true that conversion value is very different today from what it was four or five years ago in that the value of the cloth constitutes a much higher proportion of the finished value than before.

What the hon. Member did not say—and this is important in respect of furnishing fabrics—is that dress fabrics are sold in the main as finished goods and, therefore, attract 33⅓ per cent. tax, whereas furnishing fabrics are in the main sold as piece goods and attract 66 per cent. Therefore, I think that there is a very sound case for my right hon. Friend to get over the administrative difficulties that we all know are involved and to do something to assist the furniture fabric manufacturers

. I should like my right hon. Friend to be specific, if he is able to be, about quilts. The lumping of the types of quilts together under one D level, really, is not satisfactory, and, unless it is attended to, it will lead to very material deterioration in the standards, particularly of down quilts. I hope that he will be able to do something for the industry there.

There are five omissions from the Schedule to which I would call his attention. I cannot see why mattress covers are not included, or quilt cases. or bolster ticks, or chair back covers, or cushion covers. If there is justification for many of the items which have been put into the Schedule, there is justification for those. I hope that my right hon. Friend will give us specific answers on those points. Between now and the Report stage we may have an opportunity of considering in more detail some of the important points raised in this Part of the Schedule.

Mr. Dryden Brook (Halifax)

Like the hon. Gentleman the Member for Cheadle (Mr. Shepherd) I shall confine myself to a very limited area of these Amendments. I want to speak about the trade I know well; that is, the woollen and worsted cloths trade. At the outset I declare two interests. One is, that I have worked in the wool industry for many years, although I have no financial interest at the moment in any particular firm; the second is that since the war I have worn nothing but Utility clothing. Therefore, I know what the cost will be of these proposals so far as my family and I are concerned. My reaction is, I think, the reaction of the average man towards these taxes.

During our debates on this matter we have had, I think, two questions in our minds: first, how will the D scheme affect employment in particular industries; and, second, will it affect the cost of living? The D scheme, in my judgment, must affect adversely employment in the wool industry, and particularly in the finer sections of the industry. We have to look at the position of the trade today. The sellers' holiday which has existed for the last 10 years or so has now completely gone. Buyers are now more "choosy," and price is now a very considerable factor in every sale and purchase that takes place. In the consumers' pockets every shilling now counts.

Therefore, there is all along the line buyers' resistance, and that buyers' resistance is accentuated as the price of particular articles rises. It is accentuated particularly if it is know that in the price there is an element of tax. If I am right in these assumptions all those factors taken together must affect demand, and, consequently, affect employment in the industry

. I have been speaking of the home market, but there is a relationship between the home trade and the export trade which the hon. Gentleman the Member for Orkney and Shetland (Mr. Grimond) emphasised, and which I want to emphasise, too. The Chancellor has spoken, as other right hon. and hon. Gentlemen have spoken, of the blind spot that existed in the Utility scheme between the best Utility and the better class worsted suitings. It was always considered a blind spot in respect of tax, but the real trouble was the relationship between the Utility scheme and the export trade. The blind spot there was the weight of the cloth.

4.45 a.m.

The Utility cloth was not of sufficient weight to make a really good suiting. The Utility cloths finished off at about 15 or 16 ounces whereas the export market for fine worsteds began at about 19 ounces. It was that gap between the weights that made all the difference between the Utility scheme and the home trade helping the export trade. It is said that an export trade is helped by a healthy home trade, but that means quantity not so much quality. There must be a fairly big output to compete in the export market.

Let me illustrate what I mean by taking two particular cloths which have been given to me by a manufacturer in my own constituency. A utility cloth fine worsted coating of 15 or 16 ounces can be made today on the present price of wool at 25s. 6d. to 27s. 6d. per yard, and the D scheme level is 23s. 4d. for a cloth of that particular width. So that cloth will pay tax. That particular manufacturer will be making that cloth for his home trade, but if he wants to export cloth of that particular quality he will have to begin at 19 ounces and it cannot be made under 30s. a yard. But he has nothing in his own home trade in that particular weight of pattern to help him. That is where the difficulty will come in, and it is something which has existed under the Utility scheme. It is a question of the relationship between the home trade and the export trade.

My hon. Friend the Member for Ashton-under-Lyne said that for ladies' material the D level was generous, but I must disagree with him. At present, ladies wear fine worsted cloth, and we must see how that comes within the scope of the D scheme. Take one example, which concerns a 14 or 15 ounce cloth. The factory price of that cloth is £1 3s. 4d., but when an uplift of one-sixth is added at 3s. 11d. it gives £1 7s. 3d. The D level for that is £1 2s. 7d. Here again we have a D level undermining not merely the demand in the home trade but also the demand in the export trade. I claim that the 14s. 6d. per square yard, which is the D level, is far too low for the fine wool and worsted trades.

If the Chancellor wants to help the export or home trade of fine worsted materials he must raise the level to such a point that he will bring out not merely all the demands for the home trade, but also some of the demands for the export trade, particularly to help the manufacturers. I hope that the Chancellor will respond to the appeals made to him tonight, because I believe that this is the most important section of the Schedules which we have been discussing. If he takes some action in this matter it will greatly help the industry and will be very much welcomed.

Mr. John Baldock (Harborough)

I want to bring to the notice of my right hon. Friend the Chancellor of the Exchequer an anomaly in one section of furnishing fabrics. Ready-made loose covers for cushions, chairs and seats pay tax not only on the D value of the fabric from which they are made, but also on the cost of making them up. If the same fabric is sold to a retailer and made up by him it pays tax only on the value of the fabric. One would expect the ready-made article to carry less tax than the purpose-made one.

The position is still more anomalous in that retailers are permitted to advertise loose covers made to a certain size and style which pay Purchase Tax only on the fabric and not on the cost of making up the article. A further anomaly is that loose covers for motor car seats come under the same arrangement, tax only being paid on the fabric, although loose covers for motor car seats are less essential than cheaply made loose covers for other purposes for which there is a demand. This class should be transferred to section 3 of Part II and be treated in the same way as blankets and pram covers, paying tax on the value of the material and not on the cost of manufacture.

Mr. Lee

No matter what the views of hon. Members may have been on the application of the D scheme prior to the discussions on the Finance Bill, all must now view its continued application with some apprehension. One can imagine the complexities of dealing with it each year on the Finance Bill. Even in this initial year it is obvious that neither right hon. Gentlemen on the Government Front Bench nor their hon. Friends behind them can adequately explain how D is fixed in relation to the value of an article before the introduction of the scheme.

We are rapidly coming up against a most important constitutional issue. I understood that the general theory was that the Opposition put down Amendments to Government Bills in the hope of getting scientific explanations from Ministers about the meaning of their Bills. I should be the last to charge any of the Treasury Ministers with incompetence, for that would be untrue and unfair, and I do not believe that anyone could go to the Dispatch Box and give a scientific explanation why any of the Ds that we are discussing have been placed in the categories in which we find them.

My hon. Friend the Member for Flint, East (Mrs. White), was right in her criticism. I do not believe that the Chancellor understood precisely what she meant when she said that we had not had satisfactory answers. It is impossible to get a satisfactory answer from any Minister why D is placed where it is instead of in the positions suggested by our Amendments. On previous Amendments, for instance, I felt very sorry indeed for the Financial Secretary when some of my lion. Friends were asking him to define why panties, slips, corsets, brassieres, and the like were placed in certain classes. How was it possible for him to give a scientific explanation on matters of that sort? I would have hated to have to do his job, and I was glad he had to answer rind not me.

We are coming up against a quite serious constitutional point in that we cannot hope to get satisfactory answers from Ministers on questions of this type. The Chancellor himself pointed out that he was unable to have consultations with the trade on many of these things because they might lead to a Budget leak. He has had to have a hit-or-miss policy because he did not dare consult the only people who could advise him on these matters. I have protested on two occasions about the fact that Treasury Ministers alone are now having to deal with complicated issues concerning the textile industries of Lancashire and Yorkshire, and the other industries covered by the Finance Bill.

The hon. Member for Flint, East, again mentioned the fact that the President of the Board of Trade and his Parliamentary Secretary have been conspicuous by their absence during the whole of the Committee stage. I want to repeat my protest that at a time when many of our industries are not in a healthy state we are discussing their products solely from the point of view of their ability to produce revenue, and not from the point of view of the social necessity of developing some types of products against others.

Mr. William Ross (Kilmarnock)

On a point of order. I wonder if your attention has been drawn to the noise and chatter from the end of the Chamber, Sir Charles. We can hardly hear the hon. Gentleman the Member for Galloway (Mr. McKie) snoring.

Mr. Lee

The Minister of State for Economic Affairs had flatly to contradict the Chancellor's statement that there had been a scientific process worked out in the Treasury to find the correct level of D. When the Minister admitted that there was no such process, and that there could not be one, he did quite a lot to discredit the basis upon which the scheme was founded. One of the reasons why the Chancellor has sought other methods of decreasing the level of taxation than raising D is because he could not possibly defend an alteration in the level of D in public because he has not the slightest knowledge of any scientific process on which the level was founded.

5.0 a.m.

I am extremely apprehensive—more than I was even when this Committee stage began—about the future of the textile industries. The only consolation we could get from the Minister of State for Economic Affairs was that he would try to find out why so many anomalies could be revealed and, if possible, to rectify them between now and the Report stage. He was not by any means optimistic that this could be done, and went on to say that, if that were not possible, the Government would try to do something in the next six or 12 months.

The chaos now obtaining in the textile industries is such that it is the height of folly to believe that those industries can survive another six or 12 months with the iniquitous system of taxation now being levelled on their products. It is hard to conceive how we can restore health back to those industries if we have to wait such a long period before these obvious anomalies can be redressed.

I hope that hon. Members in all parts of the Committee will now say to the Government that the D scheme has been shown to be unworkable. I thought my hon. Friend the Member for Ashton-under-Lyne (Mr. Rhodes) showed that to be so in a most illuminating way, from his expert knowledge of textiles. The scheme has been exposed as being futile and completely unworkable, and the Government should not insist on continuing with it merely because they would lose face if they agreed that it was no good. I suggest that it is no use, on the one hand, adhering to that and, on the other hand, saying that they do not wish to encourage the spread of unemployment throughout the whole textile industry.

I can think of no better way in which any Government could set out to kill an industry and to force mass unemployment in many of the great counties where we produce our textiles than now to adhere to a scheme which hon. Members in all parts of the Committee have proved beyond peradventure to be unworkable. I appeal to the Government now to take away the whole basis of the D scheme. We are agreed that there were many anomalies in the Utility scheme. Indeed, my right hon. Friend the previous Chancellor of the Exchequer would not have set up the Douglas Committee had there not been anomalies. But it is one thing to set up a committee to examine and eradicate anomalies and quite another thing to use a Report such as theirs as a pretext to wreck the entire Utility scheme.

I appeal to the Government, while there is yet time, to reconsider the basis of what they are doing. If they do not do so a great calamity will fall upon many of our great manufacturing industries, and it will then be no good for right hon. Gentlemen opposite to say that they did not appreciate what would happen because they will stand damned as a Government which deliberately caused mass unemployment throughout regions which have been responsible for the prosperity of this country for centuries.

Mr. Charles Fletcher-Cooke (Darwen)

I have not intervened in the Purchase Tax debate on textiles so far although it is a matter which concerns my constituents very closely. I have, however, listened throughout all the many debates on this subject and it has emerged quite clearly that there is an irreconcilable dilemma in the imposition of this tax.

I was much struck by a statement made by the hon. Lady the Member for Coat-bridge and Airdrie (Mrs. Mann). She said that the D tax would now be spread more equally among all members of the community. Such words are usually ones of approval, but I think she meant to disapprove. On the other hand, there was one hon. Member opposite, who spoke with great knowledge of the boot trade, who said that there was a case for putting a tax not on quality goods but on shoddy goods.

Those two statements illustrate two arguments—one for taxing inferior goods, one for taxing superior goods. I have noticed that sometimes the better goods are called quality goods, when words of praise are used, and sometimes luxury goods, when words of disapproval are used. But they are the same goods when exports are to be encouraged. It may be a wicked world, but it is the luxury goods we export that are most in demand abroad, and although we can control our home market we cannot control our foreign market.

That is the dilemma of this tax. There is a case—with furnishing fabrics a strong case—for raising the D level to encourage quality. I lend my voice in support of my right hon. Friend the Member for Blackburn, West (Mr. Assheton), because it has been proved, in the words of the last speaker, beyond a peradventure in this case, that unless the D level is raised, or some similar relief is given to the industry, not only the export but the home market will be radically and seriously crippled, perhaps permanently, because it is twisting the structure of its trade in order to take advantage of tax relief from another source. I therefore earnestly pray that the Chancellor will, so far as he can, give some concession to this important trade.

Mr. Geoffrey Bing (Hornchurch)

I address myself to the arguments of the hon. and gallant Gentleman the Member for Down, South (Captain Orr) and the hon. Gentleman the Member for Belfast, South (Mr. Gage). If I do not address the Committee at such length as the hon. Member for Belfast, South, it is not that I do not feel the matter is serious, but only that the argument has been so thoroughly canvassed that it is not for me to go into it again.

The argument of the hon. Member for Belfast, South was absolutely impeccable. We are all sorry that we are to lose him from this House, and we hope that his successor will be able to put these questions as clearly as he does. But these matters are not solved by speeches but by actions, by works. It is because the hon. Gentlemen opposite represent not the Unionist Party but an independent party that I ask them whether they are prepared to solve this matter by a vote. The Government had in the last Division a majority of 18; the party of the hon. Member for Belfast, South is nine. They have only to say that if the Chancellor does not give way to their Amendment they will vote with us.

Is it just all talk? This is a very serious matter so far as Northern Ireland is concerned, and hon. Gentlemen opposite cannot afford just to have all talk about the most important industry of Northern Ireland. There was a slight quarrel about how linen was produced in Scotland, but 80 per cent. of the linen production of Great Britain comes from Northern Ireland and the balance comes from Scotland.

Mr. Gage

On the point of the vote. Does the hon. and learned Gentleman recall the time when he was in charge of the Labour Party's Northern Ireland policy and he inveigled 200 of his hon. Friends into putting down one of the most insulting Amendments that could be put down on Northern Ireland? Would he suggest we are really serving our constituents best by supporting the party that did that, or by supporting the party that has consistently supported us throughout the years?

Mr. Bing

You would rule me out of order, Sir Charles, if I were to start a general Irish debate. All I was suggesting was that the hon. Gentleman should have the courage to vote for his own Amendment. Is there anything very wrong in suggesting that when hon. Members have put an Amendment on the Order Paper they should either vote for it or withdraw it? It closely follows the Amendment put down by my hon. Friends. I cannot speak for my party in this matter, but I hope we should follow the hon. Member for Belfast, South into the Lobby if he voted for his Amendment. The difference between the Amendments is only a penny or so. I think our Amendments are possibly better, but it is only a question of degree. I am certain that if the hon. Member were to move any one of his Amendments he would have this party behind him. Will he move any of them? This is a very serious matter for Northern Ireland.

Scotland had a linen industry, and it has a great monument in the British Linen Bank, but the Scottish side of the linen industry has gone rather to finance. On the other hand, in Northern Ireland one-fifth of all the people who are employed in any form of employment are engaged in the linen trade. If there is one word of truth in what was said by the hon. and gallant Member for Down, South—and he can get up and admit that he was mistaken if there is not—then the tax will ruin the economy of Northern Ireland. The hon. and gallant Gentleman belongs to an independent party—a party which has come forward all the time to say, "Elect us; we are pledged to nobody; we are pledged only to look after the interests of Northern Ireland."

Here the interests of Northern Ireland are at stake, and is the only hon. Member who is to go through the Lobby on behalf of Northern Ireland the hon. Member for Mid-Ulster (Mr. O'Neill)? Is he the only Member for Northern Ireland who will vote in favour of a series of Amendments put on the Paper and discussed in a long speech by the hon. and gallant Member saying that hon. Members determined on this course in order to force the Chancellor of the Exchequer to take action?

But hon. Members do not need to go through the Lobbies. The Chancellor knows the figures of his voting strength as well as we do, because the Patronage Secretary has been whispering to him, and the hon. and gallant Gentleman has, therefore, only to threaten to do it—and the Chancellor will give way. Will not one hon. Member opposite from Northern Ireland get up and say that, for the sake of Northern Ireland, he is prepared to support his own Amendment—or it is all nonsensical talk? Is it talk with the idea of deceiving the unfortunate workers, the people who are now out of work in Northern Ireland, into thinking that hon. Members opposite will do something for them? Are they not to vote for their Amendments because in some other Parliament someone put down an Amendment which they thought insulting?

Are we to hear from any other hon. Members for Northern Ireland whether they intend to vote for their Amendment, or are they to remain silent? If the latter, it should go out clearly from the Committee that this is a most cynical betrayal of the interests both of the working class, whose votes sent them here, and of the manufacturers, whose money put them here.

Mr. Gage

The hon. and learned Gentleman will remember that it was his lion. Friends who first put forward the argument that they would not vote for their own Amendments on the ground that they did not desire to put the Tory Party in power. We work in the reverse direction.

Mr. Bing

So far as I can recall, on the last two occasions there have been no Labour Amendments to the Finance Bill, so satisfied were my hon. Friends with what was presented. That is a remarkable difference from the present position.

Mr. Braine

Will the hon. and learned Member say that the party opposite, including himself, were consistently satisfied with the incidence of Purchase Tax during the last six years?

Mr. Bing

The question was why we did not vote for our Amendments to the Finance Bill, and the answer was quite simple: there were none on the Order Paper, so it was impossible to vote for them. If we put an Amendment on the Paper we do so for one of three reasons. The first is to secure a discussion, and then to withdraw the Amendment. Is the Amendment to be withdrawn? The second is because we are determined to support the Amendment. Are hon. Members opposite going to support this Amendment? Thirdly, an Amendment may be put down to deceive people and to pretend that we intend to take a strong line; to induce people to vote for us, and yet to support the party vote while still endeavouring to satisfy those who voted for us.

5.15 a.m.

Are hon. Gentlemen opposite going to say how many Amendments they had on the paper; how they copied the Labour Amendments, every single one of which referred to Northern Ireland, but how they did not, of course, vote for them? I need not delay the Committee longer. [HON. MEMBERS: "Hear, hear."] It is all very well for hon. Members to say "Hear, hear"; but by their actions nine hon. Members from Northern Ireland are probably condemning about 20 per cent. of the insured population to unemployment, and they could stop it, according to their own argument. They have only to vote for their own Amendment. Are they prepared to do that?

Mr. Pryde

I support this Amendment. We have listened to frank arguments by hon. Members representing Northern England constituencies on this side of the Committee who have demonstrated that they are masters of their craft. It only remains for me to dot the i's and cross the t's of what has been said. I gave the Chancellor notice a fortnight ago that we would do our best to assist him in amending the Bill. I think he will agree that we have given him every opportunity to make some improvement.

I associate myself with my hon. Friend the Member for Ashton-under-Lyne (Mr. Rhodes) and the right hon. Gentleman the Member for Blackburn, West (Mr. Assheton), who objected to so many things being grouped together. Travelling rugs and blankets are in the same category, while in the same class are woven curtains; yet we find that curtains and tapestries are woven in different factories in different parts of my constituency. I do not want to follow my hon. and learned Friend the Member for Hornchurch (Mr. Bing) into party squabbles, but as a member of another subject race, I must cross the Border to Scotland for my data.

I want to clear up a point which may have caused a certain amount of misapprehension. An hon. Member has said that we in the woollen industry in South-East Scotland are not equipped to tender for contracts which would be placed by Government Departments. Let me make clear that in past years we have participated in these contracts for serge, great coatings and shirtings. This year, because of the economic situation in the North of England, I presume, we find that we are not participating in the Service contracts.

I want to tell the Chancellor that our contracts are fast running out, and to warn him that we face a serious situation. The people in the Tweed Valley are a proud people; they will not easily take to unemployment. One only needs to stand in the High Street in Peebles on a certain Saturday morning in June to witness the ceremony at which telegrams are read from Peeblians all over the world for the Peeblian is not afraid to go abroad. There is great apprehension in Scotland today, because only a week ago we saw the Government play "Old Harry" with our great Health Service, and I do not want to see the same happen to our tweed industry.

Tweed occupies a very important place in our economy, because in Yorkshire they cannot weave the quality of cloth that we weave on the Tweed. Hundreds of years of experience, generation after generation, have imparted skill and knowledge into the weaving of tweed in the Tweed Valley, and with the allied industry of tartan we have something which can be very useful to our national economy. Tartan is not a cloth that is dyed, printed, coated or yet subjected to any other process. It is woven.

Here I draw the Chancellor's attention to the fact that, while it is exported in large quantities, still we do not get the benefit of freedom from Purchase Tax. Our manufacturers supply the kilt makers in all the big towns of Scotland.

Edinburgh, Glasgow, Dundee, Perth, Inverness and Aberdeen all have their kilt makers. Anyone who sees a Scottish regiment marching along Whitehall or Princes Street can bet that the tartan has been woven in Peebleshire. Now, we do not get the benefit of freedom from Purchase Tax because of the system of getting rid of our cloth.

In regard to the Utility wear in Peebles mills, I draw the Chancellor's attention to the fact that while he has been absent we have listened with very great respect to the Financial Secretary, who stressed the blind spot between the Utility garment and what is called the lower luxury garment. For many years the tweed industry in Scotland was regarded as a luxury industry and I resented that; I denied it, because I believed that the miners in my constituency did sufficient at their work to earn a good suit of clothes. Today, I want to make sure that the Chancellor will follow the advice of both employers and employees in the Tweed Valley and accede to our request to lift the D level in order that our industry can get going, and so that we shall again be making our full contribution towards the British national economy.

Mr. R. A. Butler

This, I think, has been the longest debate of the whole night, and indeed of the whole two days. That is due to the fact that it concerns the most important subject of cloth and all these other articles to which reference has been made. I hope, however, that we may now bring our discussion on these many matters to a close, and I will do my best to answer some of the points that have been raised.

The right hon. Gentleman the Member for Huyton (Mr. H. Wilson), who opened the debate, referred, I think rightly, to the practical impossibility of differentiating between woollens and worsteds. That has been our experience, and it accounts for our inability to differentiate between them in the Schedule. The right hon. Gentleman, however, was not in agreement with his hon. Friend the Member for Ashton-under-Lyne (Mr. Rhodes) on the subject of the D for wool, because the latter thought that the D was at a reasonable level whereas I do not think the right hon. Gentleman did.

Mr. H. Wilson

I am sorry to interrupt at this time, but there was no contradiction. I made it plain, I think, that the D level was reasonable for the wool part of the woollen and worsted industry. But above the D level—between the D level and the one we propose—one has the main range of worsted products and the D level is not suitable for worsted. My hon. Friend the Member for Ashton-under-Lyne (Mr. Rhodes) and I have discussed this matter on many occasions and I can assure the right hon. Gentleman that we are in complete agreement.

Mr. Butler

I am glad that I have effected one reconciliation today. The matter was referred to by at least one other hon. Member. But the right hon. Gentleman's argument leads him into that difficult territory, which I mentioned earlier, of differentiating between woollen and worsted. That is one of the reasons why we have found it difficult to change the wool D to which the right hon. Gentleman's Amendment refers.

The case of linen has been raised by my hon. and gallant Friend the Member for Down, South (Captain Orr) and my hon. Friend the Member for Belfast, South (Mr. Gage) and others. I realise their anxieties. If I may say so in the presence of the hon. and learned Member for Hornchurch (Mr. Bing), if the Government needed means to bring hon. Members from Northern Ireland closer to them their best course would be to ask the hon. and learned Member for Hornchurch to take part in the debate. We are very much obliged to him for acting as a soothing balm upon the feelings of Northern Ireland Members and for tying them more closely to our majority.

Mr. Bing

Is the right hon. Gentleman suggesting that Northern Ireland Members would be prepared to agree to something which was not in the interest of Northern Ireland out of personal pique because they happened to dislike the speaker on this side of the Committee? If so, it is a very unworthy suggestion.

Mr. Butler

I am suggesting that Northern Ireland Members, unlike some hon. Members opposite, would be ready to listen to what I have to say.

As to linen, following upon the advice of the Douglas Committee, we have deliberately made a different D for what are called white goods, in particular pillow cases, bolster slips, towels and handkerchiefs. We did so because, as the Douglas Committee said, these articles are used in the export trade. It is true that the cloth to which my hon. and gallant Friend the Member for Down, South referred is not included in Part 11 at the beginning under A or B actually by name. Reference was made by another hon. Member to that fact. But Class B material does include linen, as will be found at the beginning of the Schedule on page 73 of the Bill.

That is not meant to be an insult to Northern Ireland, but to represent an absolute conclusion to which we have come that linen must be considered on the same sort of level as other threads or articles we have considered earlier, particularly nylon and silk. But, much more than that, in our close investigation of this subject we have found that very little linen is sold as piece goods and that it is mostly made up into those articles which now come under the higher D level.

I believe that one of the reasons why my hon. Friends have wished to include a special sub-head at the beginning of Part 11 for linen and a special D level for linen is because they are taking an interest in furnishing fabrics. If that is the case I ask them to wait until later in my speech when I shall say something on that subject. I am sure that hon. Members will see that we are taking considerable interest in the severe unemployment in Northern Ireland, which is one of the problems of United Kingdom economy at the present time.

My hon. Friend the Member for Cheadle (Mr. Shepherd) and the hon. Member for Ashton-under-Lyne raised the question of quilts, bolster tick—which are not so bad as they sound—and other articles which, in the various levels of their Ds, have raised a certain amount of difficulty. I give no undertaking about quilts, except to say it is one of the subjects on which I have listened to the experts with the greatest interest and if I can find anything in the points raised in the next few days or weeks I shall certainly do so.

5.30 a.m.

I notice that the Opposition have been very critical of the way we have drafted our provisions. I think in the case of linen they have made provision for the increase of D for double bed pillow cases but not for single bed ones. I should like to ask the right hon. Gentleman, who has been very able in the drafting of these Amendments, whether this was intentional or not.

Mr. H. Wilson

Yes.

Mr. Butler

Then there are other items, pillow cases, towels, towelling, and other similar matters. I am afraid that we have to adhere to the general levels we have decided on in these various matters.

I want to come to the major issue raised in this debate. It was raised by my right hon. Friend the Member for Blackburn, West (Mr. Assheton) and the right hon. Member for Huyton. Let me say in passing, while referring to Blackburn, that I am sure we all wish that the hon. Lady the Member for Blackburn, East (Mrs. Castle) will soon recover. The position about general cloth at 4s. D which I now come to is covered by the general observations I made yesterday to the effect that I have thought that the revenue I can spare is best devoted to lowering the general rates rather than to increasing the Ds in general. We have already given substantial relief by reducing those rates, and I believe that it would be wrong to pursue the course quite recently suggested by the Opposition.

It would also, if we were to follow the advice given by hon. Members opposite, not only be necessary to go back over all the Schedules we have painfully discussed and readapt several matters we have considered, but I calculate that it would cost an extra 10 million or more likely £15 million above that already conceded, and it would upset the balance which must be maintained.

The hon. Gentleman the Member for Orkney and Shetland (Mr. Grimond) and the hon. Gentleman the Member for Ashton-under-Lyne asked me, in this connection about the two-to-one ratio and the conversion rate, and the general relation of the ratios to D. The Government intend to adhere to the general advice we have been given and the general formula on this matter. I have made inquiries since the hon. Gentleman the Member for Ashton-under-Lyne spoke, because he speaks with considerable authority in these debates. It is probably working all right in the woollen and worsted trades, but I have some doubt whether the rates are working in the cotton and rayon sector, and, therefore, I shall pay particular attention to the hon. Gentleman's remarks, which are of an expert character, and follow this up in due course. At the same time, hon. Members will understand that if we were now to make alterations in the normal cloth D it would affect considerably the general ratio of all Ds that we have been through, and heaven forbid that we should go through it all again, at any rate for a long time.

The general impression I get is that the 4s. figure is not too bad for ordinary cloth. At any rate, it has been worked out, and I am prepared to stick by it. I am aware of the severe incidence of this on the furnishing fabrics—curtains, and so forth. I have examined the figures of the incidence of the tax upon one of our finest firms in this sphere, and the owner of the business works out that the average tax on these beautiful cloths produced is about 16½ per cent. as a result of the Budget. This will now fall as a result of the concession I gave yesterday to some 12½ per cent., and 10 per cent. on the retail price.

I want the Committee to realise, when we talk about the 66⅔ per cent. that this, especially when dropped by a quarter to 50 per cent., is not a very high tax, for the tax is subject to what is known as the D relief, and the amount of D has to be subtracted from the total sum of the tax levied on the remainder. That results in the incidence of the tax not being so severe as hon. Members imagine.

Before the right hon. Gentleman for Leeds, South (Mr. Gaitskell) left us he said that the cost on the lower income groups of this new scheme would be a sum of £30 million to £40 million because I said that was the amount the D scheme would raise. The mathematics of the right hon. Gentleman are totally wrong, because the £30 million to £40 million is not the extra cost to the consumers below the D level or ex-Utility purchasers. It is the extra cost of subtracting D and taking into account the extra margin between D and the top price. That means that it is affected not only by Utility garments with a vast range, but the people who purchase above the D.

These are very complicated mathematics to follow at this early hour of the morning. I see that the Financial Secretary is nodding his head. It should be possible for him to contain such sums in his head whatever the hour of the day. The main object of this is to show that the right hon. Member for Leeds, South, before leaving us, deluded the Committee and the country—I am sure not intentionally—and as we have had so much propaganda I should like the people to know the truth about this important matter.

Mr. Jay

I am no longer Financial Secretary, but it is still clear to me, even at this hour, that the greater part of the £30 million to £40 million must largely fall on the lower-priced goods which will be bought by the lower income groups.

Mr. Butler

I am not so informed, because the higher prices will account for a greater percentage of that amount owing to the higher rates at the top levels. I am assured that that is the case.

No one who has listened to this debate and has heard the representations that I have heard—and I have been here most of the time—can be satisfied with the position of furnishing fabrics or curtaining material. These were referred to by my hon. Friend the Member for Cheadle—and I wish that he had taken more part in our debates, particularly in that concerned with boots and shoes, on which he is an expert. With great reticence he withdrew at the last minute. He talked a great deal of sense on this matter before us now.

Hon. Members generally, and particularly my right hon. Friend the Member for Blackburn, West will want to know what we can do about it. I have been able in my position to get the most expert advice in the country on this matter, and I notice that almost all of those hon. Members who have taken part in this debate, including the hon. Member for Ashton-under-Lyne, my right hon. Friend the Member for Blackburn, West and the right hon. Member for Huyton, agreed that it was almost impossible to find a definition of furnishing fabrics or curtaining which cannot, like the curtain material of the wife of the right hon. Member for Huyton, be placed on the person and worn as a frock or dress. It is even possible to wear very heavy curtaining with some advantage in our wintry weather.

I have done my best to find a definition, but so far I have not succeeded. What I shall do is this. I am going to appeal particularly to the three hon. Members concerned to consider this matter and send me a definition which they think will work. I have studied, for instance, the question of weight. I will weigh what hon. Gentlemen send me in the light of the expert opinion I have in my possession. I have listened to the suggestions in the debate, and the undertaking I can give is this: I wish to find a solution of this matter. I do not wish to alter the ordinary D scheme, but I wish to find a definition which will satisfy the position, and which, with the aid of the expert opinion we have already got, can be weighed by me as quickly as possible.

In the interests of certainty I do not wish to leave the position as it is for very long. In fact, I should like to have the definition before the Report stage if I can get it. I want to acknowledge to all hon. Members that a point has been made on this matter, and that it would be wrong for any responsible Minister not to pay attention to the point of view put forward.

Mr. Anthony Greenwood

At this stage of the debate, when most of us have been here for over 15 hours, I am not sure whether the public will admire our fortitude or question our sanity. However, I associate myself with the protest that was made against the fact that an important subject like this had to be discussed after 5 a.m. It is a matter for great regret that the proposal of my right hon. Friend the Member for Battersea, North (Mr. Jay), made just before midnight, was not accepted. We have been dealing with the most complicated and technical parts of the Schedule, and it is not possible to do them justice at this hour.

It is a pity that the Chancellor did not give way, because, on the whole, throughout the debate he has been most helpful and co-operative and willing to make suggestions which would meet the points advanced from all parts of the Committee. He has provided a useful example to the Government of how much more effectively the business of the House can be carried on by Ministers who know their job and treat the House with respect.

I am glad that the Chancellor has acquitted us of any suspicion of filibustering, because during these discussions we have considered about 150 Amendments. Hon. Members on both sides have done a great deal of work in considering the technical aspects of those Amendments.

It has been a little disappointing to hon. Members on both sides that the Board of Trade has been so generally unrepresented during our discussions. We caught a fleeting glimpse of the Parliamentary Secretary; he did not stay very long. I have not seen the President of the Board of Trade on the Government Front Bench during our discussion of the Schedule. It cannot be discourtesy on their part, because the President and the Parliamentary Secretary are always most courteous, but it seems a little odd that when we are discussing a matter which the textile industry regards as of such supreme importance the President and the Parliamentary Secretary are insufficiently interested to spend even an hour listening to the discussion in the hope that they might pick up something of advantage to them.

After all, they are in charge of the Department which is responsible for placing the defence contracts, on which the Government sets so much store for the diversification of industry—one of the things that the textile areas are demanding—for finding markets overseas, and for disposing of the frustrated exports, one of the problems of the textile industry.

I do not want to seem ungrateful to the Chancellor. In the speech which he has just made he has genuinely tried to meet the points which have been put to him from both sides of the Committee. As to the D level of woollen cloth and worsted, I did not think his explanation very convincing. We admitted that we had found it almost impossible to devise a definition which would make it possible to distinguish between worsted and woollen cloth.

The Chancellor has obviously had the same difficulty, but he has come to a different conclusion to ours. Whereas we proposed to raise the D level so that all woollen cloth and worsted would come to a higher D level, he is prepared to penalise the worsted side of the industry by making it subject to the same low D level to which all other woollen cloth is subject. I do not think that the speech he has made really deals with the points put by my hon. Friend the Member for Ashton-under-Lyne (Mr. Rhodes), the hon. Member for Orkney and Shetland (Mr. Grimond), and my hon. Friend the Member for Midlothian and Peebles (Mr. Pryde).

5.45 a.m.

Turning to linen, I am glad we had an explanation from the hon. and gallant Gentleman the Member for Down, South (Captain Orr) of the curious behaviour of his colleagues on this part of the Bill. But, as one who admires the Chancellor, I felt it was going a little far to say that he was exposing the trick that the Chancellor had played. That is strong language to use even in a united party and I think we should all join in repudiating the charge that the hon. and gallant Gentleman made. However, I do not think that the Chancellor of the Exchequer himself has made much effort to meet us on this point. There, again, he tells us that Class B includes linen, which we knew before, and we feel that even if the linen trade of this country is very small indeed it is placing it under an unfair disadvantage if it is classed in the category which comes under the low D level of 4s.

The right hon. Gentleman has forgotten that in Statutory Instrument No. 128 of 1952 a list of linen sheets is given which were previously tax free under the Utility scheme. All those sheets, which sell in considerable quantities in this country, will be subject to tax under the scheme as it now stands. We cannot accept the absence of proposals by the right hon. Gentleman in respect of linen as being satisfactory. If hon. Gentlemen opposite care to press their Amendment to a Division, we shall be happy to join them in the Division Lobby.

We appreciate the offer of the Chancellor in respect of furnishing fabrics. We have been faced with the same difficulty he has had, and we have not bad all the technical advice he has had in finding a definition which would enable us easily to distinguish between furnishing fabrics and other forms of cloth. However, we accept his suggestion. We will get down to work on this problem again during the next few days and will discuss with him whether we have been able to arrive at a definition which we can put forward to him as a basis of discussion. But we would not like to be regarded as necessarily approving of this low D level of 4s. for all cloths if events show that it is not possible to work out a satisfactory definition to enable furnishing fabrics to be put in a special category.

I do not want to detain the Committee by going through other aspects of the Schedule, about which we still have misgivings in spite of the reply of the Chancellor. However, I should like to say that we appreciate his suggestion in respect of furnishing fabrics, but that we feel it will be necessary to divide the Committee in respect of wool and also of linen.

Mr. Assheton

I want to say how profoundly relieved all Lancashire Members, and also all Members representing textile constituencies, must be to hear what the Chancellor has just said about furnishing fabrics. He has recognised that the case has been made out and he has asked us to help him in trying to solve the problem by providing the proper definition. It is a difficult problem but I can assure him that now we have been given that challenge we shall meet it, that a definition will be found, and that the trade of Lancashire will therefore benefit greatly.

Mr. Rhodes

The Chancellor has not said what he will do if we find a definition. Craftsmen are worthy of their hire, and if he will only state the wages perhaps we shall be better satisfied.

Question put, "That '14 6' stand part of the Schedule."

The Committee divided: Ayes, 204; Noes, 186.

Division No. 13.] AYES [5.51 a.m.
Aitken, W. T. Fraser, Sir Ian (Morecambe & Lonsdale) Noble, Comdr. A H P
Allan, R. A. (Paddington, S.) Gage, C.H. Nugent, G. R. H.
Alport, G. J. M. Galbraith, T G. D. (Hillhead) Oakshott, H. D
Amory, Heathcoat (Tiverton) Garner-Evans, E. H. Odey, G. W
Anstruther-Gray, Major W. J Godber, J. B. Ormsby-Gore, Hon W D
Arbuthnot, John Gomme-Duncan, Col. A Orr, Capt. L. P. S.
Ashton, H. (Chelmsford) Gough, C F. H. Orr-Ewing, Charlas Ian (Hendon, N.)
Assheton, Rt. Hon. R. (Blackburn, W.) Gower, H. R. Perkins, W. R. D.
Aster, Hon. J. J. (Plymouth, Sutton) Graham, Sir Fergus Peto, Brig, C. H. M
Astor, Hon. W. W. (Bucks, Wycombe) Grimston, Hon. John (St. Albans) Peyton, J. W. W.
Baker, P. A. D. Grimston, Sir Robert (Westbury) Pilkington, Capt. R A
Baldock, Lt.-Cmdr. J. M. Harris, Frederic (Croydon, N.) Pitman, I. J.
Baldwin, A. E. Harrison, Col. J. H. (Eye) Powell, J. Enoch
Banks, Col. C. Harvey, Ian (Harrow, E.) Price, Henry (Lewisham, W)
Barlow, Sir John Hay, John Prior-Palmer, Brig O. L
Baxter, A. B. Heath, Edward Profumo, J. D.
Beamish, Maj. Tufton Higgs, J. M. C. Raikes, H. V.
Beach, Maj. Hicks Hill, Dr. Charles (Luton) Rayner, Brig. R
Bell, Philip (Bolton, E.) Hill Mrs. E. (Wythenshawe) Redmayne, E.
Bell, Ronald (Bucks, S.) Hinchingbrooke, Viscount Remnant, Hon P
Bennett, Sir Peter (Edgbaston) Hirst, Geoffrey Renton, D. L. M
Bennett, Dr. Reginald (Gosport) Holland-Martin, C. J Roberts, Peter (Heeley)
Bennett, William (Woodside) Hope, Lord John Robinson, Roland (Blackpool, S.)
Birch, Nigel Horobin, I. M. Rodgers, John (Sevenoaks)
Bishop, F. P. Howard, Gerald (Cambridgeshire) Roper, Sir Harold
Black, C. W. Howard, Greville (St. Ives) Ropner, Col. Sir Leonard
Bossom, A. C. Hudson, Sir Austin (Lewisham, N.) Russell, R S.
Boyd-Carpenter, J A Hudson, W. R. A. (Hull, N.) Ryder, Capt. R E. D
Boyle, Sir Edward Hurd, A. H. Salter, Rt. Hon. Sir Arthur
Brine, B. R. Hutchinson, Sir Geoffrey (Ilford, N) Schofield, Lt.-Col. W (Rochdale)
Braithwaite, Sir Albert (Harrow, W.) Hutchison, Lt.-Com. Clark (E'b'rgh W) Scott, R. Donald
Bromley-Davenport, Lt.-Col. W. H. Hyde, Lt -Col. H M Shepherd, William
Brooman-White, R. C Jenkins, R. C D (Dulwich) Simon, J. E. S. (Middlesbrough, W)
Browne, Jack (Govan) Johnson, Eric (Blackley) Smiles, Lt.-Col. Sir Walter
Buchan-Hepburn, Rt. Hon. P G T Jones, A. (Hall Green) Spearman, A. C. M
Bullard, D. G. Johnson-Hicks, Hon L. W. Speir, R. M
Bullock, Capt M. Kaberry, D. Stanley, Capt. Hon. Richard
Bullus, Wing-Commander E. E. Keeling, Sir Edward Stevens, G. P.
Burden, F. F. A. Kerr, H W. (Cambridge) Steward, W. A (Woolwich, W.)
Butcher, H. W. Lambert, Hon. G. Stewart, Henderson (Fife, E.)
Butler,'Rt. Hon. R. A. (Saffron Walden) Lambton, Viscount Strauss, Henry (Norwich, S.)
Carr, Robert (Mitcham) Law, Rt. Hon. R. K Summers, G. S.
Cary, Sir Robert Leather, E. H. C. Sutcliffe, H.
Clarke, Col. Ralph (East Grinstead) Legge-Bourke, Maj. E. A H Taylor, Charles (Eastbourne)
Clarke, Brig. Terence (Portsmouth, W) Legh, P. R. (Petersfield) Taylor, William (Bradford, N.)
Cole, Norman Lindsay, Martin Teeling, W.
Craddock, Beresford (Spelthorne) Linstead, H. N. Thompson, Lt.-Cdr. R. (Croydon, W.)
Cranborne, Viscount Lloyd, Maj. Guy (Renfrew E.) Thornton-Kemsley, Col. C N.
Crookshank, Capt Rt. Hon. H F. C Longden, Gilbert (Herts, S.W.) Tilney, John
Crosthwaite-Eyre, Col. O. E. Lucas, Sir Jocelyn (Portsmouth, S) Turner, H. F. L
Cuthbert, W. N. Lucas, P. B (Brentford) Turton, R. H.
Darling, Sir William (Edinburgh, S.) Lucas-Tooth, Sir Hugh Tweedsmuir, Lady
Deedes, W. F. Macdonald, Sir Peter (I of Wight) Vane, W. M. F.
Digby, S. Wingfield Mackeson, Brig H. R Vaughan-Morgan, J. K
Donaldson, Cmdr C E. McA. McKibbin, A. J. Vosper, D. F.
Donner, P. W. McKie, J. H. (Galloway) Wakefield, Edward (Derbyshire, W.)
Doughty, C. J. A. Maclean, Fitzroy Wakefield, Sir Wavell (Marylebone)
Douglas-Hamilton, Lord Malcolm MacLeod, Rt. Hon. Iain (Enfield, W.) Walker-Smith, D. C.
Drayson, G. B. MacLeod, John (Ross and Cromarty) Ward, Miss I. (Tynemouth)
Drewe, C. Macpherson, Maj. Niall (Dumfries) Waterhouse, Capt. Rt. Hon. C
Duncan, Capt. J A. L Marshall, Sidney (Sutton) Webbe, Sir H. (London & Westminster)
Erroll, F J Maude, Angus Wellwood, W.
Fell, A. Maydon, Lt.-Cmdr. S. L C White, Baker (Canterbury)
Finlay, Graeme Molson, A. H. E. Williams, Gerald (Tonbridge)
Fleetwood-Hesketh, R. P Morrison, John (Salisbury) Williams, R. Dudley (Exeter)
Fletcher-Cooke, C. Mott-Radclyffe, C. E Wilson, Geoffrey (Truro)
Fort, R. Nabarro, G. D. N. Wood, Hon. R.
Nicolson, Nigel (Bournemouth. E)
Fraser, Hon. Hugh (Stone) Nield, Basil (Chester) TELLERS FOR THE AYES:
Mr. Studholme and Major Conant.
NOES
Acland, Sir Richard Bing, G. H. C Brown, Rt. Hon. George (Belper)
Adams, Richard Blackburn, F Burke, W. A.
Albu, A. H. Blenkinsop, A Burton, Miss F. E.
Allen, Scholefield (Crewe) Blyton, W. R Butler, Herbert (Hackney, S.)
Anderson, Alexander (Motherwell) Boardman, H. Callaghan, L. J.
Bacon, Miss Alice Bottomley, Rt. Hon A G. Carmichael, J
Benn, Wedgwood Bowden, H. W. Champion, A. J.
Benson, G. Braddock, Mrs. Elizabeth Chapman, W. D.
Beswick, F. Brockway, A F. Chetwynd, G. R.
Bevan, Rt. Hon A (Ebbw Vale) Brook, Dryden (Halifax) Clunie, J.
Cocks, F. S. Hynd, J B. (Attercliffe) Pryde, D. J
Coldrick, W. Irving, W J. (Wood Green) Rankin, John
Collick, P. H Janner, B Reeves, J.
Cook, T. F. Jay. Rt. Hon. D. P. T. Rhodes, H
Corbet, Mrs. Freda Jeger, George (Goole) Rabens, Rt. Hon A
Crosland, C. A. R. Jenkins, R. H. (Stechford) Roberts, Albert (Normanton)
Cullen, Mrs. A. Johnson, James (Rugby) Roberts, Goronwy (Caernarvonshire)
Dalton, Rt. Hon. H. Jones, David (Hartlepool) Ross, William
Davies, Ernest (Enfield, E.) Jones, Frederick Elwyn (West Ham, S.) Royle, C.
Schofield, S. (Barnsley)
Davies, Harold (Leek) Jones, Jack (Rotherham) Shackleton, E. A. A.
Deer, G. Jones, T. W. (Merioneth) Shawcross, Rt. Hon Sir Hartley
Delargy, H. J. Keenan, W Short, E. W.
Dodds, N, N. Kenyon, C Shurmer, P. L. E
Driberg, T. E. N. King, Dr. H. M Silverman, Julius (Erdington)
Dugdale, Rt. Hon. John (W. Bromwich) Lee, Frederick (Newton) Simmons, C.J. (Brierley Hill)
Ede, Rt. Hon. J. C. Lee, Miss Jennie (Cannock) Slater, J.
Edelman, M. Lever, Harold (Cheetham) Snow, J. W
Edwards, John (Brighouse) Lever, Leslie (Ardwick) Sorensen, R. W
Edwards, Rt. Hon. Ness (Caerphilly) Lewis, Arthur Steele, T.
Edwards, W. J. (Stepney) Lindgren, G. S. Stewart, Michael (Fulham, E.)
Evans, Stanley (Wednesbury) MacColl, J. E. Stokes, Rt. Hon. R. R.
Fernyhough, E. McGovern, J Strauss, Rt. Hon. George (Vauxhall)
Field, W. J. McInnes, J. Swingler, S. T.
Fienburgh, W. McKay, John (Wallsend) Sylvester, G. O.
Finch, H. J. McLeavy, F. Taylor, John (West Lothian)
Fletcher, Eric (Islington, E.) MacMillan, M. K. (Western Isles) Taylor, Rt Hon. Robert (Morpeth)
Follick, M. McNeil, Rt. Hon. H. Thomas, David (Aberdare)
Foot, M. M. MacPherson, Malcolm (Stirling) Timmons, J.
Forman, J. C. Mainwaring, W. H. Tomney, F.
Fraser, Thomas (Hamilton) Mallalieu, J. P. W. (Huddersfield, E.) Ungoed-Thomas, Sir Lynn
Freeman, John (Watford) Manuel, A. C. Watkins, T. E.
Freeman, Peter (Newport) Marquand, Rt. Hon H. A Weitzman, D.
Glanville, James Mayhew, C. P. Wells, Percy (Faversham)
Greenwood, Anthony (Rossendale) Mellish, R. J. Wells, William (Walsall)
Grey, C. F. Milkrado, Ian West, D. G.
Griffiths, David (Rother Valley) Monslow, W. White, Mrs. Eirene (E. Flint)
Grimond, J Moody, A. S. White, Henry (Derbyshire, N.E.)
Hale, Leslie (Oldham, W.) Morley, R. Whiteley, Rt. Hon. W
Hall, Rt. Hon. Glenvil (Colne Valley) Moyle, A. Wigg, George
Hall, John (Gateshead. W.) Mulley, F. W. Willey, Frederick (Sunderland, N.)
Hamilton, W. W Murray, J. D. Willey, Octavius (Cleveland)
Henderson, Rt. Hon A (Rowley Regis) Neal, Harold (Bolsover) Williams, Ronald (Wigan)
Herbison, Miss M Orbach, M. Wilson, Rt. Hon. Harold (Huyton)
Hewitson, Capt. M Oswald, T Winterbottom, Ian (Nottingham, C.)
Hobson, C. R. Padley, W. E. Winterbottom, Richard (Brightside)
Holman, P. Paling, Will T (Dewsbury) Woodburn, Rt. Hon A.
Holmes, Horace (Hemsworth) Paton, J. wyatt W. L.
Houghton, Douglas Pearson, A Yates, V. F.
Hoy, J. H. Peart, T. F Younger, Rt. Hon. K
Hughes, Gledwyn (Anglesey) Plummer, Sir Leslie
Hughes, Emyrs (S. Ayrshire) Porter, G. TELLERS FOR THE NOES:
Hughes, Hector (Aberdeen, N.) Price, Philips (Gloucestershire. W) Mr. Hannon and Mr. Wilkins.
Hynd, H. (Accrington) Proctor, W. T

Amendment proposed: In page 78, line 37, at end, insert:

(c) Class material … 9s. 0d. per sq. yd.—[Mr. Jay.]

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

The Committee divided: Ayes, 186; Noes. 204.

Division No. 134.] AYES [5.58 a.m.
Acland, Sir Richard Burke, W. A. Dodds, N. N.
Adams, Richard Burton, Miss F. E. Driberg, T. E. N.
Albu, A. H. Butler, Herbert (Haokney, S.) Dugdale, Rt. Hon. John (W. Bromwich)
Allen, Scholefield (Crewe) Callaghan, L. J. Ede, Rt. Hon. J. C.
Anderson, Alexander (Motherwell) Carmichael, J Edelman, M.
Bacon, Miss Alice Champion, A. J. Edwards, John (Brighouse)
Benn, wedgwood Chapman, W. D. Edwards, Rt. Hon. Ness (Caerphilly)
Benson, G. Chetwynd, G. R. Edwards, W. J. (Stepney)
Beswick, F. Clunie, J. Evans, Stanley (Wednesbury)
Bevan, Rt. Hon A (Ebbw Vale) Cocks, F. S. Fennyhough, E.
Bing, G. H. C Coldrick, W. Field, W. J.
Blackburn, F Collick, P. H. Fienburgh, W.
Blenkinsop, A Cook, T. F. Finch, H. J.
Blyton, W. R. Corbet, Mrs. Freda Fletcher, Eric (Islington, E.)
Boardman, H. Crosland, C. A. R. Follick, M.
Bottomley, Rt. Hon A G Cullen, Mrs. A. Foot, M. M.
Bowden, H. W. Dalton, Rt. Hon. H. Forman, J. C.
Braddock, Mrs. Elizabeth Davies, Ernest (Enfield, E.) Fraser, Thomas (Hamilton)
Brockway, A. F. Davies, Harold (Leek) Freeman, John (Watford)
Brook, Dryden (Halifax) Deer, G. Freeman, Peter (Newport)
Brown, Rt. Hon. George (Belper) Delargy, H. J. Glanville, James
Greenwood, Anthony (Rossendale) McGovern, J Shawcross, Rt. Hon. Sir Hartley
Grey, C. F McInnes, J. Short, E. W.
Griffiths, David (Rother Valley) McKay, John (Wallsend) Shurmer, P. L. E.
Grimond, J. McLeavy, F. Silverman, Julius (Erdington)
Hale, Leslie (Oldham, W.) MacMillan, M. K. (Western Isles) Simmons, C. J. (Brierley Hill)
Hall, Rt. Hon. Glenvil (Colne valley) McNeil, Rt. Hon. H. Slater, J.
Hall, John (Gateshead, W.) MacPherson, Malcolm (Stirling) Snow, J. W
Hamilton, W. W Mainwa