Clause 1.—(AMENDMENTS TO SECTION ONE OF COLONIAL LOANS ACT, 1949.)

HC Deb 21 November 1952 vol 507 cc2270-322

1.18 p.m.

Sir Richard Acland (Gravesend)

I beg to move, in page 2, line 6, to leave out from the beginning, to "for," in line 10.

The Deputy-Chairman

I would point out for the convenience of the Committee that this Amendment and the two that follow it can be taken together.

Sir R. Acland

I entirely agree, Mr. Hopkin Morris, that the first three Amendments hang together. The first is the only one that has substance. The next two are consequential and drafting in character.

The Bill has two main purposes. There is already an Act of Parliament allowing the Treasury to guarantee loans made by the International Bank to Colonial Territories. The Bill allows the Treasury to guarantee loans to Governments or other authorities exercising common functions for or over groups of Colonial Territories. Secondly, the Bill raises the limit of the guarantee from the existing figure £50 million to a new limit £100 million.

The proposal to increase the limit is contained in subsection (2) of the Clause. The subsection has two purposes, the first being to raise the limit. The second is to give the Treasury authority to declare what shall be the proper rate of exchange between sterling and some other currency when loans are made to the Colonial Territories in currencies other than sterling. With the second of these two purposes I have no objection. It is absolutely correct. My Amendments are designed to deny to the Government the right to increase the limit from £50 million to £100 million and to leave the limit where it is now.

The point which the Committee is called upon to consider is whether £54 million is for the time being sufficient or whether we should here and now increase that limit to £100 million. About this we had some useful figures from the right hon. Gentleman the Secretary of State for the Colonies and the right hon. Gentleman the Minister of State for Colonial Affairs. Re-reading those figures in the OFFICIAL REPORT I find them informative as to the course which colonial borrowing has taken up to now and is likely to take in the future.

In his speech the Secretary of State explained that in the immediate postwar years there was little colonial borrowing anywhere. In fact, there was none until 1948, when total borrowings from all Colonies amounted to £3 million, all of which was raised on the London money market. Then in 1949, 1950 and 1951 the borrowings increased from £3 million to £10 million, from £10 million to £17 million, and from £17 million to £25 million—giving the figures to the nearest million.

Looking at that list, the figures have this convenience, that they seemed to increase by £7 million every year except in the last year when they increased by £8 million. So it is reasonable to forecast that the increase may continue, roughly speaking, at the same rate into the future, and it may turn out that in the present year borrowings will be about £31 million, in 1953 about £40 million and in the next year about £50 million. That is the possible course of total borrowings, all of which have been raised up to now on the London money market and there is nothing to indicate that we shall have anything different in the future.

What has happened up to now to the loans raised by Colonies from the International Bank and guaranteed by the Treasury? I understand that there is only one such loan to a total of £10 million made in the latter part of 1951 to Southern Rhodesia. During 1952 no loans have been made, and it is a reasonable certainty, as they take a little time from proposal until finally made, that in 1952 there will not be any more loans by the International Bank.

We asked the two right hon. Gentlemen who presented the Second Reading of the Bill to give us some forecast. They did so and we had no complaints to make about their frankness. They spoke of loans pending in one or more of the Central African and East African Colonial Dependencies mainly for transport development and/or for hydro-electrical development. I have no doubt that those are desirable purposes. At the end of the debate, when the Minister of State for Colonial Affairs was replying, we pressed for an estimate of the total and the right hon. Gentleman said without hesitation that this was £15 million. If all goes well, we may suppose that these will reach their final stage some time in 1953.

We understood that there were no other loans in prospect about which the Government could tell us. I am sure I am not exaggerating in saying that it takes at least a year from the moment when a loan is seriously in prospect to the moment when it is finally made by the International Bank and guaranteed by the Treasury. We can say, therefore, with a reasonable degree of probability, that £15 million is the highest total of loans we are likely to expect during 1953.

Under the present limit we shall therefore come to 1st January, 1952, with £25 million worth of loan authorisation available to the Treasury for future years. If the present trend continues in 1954 we may expect total colonial borrowings to be in the neighbourhood of £50 million and the indications are that, roughly speaking, one-fifth to one-third of what is raised in total on the London money market is asked for from the International Bank. It is, therefore, not a wild conjecture that the maximum of loans which could be asked for in 1954 of the International Bank will be of the order of £10 million to £15 million.

That will mean that we shall come to 1st January, 1955, even if this expands steadily, with still some £10 million to £15 million of loan authorisation in hand, so that the Colonies could continue to approach the Bank and the Bank could make propositions to the Treasury right up to the end of 1954, more than two years from now. If at that time I were proved to be wrong and in November, 1954, a dazzling possibility emerged on the horizon where with a loan of £30 million, £40 million or £50 million from the International Bank to one of our Colonies a great development could be undertaken, who could doubt, in view of the interest and anxiety shown on both sides of the House on this question that, whichever Government happened to be in power, it would only be a matter of coming to the House for a couple of hours on perhaps three successive days to get the Second Reading, Committee stage and Third Reading of a Bill to extend the limit which the Government would need to support that Bill?

What is the need at this stage to raise this limit? There is plenty of elbow room and we could well afford to let things stand as they are for another year, 18 months, or two years to see how things go. After all, we have not yet had any practical results out of any one of the loans made and guaranteed under this Bill. I believe that there is a hydroelectric scheme in Rhodesia which has not yet come into being so that we have not had actual results from this form of financing. Could we not let this go for another year or 18 months before we need commit this House into the hands of the Treasury which, with a stroke of the pen, could go to this very high limit?

There is a consideration in my mind which, although it applies to some extent to this Amendment, applies much more to my last Amendment. On the face of it there is no great urgency or special need unless it be that the Government is sliding this Bill through knowing that there is a strong prospect of a large international loan being needed for Central African federation some time in 1953.

1.30 p.m.

Before I finish with this Amendment there is another quite separate point I wish to raise. I am rather surprised that it was not mentioned on Second Reading. I had intended mentioning it myself but when I got to the end of the points which seemed to me to be more important I thought that I had spoken long enough and ought to stop. I am glad to think that what I did not say then is quite in order now.

I am not too sure that we should go too far in continuing this type of financing colonial developments without giving much more serious consideration to the growth of the sterling balances in the hands of the Colonies. I am quite prepared to give the Government authority to persist in guaranteeing loans from the International Bank up to a limit of f50 million, which I think will easily see us through for the next couple of years or even more, but when we are asked to extend that to £100 million—which, unless I am mistaken, is in respect of a loan to Central Africa and is liable to keep this type of financing in being for another four, five or six years without there being any necessity to come to the House again—we should not do so without considering the position of the sterling balances.

There have been arguments—one sees them in the weekly paper "West Africa"—whether it is or is not appropriate to use the word "exploitation" to describe what is now going on between this country and some of the Colonial Territories for which we are responsible. The editor of the newspaper "West Africa" feels that "exploitation" is not a proper word to use. Although I disagree with that editor on many things, on the whole this is one of the matters in which I am in a certain measure of agreement with him and also with the Secretary of State who, just before or just after assuming his present office, made comments upon the sterling balances which, if not going so far as to justify the use of this rather emotive word "exploitation," indicated that we are face to face with a situation which cannot be allowed to continue.

What is happening as between us and some of the Colonial Territories for which we are responsible is not that we are financing their development, either by loans or grants or in any other way, but that they are financing us to the tune of several hundred million pounds per annum. I do not press the point about the word "exploitation." The editor of "West Africa" and others may be perfectly right in saying that it is an utterly improper word to use in connection with this process.

It can be argued that it is a perfectly honourable process which the responsible Ministers in such territories as the Gold Coast and Nigeria and the African members of legislative and executive councils and other colonial Ministers perfectly well understand as being something they want, but the fact is that in Malaya in 1950, according to the October, 1952, issue of "The Banker," the amount of money which we owed them in different ways increased by £60 million, and in 1951 by £85 million. The total of Malayan sterling balances is now £250 million.

There are even bigger figures for West Africa. In 1949 the sterling balances increased by £20 million; in 1950 by £55 million, and in 1951 by £75 million; and the present figure is £330 million. The figures for East Africa are somewhat smaller but they are still significant. In 1949, the balances increased by £5 million; in 1950, by £30 million and, in 1951, by £25 million. They now stand at £165 million.

All right. Let us continue to authorise the Treasury to back loans made by the International Bank to these Colonial Territories up to the limit we now have of £50 million for the next period—it may be two years—but let us not raise the limits or increase the period during which the Treasury can continue the system without the necessity of coming to the House again.

I want to quote a few words from "The Banker." I am surprised to be able to quote from that magazine with approval, but they say: There seem, therefore, to be sound economic, as well as wider, reasons for securing for the Colonies a flow of the goods they require for their development as well as the means to finance it. In exceptional years such as 1950 and 1951 it may be justifiable for the Colonies to be, in effect, net lenders to the rest of the sterling area, but during the phase of the development of their resources it is clearly appropriate that the Colonies should normally run deficits financed by loans and grants from the richer sterling countries, especially the United Kingdom. It may be that the present position is honourable and satisfactory and is perfectly understood on all sides, and the present position may properly persist for another year or so; but not much later than two years hence—and I should have thought not much later than one year hence—it really should become possible for many of our Colonial Territories to finance their development not by borrowing loans from the International Bank, backed by the Treasury, but by using their sterling balances to buy both the capital goods which they cannot make in their own countries and the consumer goods which need to be imported in much greater quantities in order that they can pay larger wages to their own people for development work without running into a rip-roaring consumers' inflation.

I think it would be wise to keep the limit to £50 million as it is now and if in the next couple of years some new and useful project arises which makes it necessary to exceed that sum the Government can come to the House again and the whole situation with regard to financing colonial development can be reviewed. Then, if it seems right to some future House of Commons the limit can be raised and, if not, financing by some other means can be suggested.

Mr. Leslie Hale (Oldham, West)

I wish to support the Amendment. I want to deal at once with the remarks on Second Reading by the hon. Member for Nottingham, South (Mr. Norman Smith). In my absence, he described me as being of the brotherhood of man on the basis of a guaranteed inscribed 4¾ per cent. stock. It was a somewhat ungenerous remark for a colleague to make in reference to one who has spent the whole of his time in the last two years in making propaganda for more generosity towards our Colonial Territories and a greater expansion of world development.

I resent those remarks of my colleague, and I resent even more his refusal to express any regret for his statement. Those of us who have been trying in the last two years to bear the burden of this matter have found it to be rather a heavy personal burden, and I should welcome more assistance in colonial affairs from a wider representation of hon. Members on both sides of the House.

I am sorry to add that the Minister of State failed to reply to any observations I made on Second Reading and associated himself with the same vicious misrepresentation of the tenor of my remarks—a misrepresentation which, I am glad to say, has not been accepted by anybody else. I shall not pursue that, except to say that the Minister should be the last person to associate himself with such remarks, although he has not had much experience of office, having come straight from the Tory Central Office to the Front Bench. But he has always been treated with the greatest courtesy by us. I hope that on this occasion he will try to give to the Committee some of the information which it is entitled to have.

Mr. Douglas Dodds-Parker (Banbury)

I think the hon. Gentleman is being rather offensive. He has addressed the House on more than one occasion without disclosing an interest which he must have had in making his recent trip to Africa. He has not stated who financed the trip.

Mr. Hale

The hon. Member handles the truth so lightly that he does not mind if it comes to pieces in his hands. I made my trip to East Africa as a guest of the Kenya African Union. I stated that fact in a Press interview immediately on my arrival. I made it perfectly clear that my travelling expenses were met by the Kenya African Union and that I regarded it as a great honour to be invited there on behalf of 5 million Africans. I did not go there representing any mining interests or any great industrial concern; I went there at the invitation of 5 million people. If the hon. Gentleman wishes to pursue the matter, I shall be happy to give way and to let him spill his venom while he is still so inclined.

Perhaps we can come to the calmer waters of this Amendment. I have no passionate desire to limit the expenditure envisaged by this Act, but I would point out that for the third time today we are considering a Bill which authorises future expenditure in bulk and in gross and in respect of which no details have been given to the House. My hon. Friend the Member for Gravesend (Sir R. Acland) tells us—and I do not doubt that it is correct—that in fact only one loan of £10 million has been guaranteed under the procedure of this Act.

I have no special objection to the procedure, although I think there are better ways of dealing with colonial development; indeed, I even have some sympathy with some of the comments made by hon. Members opposite on the last occasion about the curious method of our guaranteeing a loan by the International Bank to a Colonial Territory. It seems a somewhat circuitous way of doing it. On the other hand, I have made it clear that I welcome the International Bank taking a much wider interest in world development and trying to make available very much more money on more generous terms to assist in the development of the world.

But when the Government come along at this juncture to say that they are providing a Bill which asks for an increase of £50 million in the amount we can expend on these projects, while in practice, as my hon. Friend has said, only £10 million has ever been guaranteed; when, as far as I am aware—and I do not want to misrepresent the Minister of State for Colonial Affairs—no suggestion has been made about what are the expected guarantees likely to be called for in the next 12 months, we are entitled to ask questions.

I apologise if I am not right in saying that; I have not had a chance of checking all the speeches which were made on the last occasion, and I will give way immediately to the right hon. Gentleman if I have misrepresented him. But, as far as I know, he has not told the House what are the expected forms of guarantee likely to come within the period or what are the areas in respect of which the guarantees will have to be made.

The Minister of State for Colonial Affairs (Mr. Henry Hopkinson)

In fact, on the last occasion I said we expected that roughly £15 million worth of loans would be negotiated, and we hope given, in the course of the next two months.

Mr. Hale

To whom?

Mr. Hopkinson

In Northern Rhodesia and in East Africa.

1.45 p.m.

Mr. Hale

I am very much obliged, and I apologise at once. I had not that fact in mind, and I am sorry if I misrepresented the right hon. Gentleman. But in any event, that gives a grand total of £25 million, so that we are still £25 million short of the figure already covered. That is no reason whatever for passing this Bill and no reason whatever for saying we want to increase the figure to £100 million.

I will ask the Minister a direct question about this, because when the Government come forward with a Bill at a time when we are told that their legislation is likely to be over-congested, and when they go through all the motions of trying to secure the passage of a Bill of this kind while not being prepared to put before the House any indication of any reasonable expectation of spending the money within a measurable period of time, or issuing these guarantees within a measurable period of time, I think one becomes a little suspicious and one begins to wonder.

I want to know how far this Bill is intended as a preliminary step to Central African federation—and I hope that the Minister will be frank in this mattter, because it seems to me, looking at the Colonial Territories as a whole, that the one possible source of this great expenditure might be in the sort of loans which might be made to the federation territories. That doubt in one's mind is made a little more acute by the references in the Bill to loans to two or more territories and, again, by the reference to combined loans, which the Minister of State made last week, to the High Commission Territories.

I suggest that the Minister should come clean on this matter, because I want to give him this warning: if Her Majesty's Goverment try to force Central African federation against the overwhelming wish of the overwhelming majority of the inhabitants of the three territories concerned, I believe they will be taking a most retrograde step in our colonial history and one which will cause a very great deal of trouble in Africa and also to this country for many years to come. It would be a shameful thing to enforce federation against the overwhelming wishes of the great majority of the inhabitants of the territories.

We had a discussion last time on the sort of loans it is desired to deal with in this way, but there are many varieties of colonial projects. I do not want to take up the time of the House on the subject today; I put what I mainly had to say on the matter during the debate last Friday. But surely the Minister of State for Colonial Affairs should tell us what are the types of loan which it is envisaged will be dealt with in this way. Why is this machinery reserved for some types of loan while the old machinery of colonial development is used for other types?

As we all know, we have in East Africa the great Owen Falls scheme as one the greatest projects in colonial development. That can be followed up by even greater things if we can carry on the original scheme of the irrigation of the Blue Nile, bringing vast areas under cultivation. That might be a scheme as epoch-making in the history of world development as the Tennessee Valley Authority was in its day. But I gather that nothing of that sort comes within the description of this Bill and that the Bill is reserved for a series of projects. My hon. Friend told us of the project in Northern Rhodesia, but I frankly do not know about it and I am wondering. Possibly it has to do with the background development in connection with mining expansion, and it may have something to do with communications and, if so, it is a very necessary project.

Mr. Hopkinson

I spoke on both those points last week. I said that the Owen Falls scheme and the Jinja Dam scheme, which will require further financing, would certainly be open to be financed by this system of loans if that were thought desirable. My right hon. Friend explained that as far as the Northern Rhodesia scheme was concerned, it was a question of transport—a railway loan.

Mr. Hale

I had the railways in mind, but I was not quite sure. That explained my hesitant manner. When we have three authoritative Bills presented to the House on a Friday morning it is not easy to keep oneself constantly refreshed on all the evidence. I did not recall that the right hon. Gentleman spoke about the Jinja Dam, but I think I was representing him accurately when I said there has been no question of financing that scheme at the moment by this method and that the finance for that scheme and the Owen Falls scheme had been provided in other ways.

As the hon. Gentleman knows, there is also a Uganda Development Board which has recently been constituted with every indication of being very ably officered and every indication of having some very useful work to do. But, at the same time, I hope the Minister of State for Colonial Affairs will look at this question, because it seems to me that all these conflicting matters raise difficulties and that a little attention should be given to the various methods which have grown up and the various forms of expenditure of colonial development which clash, the one with another.

I rise only to ask this question: will the Minister of State for Colonial Affairs say why this Bill has been introduced at this moment? What is the reason for the suggestion that he may need a further £50 million in addition to the existing expenditure within a measurable period of time? What are the apprehensions or reasons or expectations in the mind of the Government on this matter and what connection have they with Central African federation?

I would ask the Minister to say what are the types of activities which normally he would regard as being appropriate to be guaranteed through the International Bank and what types of activities are regarded as suitable for the Colonial Development Board. Many of us are keenly interested in these projects. We all wish them well, and the fuller the information we can have, the better it will be. Last time, when the Minister of State was in a somewhat contemptuous mood, I referred to the scheme for co-operative farming. I would ask him to have a look at this. I said that the Governor of Kenya himself, with his experience in Basutoland, was keenly interested in this sort of project. I referred to the project in Uganda, where something like 50,000 farmers are now members. It may be they are transient members, because there is not much organisation, and I am not suggesting that it is a successful scheme. But it is a brilliant piece of initiative by two young men who have enthusiasm and vision.

There is more than one form of development. Of course, a great scheme like the Owen Falls, with its vast area and the vast panorama of its achievement, is a thing which moves the House, and which will weigh out in Uganda and Kenya. But it is the little generic plans which will revolutionise the life of the farmer. The provision of a coffee-curing station in Uganda would make all the difference in the world to the life, prospects, profits and standard of living in whole areas. Those are schemes which could be financed with very little money, and which, in my submission, ought to be financed forthwith out of the swollen profits of the Cotton Board and the Coffee Board.

I should be out of order were I to pursue that matter very far, and so I will set a curb upon myself. But I hope that at some time we shall have an opportunity of discussing that matter. While one appreciates the necessity of firms building up substantial reserves, and that those reserves may be of great value in the future, there is a feeling in Africa that they are moving far too slowly and that some of this money spent quickly might do a very great deal to restore confidence in areas where confidence is lacking, and help to improve the standard of life.

I have addressed these questions to the Minister of State for the Colonies in the hope that he will answer on this occasion, and I will leave it at that.

Dr. Barnett Stross (Stoke-on-Trent, Central)

I wish to ask one or two questions. I think we ought to have as much information as possible from the Minister about what schemes he has in mind so far as the increase of £50 million is concerned or, if he prefers for the whole of the money invested. I do not ask for details of the generic type of scheme and principle which lies behind it.

I feel that the Committee are sensitive about the development of territories of this type. Territories can be developed in at least two ways. We can lend money in order that there shall be exploitation of raw material and food for our own specific benefit, without looking at the interests of those who must produce the raw materials or the food in the territory under question. Another method is to abandon the principle of insisting upon what I think has been termed cash crops or mono-culture, which has devastated great sections of territory all over the world; and which has, in the long run, produced poverty, not only of the soil but for the people themselves.

We should encourage in effect that for which people like Dr. de Castro have so urgently been asking, the normal ordinary development of agriculture so that the nutritional and health standards of the people involved are continuously raised. We are all agreed—I am sure the Minister must agree with this—that if we do not take special care of the human element in these territories it ceases to be anything except a wasting asset.

There is an example which I have in mind and which I can remember quite well. I read in a report on nutrition in the Colonies before the Second World War of a great mining area in Africa, and the figures were terrifying. They showed that in 1932 men working in a particular project whose average age was under 30, had a death rate of 52 per 1,000 per year. I suppose that the death rate of people in this country at the age of 30. members of our working classes, engaged in ordinary occupations, is less than half of one per 1,000. There, it was 52 per 1,000.

The Minister may perhaps remember that when the matter was investigated it was discovered that malnutrition was the cause of these men dying. They were being badly fed on food to which they were not accustomed, food which was distasteful to them, and which was not properly prepared or cooked for them. The cure was found at a tiny cost and the whole picture was transformed by 1936. As a result of a small expenditure on bringing in skilled cooks and skilled physiologists and doctors, an expenditure of, I think, 6d. per head per day—for which I am glad to say the firm made itself responsible—that death rate fell to eight per 1,000. I need hardly say, and the Minister will appreciate, as will anyone with any business knowledge, that it was then possible to begin to turn out shifts to do some work. With a death rate of 52 per 1,000 one can imagine the morbidity which previously must have existed.

I am asking the Minister to tell us whether any of this money is to be allocated for the furtherance of normal agriculture or normal enterprise which will restore the living standards of the individual workers. I would impress again upon him that the concentrating on one single crop for the sake of immediate advantage can be ruinous to the land, and certainly, in the long run, is ruinous to the health of those who have to work the land.

We have heard today from the hon. Baronet the Member for Gravesend (Sir R. Acland) the figures for the sterling balances, and they are impressive. He made an appeal which I would like to support. He quoted the progressive banking view which suggested that it is these territories who should be borrowing money from us, and not we who should be owing money to them. The time is coming when we should consider seriously how best we can help, and let them spend their money and obtain their capital equipment in this country. It would be unhappy and unfortunate if an impression were to go out that we were taking steps to lend money at interest to these territories when, in fact, they themselves have a right to look to us for the repayment of very large balances. That is a point about which I think the Minister might give us some satisfaction.

Lastly, the responsibility for territories of this type is most serious. We live in a changing world and we must adapt ourselves to what is happening round about us. The people who live in the territories have a right to look to us for assistance in many directions. If we cannot give it to them they will be patient for some time. If, however, they get the impression that we are indifferent to their needs and that we are using them as a convenience for ourselves, or because we wish to exploit their resources, then the changed world will become most embarrassing to us within a short time.

2.0 p.m.

Mr. James Johnson (Rugby)

I do not wish to be too loquacious but, as the Minister is always so co-operative, I should like to ask him to answer one or two questions about the purposes for which loans are to be made. I hope that, without going into too much detail, he will be able to give some indication of what he has in mind. I think that this Bill will do an enormous amount of good in the Colonial Empire, but I should like the Minister to be a little more forthcoming than he has been in the past.

I ask him to be good enough to tell us a little more about the areas in which the money is to be spent. We all know about the need for capital investment in East Africa under the East Africa High Commission and Central Africa. There are enormous schemes in hand. We should like to know more details. For instance, I should like to know about the output of cement and the figures of the young and expanding economy in Northern Rhodesia.

Having been to West Africa, I am a little anxious about development there. Can the Minister tell us whether, under this Bill, money can be guaranteed for the West African territories which will soon attain a status almost of self-Government, like Southern Rhodesia, the Gold Coast and Nigeria? What bothers one there is the question of population and food. I have said more than once in Parliament that there is an enormous need for secondary industries.

One is most anxious that there should be more secondary industries. There seems less hope of this at the moment because the Colonial Development Corporation is apparently not doing what it did a year or two ago. For example, there is the Oritsha sack factory in Nigeria. It is not doing what we hoped that it would do. Many schemes which we hoped might develop appear now unlikely to be carried out. It is most important that, not merely in Kenya—where, as the Colonial Secretary mentioned in a recent debate, we need to have much more secondary industry to occupy the 10,000 or more workless Kikuyu on the edge of Nairobi—but elsewhere we should have this development.

It is most important in view of the technical advance of the territories that food supplies should be increased. Jobs should be provided for the up and coming young people to exhaust their energies and to engage fully the enormous wealth potential which is latent in the African people.

I ask the Minister to tell us whether West Africa will benefit under any of the schemes. I am not talking about projects of the size of the Volta Dam scheme but of the smaller schemes in the lesser towns. The West African territories, including the young nationalist societies of the Gold Coast and Nigeria, need this type of assistance badly just as do the more mixed peoples of Rhodesia. I am in favour of East and Central Africa having help, but I should also like to see assistance given to West Africa.

I welcome this Bill because, since 1945, the main sources of economic development under the Colonial Development Fund appear not to have been doing the job which they did under the last Government. One is perturbed sometimes. One might even use the word "liquidation" when describing the way in which the Colonial Development Corporation appears to have been doing its work within the last two years. It is doing much less work than it did some years ago. There will be even greater need for loans in the next year or two. I would suggest that this figure should be not £50 million or £100 million but even greater, because the Colonial Development Corporation seems to be doing less work than it did in the past.

On all these counts I ask the Minister to be forthcoming and to detail the geographical areas like West Africa, to tell us of the types of industry, especially secondary industry, which will be helped by the guarantee of loans. I would re-emphasise and fortify the plea made by my hon. Friend the Member for Stoke-on-Trent, Central (Dr. Stross) on the most important question of pumping money into the present farming economy. It is tremendously important that we should develop, fortify and help the ancillary industry connected with agriculture. There we have the tie-up with present farming.

If we have the smaller ancillary industries based upon the fundamental agricultural activities we shall keep the indigenous people near to their tribal homes and the places where they were born. In that way we shall not do what we have been doing for years, we shall not disintegrate the fabric of African society. In the past we have had grandiose schemes of agriculture and mining which attracted natives from miles around.

I suggest that we should use this money to build up compact, homogenous native societies based upon their best traditions. For example, money has been used in the right way for the co-operative farming of coffee by the Chagga on the slopes of Mount Kilimanjaro. In ways like that not £50 million but much more could be well spent.

Mr. A. Fenner Brockway (Eton and Slough)

As perhaps the Minister may know, I have returned recently from East Africa. I wanted to put to the Committee three points on this Amendment which are very deeply in my mind as a result of this experience. I have come back feeling that a question mark of destiny is now over the Continent of Africa. It may be—and I pray so more sincerely than I do on any other matter—that we shall be able to find a basis of co-operation with the African people. The other alternative is a racial conflict, which may be alarming, not only to ourselves, but to future generations. It is because I believe the Bill now before the Committee is of great significance in determining which of these two courses shall take place that I want to make a few remarks.

The Amendment at present before the Committee suggests that the Minister should not ask for very large sums before his plans for development schemes are decided both in principle and in some detail. I want to support that Amendment, because I believe that it is the principles which are applied to these plans which will determine their success or failure, and which will contribute to racial co-operation or racial conflict.

I believe, first, that if these plans are to succeed we must win the trust and the co-operation of the African people themselves. When I was in Uganda two and a half years ago, I was alarmed to find how the reaction of the average African was one of opposition to any economic planning by the Government of Uganda. I remember sitting with them in the late hours, while they were drinking their glasses of Uganda beer, which I just could not taste, and their whole attitude was one of opposition to every development plan and every economic proposal, because they regarded the Government of Uganda as an enemy in their midst. If we are to secure the co-operation of the African people we must first win their trust and confidence to put through the schemes which we propose.

I was in Uganda 10 days ago. The atmosphere had entirely changed. Two and a half years ago, both the political and the economic organisation of the Africans had been banned and suppressed, their executives were in hiding in the jungle, and their leader, Ignatius Musazi, leader of the African Farmers' Co-operative Federation, deported. I was pleased, when I returned from Uganda two and a half years ago, to find the sympathy with which the then Colonial Secretary, my right hon. Friend the Member for Llanelly (Mr. J. Griffiths) received my report. The bans were lifted, Musazi was allowed to return and a very beneficial change was made in the Governorship of that Protectorate. I pay my tribute to Sir Andrew Cohen, who is now the Governor of Uganda, for the progressive policy which he is pursuing.

Only 10 days ago, instead of these organisations being banned, the representatives of the Government were attending the reception which was arranged by the African organisations, and the result is that, in Uganda, because of the progressive and more enlightened policy which is now being pursued under a progressive Government, we have a response from the African people and are moving towards a basis of co-operation.

I say to the Minister that, if the essential co-operation of the African people is to be gained, it must not only be in Uganda, but must also be in Kenya and in Central Africa, that the Administration must pursue a policy which enables the African peoples to feel that this is not an alien Administration in their midst, but one with which they can co-operate in trust and confidence.

2.15 p.m.

The second point which I put very sincerely to the Minister is that if these development schemes in the Colonies are to be correct in principle we must look forward to the day when these people move towards self-government. I mean that in a broad way. I have never advocated that, in the communities of Eastern Africa, where there are large European and Asian populations, self-government should merely mean all-African government. Obviously, it must mean the participation of all the races, but I suggest to the Minister that, when that stage is reached—and I want to see it reached as early as possible—the development schemes that are inaugurated under this Bill must become the property of those peoples who have secured that self-government.

In Uganda, only a few days ago, I saw the schemes for the development of the copper mines. The company concerned is an American company, and there is the gravest suspicion of it by the people of Uganda. It is absolutely essential, if this House is inaugurating schemes of development in the African Colonies, that, at the moment when self-government is attained, these great enterprises shall be the property of the people in that self-government, rather than the property of financiers of other countries. In urging that principle, I have one example which, I believe, should be followed in these other countries, and I know that the Minister himself is very interested in it. It is the very great example of the Gezira scheme in the Sudan.

I think the British administration in the Sudan has achieved the greatest success in any African community, and I apply that particularly to the Gezira scheme. I was only a young man, just beginning my interest in politics, and sitting up there in the Press Gallery, in the years following 1910, when the Gezira scheme was established. The principle was then adopted that there should be a tri-partnership between the Sudan Government, the peasants in the scheme and two British syndicates, 40 per cent. passing to the peasants, 40 per cent. to the Sudan Government, and 20 per cent. passing to the syndicates.

In addition, the period during which these syndicates operated was definitely limited. When this concession came to an end, two years ago, the Labour Government had the good sense to end this concession so that the vast Gezira scheme, which has brought about a social and economic revolution in the Sudan, is now the entire property of the Sudanese people. I urge the Minister, before he asks the House for large sums for these development plans, to apply to the other Colonies the principle which has been so successfully applied in the Sudan.

My third point is that the whole social and economic future of Africa depends upon the development of the co-operative movement. A few days ago my hon. Friend the Member for Oldham, West (Mr. Hale) and I were in the office of the Governor-General of Kenya. Our interview began in a very formal spirit, but as soon as we mentioned co-operative farming the eyes of Sir Evelyn Baring lit up with enthusiasm and a desire to do everything that he can for the extension of co-operative farming in Kenya. Before the Minister asks the House for large sums of money for his development schemes, I urge him to accept the principle that co-operation and co-operative farming should occupy absolutely first place in agriculture and many other matters in Africa.

I am aware of the difficulties. Before I went to Kenya the Secretary of State for the Colonies permitted me to see the report which the registrar for the co-operative societies in Kenya had sent him about the difficulties of co-operation there. It said that it was almost impossible to find Africans who were capable of keeping accounts and doing the secretarial work of the co-operative societies and that there was a danger that even if the schoolmaster fulfilled the task he would become a dictator in the co-operative society, which, in itself, would be a denial of the principle of democratic co-operation.

If co-operative farming is to be developed in Kenya and other countries—I regard it as the most important step on the economic side for dealing with the poverty of the African people—I suggest that the Minister should not be content to appoint civil servants as co-operative registrars and to the co-operative staffs. Many of them are excellent men but before they were appointed they had no experience at all of the Co-operative movement; their enthusiasm for co-operation has come after they have begun the task, and they have had to learn it.

Before the Minister puts into operation these great schemes of colonial development, he should approach the Co-operative movement in this country, whose members have experience of this kind of task, and ask it to nominate men who have not only the competence to fulfil the task but also the spirit of racial equality which will inspire the trust of the African people.

We do not want in the Colonies a co-operative movement which is a Government Department, for that would be a denial of the very essential of voluntary democracy which is in the Co-operative movement. Instead, there should go to Kenya, Uganda, Tanganyika, Central Africa and, as my hon. Friend the Member for Rugby (Mr. J. Johnson) has suggested, to West Africa, men and women from our own midst who have had experience of our own Co-operative movement, who are technically competent, and who, above all, will be regarded by the African population not as administrators of a Government distant from them but as colleagues with them in the day-to-day work of development of the new movement.

Mr. Hale

And they should go at once.

Mr. Fenner Brockway

Before the Minister asks the House for these very large sums, he should accept the three principles which I have urged as essential to secure the co-operation of the African people and the success of the schemes. While bigger constitutional issues and even bigger economic issues have still to be decided in Kenya and other countries, I beg him to begin this task at once, because on the solution of the social and economic problems depends immediately whether the African people will move towards co-operation and towards us or whether the future of Africa is to be the kind of conflict which is just a nightmare for some of our Colonies.

Mr. John Edwards (Brighouse and Spenborough)

I have listened with interest to my hon. Friend the Member for Eton and Slough (Mr. Fenner Brockway) and I am sure he will forgive me if I direct my attention to the field of activities with which I am more familiar and discuss for a few minutes some of the financial aspects of this matter.

In the Amendment we are concerned with the limits which are to be placed on the aggregate amount of loans to be guaranteed under the Act of 1949. I must make it clear that we have never denied any resources for the proper development of the Colonies under proper auspices, and I trust that we never shall. Nevertheless, it is right for us to ask questions about the figure which is to be put into the Bill. It is proposed that the limit shall be £100 million.

When the 1949 Act was introduced, the then Under-Secretary of State for the Colonies said that he did not anticipate any immediate request under it but the Measure had been introduced so that if the occasion arose his Department would be able to act promptly. That was a very reasonable point of view to put forward, and in those circumstances it was not unreasonable that the figure of £50 million should be put in the Act to save the Government the embarrassment of not being able to meet a demand for a guarantee at any time.

2.30 p.m.

However, we have been told that the only loan raised from the International Bank and guaranteed under the 1949 Act was the £10 million for Southern Rhodesia. That is all. When the right hon. Gentleman the Colonial Secretary was addressing the House last Friday he spent a good deal of time explaining to us why the Act had not been used more than it had been. The main reason that he gave was that no project had been held up by lack of money. I agree with him.

I think that it is true that in the past few years the colonial development schemes have been held up for lack of materials, lack of machines, not enough steel, not enough cement, and a hundred and one other shortages with which we are all too familiar. In passing, it is interesting to compare the situation which we have had in the last years with the situation in the years between the wars when we had unemployed resources, plenty of steel and other things that could have been used in these areas for colonial development.

The right hon. Gentleman further said that there had been no need for the International Bank to be used, because it had been possible to raise the money on the London market. It will be within the recollection of many hon. Members that I interrupted the right hon. Gentleman and asked him if he would be good enough to tell us what, in round figures, would be the amount involved in the loans to the Central African territories and for the East African territories to which the right hon. Gentleman had referred. I was absolutely amazed when the right hon. Gentleman answered me: I will ask my right hon. Friend to look into that point. I have not the figures with me and I will have to check them up.—[OFFICIAL REPORT, 14th November, 1952; Vol. 507, c. 1265.] The House was being asked to give a Second Reading to a Bill to increase the limit of guarantees from £50 million to £100 million. The right hon. Gentleman did not even know in round figures, let alone in detail, what was involved in the loans that might be likely to arise in the immediate future. He had to leave it to the Minister of State for Colonial Affairs to tell us, in his winding-up speech, that the amount was £15 million.

Why is it that in these two cases the Government concerned are having to go to the International Bank? They will pay a higher rate of interest. Obviously, they will only go to the Bank in the last resort. It is much the most expensive form of raising money for this purpose. I would ask the Minister to be quite explicit on this point: is it because these two Governments have been refused permission to raise this amount of money on the London market? It is important for us to know what lies behind some of the things that were said by the right hon. Gentleman and the Minister of State. Is it that the London money market is drying up?

Mr. Hopkinson

I made it quite clear, I think, in reply to one of the hon. Member's right hon. Friends, that no loans had been refused by the Treasury at all.

Mr. Edwards

Yes, of course, but we are here talking about two loans which have not yet been made. The Minister of State for Colonial Affairs said: The loan to Northern Rhodesia, which is under discussion with the Bank and which, we hope, will be settled early next year refers. … to the Rhodesian railways."—[OFFICIAL REPORT, 14th November, 1952; Vol. 507, c. 1353.] He went on to say that there was another matter under investigation by a mission from the Bank concerning East African railways and harbours.

These loans have not yet been granted, but there must be some reason why the Northern Rhodesia authorities have gone to the Bank for a loan instead of going to the London market. As the Committee will know, I am entirely familiar with the procedure involved here because of my own Departmental experience. As the Minister of State for Colonial Affairs knows, in the last resort it is not the Colonial Office but the Treasury who are concerned with the total amount of borrowing from the London market.

Although the views of the Colonial Office are of the greatest importance in reaching decisions, the final overall picture has to be taken by the Treasury. Incidentally, I am surprised that the Minister is not supported today by his right hon. Friend the Minister of State for Economic Affairs, because we are here going into an activity which is much more a Treasury than a Colonial Office matter.

I ask the Minister to tell the Committee why, in these particular cases, where the loans are expected to amount to £15 million, the Government concerned have not raised the money in some other way say from the London market where they would be likely to get it at much cheaper terms. When I spoke last Friday I was at pains to point out the very limited scale on which the International Bank operates. I pointed out that it only operates in a very limited field and in a sense can be regarded as the last resort.

I repeat that now. Do not let anybody suppose that under this Measure anything other than a marginal contribution will be made to colonial development. The amounts involved are necessarily small in all the circumstances. I am not complaining about that; I am just pointing it out. Let us, therefore, look at the proposal to have a limit of £100 million in terms of the Bank's own activities.

With a limit of £100 million one could guarantee all the loans not merely to our territories but to all the undeveloped areas of the world for four or five years at the present rate of activity of the International Bank. Therefore, I ask the Minister to take us into his confidence on this point. What really lies behind this Bill? On the last matter that we discussed I listened to the Financial Secretary to the Treasury. In the course of his speech he said—I cannot quote him word for word—that it was his duty to explain to the House or the Committee the purposes for which any money was required. He considered that when a Minister stood at the Box it was right that he should explain the purposes for which any money was needed.

So far, the Minister of State for Colonial Affairs has not done that. I am not by nature suspicious, but I am left completely puzzled. I had a feeling that there is something here that has not yet been told. Why? Is it because, as my hon. Friend the Member for Gravesend (Sir R. Acland) suggested, there are big projects looming up of which the Minister is aware but of which we have not been told? Are there projects of which the Minister is aware, even tentative projects, which will add up to anything like the figures which we are now putting in this Bill?

We are anxious to facilitate anything that will help develop the Colonies. If there are to be loans in the next year or so which will amount to £100 million that will be all right by us. But nobody has shown that. We have been shown loans of £10 million up to date, and a possible £15 million. But we have not had any word about anything else, at a time when the last figure that I have of International Bank lending to the whole of the under-developed areas of the world for the last year was just over 70 million dollars. Here we are asked to give authority to the Government to guarantee up to £100 million.

What lies behind the introduction of the Bill? If it is that there are big projects looming round the corner of which the Minister is not prepared to speak at the moment that, at any rate, would be one explanation. There is, however, another explanation that may be the right one, and it is this. The London market is not going to be able to meet as many demands in the future as in the past. The general amount of lending or borrowing by the Colonial Governments in the London market is, as the Minister of State for Colonial Affairs knows, something with which the Chancellor of the Exchequer has a good deal to do. Is it hoped to provide money from the International Bank in substitution for funds which have hitherto been secured at lower rates of interest from the London market?

Speaking for all of us on this side of the House, I say that we are, frankly, puzzled. We cannot see a single reason why this Bill has been brought forward. It could have been brought forward in a year or two's time, which would appear to be perfectly adequate. There is, of course, a further explanation, which may be the true one, which is that the Bill has been brought forward in this form, talking about an increase from £50 million to £100 million, when in fact the real purpose of the Bill is concerned with other parts of this Clause on which a later Amendment, to be moved by one of my hon. Friends, I think, has a bearing.

In any event, I say to the Minister of State for Colonial Affairs, with the greatest respect and without wishing to be offensive in any degree, that it is clear to all of us that there must be something more than has so far been said. Otherwise, the thing does not make any sense at all. I invite him to take the Committee into his full confidence.

Mr. Hopkinson

The proposal that the amount to be raised in loans to which Treasury guarantee would be given is one of the main purposes of this Bill. The noble Baronet the Member for Gravesend (Sir R. Acland), who moved the Amendment, had previously questioned this amount. He questioned whether it was necessary, and he suggested that the money could equally well be raised on the London market. On that occasion at a later stage he seemed to express a rather contradictory thought when he sought to show the advantages to the African Ministers of looking towards the international bodies rather than to ourselves and our own resources, which I rather took as an argument for increasing the amount of loan rather than reducing it.

In this case, the facts speak for themselves. Several hon. Members mentioned that Southern Rhodesia has also got a loan of £10 million which is to come out of this Fund, and, in addition, we expect that loans under negotiation or about to be negotiated will account for another £15 million, which amounts to half of the existing amount of £50 million. That will already have gone in the next few months. There are only another £25 million available.

Mr. J. Edwards

I hope the Minister appreciates that in the last year for which we have figures the total amount of lending by this Bank to the whole of the under-developed areas—not just to our Colonies—was not more than £25 million sterling.

Mr. Hopkinson

I quite agree. The hon. Gentleman has made that point several times, but the fact is that we have got £10 million and we are hoping to get more. We are hoping to get more from this source, as was indicated by my right hon. Friend the Secretary of State for the Colonies the other day. There have been visits of missions to Jamaica and British Guiana. It is true that they were general economic advisory missions, but we cannot exclude the fact that they may result later on in loans.

There is a mission at present on the Gold Coast. Mr. King is there. He is a member of the Loans Section of the Bank, and there again, although it is purely preliminary and exploratory, we cannot exclude the possibility of a loan there. He is visiting Nigeria on his way back from the Gold Coast. There again, it is purely exploratory, but we cannot exclude the fact that loans may eventuate for all these territories. Only the other day the right hon. Member for Easington (Mr. Shinwell) was suggesting that this assistance should be used to develop shipping facilities in the West Indies on which he laid great emphasis. I can assure hon. Members opposite that there is nothing behind this Bill at all except what it says.

2.45 p.m.

Mr. John Dugdale (West Bromwich)

With regard to the mission to the West Indies, I think the right hon. Gentleman told me, if I remember correctly, that it was pure]; a technical mission and that there was no question of a loan at all. I think he also told me that no Colonies had so far asked for loans and been refused. Is that a fact?

Mr. Hopkinson

That is a fact, and I went on to say that it certainly did not preclude those Colonies asking for a loan as a result of the position disclosed by the investigating missions. We feel that it would be unreasonable and, indeed, dangerous to limit ourselves to this amount of £25 million, which is all that will be left to us if the sum is not raised. We think that if we were to do so we should be taking a risk in handicapping the economic development of the Colonial Territories, which I am certain is not the desire of hon. Members opposite any more than it is of ourselves.

I had thought that we could certainly count on the full support of the Opposition Front Bench, at any rate, on this matter, in view of the statement by the right hon. Member for West Bromwich (Mr. Dugdale) when he said the other day: If we cannot give that help I hope that the International Bank will give it. It is because we believe this that we think there is a great deal to be said for the Bill. I do not, however, know why there need be a limit of £100 million and why the figure should not go higher if the need exists and if in future the capital issues market will not be able to supply it."—[OFFICIAL REPORT, 14th November. 1952; Vol. 507, c. 1271.] I felt that in this matter of the amount of the loan we could count on the full support of the Opposition this afternoon.

Mr. R. T. Paget (Northampton)

If the need exists.

Mr. Dugdale

We certainly do support this, and we think there may be a need for a greater sum, as the Amendment says, but we do think that the Government should tell us some of the reasons which have led them to think that loans may be necessary. We are asking the Government to give us an account of their stewardship.

Mr. Hopkinson

I do not think it would be right for me to go over the whole of the speech which my right hon. Friend made the other afternoon, because he went into this matter in very great detail. I will deal with some of the points which have been raised here today, but I do not think the Committee would wish me to develop the whole of that argument again.

The noble Baronet the Member for Gravesend referred to the possibility of the Treasury, by a stroke of the pen, going right up to the limit. Of course, that is not possible and it is not likely to occur. The approval of the Secretary of State for the Colonies has also to be obtained before anything of that sort could happen.

As for the issue of Federation, it would be easier if I dealt with it on the next Amendment. I felt that several hon. Members opposite rather let the cat out of the bag when they referred to Central African federation. I will deal with it later, but I will say that this Bill has no bearing on, or connection with, Central African federation at all, except in so far as Central African federation would fall under the head of this particular Clause.

The noble Baronet also touched on the question of sterling balances and he asked me whether, in fact, the financing of the needs of the Colonies should not be made by repaying the sterling balances rather than by a fresh loan. I think that was the tenor of his suggestion. The fact is that the colonial sterling balances consist largely of funds which are held by the colonial Governments in London for special purposes. They are held for currency backing, pension funds, sinking funds, and so on, and it is to their convenience that these balances should be held here. They cannot normally be drawn upon for general development which is contemplated in the Bill. The sterling balances also include the normal reserves of the colonial Governments, and they are an essential safeguard for the financial position of the Colonies. Again, they are held in London as a matter of convenience.

It is true that these balances are at present very high, but I think that from what I have said it would be agreed that the release of these balances, as regards their relevance to the present scheme, should be very limited. The colonial Governments use their own funds as fully as possible, subject, of course, to financial prudence before they seek external loans.

The hon. Member for Oldham, West (Mr. Hale), who, we are glad to see, has recovered from his indisposition, referred to my remarks of the other day. I do not wish any more than he does to prolong the controversy. All I would say is that certainly I had no intention of being discourteous. I may have said that his speech was unhelpful, but no discourtesy was intended.

Mr. Hale

The right hon. Gentleman would help me very much if he would indicate what he thought was unhelpful. I made no reference whatever to police action, to wholesale arrests, or to the state of affairs in the Colonies. I referred to economic developments and to their need of them. If the right hon. Gentleman thinks that a speech calling for help for the African people in economic affairs is unhelpful, he is entitled to his opinion. I felt, however, that I had leaned over backwards in restraint. I had been doing it for something like 14 days and I am still doing it, and it hurts.

Mr. Hopkinson

I do not propose to deal with that aspect this afternoon. In my opinion, it was a speech which would not help to solve the present problems of racial disharmony—

Mr. Hale

Next time, I will tell the truth.

Mr. Hopkinson

—in Africa as a whole, or particularly, at present, in Kenya.

I dealt with two points that the hon. Member mentioned and if I had had more time I should have dealt with a third point, in regard to the producer co-operatives. As, however, the subject has been mentioned this afternoon by a number of hon. Members, including the hon. Member for Eton and Slough (Mr. Fenner Brockway), I should like to mention it now.

I was in full agreement with the hon. Member for Oldham, West about the value of those co-operatives. I know what wonderful work they have done in Uganda and the good work they have done elsewhere. I fully share his view about their importance.

Mr. Hale

As 75 per cent. of my speech referred to the necessity for co-operation in Africa, can the right hon. Gentleman say that that part, at any rate, was helpful? It is amazing to have this tribute from someone who condemned my speech out of hand. I ask the House to remember that I have been reticent.

Mr. Hopkinson

If the hon. Member looks again at his speech, he will find that not more than a quarter of it dealt with the producer co-operatives.

Mr. Fenner Brockway

I was not present during the debate last Friday but I have read the Press reports of what happened and then I read the full speech in HANSARD. I know the right hon. Gentleman, and I know him as a man of honour, but I ask him to read again the speech which was delivered by my hon. Friend. He would find that the greater part of that speech was not only said with restraint, but was all the way through an expression of a constructive solution of the problems which now face us.

Mr. Frederic Harris (Croydon, North)

How could the hon. Member know this after a few days?

Mr. Brockway

I deplore the fact that the right hon. Gentleman should have made the kind of remarks that he did.

Mr. Hopkinson

I do not intend to pursue the matter now, because I hardly touched on the hon. Member's speech and, as I say, its impression on me was not that it would be of any particular help.

As regards the producer co-operatives, which is the more important aspect of that speech as far as I am concerned, I should not go as far as the hon. Member or other hon. Members in saying that it is the whole answer, because I do not think that it is. But they have done extremely well and, I believe, they present the possibility of a solution of this terrible problem of African agriculture in the native reserves. I believe that they are particularly well adapted for places like the native reserves in Northern Rhodesia and territories like Nyasaland.

I do not think, however, that that is on the whole the sort of project which can be usefully financed from loans of this sort, which are intended for other purposes, as I shall show. These producer co-operatives are too complex and too varied to be dealt with in a general way from loans of this sort and are better financed by local government funds, as is done in most cases, or from Imperial development and welfare funds, as is done in other territories.

The hon. Member also raised the question of Central African federation and he asked that we should not authorise future expenditure in this way. Perhaps he has slightly, not misunderstood, but misappreciated the reason for this Treasury guarantee, which is what, in fact, we are giving. It is most unlikely that the Treasury guarantee will ever be called upon to be paid having regard to the fact that these loans are secured from revenues and other assets of the Governments concerned.

The guarantee is required for technical reasons. These territories cannot themselves be members of the International Fund, and if those technical reasons did not exist I think we should be the first to say that we should like to see the Colonies going to the International Fund, as is done, of course, in the case of the independent Commonwealth and other territories.

The hon. Member for Oldham, West had a word to say about the Colonial Development Corporation and asked how this fitted into the scheme of financing by way of these loans. The primary purpose of the Colonial Development Corporation is not to lend money but to carry out development. It is in an intermediate position between colonial development and welfare, on the one hand, and commercial projects and projects such as those contemplated under the Bill, on the other hand. It is intended to pay its way and, of course, it enjoys certain benefits from the Treasury in the form of assured capital and favourable rates.

The hon. Member spoke also of the conflicting forms of finance. They do not, in fact, conflict, for the very reason that each of them is intended for certain purposes; and they run alongside one another.

Mr. Hale

The Minister himself intervened in my speech and said that as regards Owen Falls certain parts of the finance will come from the International Bank. It was on his own intervention that that point was made.

3.0 p.m.

Mr. Hopkinson

I appreciate that very well, but we have also pointed out that the absorptive capacity of the London market has altered and has been reduced in recent years and, therefore, they have to turn to other forms of finance.

The hon. Member for Stoke-on-Trent, Central (Dr. Stross) referred to the question of malnutrition and asked whether we had any particular schemes for the development of agriculture and particularly peasant agriculture under these loans. The answer to that is no, because there again we feel that local finances are more appropriate for that particular purpose than these big loans which are intended for basic schemes such as communications, power and so forth.

The hon. Member for Rugby (Mr. J. Johnson), in a very helpful speech, asked me whether West Africa would also benefit. Of course it will, including the Gold Coast and Nigeria, which are well on the way to self-government. One of the reasons for this Bill is to enable them to participate in the benefits of these loans. He asked about industries in these territories. There again they are better met through local bodies, such as the Gold Coast Development Corporation or the Uganda Development Corporation, rather than out of these large loans.

The hon. Member for Eton and Slough put three points to me, some of which, particularly those regarding the co-operatives, I have already touched upon. I can tell him, as I have told him privately, that I fully share his admiration for what has been done under the Gezira scheme, and I feel quite certain he would not wish to deny to private enterprise the part which it played in managing that scheme, and leading it along to the position where it was able to be turned over to State management. I agree with the hon. Member when he said that we have got to see that these co-operative producer schemes are given the right leadership and people to organise them. I do not feel chary about sending large numbers of Europeans to help organise these co-operative schemes. I feel sure it will pay dividends. I saw it myself in Northern Nyasaland this year, where one or two young officers of the administration were throwing themselves wholeheartedly into these schemes and doing magnificent work.

We should not refuse any help we can get from the co-operatives in this country in advising on those matters. When the hon. Member said that they must remain co-operatives and not become civil servants, I could not help thinking of the great success of the labour advisers taken from the trade unions in this country and who have played a dual role between labour advisers and officials in many parts of the world.

I think I can say that, in general, I agree with the points which the hon. Gentleman made except in one particular. He asked me to accept the principle that, in looking forward to these people acquiring self-government, we should arrange for these development schemes to become public property. I do not feel that that is for us to say. It is for those countries to decide how they want their economy to be run. That is true today in the Gold Coast and Nigeria, and it will be equally true in Uganda and the other territories as they achieve greater self-government. We must leave it to them to decide what sort of an economy they wish to have.

I want now to deal with the points raised by the hon. Member for Brighouse and Spenborough (Mr. J. Edwards). He asked me a number of questions on the financial side. I feel that they were dealt with the other day by my right hon. Friend the Colonial Secretary, but he asked me, in particular, whether the territories which are seeking loans at the present time, namely, Northern Rhodesia and the East African High Commission, have, in fact, been refused permission to go to the London market. Offhand, I cannot say; I think it is most unlikely. Because the absorptive capacity of the London market seems to have been reached, it was decided by those territories to try other means of financing their projects.

Mr. J. Edwards

There is, of course, a subtle distinction between formal refusal and advice not to go ahead. In my experience what happened was that when one talked to the representative of the territory in question, be it Northern Rhodesia or any other, as to arrangements about a loan it was quite often suggested that they should try to seek it in another way. It may very well be that they have not been formally turned down, but were advised that it would not be desirable for them to proceed.

Mr. Hopkinson

I understand that no advice was given not to proceed. As a matter of fact, it was simply because of the knowledge that the limit of capacity had been reached that they decided to go elsewhere. It has to be borne in mind that the interest rates of the Bank compared with the position on the London money market are closer today than they were before, and that there is not the same urge to come to London as there has been.

The right hon. Gentleman asked me what lay behind the Bill. I can assure him that nothing lies behind the Bill except a desire to fortify our position by having a sufficient manoeuvrability if, as we hope, in a number of territories over the next year or two there will be projects coming forward entailing large scale financing. Given the conditions on the London money market we believe that it is essential to have this elbow room in regard to the amount which should be provided under the Bill. I hope, after the explanation I have given, that the hon. Baronet will feel able to withdraw his Amendment.

Mr. Paget

We have had a singularly unsatisfactory reply, both from a personal and from a governmental point of view. I will deal first with the personal point of view.

A week ago, a most intemperate attack from an utterly irresponsible quarter was made upon my hon. Friend the Member for Oldham, West (Mr. Hale). I was in the House at the time. The Minister of State for Colonial Affairs—

The Deputy-Chairman

I must point out that this is some distance away from the Amendment before the Committee.

Mr. Paget

I can only point out to you, Mr. Hopkin Morris, that this matter was raised in the speech which we have just heard from the Government Despatch Box, and that I want to say a word upon it.

The Deputy-Chairman

I did not know that the right hon. Gentleman, the previous speaker, was referring to that. It is still some way from the Amendment that is on the Paper.

Mr. J. Edwards

On a point of order. It is within the recollection of all of us who listened to the right hon. Gentleman that he had quite a considerable exchange with my hon. Friend the Member for Oldham, West (Mr. Hale) on this very matter. I respectfully suggest that this is in order.

The Deputy-Chairman

I understood that the right hon. Gentleman referred to the speech delivered today.

Hon. Members

No.

Mr. Paget

I will deal with the matter very shortly indeed. I was in the House last week when it happened. The right hon. Member for Taunton said words which associated himself and the Government with the intemperate attack. It was clear—it was certainly clear to me—that those words were not considered relevant and he should have the courage to apologise. This House will always treat generously somebody who apologises, but for a Member of a Government to associate himself with a personal attack for which he will neither apologise nor produce one word of justification or substantiation is something which the House does not tolerate. I hope, even at this late hour, that the right hon. Gentleman may think better of what he has done.

Now I turn to his reply, on behalf of the Government, to what has been said today. There has been a total failure to justify bringing this Bill forward. They want £10 million. They think they may want £15 million. That adds up to £25 million. They are already authorised £50 million. As to the additional balance, they have not an idea. There is not the slightest reason adduced for bringing forward this Bill.

It is a Bill which we on this side of the House would have considered most sympathetically. I have only to refer to what my right hon. Friend said, that if there is shown a need for these funds for colonial development we would agree not merely to the expansion to £100 million but to an even larger figure. On the other hand, we are not prepared to sanction loans of this kind when not the slightest justification is brought forward. There might be some justification if the Government were to say, "There is little to do in the House. We are a Government more or less in a caretaker position, representing a minority of the vote, and we cannot do more than introduce just a few useful tidying-up Measures. At some future time this additional power may be of value to some more enterprising Government." If that is what they were saying, we could understand, but to introduce a Bill for which they do not produce the slightest justification, which they cannot say is wanted, on the very day after—

The Deputy-Chairman

The hon. and learned Gentleman is now making a Second Reading speech.

An Hon. Member

A very good one too.

Mr. Paget

I am proceeding to deal with the attempts at justification. Mr. Hopkin Morris. My hon. Friend the Member for Eton and Slough (Mr. Fenner Brockway), in a notable speech, referred to the problem of developing co-operatives and asked whether this money would be available for that purpose. In Africa, and in any great under-developed area of that kind, one is always faced with the tremendous problem that as we increase wealth so we increase consumption capacity and the numbers of people in the area. So often the numbers of the people are increased by the schemes faster than we can increase that which is there for them to eat so that, with enrichment, there is a net impoverishment. Indeed I have heard it said that there is no greater crime that can be committed against a nation than to lower its death rate before raising its standard of living to the point where it will lower its birth rate itself.

That is precisely the kind of problem which this co-operative farming scheme can deal with, because by it we can push up production in proportion to the people who are benefiting the State. Yet we are told, "No, it is not intended for this; it is for local welfare funds." Does the right hon. Gentleman really imagine that local welfare funds will put African farming—

Mr. Hopkinson

I must correct the hon. and learned Gentleman. I referred to two things: to the Colonial Development and Welfare Fund, on the one hand, and to territorial local funds on the other, which are the ordinary funds in the hands of different governments.

3.15 p.m.

Mr. Paget

Does the right hon. Member think that the funds in the hands of the different governments are sufficient to develop African farming? Is not this the very sort of method by which we should develop that African farming? Another great scheme for which this Fund is apparently not available is the Owen Falls scheme. There we have a vast plan for the raising of a great lake, the draining of the Sude Marshes, an increase in the water supplies for an additional 5 million acres in Egypt and the unification of the Nile Valley, which may also help to unify its people; but this Fund is not to be used for that project.

Mr. Hopkinson

I made it quite clear last week and again today that the Owen Falls scheme—the Jinja Dam—was eligible for loans of this sort.

Mr. Paget

What has been done about it? Are we to have no information about this, or is this a financial matter? My hon. Friend the Member for Brighouse and Spenborough (Mr. J. Edwards) is here, but we never seem to see his successor in office. It is a deep disappointment to us. He always puts up a distinguished performance at the Box and we should not be deprived of it.

Are we to be given no information simply because the elusive Minister of State for Economic Affairs is the only person who can tell us how the negotiation of this finance is faring? When are we going to see him? We have been told that there is nothing secret behind this Bill, but is not the right hon. Gentleman the secret behind it? He seems to have become so gun-shy of late that we never have the opportunity to see him. I am sure that I can speak for my right hon. and hon. Friends in saying how much we miss that particular Minister when he does not give the House his assistance.

In view of the totally unsatisfactory reasons which have been given in support of the Government's case, I certainly hope that my hon. Friend will not withdraw his Amendment.

Amendment negatived.

Sir R. Acland

I beg to move, in page 2, line 25, at the end, to insert: (4) To subsection (5) of the said section there shall be added the words: Provided that when the Treasury proposes to guarantee a loan which is the first loan made by the said bank to a government or authority which has been established after the passing of this Act, the guarantee shall not take effect until it has been approved by resolutions passed in both Houses of Parliament. The original Section 1 (5) of the Colonial Loans Act of 1949 reads as follows: Immediately after any guarantee is given under this Section, the Treasury shall lay a statement of the guarantee before each House of Parliament. I take it that that statement is laid before the House for information. It does not have to be presented to us to be voted upon. The Government do not have to allow a discussion upon it. I understand that there would be no power of praying against it. The Treasury gives the guarantee and lets us know that it has been given; and apart from the ultimate right of moving a vote of no confidence in the Government and thus raising the question of this action by the Treasury in giving a guarantee, the House will have no control over the matter at all.

By and large, I do not very much object to that kind of thing. Perhaps this is the wrong geographical point of the House from which to say it, but I do not quite share the Liberal, and to a large extent the Conservative, sensitiveness about allowing Government Departments to do this, that and the other without having the matter fully discussed in the House.

My view is that government has become such an infinitely complex process that any Ministers are bound to do all kinds of administrative acts, which they have to do at almost any time of the day or night or in any month or year, without the matter being discussed and thrashed out and chewed over in this House. The right which we retain is not the right of detailed discussion of every single Ministerial action but the right of criticising any Minister or the whole of the Government either on a Supply Day or on an Opposition Vote of Censure if we believe they are running completely off the rails.

If there were no new principle in the Bill, I should let it stand and simply comment that the Bill gave the Treasury discretion to act, that the Treasury would give the guarantees, and that if we objected we should raise the matter on a Supply Day or on the Adjournment or on some other such occasion. But in Clause 1 (1) of this Bill, the Treasury is given power to make guarantees in respect of bodies of a new kind—governments or other authorities exercising government functions or discharging other common functions for a group of territories.

Perhaps I may read my Amendment, which says: Provided that when the Treasury proposes to guarantee a loan which is the first loan made by the said Bank"— that is, the International Bank— to a government or authority which has been established after the passing of this Act, the guarantee shall not take effect until it has been approved by resolutions passed in both Houses of Parliament. In other words, my Amendment seeks to leave out just this much control—that when, for the first time, a guarantee is given in respect of a loan to a new body—a body which does not exist today but which is brought into existence after today—then the question should come before the House so that we may consider whether this new body is a sufficiently credit-worthy body, and whether the functions which it discharges in the Colonies are sufficiently worthy functions, to make it reasonable for the British Treasury and the British taxpayer to back the loan, to put itself in a position of having to repay the loan with interest at 4¾ per cent. in the event of that authority proving not to be quite so credit-worthy as the Treasury thought.

I said in moving my previous Amendment that what I had in mind in putting this Amendment on the Paper was very largely Central African federation. But that is not the only consideration. There are authorities of a quite different kind, and I should like to mention one or two of the possibilities. In my speech on Second Reading I quoted some words from Clause 1 of the Bill, namely— … the reference to the Government of a colonial territory shall be construed as including a reference"— and here I omitted a few irrelevant words— … to any authority established for the purpose of providing or administering services which are common to"— and again I omitted a few words— … two or more such territories."—[OFFICIAL REPORT, 14th November, 1952; Vol. 507, c. 1277.] I asked whether such an institution as the West Africa Cocoa Research Institution would technically qualify for a loan and whether the Treasury would be entitled to back such a loan. I got a very satisfactory answer from the right hon. Gentleman. He said that the answer was technically, "Yes," but that it would, in practice, not arise.

So far as concerns the West Africa Cocoa Research Institution I find myself in cordial agreement with that answer. I think it unlikely that W.A.C.R.I. would want to borrow money from the International Bank, but I am glad to know that it is technically possible for it to do so and for the Treasury to guarantee the loan. But I would not for a moment want that matter to come up for affirmative Resolution in this House.

As I look round, with such knowledge as I have, or from reading such reports as I can, I find that in the Colonial Empire there are various institutions which do service in the territories, there is one for tropical agriculture in the Caribbean, for example, and I cannot think of a single one in respect of which I would have any violent objection to them raising a loan through the International Bank and for the Treasury to guarantee the loan. If hon. Members can think of any particular case we can raise it and if we—

Mr. J. Johnson

Would the hon. Member include the West Africa Cocoa Research Institution?

Sir R. Acland

That is one which I have dealt with.

But let us consider a hypothetical case, which might appeal to hon. Members opposite, and might even show them that there is something to be said for the Amendment I have moved. Let us suppose that in their advance towards political and economic independence, the West African territories were minded to set up a West Africa shipping corporation to run ships from the West African territories to all parts of the world. Goodness knows, they have inducement enough to think over a project of that kind, though I am not aware that they are thinking about it at this moment as a likely or possible practical proposition. But when one considers their stranglehold and the wicked increase in freight rates by the West Africa Shipping Conference, the sort of thing which, according to hon. Members opposite, is found in publicly owned monopolies and cartels, but which is here happening in a privately owned monopoly, they have sufficient inducement.

The public, traders, consumers and producers, both in West Africa and in this country have been mulcted of an enormous fund now held in reserve by that organisation and which really is loot in the hands of a private corporation. It is a sum of public money—because these sums belong to the public every bit as much as the taxes we pay or the money we pay when we buy tickets on the nationalised railways—and it has been taken by this great international monopoly.

It may very well happen that the West African Colonies, in their advance toward economic and political independence, might be minded to set up their own joint shipping board. Such a board, which might be publicly owned or even partly privately owned by African private citizens, might certainly approach the International Bank for a loan.

Suppose that came up for Government or Treasury guarantee during the time when a Labour Government was in office. Are hon. Members opposite quite sure that they would want such a guarantee to be given by the Treasury? Is the hon. Member for Croydon, North (Mr. F. Harris) sure that he would want such a guarantee to be given by a Labour Government to a corporation of that kind, acting in competition with a privately owned monopoly? One would think that hon. Members opposite would be glad to find this Amendment of mine had been passed, and that it would have to come before the House for affirmative Resolution.

3.30 p.m.

If such a corporation were to be initiated by the West African Colonies for the purpose of breaking through the shipping trade monopoly we ought to back it to the hilt, even at the risk of losing money. I mention this merely as an example to show hon. Members opposite that it is not altogether a good idea to pass a Bill now which can give carte blanche to all sorts of authorities, and common services set up to help different Colonies to borrow money from the International Bank and for the Treasury then to back the loans without the proposals ever coming before the House of Commons for affirmative Resolution.

I cannot deny—indeed I have said this twice already—that what was in the minds of my hon. Friends in putting down this Amendment was the prospect of a Central African federation coming into being. And even now, despite all the denials, there is unanswerable logic in the speech made by my hon. and learned Friend the Member for Northampton (Mr. Paget), who challenged the Government to say for what possible reason they have brought forward a Bill for which there is no immediate practical need at a time when they have so little time that on the first day of next week they have to introduce a Time-table Motion for one of their Bills.

The fact that there is no answer to that question raises in our minds the high probability that why this Bill has been introduced now is to get it through in advance of federation so that, if and when federation comes into being, they can go slap off and ask for a really big loan. If it would not be out of order, I wonder whether the Minister would care to bet me sixpence that within 15 months of the establishment of Central African federation, if it is, in fact, established, there will not be a request to the International Bank for a loan of about £50 million for development. Of course, I must not ask any more about that, because it would be out of order if the Minister took me up in this Committee.

There is a grave dark question mark overhanging the whole future of Central Africa and the financing of its development. I appreciate that we cannot discuss the merits of federation overmuch. If federation were to come to pass I for one would not want to have a separate discussion here every single time when that federation asked permission to obtain a loan from the International Bank and every single time when the Treasury guaranteed it.

But it is not unreasonable when we are passing this Bill through Committee to say that, if federation comes into being, then on the first occasion when permission is asked and obtained for a loan from the International Bank and that loan is guaranteed by the Treasury, the guarantee shall not become effective until the matter has been brought forward and approved by affirmative Resolution in both Houses of Parliament.

That would give us an opportunity of discussing the important question, which I should have thought would have been of great interest to Tory Members opposite, of whether the taxpayers' money would be safe if such a guarantee were given. It is a question which surely we, as guardians of public money, ought to have an opportunity of discussing. If this Clause goes through unamended, then, when the Central African federation asks for a loan from the International Bank and a guarantee is given by the Treasury, we shall not at that time have any opportunities of discussing the creditworthiness of the federation.

My submission is that we must cast our minds problematically forward to consider what this credit-worthiness will be. I notice, in confirmation of what I am saying, that when the Colonial Loans Bill of 1949 was before the House, the hon. Member who is now the Assistant Postmaster-General made some remarks about the possible credit-worthiness or noncredit-worthiness of the Colony of Cyprus. He spoke of the political malaise of that Colony which might destroy its credit-carrying capacity, and he warned the Labour Government of the day against the dangers of guaranteeing a loan to any Colonial Territory in which political disturbances were to be forecast, or even where they were to be sensibly feared, though not absolutely certain.

It is certain that, particularly in multiracial communities that have any substantial number of members of any community who are behaving in such a way as to store up political trouble and anxiety for the future, it must, of necessity, reduce the credit-worthiness of the whole of the community, and we have every reason to fear that that is precisely what is happening in the way in which—let us be very careful about it—not all members of the white community in Southern Rhodesia behave, but the way in which some of them behave, in relation to this prospective Central African federation.

I think we have already had quoted in this House on this matter the comments made by the Archbishop of Canterbury in a letter to "The Times," in which he expressed himself as being aware of the advantages, economic and otherwise, which may come if federation was carried through with the assent of all peoples. He went on from that to doubt whether federation could lead to anything but grave future difficulties and possible disturbances if it was forced through against the wish of any community.

The Chairman

I think this is going rather beyond the Amendment, which only asks for the affirmative Resolution procedure.

Sir R. Acland

We are in some difficulty, Sir Charles, in that, if my Amendment was agreed to, we should then know that if, at some future time, we were asked to give a guarantee for a loan, we should, at that moment, have the opportunity of discussing whether the Central African federation was a credit-worthy institution on whose behalf we should take up the guarantee.

Therefore, what I am saying now about its possible credit-worthiness would be clearly out of order, but if, as I understand the matter, the Amendment is to be resisted and large numbers of hon. Members who have not listened to my arguments are to be brought in to vote against it, this is the very last occasion on which it will be in order to discuss whether Central African federation, if and when it occurs, will be a credit-worthy institution.

Sir Herbert Williams (Croydon, East)

On a point of order. How often is the hon. Gentleman to be permitted to discuss the credit-worthiness of various parts of the world without infringing the rule against tedious repetition?

The Chairman

I think we have reached that point now.

Dr. H. Morgan (Warrington)

The hon. Member for Croydon, East (Sir H. Williams) ought to know. He is always most tedious.

Sir R. Acland

I am very anxious to respect your ruling Sir Charles, but, without wishing to irritate the hon. Member for Croydon, East (Sir H. Williams) by repeating my argument, it seems to me that we should be allowed to consider, in connection with the bringing into being of a Central African federation, the African Affairs Board, as one of the major items which is supposed to make it acceptable to the African people.

We had a letter in "The Times" from the Archbishop of Canterbury, quoting, with the deepest concern from a Christian point of view, the statement of the Southern Rhodesian Prime Minister that the African Affairs Board is like Gilbert and Sullivan without the music, that maybe it will not do any good, and probably will not do much harm, but that if it does they can get rid of it.

If this is the atmosphere in which Central African federation is being pressed forward in Southern Rhodesia, we have a right to bring forward these matters as arguments why we should not pass a Clause in a Bill of this kind giving the Treasury authority to back a loan made to the Central African federation without bringing the matter to the House to enable us to examine the circumstances in which the federation has been brought into being and the evidence which will doubtless be put before us by the Minister of State for Colonial Affairs, arising from his tour, to show that the Africans are all in favour of it. When we can examine the evidence and when the federation is in being, presumably we shall know all the things which at the moment are only to some extent prospective.

Mr. Hale

They will not be fully known.

Sir R. Acland

These matters will be a great deal better known than they are now. Some people who have doubts now might find, by then, that their doubts are quietened and they might be quite willing to see the Treasury back loans to the federation. Other people who feel happy about it now might feel that it would lead to outbreaks of disorder of one kind or another; they might, by then, be inclined to feel that one of the regrettable consequences of the way development was proceeding was that the British Treasury should not back loans to a community which might be turning out to be financially not credit-worthy.

It is of very great regret to me to, have to couch the whole of my argument in problematical, hypothetical terms of what may or may not happen at some future time. It is exactly for that reason that I very strongly press the Amendment. It would have the effect of assuring the Committee, and it is not only a matter of the Central African federation, that whatever new bodies are set up in the future—bodies which do not exist today, so that we cannot now tell what quality and stability they will have or what purpose they will be serving—and ask the International Bank for a loan, the first time that happens we shall have an opportunity here of saying in the light, not of guesswork or of hypothetical discussion and argument, such as I am reluctantly compelled to indulge in this afternoon, but of actual events, whether we feel that the British taxpayers' money should be risked behind whatever authority or Government it may happen, to be.

3.45 p.m.

Mr. Hopkinson

I should like to make it quite clear, first of all, that this Bill has not been introduced specifically to deal with the matter of Central African federation. The Clause which extends power to guarantee loans made under the Bill to Colonies which are now or may in the future be constituted, or to two or more Colonies, was introduced to deal with existing territories such as the Gold Coast, which combines a Colony, Protectorate and Trust Territory, and the same thing in Nigeria, the High Commission in East Africa and also future federations such as Central Africa, the West Indies or other combinations of particular territories.

The fact is that this is an enabling Bill. The power to give guarantees for these loans is purely permissive. It is in the hands of the Treasury and the Secretary of State, and they will always satisfy themselves beforehand that the authority which is proposing to borrow is financially and economically sound. It is not a question of the political status of a Government or of an authority at all. It is a matter of credit-worthiness which, we feel, must be left to the Secretary of State and the Treasury.

I should like to ask the hon. Baronet the Member for Gravesend (Sir R. Acland) why there should be any more strings attached to credit on extension of facilities to a new Government authority rather than to an existing one. After all, there are existing territories in our Colonies which vary very much in their financial strength. I could quote examples, but I will not do so. What I felt when I saw this Amendment, and it has been brought out very clearly in the course of this debate, was that it was directed at Central African federation and, I believe, at sniping at Central African federation through the back door, at a risk of hampering economic development not only in that federation, if it was set up, but in many other places as well.

The question of Central African federation is still purely hypothetical. There is to be a conference in January. After that, if agreement can be reached on the final document, there will be a referendum in Southern Rhodesia, followed by debates in the Legislatures of Northern Rhodesia and Nyasaland. Only then, and not until then, would Her Majesty's Government be called upon to take a decision. If that decision is in favour of proceeding with federation then would come the full opportunity, for which the hon. Member for Gravesend was asking, for Parliament to debate the issue in all its aspects—when the enabling Bill to bring the new constitution into force was brought before the House of Commons and before another place.

That seems to me to be the moment for raising objections in the House of Commons to Central African federation. That is the time to attack and to attack openly, not now by oblique methods on a financial Bill drawn up for completely different purposes. If federation came about it seems to me that it would be quite wrong to place the new Government in a less favourable position than any existing Governments of Colonial Territories as regards their borrowing powers with the International Bank. I feel quite certain, despite what the hon. Member for Gravesend has said, that that is not the intention of hon. and right hon. Gentlemen opposite, and for the reasons that I have given I hope that he will feel able to withdraw this Amendment.

Mr. Hale

I am sure that the whole Committee is very much obliged to the right hon. Gentleman for his early intervention between the moving and seconding of this Amendment.

Hon. Members

Oh.

The Chairman

In Committee there is no seconder required. That remark is quite uncalled for.

Mr. Hale

I agree that no seconder is required. All I am saying is that the right hon. Gentleman spoke between a first and second speech in Committee, which is somewhat unusual, and I was expressing gratitude to him for giving the limited facts that he is prepared to give at so early a stage. When I am generous and express appreciation to the Front Bench there is resentment. I was expressing wholehearted appreciation of the right hon. Gentleman's action in giving us these limited facts so early. These facts are very relevant and very important.

In the early stages, we raised the question of a joint authority. The right hon. Gentleman referred to the East African Commission, of which I knew very little, as one of the examples of a joint authority—not a joint Government but a joint authority. In my speech a week ago, I raised the question of organisations like the Royal Empire Society for the Blind. I know that quite obviously that is not the sort of thing that would normally be dealt with under the procedure of this Bill, but it is a fair point to make that under the terminology of the Measure it appears to be a joint authority for a number of colonial territories, and therefore could be brought within the purview if we wanted to do so.

I dealt with the noble work that they are doing and expressed the hope that at some time or other the Government would see if they could assist in this great work, which is being brilliantly and economically done, and which is being frustrated by lack of funds at the moment. They are doing very great and substantial work, and the brilliant secretary, himself a blind man, bids fair to become one of the real benefactors of the world.

I want to approach this matter, not precisely in the words of the hon. Baronet who moved the Amendment, but in words which I used a week ago. May I say to the Minister of State for Colonial Affairs that I realise why he was annoyed with my speech. I have gone right through it word by word, and I see that I did introduce the subject of trade unions in the Colonies. I appreciate that that would cause resentment on the benches opposite.

Mr. Hopkinson

rose—

The Chairman

This point cannot be pursued. This Amendment relates to the setting up of the affirmative Resolution procedure.

Mr. Hale

The point that I was making was that the Amendment proposes that we should have the right to consider a new loan, to consider the cirucmstances of the loan and the credit of the country concerned on the lines very ably followed in a previous debate by the Assistant Postmaster-General. We can consider the credit, the organisation, the protection given to the people and so on. It is really on those lines that the Amendment is drawn. We ask that, in connection with any new Government or any new authority or new organisation, we shall have a right to investigate it and see if it is the appropriate authority or organisation to which the money should be advanced.

I concluded in the last debate by saying: These works of welfare are not merely a Christian duty which should be embarked upon simply because they are a Christian duty, but because at this point in the turning of affairs in Africa they are a vital part of the work of reconciliation and the creation of understanding, the tide of which has ebbed dangerously far already. We should concentrate on.…"—[OFFICIAL REPORT, 14th November, 1952; Vol. 507, c. 1324.]

The Chairman

I do not think the hon. Gentleman can have heard what I said just now. This Amendment deals only with the affirmative Resolution procedure. To go back over last week's debate is quite out of order.

Mr. Hale

I am obliged, Sir Charles. I am always grateful for your help.

Mr. James Hudson (Ealing, North)

On a point of order, Sir Charles. The difficulty is that not only does my hon. Friend not appear to have listened to what you have said, but we cannot hear what he is saying. We would be very glad if we could share with hon. Members opposite the secrets which my hon. Friend seems to be passing over to them.

The Chairman

That is not a point of order.

Mr. George Wigg (Dudley)

Further to that point, Sir Charles. When the right hon. Gentleman was speaking he did go in some detail into the question of federation—[HON. MEMBERS: "Speak up."] I beg my hon. Friends' pardon. I have got a cold. When the right hon. Gentleman made his speech, he answered my hon. Friend the Member for Gravesend by dealing with a question of Central African federation. Therefore, I should have thought that my hon. Friend the Member for Oldham, West (Mr. Hale) was merely following the path which the right hon. Gentleman was allowed to tread.

The Chairman

I was unduly kind to the hon. Baronet to allow him to develop his argument. The Minister has answered it, and I think that is sufficient.

Mr. Hale

I am grateful, Sir Charles. Now that my hon. Friend the Member for Ealing, North (Mr. J. Hudson) has called attention to the fact that I was inaudible, I can well understand how I may have been misunderstood.

The Amendment states: Provided that when the Treasury proposes to guarantee a loan which is the first loan made by the said bank to a government or authority which has been established after the passing of this Act, the guarantee shall not take effect until it has been approved by resolutions passed in both Houses of Parliament. My hon. Friend has quoted a specific example of the sort of thing that can happen and of the sort of thing he has in mind. He does not say "I drafted this Amendment because of the imminent possibility of Central African federation," but he does say that I had in mind that that was one of the early possibilities that might arise. The whole argument which we are desiring to develop, and which, with great respect, Sir Charles, I venture to think would be well in order on the Clause, is that if there be created a joint Government on the basis of the lines now indicated for Central African federation; if there be created a joint Government against the wishes of the overwhelming majority of the inhabitants of the territory, forced through the House of Commons without regard to the wishes of the inhabitants or to the representations made by the overwhelming majority of the people, the whole purport and tenor of the Amendment moved by my hon. Friend is that in those circumstances we should have an opportunity of considering the circumstances under which we were prepared to give guarantees and the type of financial assistance which we would be prepared to guarantee. That is the quite short point which is put in the Amendment, and I think it is a very important one.

With very great respect, Sir Charles, I venture to submit—I hope you will understand that I am not for a moment disagreeing with your Ruling, but I am trying to put a point within the ambit of the Ruling—that it may very well be a matter for consideration in a newly constituted territory whether the fundamentals of human rights are permitted there, whether there are trade unions, whether there are co-operative societies, whether they are illegal or not, whether there are restrictions on crop growing and so on. All those are matters that the House would have a right to consider in determining whether or not this was an appropriate occasion for a guarantee.

I have made the point before, and I do not want to labour it, but it is right that I should make it now, that these guarantees are being made to the International Bank, which is representative of a wide variety of countries, including India. It may very well be a matter—[Interruption.] I will give way to the hon. Member for Croydon, East (Sir H. Williams) with pleasure, but having heard his previous intervention, I can understand why the Chambers of Commerce did not invite him to speak.

It is wholly impossible for us to eliminate questions of colour bar when we come to consider a loan by the International Bank, guaranteed by this country, when some of the funds are coming from India and when the present very distinguished Prime Minister of India has already expressed very strong views about what is happening in some of the colonial territories. These are the problems that we have to face.

The Minister of State for Colonial Affairs has said, and without equivocation—and I accept it from him—that there was not in mind at the moment of the introduction of the Bill the question of Central African federation. He has said, and without equivocation, that there is not in mind at the moment the granting of a large loan to a federated Central Africa, although, of course, such an application could be made, and it may arise in the future. I accept that. But I am bound to say that it leaves us in great doubt on the whole matter as to why the £50 million is needed at all. If it is not needed for that purpose, the right hon. Gentleman has given no figures whatever to indicate the need.

The right hon. Gentleman has talked about the East Africa Commission as one of the joint bodies which would come up for consideration under this scheme; but the whole trend of political events is in the direction of the gradual development of bodies which are not bound by a purely national or colonial boundary, but of bodies which function for their own particular purpose over a large area. Most of us would agree that on the whole that is a good thing and a step in the right direction.

I have ventured to point out what, I think, is still a quite serious defect in the Act, that it seems that in dealing with this matter we should have in mind also the possibility of dealing with joint applications by a colonial territory and by a non-colonial territory, the obvious example being liberated Sudan making application in conjunction with Uganda for development of the reclamation of the marshes scheme. It is not possible for me to conclude now in the few seconds that remain. Therefore, we shall have a further opportunity of debating this matter. I hope that the right hon. Gentleman will apply his mind to that aspect, because it seems to me that it would be a substantial improvement.

It being Four o'Clock, The CHAIRMAN left the Chair; to report Progress, and ask leave to sit again.

Committee report Progress to sit again upon Monday next.