HC Deb 10 December 1953 vol 521 cc2194-217

As amended, considered.

Motion made, and Question proposed, "That the Bill be now read the Third time."

4.15 p.m.

Mr. Leslie Hale (Oldham, West)

I want to say only one or two words because the House is anxious to pass on to other business which it regards, rightly or wrongly, as more important. Perhaps, as a courtesy to the Parliamentary Secretary to the Board of Trade, it would be right for me to say one thing. During the deliberations in Committee we asked that the Report stage of the Bill and the Third Reading should be taken on a separate day so that we could have an opportunity of considering Amendments on the Report stage.

My hon. Friend the Member for Cheetham (Mr. H. Lever) and I drafted some fairly extensive Amendments for discussion which were related primarily to the type of detail which should be given when the Minister reported to the House in respect of the cancellation of obligations or arrangements that were made, and we had intended to raise some discussion on them. It was obvious, in view of the way that the Bill had been discussed, that in the end we should not have forced that matter to a Division and we should have had to accept such assurances which the Parliamentary Secretary would have given us, and in view of the obvious desire of the House to discuss the subsequent business at length we felt that we were meeting the desire of the House in not in the circumstances insisting on a discussion on the Report stage of the Bill.

I hope that due notice will be taken of our magnanimity in this matter and of the friendly hand of co-operation which my hon. Friend the Member for Cheetham and I, in particular, have extended to the Government in this matter, and of the facilities we are giving gratuitously for the speedy passing of Government business. We have been trying to do this all day, as the President of the Board of Trade knows; upstairs we have been moving, and here we are nearly through.

Mr. Frederick Gough (Horsham)

I was a little concerned when the hon. Member said that he had given these facilities gratuitously. How could he give them otherwise without running into the danger of committing a breach of Privilege?

Mr. Hale

I had not thought of that, but will give it my attention in the future. It seems to open up attractive vistas, and the opportunity to explore every avenue is one of which I should like to take advantage.

On Third Reading, may I be permitted to say that we have never opposed the Bill? We have opposed the lack of precautions in the Bill. As I have said before, it is rather surprising to find these apostles of private enterprise coming and asking for Government subsidies for competitive industry while still keeping it competitive, although they have often done it in another form. In essence, however, it was a Socialist Bill. My hon. Friend the Member for Cheetham and I were conscious of one or two perfectly well-known facts about it which demanded a little more scrutiny than otherwise might have been necessary.

The first of those is the slight caviar complex of the film industry. If one is asked to discuss films with film magnates, the discussions do not normally take place in what is vulgarly known as the "spit and sawdust" bar of the local "pub." There is a caviar and Park Lane complex about the industry that for a moment inhibits one from writing out blank cheques without a little consideration. We have given the Bill fair consideration, and I leave it at that.

Secondly, in spite of the fact that my right hon. Friend the Member for Huyton (Mr. H. Wilson) introduced the earlier Bill and did a great deal of work in doing so, and made the situation clear and at that time rescued an important industry and saved the life of "Old Mother Riley" for posterity, and so on, we rather detected behind the Bill the urbane and charming, but, in this connection, perhaps, slightly sinister, figure of my hon. Friend the Member for Nottingham, North-West (Mr. O'Brien).

It is part of the tradition of this House that those Members who have great experience of trade union affairs and thus have knowledge of the industry should lay that great knowledge at the disposal of the House. No one will blame my hon. Friend for doing so, though had he been a member of the People's Progressive Party in British Guiana he might have come in for some trouble on that account. But the industry owes him a debt of gratitude for his services in the matter.

I have sometimes wondered how this industry got at the head of the queue and why it was selected for this special, munificent and rather generous assistance which is carried on in the Bill. But anybody who knows my hon. Friend knows that he has the interests of this great industry at heart, that he has an unrivalled knowledge of it, that on every possible occasion in the last eight years he has given the House the benefit of that knowledge and experience, that he has served the interests of the industry well, and that both he and my right hon. Friend the Member for Huyton are entitled to the thanks of the community for continuing this service, which preserves a vital and important industry and one which, one still thinks, could be developed even more and ought one day to be able to stand on its own feet, to common benefit.

There is only one other observation I desire to make on the Bill. In Committee, the Parliamentary Secretary said that questions of cultural, aesthetic and artistic value could hardly be considered because of the terms upon which the loans were granted under the Bill. I do not want to misrepresent the hon. and learned Gentleman, because I hope he will say that that is not true. If he says that I misunderstood him or that the words which he used offhand did not convey the impression he wished to convey, I shall be very glad, because it seems to me that if we are considering the granting of public money for the purpose of preserving an industry, we should also be considering the way in which that industry serves the community.

While no one wants to impose a snob complex or a snob attitude on what is a matter of widespread public enjoyment and entertainment, there is really no reason why, from time to time, some preference should not be given to those films which serve the national interest best and to our desire to produce worthwhile films and films of cultural, aesthetic and artistic value. I hope that that will be done.

4.22 p.m.

Mr. Harold Lever (Manchester, Cheetham)

I find myself wholly in agreement with the expressions just uttered by my hon. Friend the Member for Oldham, West (Mr. Hale) concerning the hon. Member for Nottingham, North-West (Mr. O'Brien), concerning my own magnanimity, and the necessity for the scrutiny of matters such as are contained in this Bill. I fear, however, that I cannot follow my hon. Friend either in seeking to relate this Bill to interesting colonial events, or in saying that, in principle, I am in support of the Bill. I must record that I remain profoundly opposed to the whole principle of this Bill. Moreover, as I am bound to acknowledge that the Leader of the House has in this case treated the back benches with very great consideration, it would be churlish of me if I did not respond by making my argument as brief as I can.

It is an astonishing situation that upon the Third Reading of a Bill which purports to govern and deal with £8 million of public money, the House should be in the position that the case for the Bill has never been made out. I want very briefly to enumerate to the House the questions which I raised tirelessly on Second Reading and during the Committee stage, and to raise them again because they are, I believe, relevant to the Third Reading. In the first place, the House ought to be aware that this Bill is renewing the original Bill of 1948 which was introduced by my right hon. Friend the Member for Huyton (Mr. H. Wilson), whereby he set up the Film Finance Corporation in order to cover an emergency crisis.

That Bill provided £5 million of public money with which to support the film industry for five years. We were then told that it was a regrettable necessity, that it was strictly temporary in nature, that the money was going to come back because the scheme was self-liquidating, and that, at the end of that time, the film industry was to stand on its own feet, because, in the meantime, the 1948 Act was going to provide a cover under which the Government would take the necessary action to make the industry self-supporting.

To me it is an astonishing and regrettable thing that the Government should have introduced this Bill without tendering any explanation at all to the House for coming here with a completely reversed policy. The Government have not told us why they have abandoned the original idea that the scheme was to be temporary pending Government policy with regard to the industry.

There has been no Government policy, and we are now told that the scheme is not to be temporary, but is to be extended for three years. The only Government explanation which I have heard during my attendance of all the hearings is this. They say that the £5 million—increased later by stages to £8 million—has become part of the permanent capital of the film industry. They have not ventured to tell the House why that state of affairs has been brought about, in spite of the declared purpose of the House in 1948 that the money so provided was to be nothing of the kind.

We were led to suppose that this money which was voted by the House as temporary finance became permanent capital by some process not within the Government's cognisance or subject to their action. It is rather as if the fact that we now find ourselves in 1953 voting temporary assistance for the film industry into permanent assistance is due to the same reason why we are having a mild autumn this year. It is a matter which does not fall within the competence of the Government to affect.

We have not been told—and we ought to be before this Bill gets its Third Reading—what are the purposes for making the £5 million originally voted as temporary into permanent capital for the film industry. Why has no policy been provided under cover of the original Act? Why is there no explanation of the non-attainment of the original and very laudable and necessary purposes for which the 1948 Act was brought in?

How can the House hope to give another three years' life to the Film Corporation until the Government tell us how much that Corporation has cost us for five years? I would not repeat this ques- tion on Third Reading, but for the fact that I find it an extreme affront to the House that we should be asked to vote assistance for another three years when, at the same time, the Minister refuses to tell us how much it has cost so far.

Even at this late stage, I ask the Minister to do his duty and to tell the House how much the Corporation has cost so far. He has not yet given any answer to that question, which is truly astonishing. My right hon. Friend the Member for Huyton has sought to give an answer. He says that it has cost the country nothing; that, in fact, we have made a profit on it because of the Entertainments Duty we have been able to collect owing to the activities of the Corporation.

That is the kind of argument which makes me more uneasy than does the Government's silence. It amounts to saying, when I ask how much has been taken from the public purse with which to finance the film industry, that nothing has been taken from the public purse because, by spending this money, we have been able to take more money from the public by taxing them as they enter the cinema. It is truly remarkable.

My right hon. Friend is not unaware that the Government have unlimited opportunities of taking money from our pockets without the necessity of a Film Finance Corporation to enable them to do so. That argument will not do. I press the Minister, even at this late stage, to repair the wrong he is doing by telling us what is the financial cost so far of the Film Finance Corporation. He is not entitled to have this assistance extended until he tells us what it has cost so far.

The Minister has only answered, "Look at the Corporation's accounts." That is really a most unsatisfactory answer. All we have are out-of-date accounts which the Minister dare not maintain are accurate. Does he really mean that the House should regard the figures in the books of the Corporation as representing the average cost? For example, the British Lion debt is there recorded as worth £2 million. Does the Minister think that is the worth of it? If we are not to treat the books of the Corporation as being representative of the reality of the cost of the Corporation, then we find the astonishing situation that the Minister has told us nothing at all about the cost.

We are entitled to know what the Corporation has achieved. It is all very tedious, and we are all anxious to get on to other business, but we are entitled to know these things. What has the Corporation achieved? I do not find any answer to that in the interesting and attractive propositions about artistic creations which were made on Second Reading and during the Committee stage.

After all, we are not handing out Parliamentary Oscars. We are asking the Minister to account for £8 million of public money. We do not want an interesting selection of what films are trash and what are good. We are not deciding the film of the year. We want to know what the Film Finance Corporation has done for the film industry.

As far as I can make out, the attitude of the Parliamentary Secretary is that, as long as the Corporation has kept British Lion and other film companies solvent, that is all that is necessary. Of course, the British Lion can echo the words of the famous old lady who triumphantly announced that she had borrowed enough money with which to pay all her debts. The film industry has been placed in this happy form of solvency by the activities of the Corporation.

I want to know not only what it has cost so far but something about what it has done so far. It is astonishing that not only does the Minister conceal from us how much it has cost but he does not tell us what he thinks it will cost. No estimate has been offered to the House. We are all in favour of helping the industry, but surely the House must realise that the mere declaration of desirable objectives is no excuse for us failing to give a critical examination to the methods whereby it is sought to achieve those objectives. We are entitled to know from the Minister who asks for a three year period how much that extension will cost. We want some estimate. Will it cost 3d., £3 million or nothing?

What does he think of the interest on the £6 million of public money which has been lent so far and which could have earned perhaps some £300,000? We want to know what this will cost in future. What is the purpose of the three year extension? I ask the Minister again, as I asked him in Committee, what is the intention of the Government about this three year period. Is it to be the final period? Earlier the Minister provided me with the most astonishing reply. He said, first, that the Government could not bind future Parliaments. That interesting statement on constitutional law must have been received by the House with something less than surprise.

He also told me that the Government thought it right now to have a three year extension. I might have deduced as much from having read the Bill. I assume that the Government are not in the habit deliberately of damaging British industry, though many times one is tempted to hold a contrary belief. The Minister told us that he wanted a three-year period because he thought it right. That sort of expression may be appropriate in the nursery but it is not good enough for a Minister in the House of Commons. His declaration about the Tightness of what he is doing was something less than impressive.

I want to know what the three-year period is for and what the intentions of the Government are. I cannot forbear to mention that if, when we brought in the Coal Board and nationalised the coal industry, we had been asked to say what our permanent policy was, and we had said that we could not bind future Governments but we thought it right to have a Coal Board for five years, we should have been faced with the most grave criticism. But that is what the Minister says. He says, "I think it is now right to have the Corporation for three years." Why he thinks it right remains for ever locked in his breast. We do not know the answer.

At the end of the three years, is the industry to be thrown to the wolves? We do not know. At the end of three years, is it the intention of the Government that the industry shall have a fresh subvention? We do not know. Do the Government expect to have any money left at the end of this time? We do not know. Will the House be asked to provide any more money? The House already knows that we shall be kept in ignorance—perhaps in the category of blissful ignorance, because if we knew the real truth we might not be ready to accept the Bill.

Nobody can accuse me of having dealt with anything but fundamental issues. I propose now to discuss another fundamental matter. We are entitled to know a little about the future policy of the Corporation, something of its policy in the past and something about its powers. Those hon. Members who attended earlier debates will know that I had to press and press and ask and ask again before the Minister would tell me whether it was lawful for the Corporation to lend money otherwise than in the honest expectation of getting it back.

In the end, in an unguarded moment late in the Committee stage, the tired Minister, quite contrary to the policy so far followed, managed to vouchsafe a vital piece of information which the House on elementary grounds was always entitled to know. As I understood him, he told us that it was not lawful for the Corporation to lend money otherwise than in the honest expectation of getting it back. I then asked him whether he was satisfied that the Corporation had been acting lawfully within that definition during the past five years when it had been handling this £6 million of public money.

That was not an unreasonable question, but the Minister was not unguarded enough to give me that elementary piece of information. I ask him now to tell me whether he is satisfied that the Corporation has always obeyed the rule that it ought not to lend money otherwise than in the honest expectation of getting it back. I do not want him to give me general observations as he did on Second Reading when he said that if the Government thought the Corporation were doing anything unlawful they would stop it. We always felt that the Minister might be inclined to hold such a view.

Now that the Minister has committed himself to the view that the Corporation has no lawful right to lend public money otherwise that in the honest expectation of getting it back, I want to know whether he is satisfied that on no occasion in the past five years, has public money been lent by the Corporation otherwise than in that belief. My next question is about the powers of the Corporation and its lawful use of them. The House has not been told what will be future policy for the three years we are asked to authorise the Corporation to continue. We have already reconciled ourselves that the fact that either the Government have no policy or, if they have, they will not tell us about it.

But, at least, we ought to be told about the policy of the Corporation before we authorise its existence for another three years. Will the Minister tell us, even at this late hour, what the policy will be? He made an astonishing statement when he said that he did not intend to interfere with the policy of the Corporation and that he would leave the policy to it. I am sure that one of the able civil servants of his Department has already drawn his attention to the fact that he is under a statutory obligation to interfere and that the Corporation has to receive directives from him from time to time as to the classes of lending it must undertake.

This must have come as a shock to the Minister who thought that all he had to do was to exchange a few votes of confidence with the persons connected with the industry and that nobody would interfere any further. He has not only power to control the Corporation; he is under a statutory obligation to do so. The Corporation cannot work without his directives. Instead of wasting time on Second Reading under the procedure whereby the recipients of State bounty gracefully pay compliments to the gentlemen who are placed in charge of this distribution, and those who speak on be-behalf of the gentlemen in charge of distribution pay equally graceful compliments as to the sober, respectable and artistic nature of the beneficiaries—instead of all that we might have been told a little about the policy of the Corporation. Now that the Minister—even in the middle of the proceedings—has been acquainted with his statutory responsibilities, perhaps he will confide in us what he intends to do about them.

Mr. Hale

I do not think that at any stage anyone has referred to the artistic proclivities of the recipients of bounty. I made the simple point that if one is to subsidise the selling of soap one might as well see that it is good soap, and if one is to subsidise films there is something to be said for the films being good.

Mr. Lever

As usual, I find that I am in wholehearted agreement with the general declaration of my hon. Friend on matters of an artistic and cultural nature. But that does not prevent me from thinking that these expressions, interesting and encouraging though they may be, fall short of what is desirable when the House is discussing the financial machinery whereby it is sought to support the film industry.

The next matter which concerns me is the semi-permanent pauperisation of the industry by the Government. This was not done by my right hon. Friend the Member for Huyton. My right hon. Friend did not pauperise this industry. The responsibility will be upon the Government, from now on, if we pass the Bill which says that we intend to keep the industry in a semi-permanent state of dependence upon the Corporation. If we pass the Bill I cannot see how any young man can go into the industry honestly expecting to pay his way. In effect he is told by the Government that, except in a minority of cases, he cannot earn his living in the industry, and that the most he can hope to do is to borrow money from the Corporation. The Government say, "If you are lucky you pay it back, and if you are unlucky you come to a deal with the Corporation." I am not at all an opponent of a mixed economy, but this is a mixed up economy. We have people invited to come into the industry on a basis of pauperisation.

No active, lively, honest young man would want to come into the industry on those terms. This becomes a new kind of free enterprise, where people can borrow State money, paying it back if they are lucky and in the meantime living on an expense account and perhaps an entertainments allowance. That is a kind of free enterprise which I should have thought all hon. Members would deplore. That is not an incentive for intelligent, active people to come into the industry. That is a neglect of duty on the part of the Government which will do the gravest damage to the industry.

The industry shows no sign of standing on its own feet. It is all very well to make pious expressions of hope that in a few years' time it will stand on its own feet. This way of pauperising the industry will never get it on to its feet. If we want to do that, the Government must formulate the policy promised to Parliament five years ago instead of coming here and, as I said in Committee, buying time over and over again without advancing any policy or giving any satisfactory reasons for their attitude.

I am sorry that it is necessary for me once again to protest. I protest, on the one hand, as a friend of the film industry in this country, that the Bill is digging a pit into which the industry will fall, because if this money has gone at the end of three years it is very doubtful whether the House will trust the Minister of any political complexion with more money with which to support the industry. The industry will then be allowed to collapse precisely because we in the House have not insisted that we should formulate a policy which will create decent living conditions for it.

The best way in which the House can test the position is to ask this question: What should we say if the Government came with such a proposition as this in connection with any other industry in the country? Supposing they made such a proposition about the motor industry and said, "We are forming a Motor Finance Corporation. They expect to lose money. We make provision for that because if they lose money we will write it off. We have no policy; we know the industry cannot pay; and we will not develop any policy." If that had been suggested in respect of any other industry in the country the Minister bringing forward such a Bill would have been howled down in the House, but by an odd mixture of circumstances the film industry seems to be able to becloud the quality of judgment normally present in most of my hon. Friends on the financial matters. It seems that we all go into a sort of cloud cuckoo land and do not get down to the problem of providing concrete safeguards for public money and tangible incentives to the industry to put itself on its feet.

I go on record as saying that unless the Government are forced to change their present idle attitude towards the film industry, then this Bill is a pit into which the film-producing industry in this country will sink. It will be the end of British film production industry if the Government do not awaken to their sense of duty.

All the Bill does is to give the Government permission to slumber for another three years unless somebody is alive and energetic enough to disturb those slumbers. I maintain both those qualities in this debate, but I need make no apology for having done so on this Rip Van Winkle's charter for the Board of Trade to go on slumbering, doing nothing and waiting until a great and important industry is ruined and a great deal of public money is sunk. In the process of doing so they are revealing scandal and unsatisfactory conditions. The Government disclosed nothing of the realities behind the situation. They have never troubled to estimate the past or future cost and the House has been treated in a very unsatisfactory way in the matter.

I venture to protest against the Bill. It can bring no good to the film industry unless it is followed by pressure in the House of the strongest character to awaken the Board of Trade from its unjustifiable slumber on the needs of the film industry.

4.45 p.m.

Mr. Christopher Hollis (Devizes)

I shall not keep the House for more than two minutes, but I would not think it right to let this Bill pass without repeating in three or four sentences my fundamental protest that, with all the will in the world, I cannot see that the policy either of the late Government or of this Government towards the film industry adds up to sense. There are two propositions, it seems to me, quite easily defended. Either we say the cinema is a bad thing and a fit subject for taxation, or we say it is a good thing and a fit subject for subvention. There is a lot to be said for either of those propositions, but I do not see how they can both be defended at the same time.

It has been the policy of both the last Government and of this Government first to tax the industry out of existence and then to bring it back again into existence by subvention. I must repeat my protest that I cannot see any sense in that. The right hon. Member for Huyton (Mr. H. Wilson) says the loans cost us nothing because we get them back in Entertainments Duty. Would it not save a lot of bookkeeping to wash out both the loans and the Entertainments Duty?

4.47 p.m.

Mr. Harold Wilson (Huyton)

I think it would be right at this late stage of the Bill's history to express the satisfaction of at any rate the majority of my hon. Friends, and certainly the vast majority of hon. Members on both sides who know anything about the subject, on the fact that at last the Bill looks as though it will get somewhere near harbour, although it has had a rather more surprising voyage than any of us originally contemplated.

In reply to the hon. Member for Devizes (Mr. Hollis), of course prima facie the view which he has expressed is a reasonable one, but if he would study any of the past debates which we have had on the film industry over the last few years, or even if he would study what was said on Second Reading of this Bill, he would understand that to remit £10 million of Entertainment Duty, whether by the previous Government or this Government, would not lead to an equally automatic recovery of £10 million by the British film-producing industry. Indeed, at the time that suggestion was reported on by expert Committees of inquiry it was estimated that only £1 million would go back to the film-producing industry, so that to put the industry in a reasonable and satisfactory financial position would mean a very big loss to the Exchequer which I do not think the present Chancellor would be prepared to contemplate.

I think I should express our satisfaction that the Bill looks like reaching the Statute Book before long so that it will be possible to continue the work done by the Film Finance Corporation from the time it was established by the Labour Government, but I hope the Parliamentary Secretary will take account of some of the points which have been raised during the debate from this side of the House. I take the view, as I think do most hon. Members, that the Film Finance Corporation has done a first-class job and has produced a large number of films which would not have been produced. It saved the film industry from complete collapse. That is something which has been pointed out to my hon. Friend the Member for Cheetham (Mr. H. Lever) on a number of occasions. It certainly strengthened our position in negotiations with the American film industry, because if we had not saved the industry from collapse we should either have had to go without films in this country or been thoroughly at the mercy of the Americans in any negotiations they had with us on film questions.

My hon. Friend the Member for Cheetham and my hon. Friends the Members for Oldham, West (Mr. Hale) and Islington, East (Mr. E. Fletcher) have raised a number of points, and I hope the Government will bear them in mind in their administration of this Bill. I hope the Government will not go away, forget this matter for the next three years and then come back. When we were operating the original Bill, never a week went past when we were not very closely watching how it was being administered by the Corporation which had been established. I hope that the same can be said of the President and his colleagues.

I think everyone in all parts of the House would wish to pay some tribute to my hon. Friend the Member for Cheetham, even if we disagree with most of his conclusions. During the proceedings on the Bill I heard him on many occasions put a whole series of questions to the Parliamentary Secretary. I hope even at this late stage he may get an answer to one or two of them, but I would not encourage my hon. Friend to be optimistic about that; it is getting a little late to expect the Parliamentary Secretary to start answering questions.

Whatever view we may take of the points raised by my hon. Friend, his performance on the Second Reading, as the Leader of the House said on another occasion, was undoubtedly a remarkable Parliamentary achievement to which all should desire to pay tribute. I have heard my hon. Friend make his points on Second Reading, on the Committee stage and now on Third Reading, and it can quite fairly be said that he has fulfilled the objective which he so clearly described on Second Reading. He said that while he might at times be tedious, he would not be repetitive while he was being tedious, and while he might at times be repetitive, he would not be tedious while he was being repetitive. Those of us who have sat through the long weary hours during which he has been putting his points can say that he has fully succeeded and has never been repetitive and tedious at the same time, no matter how tedious or repetitive he might have been at various stages during the proceedings on the Bill.

I do not know whether the hon. and learned Gentleman will reply to the points made by my hon. Friends, but I hope he will take full note of them and pay due attention to them, particularly those made by my hon. Friend the Member for Islington, East, who has a wide knowledge of the industry and has disclosed his interest in the subject.

I wish to refer to a matter which has been raised on a number of occasions. I have received a letter from the Rank Organisation pointing out that the chairman of the Organisation made some comment in a speech on the point made in the last Report of the National Film Finance Corporation about the attitude of the Rank Organisation to films produced by Group III, pointing out that the Organisation had shown five of the eight produced. It would be wrong for us to quote the last Report of the Corporation in respect of the Rank Organisation without also quoting what the Rank Organisation says about the Report. This has nothing to do with the question of the booking arrangements of the Rank Organisation through its two circuits, which I raised with the hon. and learned Gentleman on a number of occasions and about which I gather he is still making inquiries.

A large number of workers in the industry who have been saved from unemployment by the Corporation will feel some satisfaction that its work will continue. We all hope that in administering the Act the Government will pay very close attention to the points which have been raised to ensure that the Act is used not to "feather-bed" the industry—that is what my hon. Friend the Member for Cheetham is anxious about—but as a background to the most strenuous efforts to be made by the industry to place itself on a sound financial basis.

4.54 p.m.

Mr. William Shepherd (Cheadle)

For hours I have listened to the hon. Member for Cheetham (Mr. H. Lever) expressing his views about the industry. As a result of his remarks a great deal of misunderstanding must have arisen in the minds of many people and a good deal of unfairness has been done to the industry. The statements made by the hon. Member this afternoon will not stand the slightest examination if they are compared with the facts.

The hon. Gentleman referred to the "pauperisation of the industry." Does he not know that last year Ealing Studios made a profit on its activities, that the Rank Organisation is also making a good profit and that many other producers are making profits? It is disgraceful that the hon. Member does not take the trouble to find out anything about the industry and yet makes absurd allegations against the firms involved. These people are doing a lot to help themselves and are achieving some satisfactory results.

Mr. Hale

When I last looked at the figures of the Rank Organisation—I admit that it was 12 or 18 months ago—there was a controlling concern which had two shares, one of which was held by Mr. Rank and the other by Mrs. Rank. There was a production company, a completely separate company, running Odeon Cinemas, for which money was obtained from the community. Production losses by the Rank concern were amalgamated with Odeon profits, to the detriment of the shareholders in the public company. I do not know what has happened since. The hon. Gentleman is really unwise to challenge us on individual companies or to suggest that there are not a very great many things in the industry which require a little examination.

Mr. Shepherd

I did not suggest that nothing in the industry required looking at. I shall shortly suggest some matters which need examination.

Mr. Lever

I made no allegations against the British film-producing industry. I said that the Government are pauperising the industry and that, on the basis of the Report before us, two-thirds of the industry is not able to exist without borrowing on non-commercial terms from the Corporation.

Mr. Shepherd

I suggest that the hon. Gentleman reads his own speech tomorrow. He ought also to try to understand the nature of the industry and the extent to which it is using public money. It is unfair to make statements in the House about the industry which are not justified. Over the last four or five years the average cost of a film has been reduced from £270,000 to £120,000. It is unfair and unreasonable to say that everybody is in the red when a number of firms are making commendable efforts and are doing satisfactorily in the financial circumstances.

That does not for a moment alter the fact that there are serious difficulties in the industry, even though Mr. Rank may be making a profit now. I should like to tell the hon. Member for Oldham, West that the Rank Organisation restarted production only this year, and I was referring to current production and not to past production. The House is right to stress that the Government should not continue providing money indefinitely, and I hope that this will be the last time that we shall come to the House and ask for funds. I see no reason why a soundly organised company, with the benefit of the Eady Levy, cannot produce films at a profit. There will probably have to be some special form of finance for films indefinitely, but I do not think that in the years to come support of this nature will be required.

I have not heard the manner in which the £3 million debt of British Lion is to be dealt with, and I am a little unhappy about that. The hon. Member for Cheetham talked about the money spent on the film industry by the Corporation. But it has not spent half the sum mentioned. The £3 million went before the Corporation had a chance to put its hands on any money at all. I should like to elicit from the Parliamentary Secretary some idea of what is to happen to British Lion's £3 million. I should like an inquiry into the whole of the workings of the British Lion Film Corporation; if possible, I should like a committee of capable persons to decide what the structure ought to be.

I do not want to mention names, but there are difficulties in that context. I was told the other day that I was wrong in saying that Sir Alexander Korda was the executive producer. Nevertheless, it is true that Sir Alexander controls production in the sense that he engages artists and approves scripts. On the other hand, I feel quite satisfied that there is not the control of production in British Lion which there ought to be. I am advised, for instance, that no one in the executive class sees the shots as the films are made, and I am told that, so far as the last film is concerned—that about Gilbert and Sullivan—the re-takes that were ordered when the film was completed cost something like £50,000.

Mr. Deputy-Speaker (Sir Charles MacAndrew)

I think the hon. Member is now going beyond the terms of this Bill.

Mr. Shepherd

Here, it appears to me, there is a serious loss of public money. It is not the company's money, but the taxpayers' money, and I am pleading that, before any settlement is made of the issue with British Lion, there ought to be a full inquiry into the work and organisation of the company in order to see whether something can be done to safeguard the public interest. I am satisfied that what is happening in that Corporation today does not protect the public purse, and, therefore, I hope that the Parliamentary Secretary, when he replies, will give some indication that his Department will go very thoroughly into the question of organisation in order to make certain that the losses of British Lion will no longer continue.

5.1 p.m.

Mr. William Keenan (Liverpool, Kirkdale)

My principal reason for rising is to try to remove some of the impressions which seem to have run throughout the discussions on this Bill, on Second Reading, in Committee and again today. One is the impression that there are only two or three hon. Members who are in opposition to this Bill, and nobody else. It is not true. Quite a number of hon. Members, including myself, would desire to associate themselves with most of the criticisms of my hon. Friend the Member for Cheetham (Mr. H. Lever). I would also say, in connection with the criticisms made by my hon. Friends the Member for Oldham, West (Mr. Hale) and Islington, East (Mr. E. Fletcher), that there is a great deal of justification for the request for information which they made on an earlier stage and which has had to be repeated today. We are still pressing at the present moment to get answers to some of the questions which have been asked at every stage of the proceedings.

An attempt has been made to describe this industry as healthy financially, and it has been suggested that, even if British Lion are not making money, the rest of the people seem to be doing very well. It seems to me not at all desirable that the Government should be saddled only with those ventures that are not profitable, while those that are profitable should be left in the hands of private enterprise business people. It has also been suggested that the industry itself was quite healthy, and one hon. Member mentioned the fact, which was suggested as a justification for the payments that are being made to the film industry, that the industry itself made a great contribution to taxation by way of Entertainments Duty. That is no justification for the industry being given a rebate. There have been complaints about other forms of taxation, and the suggestion made that there should be some sort of rebate, but we have to remember that this particular industry, like every other, is not taxed on account of that industry alone, but on behalf of the general public purse. We must look at this matter from that point of view.

I want to add to what I said last week, and, in addition to the other questions which I put to him, ask the Parliamentary Secretary whether an attempt is being made to do more than has been done before in the direction of recovering the losses of this Corporation, so that they are not allowed to disappear altogether without any attempt at recovery. I understand that some of the productions are still saleable abroad, but that, if we are not very careful we may lose that revenue—I believe we do lose it now—from films which can still be sold abroad. I think we are entitled to a better answer than we have had already and to more information on this subject, even at this late stage. I am only too ready to associate myself with those hon. Members who have been demanding replies to their questions and more information about this matter.

5.6 p.m.

Mr. James H. Hoy (Leith)

I do not claim to be an expert on the film industry, but, for a considerable number of years I was a governor of the British Film Institute, whose main function it was to encourage appreciation of the art of the film, and it seemed to me that this body has played a splendid part in the film history of the world.

I was amazed at the hon. Member for Cheadle (Mr. Shepherd) accusing some of my hon. Friends of misunderstanding, ill-informed criticism and absurd allegations. That sort of thing carries no weight, because, if this Corporation is to be successful, it can only be successful as a result of what it is able to produce in the direction of what the consuming public want to see, and that activity is not helped by the very silly—one might even describe it as ignorant—statement by the hon. Member for Cheadle with regard to Scottish cinemas. It is obvious what the Scottish cinemas have to contend with, and they are doing their best to help to make this industry successful. The rather stupid and ignorant criticism of the hon. Member for Cheadle will not be helpful in any way to the film industry.

5.8 p.m.

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

I think it will be convenient if I answer briefly some of the points that have been made. May I say at once to the hon. Member for Oldham, West (Mr. Hale) that he did misunderstand me if he thought I said that the National Film Finance Corporation would never consider the merits of a film or its value from the point of view of culture and so forth. I think the passage in a previous speech which he had in mind was one in which I quoted the terms of the principal Act, in Section 1 (1, b) of which are stated what I may call the commercial considerations the Corporation have to have in mind; but the hon. Gentleman may recall that the Corporation gave quite exceptional help, to give only one example, to the Everest film.

May I now turn to the hon. Member for Cheetham (Mr. H. Lever)? Many compliments have been paid to the hon. Gentleman on his achievement in his original speech on Second Reading, but I must say that I am not now so much impressed as I was then, for this very simple reason. I do not think the hon. Gentleman finds the least difficulty in speaking for three hours. What would impress me would be if he managed to compress his arguments into the space of three minutes. Then he really might make a much greater impression, at least on my mind.

I am sorry that both he, and by implication his right hon. Friend the Member for Huyton (Mr. H. Wilson), repeated the completely untrue, as I think, accusation that I did not answer questions. I would say, however, of the hon. Member for Oldham, West that, whatever our differences may be on various matters politically, I do not think he has ever consciously misrepresented me, and I am quite sure he never would. But I did rather resent the positive statement of the hon. Member for Cheetham that I had not answered questions, which statement has been repeated again today, considering that, when the Bill was before the House on the last occasion and the same accusation was made I called attention to the passage in my speech on Second Reading which proved the accusation to be completely false.

Let me now deal briefly with a few of the points that were raised. The Bill is not strictly renewing the principal Act but extending for another three years the ability of the Corporation to lend. The hon. Member for Cheetham says that the Bill is quite contrary to the promise, or the prophecy, of the right hon. Member for Huyton at the time he introduced the principal Bill. That is true, and was stated on both sides of the House with equal frankness on Second Reading. The period for which the principal Act was required was a matter in which the right hon. Gentleman was over-optimistic but there have been Acts of Parliament since. There was another Act in 1950 under the late Government, and there was an Act in 1952 under the present Government.

The hon. Member for Kirkdale (Mr. Keenan) is wrong in thinking that the Bill extends in any way the amount of money at risk. The hon. Member for Cheetham said that I had not given an estimate of what the National Film Finance Corporation had lost up to date, but I say again that I cannot make a better estimate than is contained in paragraph 46 of the last annual Report. Almost the whole of the loss there mentioned occurred in the first two years of the Corporation's life.

When we turn to what is likely in the future, let me take separately the two Clauses of the Bill. Under Clause 1, there will not necessarily be any further loss, and I hope there will not be. There is no reason why we should pessimistically expect it although I cannot guarantee that there will not be, but, judging by experience, there is no reason to expect loss as a matter of course.

On the question of possible loss under Clause 2, I would explain, as is explained in paragraph 5 of the Explanatory and Financial Memorandum, that it is impossible to give an estimate.

The hon. Member also said that I appeared to be ignorant of Section 2 (3) of the original Act, which says: The Corporation shall not, except in such classes of case as the Board of Trade may approve, make a loan. I was, of course, aware at all times of that provision. But the right hon. Gentleman who was President of the Board of Trade in the previous Administration decided that these loans might be made in all classes of case and he did not make any distinction. We thought it to be a wise decision and that policy is being continued.

My hon. Friend the Member for Devizes (Mr. Hollis) was answered, I thought, in a way with which I substantially agreed, by the right hon. Member for Huyton. I quite see the prima facie force of the point which he made, but it is a fact that relief of taxation of the exhibitor does not have that direct relation with the support of the producer which he supposed. My hon. Friend the Member for Cheadle (Mr. Shepherd) spoke of an inquiry into the management of the British Lion Corporation. I have explained before that the debt of the British Lion Corporation to the National Film Finance Corporation is the most important of the matters that will fall to be considered under Clause 2.

When proposals are made by the National Film Finance Corporation for the composition of that indebtedness, all material matters will be taken into consideration, and every inquiry that is necessary will be made. I have already given assurance to the House—and indeed it is obvious—that this matter will be considered and agreed by both the Board of Trade and the Treasury. The hon. Member for Leith (Mr. Hoy) intervened in what I think was a private quarrel with my hon. Friend the Member for Cheadle and I need not make any addition to that little controversy.

The hon. Member for Kirkdale may not have realised, because he repeated erroneous statements that have been made once or twice before, that the National Film Finance Corporation frequently make it a condition of their loan that they shall share in any profits made by a film which they are helping. The hon. Member also asked me whether, before any money is written off, all proper attempts will be made to recover as much as possible. Undoubtedly that will be done.

Mr. Keenan

If the hon. and learned Gentleman had said that on the Committee stage the Bill would probably have had a much easier passage than it got.

Mr. Strauss

I think the hon. Gentleman has a wholly erroneous view of the character of the hon. Member for Cheetham.

Mr. H. Lever

For the first time I agree with the hon. Gentleman.

Mr. Strauss

Then that makes us unanimous. I believe that the Bill will perform a useful purpose which is strongly supported by the large majority of hon. Members. I am not going into the merits of the period for which the powers are being extended, because that was debated on the Committee stage, and the House came to a decision.

Mr. Lever

The Government have never given any reason for it yet.

Mr. Strauss

The hon. Gentleman must realise that he is not a monopolist and that other people are entitled to speak in this House. The Corporation performs a useful function, and it is right that its ability to lend capital to a section of the British film-producing industry should continue. Clause 2 will enable schemes of composition to be entered into by the Corporation which, if it were not a statutory corporation, it would always have had power to do. Both those provisions are wise for the reasons that have already been given, and I hope that the House will now give the Bill a Third Reading.

Question put, and agreed to.

Bill accordingly read the Third time, and passed.