SCIENCE AND PRODUCTIVITY

HC Deb 20 July 1953 vol 518 cc41-165

3.39 p.m.

Mr. R. R. Stokes (Ipswich)

I do not think anybody is left in doubt about the need for increasing our production on account of the dual necessity of settling our balance of payments problems and of fulfilling our duty to the backward peoples, a matter which was so eloquently and fully referred to by my right hon. Friend the Member for Easington (Mr. Shinwell) in the debate last week. I wish to emphasise that it is manifestly the duty of wealthy nations to produce more wealth, not that they may consume it all themselves but that they may be enabled to help forward the hundreds of millions of people in the backward areas who have not the advantages which we and other nations in Western Europe and elsewhere have. The urgency manifestly is now. The Minister will tell us in due course of the Government's plans for scientific research, and this debate is about research and production. Since I hold the view that an ounce of practice is worth a couple of tons of theory, I intend in the main to speak of my own experiences in industry, and to offer one or two suggestions as to the method whereby it may be possible to increase production in this country.

I should like, in opening, to say one or two things about the recent Report of the Advisory Council on Scientific Policy. The first thing that strikes me is their emphasis on the need for capital investment if we are to take full advantage of all the various scientific developments which there have been both in this country and elsewhere. Here I would say two things. First, industry is left with all too little with which to carry out any development which is desirable, and secondly—and here I speak with first-hand knowledge of the engineering industry—the cost of replacements, owing to the very considerable rise in prices in the last few years, is now so heavy that the margin left with industry is all too little in which effectively to bring about these replacements.

The second comment which the Advisory Council make, and which seems to me to be urgent, is that there are in this country 140,000 manufacturing establishments, of which 80,000 employ ten men or less. It is perfectly obvious that the 80,000 establishments cannot run their own research departments, and while I should be the first to agree, from the engineering point of view, that engineers in the main can look after themselves, I am fully appreciative of the importance which must attach to central industrial research. I hope that the Minister, when he speaks, will reply fully to the comments on this whole question of industrial and scientific research as applied to production which will be made by others who will follow me in this debate, and particularly by those who sit behind me on these benches.

I want to concentrate mainly on the engineering industry. That great pamphlet, "Challenge to Britain" states that 25 per cent. of our total national output comes from the engineering industry, and 40 per cent. of our total national exports come from engineering production. I want, without taking too much time, to emphasise the points which seem to me to be important. I have spent practically the whole of my life, when I was not chasing Germans around the plains of Flanders, endeavouring to increase engineering production. I started pretty well at the beginning, and that is some time ago now.

I assume that industrialists, whether in the engineering trade or elsewhere, now go in for some kind of scientific management. If they do not, the words I am trying to address to them will fall on pretty deaf ears. I suppose they have a plan. They have what is called "shop loading" and "load shedding." They go in for budgetary control—and if they do not they jolly well should. But when all is said and done—and I accept that as a basis of efficiency—what is going to be done in a unit of production substantially rests on the proper relations with the men. I think that is the most scientific thing of all, if the truth be told.

We often hear—and let me add that it does a great damage to our reputation overseas—that people here do not work. I emphatically deny that. The point is that we shall not get the best out of any man unless we explain to him, first of all, what it is we want him to do; secondly, why we want him to do it; and thirdly, that he will get a fair share of the swag at the finish of the productive effort. Those are important points, and I propose to concentrate upon them this afternoon.

First of all, there is joint consultation. A lot of people ride it off as being a high falutin' meeting at board room level at which sententious statements are made and nothing is done. My experience is that it should be divided into two. There should be what I call the works council of elected representatives of the men and appointed representatives of the management, and from this organisation general information on what is going on should be given with authority to the workshops so that everyone knows.

But as important as that is what I would describe as joint consultative committees at workshop level in the works themselves, where day-to-day troubles can be dealt with and where things are not left to fester. I am reminded that probably the most productive irritant of all is the irritant that gets into the oyster and produces the pearl. But that does not happen in industry. If irritation is allowed to get abroad in industry, what happens is precisely the reverse.

It seems to me that the vitally important thing in this country—and I deplore the fact that as I go around I find that there are still far too many factories which have not what I call proper joint consultation—is to have an effective organisation whereby the men have a full opportunity of hearing authoritatively what is the policy of a particular organisation and, secondly, the knowledge that they have almost a day-to-day organisation—if it is called monthly I am not going to argue—in which they can ventilate grievances, discuss plans and in which the management is properly represented, instead of, as so often happens, their interests being left in the hands of a person of no importance who cannot carry out decisions made there. That state of affairs is pretty hopeless.

The fundamental thing in dealing with this question of getting better production is to have throughout industry an organisation in each sector or factory which will let the men understand what it is that is wanted, why it is wanted, and what they are going to get out of it. I shall come back to this subject when I speak about incentives.

The second thing is that in my view there are still far too many Victorian-minded people about. There are far too many people who do not understand that the vital thing at this moment is that we have to get the same production out of the same number of bodies, and the only way to do that is to make it easier for them to do the job. I often reflect, not irreverently, that I find it extremely difficult to pray, but that the task is much easier when the kneeler is soft. So it is in industry. It may be sometimes I go to sleep, but, after all, there are foremen in industry who see that that does not happen.

If only people would realise that by making the task lighter we are not merely pandering to the inordinate desire of man to get the maximum result with the least effort, but that we are trying to make a tremendous contribution to increase production, then I believe that we would go places. I want to see a far greater mechanisation of the manual effort in the workshop, making the job lighter and saving fatigue, for I believe that that would lead to very astonishing results.

Now I come to incentives. I shall not argue the case for piece work against plain time, because I am not interested in that this afternoon. I am speaking of the engineering trade, since it is the only one about which I really know. In engineering workshops not much more than half, in some cases perhaps 65 per cent., of the operatives have the chance of directly affecting their own earnings; the other 35 per cent., from the people who sweep the floor to the people who drive cranes, run trucks, sling loads on to cranes, and the like, have no chance at all. There are idealists around who think we all ought to work for nothing but, so far as my experience goes, the people who believe that go into monasteries or nunneries. I once thought I would like to be a monk, but when it was discovered that what I really wanted to do was to run the monastery, they told me I had not got a vocation.

It is no use ignoring the fact that what a man worries about in his eternal struggle for existence and looking after his wife and children, if he is lucky enough to have both, is what he will get in his pay packet. Therefore, while we may provide incentives to the piece worker, what are we going to do about the chap who is not on piece work? I want to tell the Committee a little of my own experience of what I term an overall incentive system which is, if I may say so, quite scientific.

The important thing in getting production up is to have everybody interested in increasing it. The person who slings loads on to cranes for instance, can affect production enormously. If the piece worker is to work harder that chap has to move more stuff, and he has to be interested in it. I shall not go into details now, but I shall be glad to give more detailed information to anyone who wants it. We devised a scheme whereby everybody shares in increased production—everybody from the floor sweeper to the most highly-paid operative.

Sir William Darling (Edinburgh, South)

We?

Mr. Stokes

I mean the firms I look after.

Sir W. Darling

Not the party behind the right hon. Gentleman?

Mr. Stokes

I am sure that the party behind me would agree entirely with what I have said. We cannot have universality —[Interruption]. This is a serious subject and I hope that scientifically-minded hon. Gentlemen on the other side of the Committee will study the figures which I propose to give to the Committee, because I am sure this will help us with the difficult problem with which we are confronted. The firms to which I am referring started this scheme in 1950. The result is that since that time the average earnings have risen from 58 per cent. to 77 per cent., which is a considerable sum. If hon. Gentlemen want to know the money value of that, it works out roughly at between £27 and £35 a head tax-free on the year.

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

Three-quarters of what they ought to get.

Mr. Stokes

I said "tax-free." I want to emphasise that there is no sense in introducing a system of this kind unless everybody gets the same. That may sound extraordinary, but if the higher paid worker, who is directly responsible for increasing output by increasing his piece-work earnings, is to get less than the chap who sweeps the floor, he will not be so keen about it. Therefore, it has to be arranged in such a way that in effect everybody gets the same amount tax-free. It does not mean that the Inland Revenue are being defrauded. It merely means that the company pays a bit more in order to provide for the tax charged to come off the worker's pay roll, which in fact it does though one does not say so.

I will leave out all the figures, because I know how bored committees get with them. I want to emphasise where this leads to. The difficulty in the management of large numbers of men in industry is how to get them interested in saving their time. If a man can get as much for wasting his time as he can get for doing something with it, why not waste it? It seems a simple way to get through the day. But if a system is introduced which makes everybody interested in not wasting time, certain things happen. We find that the minimum of time is spent on tea breaks—those vexatious things to the Victoria-minded. We find that people do not dash off at the sound of the bell or the hooter, and there is the minimum waste of time in starting and stopping. We find that there is a punctual return after holiday breaks and no slacking of at the holiday approach, and, above all, there is less voluntary absenteeism.

It is inter[...]ng that, before this scheme was started in the factories to which I am referring, there was an average voluntary absenteeism through the year of 2 per cent. By "voluntary" I mean on the part of people who have no reason for being absent either because of ascertained sickness or because they have permission to be absent or for any other orthodox reason, but merely because they just stay away. As I say, that used to run at about 2 per cent., but for the last year it has been on the average less than one-tenth of 1 per cent. There is a saving there which any mathematician can calculate for himself for the industry in which he serves.

The right hon. and learned Gentleman the Minister of Labour will appreciate something which is perhaps just as important. It leads to a more static state of affairs in labour. The tendency of people to shift from one job to another in the last three years has gone down by 50 per cent. Of course, I agree that if the other firms did the same thing, or a bit better, they would all go over to them, but the fact that this scheme exists has made people realise that if they save time, if they concentrate on their job, if they put up production, they have something to gain.

Mr. Beverley Baxter (Southgate)

If I may interrupt the hon. Gentleman, the question of absenteeism has always seemed to me an extraordinary one. Might I ask him, as a considerable employer of labour, what happens when a man simply stays away because he feels like it? Is he questioned? Is it within his right? I am not trying to score a point, because I think this is a serious problem.

Mr. Stokes

In the enlightened life we lead today with full employment we have not got the slave market cure of sacking that man, and therefore he has to come back. In the old days we could take on another man in place of a persistent delinquent who, presumably, was kicked out. Now we are so anxious to have him that we explain to him the iniquity of what he is doing to all the other men under this scheme, how he is upsetting production and putting down their incentive bonus. In fact, we find that by education absenteeism tends to disappear. But of course the man is questioned.

I do not know what other factories do, but in those within my knowledge there is a close personnel supervision and we know when a man is away, precisely why, how long he is away and, if he comes back late for any reason, it is known, understood and reported upon. If things get too bad we say to him, "You are upsetting the machine and you must go and find a job which is your way of life." But that has not happened for the last two or three years.

On the question of absenteeism, my next point is the effect of the three days delay in the payment under the National Health Service of sickness benefit. I hope that the Minister of Labour will look into this. It is all very well for the young and unmarried if they want a day off. Unless they have other reasons for not doing so, they go off, or if they feel a bit ill they stay away. The married man with a family, however, is loath to go until he absolutely must. Under the scheme whereby a man has to endure a three days' waiting period before he gets any benefit, the tendency on the part of the married man with children is not to go sick when he ought to go sick.

Again, these same firms introduced a scheme whereby, as the Government were not forthcoming in the matter, the firm would be forthcoming. That, in its turn, has had most remarkable results. At the time when there was no compensation by the firm for these three days' waiting the absenteeism due to sickness averaged just over 4 per cent. The effectual abolition of the waiting period by the firms supplying, not in full measure, but in part measure, for that waiting period, has led to a reduction of that 4 per cent. to 1.7 per cent., a reduction of over half.

The contention of the personnel manager is that it is because the older men, who before used to hang on until they were properly ill and then went away for a month, now go off immediately they feel bad and are away two or three days and return by the end of the week. By this means, there is not as much loss of production as under the present National Health Service scheme.

For the information of those who are interested in the costs of this scheme, I can give the figures relating to a factory with 1,400 men. The average over the last five or six years has been about £980 a year. In the first year it cost £1,900, and in the year ending 31st December, 1952, the cost to the firm was £592; and the average absences, instead of being 57, were only 28. I submit that a case is made out for the abolition of this waiting period.

Mr. Gerald Nabarro (Kidderminster)

Is this scheme which the right hon. Gentleman has just enunciated, and which is not entirely novel, financed by an insurance company or is it a self-financed scheme by the company?

Mr. Stokes

I would not waste money on insurance. The firm pay for it themselves. I agree that it is not novel—there is nothing novel in the world. This is merely the straight application of Christian principles. That is all.

Now, I come to the problem of the labour force. The Report which is today under discussion states that: Until the number of Scientists and Engineers employed in our own industry is greatly increased and their average quality improved, we shall continue to lag behind. I appreciate that that is talking of a rather different strata of people from the man on the bench, but nevertheless the same problem applies. The problem in the engineering trade today is the shortage of numbers. If the right hon. and learned Gentleman, as I am sure he has done, studies the figures, he will see that the number employed in engineering, shipbuilding and electrical goods has fallen from 1,903,000 in December, 1951, to 1,888,000, a drop of 15,000—not very large, but still a trend in the wrong direction—in April, 1953.

I do not know what the Government propose to do about it. There are several things which I should like to do and which I shall suggest in a moment, but it stands out quite clearly, and the Report accentuates it, that there must be a transfer from other less important industries to meeting our export problem, the settlement of the balance of payments, the increase of capital goods and the needs of the backward peoples. While I know that my hon. Friends from the cotton areas do not like it, let us face it that to a very considerable extent cotton has had it, and we are going to have to change over; I do not mean by dragooning men from one trade to another, but by accepting the policy that over the years there must be a change in the trend. Above all, there is a need in my industry for more skilled men. To that end, while hesitating to tread on the ground which my hon. Friend the Member for Newton (Mr. Lee) will cover when he speaks later, I want to say just two things.

First, it seems to me essential to widen the gap between the skilled and the semiskilled. What the semi-skilled man earns today is so near to what the skilled man can earn that there is no real incentive to become skilled. Even some of the young people who start with skilled training and then, unfortunately, must go off to National Service of one sort or another, when they come back and are older have a tendency to drift into the semi-skilled trades, because it is easier for them; and one cannot blame them. It is quite time we recognised that we shall not get the expansion in the engineering industry which is so important to every aspect of our national effort unless we make it more attractive to a man to become skilled.

Second, there has been criticism, although it is not carried out entirely in the Report, that we have not spent enough on improving our equipment. From my knowledge, limited though it may be, of the engineering industry, I do not think that that is true. But what I do know is true is that a great number of tools are still kept in production which have no right to be in production because the rates which would attract men to work the unusual and unnatural hours of night are not such as to attract them. What we need to do in the national interest is to double-shift all the best tools we have and throw the old tools out of the way. We shall not get that done by paying men time and one-fifth for night work—there is not a hope of doing so.

It is high time that the employers set a lead in the matter. It is the people who cannot see light who are the trouble. They just will not move. The more enlightened of them understand, but there are a lot of stupid fellows who sit back and wait, and not until the grit gets into the oyster and there is an eruption do they do something about it. It is high time—and if the employers do not do something about it some of us will—that something was done on both these matters, for what we have got to do is to get more skilled men into the trade and to get more full-time work, by which I mean almost round the clock. It is no use talking about double-shift day-working—that is all boloney. We want the tools working in full double-shift and the men paid a rate which will attract them to do the job. This would make a very great contribution.

I leave what I call the personal side to talk about one or two other things, one of which is greater standardisation. This is a vast problem and covers a vast field, and I shall not develop it very largely, because no doubt others will speak on this theme. It is, however, obvious to anybody in my trade that there is considerable opportunity for greater standardisation of parts, which, while it might not lead to very great increase in production directly, would lead enormously to efficiency of service of machines in the field—that is, in the export market—and, therefore, make export very much easier.

But there is another aspect of the production and material side to which I wish to refer: that is, inspection. I am astonished to learn from a number of persons working in other sectors of the industry than my own that in quite a large number of factories inspection, which is a very scientific job, is not centralised. It is, in my view, essential that shop inspection throughout the range of production should be under the chief inspector, who should be not under the works manager but under the managing director. If that is not done, a great quantity of work gets through which is good enough apparently, but which, when it comes to the final job, is not good enough and causes dislocation, lack of production, inefficiency and goodness knows what. I should like to hear that the Government propose to give a lead in that way in emphasising to firms the importance of centralising their inspection so as to ensure that it is efficient throughout the whole range in manufacturing processes.

We had an example of this in the Second World War. I have said this in the House before. Just to please a Cabinet Committee, we went on making tanks which were never going into action. They were rolling off the line and going into a breaker's yard, to please a committee so that they could say we were producing so many thousand tanks; but the tanks were of no use. The same applies to a lesser degree here.

Now I come to a different matter altogether, that of fuel saving in industry. Everyone knows how important fuel saving is. I do not know whether the Minister of Fuel and Power is here, but here is a matter which the Government could do something about. I have studied this matter in some detail. What we are going to save in domestic fuel is pure chicken-feed. If we succeed in making the domestic user save fuel in one way, he will immediately burn it up in another way, and we shall not get anywhere. But in the industrial field—again I am speaking from experience—these figures show what can be done. A firm whose fuel bill was £10,000 a year, by insulating the big steel and iron structures in which the greater part of the engineering industry works, reduced their fuel bill by £3,000 a year, or 500 tons. On the spending of £14,140 the annual saving is now £2,900, or practically one-third of the fuel bill of £10,000 a year.

I ask the Government to do something about this. I know that the capital cost of the installation is allowed as an item on which there is an initial allowance granted, but that is not enough. I will tell the Government why it is not enough. The reason is that no one has enough money to spend in industry today. Production engineers always want to spend money on tools, and I can understand that perfectly well. They are not the least interested in saving fuel in that kind of way. If they were offered the alternative of spending £15,000 on insulating a shop or on buying brand new tools, they would go for the tools every time. What I should like to see is proper insulation allowed as a full revenue charge. I would go further and enact some legislation making it a penal offence, after a time, not to have insulated a building. I believe that in the industrial field alone we could save something of the order of 10 million tons of coal a year and that would be a big contribution in our fuel problem.

Sir W. Darling

But the heating to which the right hon. Member refers is comfort heating for the operatives working in the building, not heat for raising steam?

Mr. Stokes

Certainly I am talking of comfort heating, but no doubt the hon. Member will realise the importance of keeping people warm. I am glad that the hon. Member reminded me of that. It is important to keep people cool also. The advantage of insulation is that it works both ways—it keeps them warm in winter and gets better work out of them, and cool in the summer and again gets better work out of them.

I am now going right off what I call the manufacturing field to speak of farming. This is a question of the application of science to production. The two things which are going to save us, both in the balance of payments problem and in meeting our moral obligations to the backward peoples, are the engineering trade and farming. The increase in home food production is vital. I have just become a part holder in a farm—[Interruption.] That does not alter my view that we ought to tax land values. I shall not go into much detail because I have not had enough experience. This was more or less a derelict farm. When taken over it had 30 cows, about 40 young steers and about 300 head of poultry. That was two years ago. It now has 175 head of cattle and turns out more than 2,000 head of poultry. It has 60 acres of arable, whereas it had none before.

I am not boasting of this, because I had nothing whatever to do with it except in providing the cash, and that is a point I want to make. It is all very well for people to go up and down the country shouting for increased agricultural production, but how is the farmer to get it? What are the Government going to do to help? All they do is to put up the money rates yet money is precisely what the farmer wants. I would almost go the length, if I could control it properly, of giving interest-free loans, but that is another subject.

What the farmer needs is enough money to develop the land and, secondly, the recognition on the part of many people who have never been on a farm on a bad day that farming is a long-term and not a short-term business. I know that the period of gestation of cows is only nine months, or whatever it is, but there has to be a certain amount of regulation about that. It is no use just saying to the farmers, "Get on with production" unless we stabilise their prices over a period which they can recognise and understand will cover them for the capital outlay in which they have to indulge, assuming they can get it. Therefore, I hope we shall hear something some time from the Government of what they really intend to do to help instead of what they have done in the past, in the shape of more expensive money, to obstruct.

I have tried to explain that the scientific control of industry and the increase of production fundamentally depend on the good will of the people in the industry. We can shout "science" until the cows come home, but we shall not get anything more unless we tell the men what we want them to do, why we want them to do it, and what they are going to get out of it.

For far too long it has been ignored that the way in which capital reserves are built up is largely due to the effort of the men in the industry.

We hear a great deal of criticism of bonus issues. Today is not the occasion to discuss them, but bonus issues would be quite impossible without the work of the people in the trade. Therefore, I suggest to the Government that one of the most scientific, far-reaching and effective methods whereby they could stimulate production would be to lay it down that in future bonus issues in the industrial field not less than 25 per cent. should go to the benefit of the workers in some form or another. I know that everyone might not like that, but I could not care less. I will develop this theme on another day. If we had that, with all the highly scientific and intelligent proposals I have made, I believe we should find ourselves going a long way along the road to increasing production to the extent which is absolutely necessary.

4.20 p.m.

Sir William Darling (Edinburgh, South)

It is with the greatest pleasure that I follow the right hon. Gentleman, who is a much more distinguished leader in the field of engineering than I happen to be, though I am associated with a company, which I do not refer to as "we," which is in no way inferior in its substantial and enlightened progress to the one to which the right hon. Gentleman has referred.

I am entirely in agreement with the right hon. Gentleman in his attitude towards this debate, but I find myself at a disadvantage when I read the Motion which is before the House, beginning: that a further sum, not exceeding £105 be granted to Her Majesty, towards defraying the charges… in connection with science and industrial productivity. The sum covers 11 Votes and amounts to £105. I know that is merely in accordance with the procedure of the House, to draw the attention of the House to the fact that the Government are not spending enough in this field.

With that view I am in only partial agreement. The raising of productivity is not a matter for Government Departments. I see that my right hon. Friend is in agreement with that view. The raising of productivity in industry is not a Governmental matter. If it were obviously productivity in the mining industry would not be the matter of deep and vital concern which it is today. All the advances in productivity which we have had in this country have been due to the efforts, which the right hon. Gentleman has clearly indicated, by the great firms in specialised industries.

Mr. Stokes

My reference was not to specialised industries at all. It was what I called the more general side of engineering.

Sir W. Darling

General or specialised, I continue with my main argument.

These Votes, relating to the Ministry of Labour, the Department of Scientific and Industrial Research, the Ministry of Materials, "Science and the Arts," "Universities and Colleges" are the butterfly on the wheel. The genius for producing better and more goods in this country has never been due to the intervention of the Government machine. The right hon. Gentleman is at one with me in making that assertion. Expenditure by the State in this field has, in my experience, been extremely disappointing. In the electrical engineering industry, with which I am associated, again and again assistance has been sought, in vain. One goes hopefully to the universities and the colleges and to the Institute of Scientific and Industrial Research for the scientific help wanted, but in our industry we have found it necessary generally to seek, to find, and to train on the workshop floor, or in a drawing shop and to import from others in the same industries.

The suggestion that by the payment of more money by the Government in this field we shall attain a high standard is fallacious because if this was the logical way in which to achieve that result the railways would be efficient—super efficient—the mining industry would be a challenge to the whole of the rest of industry, whereas it is tragically true that the more the State has to do with industry, by and large, the less successful industry is. I say it with profound regret because my money, hon. Members' money, the whole country's capital, is involved in a vast elaborate system of cumulative taxation which places all these vast capital resources and revenue in the hands of the State.

Scores of examples come to mind. We have learned today that a valuable and excessively costly State experiment in aviation has just been abandoned. The right hon. Gentleman has referred today to hundreds of tanks being produced in the late war in order to please the State conception of what was required and being passed straight to the breaking-up shop.

Mr. Stokes

That is not true. It was due to a totally technically incompetent Cabinet.

Sir W. Darling

Hard words break no bones. The right hon. Gentleman will agree with me that on that occasion there happened to be a technically incompetent Cabinet in his opinion. By and large, they are all, whether they are providing 'planes every year or the tanks to which the right hon. Gentleman took exception.

I am stating the general theory that the State is not a suitable instrument; it lacks flexibility; it must be dogmatic. The hopes of modern industry, and the hope of achieving flexibility in development lie, to the regret of those who hold the collectivist view, with the industrial concerns like the one which is led with such distinction by the right hon. Gentleman.

The right hon. Gentleman has made a plea for, to some extent, more intervention by the State. State intervention has all along been quite disastrous at the worst, and at the best very disappointing.

Mr. Stokes

Will the hon. Member please deal with what was my main point on the research question? How does he propose both to make available and see that the research results of any central research organisation are used among the 80,000 industrial concerns engaged in production which employ fewer than 10 men? That is important, because they employ 800,000 men.

Sir W. Darling

The Government are providing a large and expensive research organisation for the service of industry. The right hon. Gentleman pointed out that quite half the industries in this country are employing no more than 10 to 200 people. It may be that they are quite unable to absorb or to use the kind of technical research organisation to which the right hon. Gentleman refers. The reason is abundantly clear. The States heavy handed intervention in these matters is neither suitable nor adequate. Far from increasing these sums by £105 I should be inclined to diminish them.

Obviously I have an alternative proposal. In the works of the right hon. Gentleman and the works with which I am connected, we have had to build up our own research organisation, probably not very efficient. We learn things three times over. For example, we learned that we had expended a great deal of money and time on something which is apparently being done in Switzerland; but we cannot go to Switzerland and buy it because we have not got the Swiss francs to buy the experience. We had to build up this knowledge ourselves. The State did not come along and say, "Here is the technical ability and research," nor could it do so. We built it up from our own experience, faults, failures, experiments and disasters. There is no method by which the State can help industry in that way. It cannot offer extra help from outside. It has not got it to offer.

What it can do, as the right hon. Gentleman made clear towards the end of his speech, is to leave cash in the pockets of the people, and, in the pockets of industry, the necessary capital, to fructify. Let us have our bonus shares, we shareholders, and not refuse the claims of the staff, to which the right hon. Gentleman referred. Let us have the capital to develop our industry and we shall see it develop. We shall provide much more effectively for research in that way than by increasing research grants by 100 guineas as is proposed today.

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

If the hon. Gentleman had been at the Air Review last Wednesday, and seen the last three planes which took part, he would know at once the development that has taken place with Government backing. These three planes are still in the development stage, and could not possibly have been brought to that stage without Government support.

Sir W. Darling

I agree with the hon. Gentleman, but the aircraft industry is a case apart because it has never been other than a State-ballasted and State-aided industry. Yet even with the powerful and costly guarantees of the State, it is the de Havilland Company, the Bristol Company and Handley Page which have brought these machines into the air, and they fly today because of them. I was not at Odiham last Wednesday, the reason being that we were having a Scottish debate here which I thought was, for me, more important. I would make the same point about State intervention in the shipbuilding and civil aviation industries. These are necessarily exceptional cases, because they are backed by the defence programme and the qualifications inherent in that fact.

I do not intend to be diverted, however, from my main theme, which is to tell the right hon. Member for Ipswich (Mr. Stokes) what he knows, that what has been done in his works at Ipswich and in the best works throughout the country has been done because the organisations and companies themselves have by hook or crook found the capital, often at great sacrifice, to create their own research organisations.

If we want better productivity and greater output of our goods and services in this country, if the State will leave us alone, progress certainly would be greater and more substantial. It is true to say that in the United States where, by and large, this method is followed, there is greater technical equipment, greater output, greater productivity than is provided by British enterprise in most fields; due to the fact that there is greater liberty, less interference and rather more of the surplus is allowed to remain in the hands of those particularly engaged in the engineering industry.

I agree with other things which the right hon. Gentleman has said. The art of management is the greatest of arts. One has to take the labour available and train and stimulate it. The State does not much help in this way. It could help by allowing the boys and girls of this country to come on to the labour market a little better equipped than they are. But the State have taken over the whole monopoly of education. No longer is one entitled to choose where one's boy or girl may be educated. This raw material is thrown on to the workshop floor very imperfectly educated and trained—[Interruption]—I am only speaking of what I have experienced. This whole State output of the raw material of labour is put on to the works floor and industry has to train and educate it as best it may.

We know there are State technical schools, but these often have fallen behind expectations. We in industry find it better to have our own schools and workshops with our own teaching staff, whose pupils are paid for what they are doing, within our own workshops. That in our opinion is a much more useful, effective and direct way of training our labour force. The State does not help—and cannot help in that special way. That is the point I wish to make. I am one of those who feel that for certain classes of work boys and girls who enter industry at 16 suffer a disadvantage. I think that more should be allowed to enter industry at 14 and continue their technical education in the workshop and their practical education at the bench.

Mr. Arthur Palmer (Cleveland)

Does the hon. Gentleman mean to tell the Committee that the great electrical engineering industry, with which I know he is connected, does not employ any State trained engineers or technologists?

Sir W. Darling

Unfortunately the industry is able to employ only State trained engineers and technologists. The hon. Member must know that we cannot go to any other school than a State school. We have to take the State product and mould it from its often State-minded indifference to meet the effective needs of industry. It is difficult therefore to disagree with the stress laid by the right hon. Gentleman on the art of management. This art of management has become the great art of getting people to do something in order to earn their living; getting them to take an interest in what they ought naturally to be interested. That is one of the greatest arts of management today and the right hon. Gentleman and I are examples of enlightened chairmen of companies who know how to put up with the foibles, curiosities, oddities, and strange mental attitudes of those on the workshop floor as well as on the board of directors.

The art of management, of production, is the art of managing men, and it is important that we should have that very much in mind during this debate. But my right hon. and learned Friend the Minister of Labour and his predecessors have not made a very great contribution in this direction. We hear of classes here and training there, but who seriously looks to the Ministry of Labour—I speak of the Department and not of the present distinguished and competent Minister—for any worthwhile employee? Look at "The Times" this morning. Look at the "Lancet" or the "British Medical Journal" or the "Scotsman." Look at any leading newspaper and we find employers of labour instead of using this magnificent, free and well-established service of the Ministry which is at their disposal, would sooner spend 8s., 10s.—even 25s.—on an advertisement in one of these papers to fulfil their needs.

They know that the Ministry is incompetent and unable to provide for their needs—[Interruption]—well, advertisements in newspapers have to be paid for. I ask hon. Gentlemen to reflect that if they were in need of a specialist employee of any kind, a nurse or a housekeeper or a manager—or even a substitute for their very highly intelligent selves—would they go to the right hon. and learned Gentleman the Minister of Labour? Not at all, they would advertise in "The Times"—or the "Scotsman"—or the "Guardian."

Mr. Stokes

The hon. Gentleman really does not know exactly what he is talking about. Every single person I have referred to was employed through the employment exchange. When he refers to these advertisements, that is an example of the noble art of "poaching"—I have done it myself.

Sir W. Darling

My theme was that the State makes little practical contribution to industry. It does not help very much with its educational system, or by its technical assistance, which industry could very well do without because they can do it better themselves. It does not help in supplying a labour force. Employers in this country still continue to use the newspapers to advertise their needs. If hon. Gentlemen do not buy a newspaper they can look at them in the Library, where they will find column after column of advertisements for specialists. And so I say that this proposed increase of 100 guineas will not help very much. The best thing the State could do would be to leave us alone and let us get on with the job.

The right hon. Gentleman said that there are Christian principles in business, and it is true. Methods of leadership have greatly widened in recent years. Business is now conducted in a more enlightened way and hon. Gentlemen opposite have made their contribution to that happy state of affairs. We wish to conduct our businesses properly and profitably. The right hon. Gentleman suggested that consultation is a little easier than in fact it is. I imagine that some of his consulations in his earlier days, when he was less expert than today, were as riotous as were mine. The habit of consultation is not as dignified as a drawing room party at Lancaster House. I have experienced—I do not object—some pretty rough passages in these matters, but possibly I am as well equipped as the right hon. Gentleman to meet them. But if the idea gets abroad that consultation is an easy adjunct to business, that is incorrect. Men and women have very diverse attitudes. The idea that someone is getting something more out of the job than another has been sedulously circulated by hon. Members of the party opposite for years and it is difficult to wipe out these disruptive ideas which have persisted for generations.

The employer in this country has not necessarily been a wicked man. He may have been seeking his own purposes, but he has not been untouched by the same generous impulses as other people. But the theory of exploitation has been part of the stock-in-trade of right hon. and hon. Gentlemen opposite, which I am glad they have now abandoned. I am glad to hear from one of their leaders, who perhaps has not received the acknowledgment he deserves, that there is no class war between the employer and employed; that there is an identity of interest between master and man.

I wish to add a few observations about selling. The attitude of the industry towards the importance of selling—I am speaking of the productive side of industry, the workshop floor—requires that a good deal of prejudice shall be overcome. The feeling that the advertising side and the selling side are superfluous to the organisation and unimport-ant is in many industries still to be regretted. Much education is required to explain that, though the product may be admirable and technically perfect, though it may have been the product of sweat, blood and tears, it still has to be sold and a market has to be found for it.

My mind goes back to some remarks I made a few days ago on the Finance Bill when great exception was taken by some hon. Members opposite to the expenses inherent in the art of selling. The right hon. Gentleman the Member for Ipswich is a leading figure as a salesman. I am less conspicuous but no less ardent. The suggestion was that these necessary expenses which include, among other items, sometimes very tedious entertaining, are a device by which some people get away with something. The right hon. Gentleman was not present when these somewhat shoddy expressions of opinion came from his supporters.

It was suggested that he and I. looking for a large piece of business, liked to go through the tedium of having dinner with some bore who has the money which puts him in the position of being able to give an order. I should prefer to do business in 15 minutes over a clear table with one of us on each side. But instead one has to buy a dinner and a bottle of Burgundy before business can be done. The right hon. Gentleman smiles his agreement. He knows how boring it is. I have tried to sell him something——

The Chairman

Which Vote does entertaining come under?

Sir W. Darling

The Vote to which I am referring is Class I, Vote 4, Treasury and Subordinate Departments where the Government want to spend another £10. In selling there must be expenses. The Opposition challenged the Government the other day on the question of expenses. I suggest that they were wrong to challenge and that the right hon. Gentleman would agree with me.

I congratulate the right hon. Gentleman the Member for Ipswich on applying his powerful experience to the art of farming. He did not tell us what losses he was making. They are in fact substantial. I made the calculation when he was speaking that they were in the neighbourhood of £2,000 to £3,000. That is a substantial loss which in fact is suffered by the Treasury who do not draw so much in Surtax and Profits Tax. The hon. Member for Sowerby (Mr. Houghton) is not here, and therefore no question will be raised on my observation.

It is important that those who gain experience in management, especially in engineering, should be encouraged to transfer their leisure hours, capital and interest to other industries. I have sometimes been attacked because I am a director of a number of companies, including the important business of banking and the retail distribution of the delights of feminine wear. I am decried by hon. and right hon. Gentlemen opposite, but I am the kind of person who, multiplied by 100,000, would make a great difference to the Chancellor's Budget.

Hon. and right hon. Gentlemen opposite should encourage men like the right hon. Gentleman the Member for Ipswich and myself. In spite of all this facade of the Catholic faith, of the land tax and fair shares for all, and his pamphlet, "Challenge to Britain," the right hon. Gentleman is like myself, a buccaneer and adventurer. Unfortunately, these qualities are not sufficiently represented in the House of Commons any more than they are in the country. If they were there would be very little need to increase by £105 the requirements of the Government for research and technical developments.

4.44 p.m.

Mr. Edward Shackleton (Preston, South)

I may take it, Sir Charles, that you will allow almost any subject to be discussed in this debate under Class I, Vote 4, Treasury and Subordinate Departments. I am not sure whether it would be in order to discuss the contribution of the hon. Gentleman the Member for Edinburgh, South (Sir W. Darling) to Scottish nationalism as an aspect of the education he carries out in his works; but one consideration is apparent, and that is that whereas the Committee listened with interest to the speeches of my right hon. Friend the Member for Ipswich (Mr. Stokes) and the hon. Gentleman, impressed by their verve and energy, the majority of the Committee on both sides was in agreement with my right hon. Friend and in disagreement with the hon. Member for Edinburgh, South.

I am sorry that his obvious indifference to the subject of scientific research prevented him learning something about it before he came to the debate. That is no doubt one of the reasons why he discussed tax allowances and many other matters. If he is disappointed that he has had no help from the Department of Scientific and Industrial Research, it is perhaps not surprising since he does not even know its name. I think that he called it the Institute of Scientific and Industrial Research.

The hon. Gentleman may not be aware that most industrial research in this country is not carried out by the Government but by industry either in private research departments or in cooperative research organisations which are known as research associations. He may not know that these associations receive a considerable amount of help from the Government for which industry is universally—perhaps I should exclude the hon. Gentleman and say almost universally—grateful.

Indeed, there have been complaints recently from people of all political views about the reduction in the funds for D.S.I.R., and I shall have something to say about that later. However, we appreciate the presence of the hon. Member for Edinburgh, South. It is something for hon. Gentlemen on this side of the Committee to find that a classic and historic type of Tory still exists.

Mr. Charles Pannell (Leeds, West)

The hon. Gentleman is not a classic type of Tory. He is a renegade from the Socialist Party. He started his political life in the Socialist movement and he was one of us.

Mr. Shackleton

I am well aware that the hon. Gentleman was perhaps more respectable in his Rowton House days, but the point is that in this problem of increasing industrial productivity we are well aware that my right hon. Friend and the hon. Gentleman, by the strength of their personality and energy, have distinguished contributions to make. on the whole, I prefer my right hon. Friend's more co-operative approach and, by and large, so does industry.

Tempting as it would be under Class I, Vote 4, Treasury and Subordinate Departments, to continue the discussion of matters which have been debated so far, I should like to turn to the subject of science and industrial productivity, and I hope that I shall be in order in doing that. This debate takes place in the light of the recently published Sixth Annual Report of the Advisory Council on Scientific Policy which I would commend to the hon. Member for Edinburgh, South. He might read it sometime.

In this Report there are a number of views on the problems which face British industry and suggestions about how they might be tackled. If there is one fault in the Report it is its obsession with the subject of capital investment. Whereas I am in full agreement—and I know that this will appeal to the hon. Member for Edinburgh, South—that more funds should be made available for capital investment, the fact is that this raises very much bigger questions than can be covered in the Report. New capital investment such as the Advisory Council suggests is not synonymous with technological advance.

The comparative figures for investment in new plant and equipment in the manufacturing industry in the United States of America are somewhat misleading in such a circumscribed context. We all know that American industrial methods are different, that theirs is a much more expansionist economy and that their rate of replacement is greater, but all this does not necessarily mean technological advance. That is not to say that there is not a great deal more technological progress in the United States.

I should like to draw attention to that part of the Report where reasons are given for the failure to carry out and apply—particularly to apply—the fruits of scientific research in industry. After referring to restrictive practices, they say—and this is particularly for the benefit of the hon. Member for Edinburgh, South: … complacency and reluctance to depart from things of the past, are widely recognised as major factors underlying the backwardness of British industry. These things undoubtedly contribute to industrial stagnation; but their persistence is almost certainly encouraged by the lack of adequate resources. The problem with which the country is faced, I believe, is not so much one of carrying out basic research as finding ways of getting it understood and applied, both by industry and by the Government. The hon. Member for Kidderminster (Mr. Nabarro), I am sure, will have some views on the subject of fuel efficiency. The problem we have to consider is how, in fact, this is to be put across.

Problem No.1. I think we agree, is the shortage of new capital for new investment for introducing new devices and machines and for applying the fruits of scientific research. That is a problem which is necessarily circumscribed by the policies of the Government of the day, and those policies are themselves limited by the circumstances in which the Government find themselves. No amount of easy wishing will considerably reduce the taxation of industry for a good many years to come. We have got to find other means than purely the provision of extra capital.

There is the problem of the lack of initiative, and, indeed, of incentive, for introducing new devices, and here, of course, Government finance for industry—and I think the hon. Gentleman might agree with this—in certain industries tends to produce what might be called a feather-bedding approach. I have met this feeling in one or two cases, and there are people who feel that a certain development is of so much importance that the Government ought to step in and help to finance it. That is the type of attitude which is met here and there, and I should like to give an example concerning a particular invention in which I have been interested, not financially, but because I happen to know the inventor.

A certain engineer invented a new type of boat using a hydrofoil, which is a wing in water; whereas the aerofoil is the wing used by the aeroplane, the hydrofoil is a very much smaller wing which is used in water. It is a well-established device, and there have been such boats in existence for a number of years. The Germans had them in the last war, but they could not get a hydrofoil boat to go over the waves, because, if there is a wave, the boat goes straight into it. This man produced a device which would enable the boat to go over the waves. I shall not bore hon. Members of the Committee with the story of his negotiations with the Admiralty and the general difficulties that existed there. He was convinced that it was up to the Government to take it up; in fact, it was up to private enterprise to take it up, but private enterprise did not. It was only when he went to America that somebody did take it up, and a potential new industry was lost to this country. How, in fact, is this type of new development——

Sir Herbert Williams (Croydon. East)

How is he getting on in the United States?

Mr. Shackleton

He is getting on extremely well in the United States. This is the type of invention which is not the production of co-operative research, or even of one of the big research organisations. It is essentially the production of the individual who invented it, and that is what we have to remember in all our plans.

Sir W. Darling

Hear, hear.

Mr. Shackleton

I know that my right hon. Friend was nearly as embarrassed as I shall be by the agreement of the hon. Gentleman, but there is a danger that, as we set up bodies like the National Research Development Corporation, and as large industries set up their own research departments, there will still be something missing for individual inventors, and the classic example is still the Whittle engine, which was very nearly lost to this country.

Mr. Nabarro

Will the hon. Gentleman allow me? Certainly there are cases where inventions are lost by this country, for one reason or another, to Germany, the United States or elsewhere, but, for every invention so lost, there is another which comes to this country, because the United States, Germany, Czechoslovakia or some particular foreign country will not take it up, and we will. It is not a one-way traffic.

Mr. Shackleton

I do not disagree with the hon. Gentleman; I am not seeking to draw conclusions. I was only pointing out the fact that it is important that in our framing of plans we should allow for this sort of thing. I was about to lead up to criticism of the National Research Development Corporation, which was supplied with £5 million by Parliament, and which, in the three or so years of its existence so far, has expended only about £1 million. We do not want to see waste, but, on the other hand, we do not want to see too much cautiousness in a body of that kind. There are undoubtedly inventions and developments which, with a little more willingness to take risks and a little more encouragement from the Government to such bodies as the National Research Development Corporation to take risks, some of these things could be more easily developed, but I am not in disagreement with the hon. Member on that point.

Turning to the sixth Annual Report of the Advisory Council, I find certain references made to the research associations, but no reference to those industries in which there is no research association. It is still a scandal in this country that there are certain major industries, or, at any rate, very important industries, which have effective trade associations, but in which there is no form of co-operative research being done, and, in many cases, very little research is being done by the firms in that industry.

Mr. William Shepherd (Cheadle)

Has the hon. Gentleman considered the possibility that one reason why our application is so slow is the particular vehicle of the trade research association and the large Government establishments, which are very considerable? May it not be that we are pushing along in perhaps the wrong direction?

Mr. Shackleton

Perhaps the hon. Gentleman will allow me to go on, because I am on a particular point; namely, certain sections of British industry in which relatively little research is done, either by associations or by the member firms of the industries. I shall go on in some detail to the position of the research associations.

it is a fact—and this is a point which I should like to put particularly to the hon. Member for Kidderminster—that, with certain types of industrial development, it is easier to get a new product tried in the United States by United States engineers than in this country by British engineers, who tend to be, shall we say, more sophisticated. They want to know first whether the thing will work, and whether it is really worth trying. They tend, inevitably perhaps, to be somewhat circumscribed with regard to the expenditure which they can go in for, whereas the great advantage of American industry is that the greater naivety of American engineers results in their trying it from the first. The British engineer or industrialist does not get round to trying it at all, whereas the Americans, for every four or five devices which may fail, do know that they get a solution to some particular problem which no amount of highly developed research support behind them would necessarily have found for them.

The real problem that faces industry is of getting these new results over to the boards of directors and to other people in charge of works. It is no good having even the best research in the world if it is not communicated. This is basically a problem of communication. There has been reference in these reports to the lack of technical qualifications in the higher offices of management in British industry. It is surprising that for one of the highest and most important jobs in the hierarchy of industry, that of managing director, there is in many cases no qualification other than finance, required to control the firm.

Sir W. Darling

Is the hon. Member aware of the Institute of Directors and of the qualification "F.I.D."?

Mr. Shackleton

Certainly, but since when did a director in this country need to have a technical qualification? That is my point. He does not need to have a technical qualification in the Institute of Directors, although he probably does if he wishes to be a company secretary.

I know about the work of the hon. Member for Altrincham and Sale (Mr. Erroll) in this sphere.

There is the suggestion in the Report that there should be more scientists; indeed they talk about having scientists in the board room. I am not discussing the recent appointments in I.C.I., or necessarily arguing that scientists and technologists should take over the duty of management of British industry, but I think there is a need for greater awareness on the part of boards of directors of many small and large companies of the possibilities of the help they can get from scientific development. Obviously there are many who hold views like those of the hon. Member for Edinburgh, South. Obviously they will get no benefit from scientific development; but a number are still capable of education. The research associations themselves should set out their wares and seek not merely to do research, but a means of getting the benefits of that research known to the industries which they service.

In many cases they say, "We publish it all. It is there in abstracts of various kinds, and people can take it or leave it, as they wish." The trouble is that so many people leave it, and thus leave the most important and useful developments. I believe there is a very great need in every firm, and preferably on the board of every firm—particularly the small firm—for one person whose responsibility it should be to try to keep abreast with and his mind open to new developments—scientific, engineering, or whatever they are—and to see that they are explained to the managing director and to the rest of the board.

Another job for research associations could be in helping to meet the problem of increasing the supply of scientific and technological manpower. Is there any reason why research associations should not—certainly the well-established ones—provide, as part of their general duties, courses and opportunities for training certainly in post-graduate work, leading to the attainment of higher degrees? This is a suggestion which I make very seriously because it has been made to me by one of two directors of research associations. They say that they could provide such facilities, and thereby increase the total scientific manpower with higher qualifications. They could train people specifically in the work and the activities in which these research associations are engaged, so that when those persons went into industry their use would be very much greater than if they had gone straight from a university into a research job in industry.

Finally, I would refer to other action that might be taken, and that is action by the Government. One of the problems of introducing new methods and new productivity techniques into industry is the ordinary small firm or medium-sized firm, who might lack specialised knowledge. The only possible source to which they could go for advice in many cases is a production consultant. They first of all ask the fee, and they are often staggered at the fees they have to pay. I am not proposing to discuss whether those fees are right or wrong. I fully realise that production consultants have very skilled and expensive manpower; but could not something be done by the Government? Indeed, would it not be in the national interest for the Government to do something such as they do with fuel economy? They have fuel economy teams going round the country; might there not be some body or other, equivalent to an Institute of Productivity, to carry this message?

I admit that these are only the very vaguest ideas. It is essentially a matter of getting the information over. That is why I believe that a debate of this kind, which gives publicity to the existence of these problems, is of general value. The Government should encourage some of the financing houses, whether insurance companies, or banks, or bodies like the Industrial and Commercial Finance Corporation, which at the moment inevitably concern themselves with a general view as to whether a company is run reasonably efficiently and its accounts are properly kept, themselves to provide some form of production advisory service.

These are just a few suggestions. The problem is immensely complex and there are many angles of it. I have deliberately not gone into any question of productivity on the workshop floor, since many hon. Gentlemen on this side of the Committee are much more expert on that subject than I am. It still lies with the managements to provide increased production, and whether those managements be like that of the hon. Gentleman with his engineering firm; whether it be a large firm or a small firm, it is on the management that the responsibility lies. No amount of ancient individualism plus ignorance will solve our national problems. We want individualism, but we also want more knowledge. I believe that the Government can help by one means or another to spread the word.

5.8 p.m.

Mr. E. H. C. Leather (Somerset, North)

I have listened with very great interest to the speeches so far. I hope that I shall not horrify the hon. Member for Preston, South (Mr. Shackleton) if I say that I believe there is a synthesis between himself and my hon. Friend the Member for Edinburgh, South (Sir W. Darling). It is about that very synthesis that I would like to speak.

I agree with the hon. Member as to the high value of the work that the Department of Scientific and Industrial Research and various research associations are doing, but the results of the application of their work are undoubtedly disappointing. They have not achieved anything like what we hoped they would. There has been an immense amount of scientific development, more since the war than in any previous period in our history. The intervention of my hon. Friend the Member for Kidderminster (Mr. Nabarro) on the subject of inventions was valuable. We are very often accused of being dull and stodgy and of missing opportunities. That is not true. We do miss some, but other countries also miss opportunities that come to us here; and the point made by my hon. Friend is quite important.

We have not succeeded—I am certain that the Parliamentary Secretaries both to the Ministry of Works and the Ministry of Labour will agree with this—in getting these ideas across. I believe that the hon. Member for Preston, South used those very words. I believe the reason to be that throughout a large range of industry there is not the desire to get it across. According to the general theory of competitive industry we would hope that every enterprising manager of even the smallest firm would be always thirsting for new ideas and looking for all the help he could get. Unhappily, it is not quite so. While I entirely support the plea for giving more thought to scientific research and development, I believe that the key to our difficulty at the present time is to be found in the problem of how to get it across rather than how to set up more laboratories and more institutes and turn out more scientists.

There are two factors of particular importance which I should like to develop. They are very old and trite and have been talked about many times, and I do not pretend that I have anything new to offer to the debate. The first is that what is missing in many cases is good labour relationships in the factory. I entirely support what the right hon. Gentleman the Member for Ipswich (Mr. Stokes) said about bonus shares and workers shares. These are all tools in the machinery of good labour relations. If we do not have good labour relations it does not matter how many scientists we have on the Board. Without good relations we shall not get the right results.

Anything that we can say in this Committee—and clearly the Government cannot legislate in this matter—that assists managements and trade union leaders to secure a better atmosphere in the factories and in the co-operative attitude both of management and workers is, therefore, a definite contribution to what we all want to achieve. Good labour relations depend more than anything else on what is called the climate of opinion, which I admit is a vague phrase. I believe that many people in this country are guilty of damaging that climate of opinion in a very serious way.

We cannot expect workers on the shop floor to trust their employer, or even want to co-operate, if for 50 years they have been told that every employer is a rogue and will do them down. I hope to Heaven that the propagation of class war is all over, but we should take cognisance of the fact that it has done a great deal of harm.

Mr. Pannell

Bearing in mind the industrial history of this country, is it not reasonable that there was a time when trade unionists considered employers were heretics to be burned, even if now we consider them to be souls to be saved?

Mr. Leather

That may be perfectly true, but I would suggest two points to the hon. Member. In the first place, that time was very long ago, and in the second place it never applied to more than a small minority. This is a classic case where the great majority are suffering for the sins of the small minority.

I take both sides of the coin. I entirely agree that there was exploitation, and management is today suffering from its own past sins. There are many managements who are just as much to blame as the men, but I repeat that by continuing to hold the view of management to which I have referred, if only for election purposes, we are doing harm.

An employer who makes the stupid statement that "what we want is a little unemployment," is just as bad, and causes just as much harm, as the Socialist politician or trade union leader who makes rabble-rousing speeches. Hon. Members opposite cannot have it both ways. They cannot accept what I say about the bad employer and laugh off all the rest and say that it does not apply to them. Anything that is said in the House of Commons to poison the climate of opinion and to stir up distrust, whether from that side or from this side of the Chamber, whether from the trade unionists or from the employers, does very definite harm.

The worst result is the creating of an attitude of not bothering, of not being ambitious. This kind of propaganda, which I concede comes from both sides, kills the will to be ambitious. One cannot expect young people in industry to be aggressive and ambitious and to look out constantly for new ideas and new developments if one has brought them up to believe that everybody in business is a rogue. The two things do not go together, and we are suffering from that kind of attitude.

It has been brought out time and time again in the reports of Anglo-American productivity teams that those who went to the United States to look for wonderful scientific ideas and new machine tools by and large came home disappointed. Technically they found very little that they could not have found in the best factories in this country, but what they did find was the will to use those ideas and those tools. They found a different climate of opinion among the workers in the United States.

Mr. Palmer

And better management.

Mr. Leather

Certainly, sometimes but only sometimes. But they all found a completely different climate among the workers all the time because the workers there have not been taught and had it rammed down their throats for umpteen years that to get on and be successful is a bad thing. We cannot expect people to get on and have the desire to make use of the best available scientific information unless they have ambition, and we cannot have that ambition in industry if we are constantly attacking industrialists and threatening them that the more they succeed the more they will be interfered with and controlled by the State and ultimately nationalised.

All these things are deadly to the climate of opinion, to the attitude of progressive-ness and to the desire to get on which are the things we lack in this country at the present time, though there are of course many honourable exceptions. We have not much to learn from any other country in the world in scientific education and engineering "know-how." Where we are falling down, particularly in relation to the North American countries, is in the desire and the will to succeed. That, as the hon. Member for Preston, South has said, is a management problem. It is also particularly the problem of politicians. We have a great deal to do with creating the climate of opinion. Our job is to do everything that we can to help and not to hinder.

We do great harm when we make speeches from either side of the Committee which stir up strife and discontent. I hope that we in this Committee and in the House recognise our responsibility. I am quite certain that the Minister of Labour is giving a splendid and outstanding lead, but it is a question of the whole atmosphere. That is not created merely by what the Minister and his right hon. Friends say but by what hundreds of politicians say up and down the country. If we constantly preach the desirability and necessity of good labour relations, and co-operation, and the value of our industrial system, and not go round decrying the system, we shall do more towards increasing the productivity of our country than would be achieved by spending more money on scientific research.

5.19 p.m.

Mr. Arthur Palmer (Cleveland)

When the hon. Member for Somerset, North (Mr. Leather) started his speech I, and perhaps others, hoped that he would make a constructive contribution to our debate. Instead, he expressed one or two ideas connected with what I call Tory folk-lore about the speeches of his opponents and implied that they should give up their principles and he should keep his.

Mr. Leather

Quite untrue.

Mr. Palmer

I at least agreed with him when he said or hinted that the question that we are discussing today was one on which it was all too easy to utter platitudes and emphasise the obvious. That is a great danger and I doubt whether I shall escape that fate, though I shall try.

I want to deal, I hope briefly, with the supply of professional engineers and technologists in industry. When I say "professional engineers and technologists" I am not referring to research scientists; I am talking about those who apply science. I believe that the root of our present difficulty in this shortage of professional engineers and technologists is to be found in the whole bias and continued assumptions of our educational system. It is an outlook which I can only describe as the shabby genteel outlook which persists and which has got its advocates and disciples, I regret to say, in both major political parties. We find its intellectual echoes in classical Toryism and classical Socialism as well.

It is an outlook that regards industry and technology as something morally and socially inferior to the acquisition and pursuit of knowledge for its own sake. It is an outlook which looks upon knowledge itself as being divine and the application of it just mortal. The result is that while the pure or research scientist is by now received into the charmed circle of the respectable professions, the engineering technologist is still not quite so sure of his welcome.

Years ago, under different conditions which then existed in this country, that did not matter so much. The engineer with a practical process that people wanted, could go into business on his own account and console himself for his lack of classical philosophy by making money.

Much of that has changed today, as I am sure the hon. Member for Kidderminster (Mr. Nabarro)—I see him smiling, perhaps a little cynically—will agree.

Mr. Nabarro

I was smiling in gentle approbation.

Mr. Palmer

Today, industry is concentrated in much larger units, whether they be publicly or privately owned, and the typical engineer or technologist is usually an employee and not an employer. Hence, the adequate supply and practical rewards of technologists and engineers, particularly in our larger and usually more efficient firms is vitally important.

There are some comparative figures available which will interest hon. Members. They are based on a unit of 100,000 of the population. The output of engineers of university degree status on that basis in 1949–50 was, for Switzerland, nearly 10. I do not want to be tedious, so I will take just one or two examples. For Sweden the number was six, Federal Germany five, Belgium just over four, and the United Kingdom four. Those figures are illuminating, and alarming as well.

The Report that we have before us today points out that not only is the supply of technologists inferior, but it goes on to state that industry very often will not use them. I do not know whether that is entirely true or not. It is not quite borne out by my personal experience. I happen to be Vice-Chairman of the British Electricity Authority's Advisory Committee on Education and Training. The nationalised electricity supply industry has done a good job since 1947 in developing broad schemes of education and training in that industry. We have organised schemes for the intake of apprentices, student-trainees and graduates.

As far as graduates are concerned we find it increasingly difficult to get anything like the number that we need for our purpose, and there is tremendous competition with outside industry to get graduates for training as technologists of the type we need. The result is—I am not sorry about this—that we are tending to push up salaries in order to get them. The correct conclusion would seem to be that the supply of technologists in general is not sufficient to meet national needs.

I credit the universities with at least making an attempt to meet the difficulty, but I am unable also to escape the opinion that the solution to this difficulty of the lack of technologists, and engineers is so obvious that nothing has been done about it until recently. That solution must be applied; it is the creation not only of just one technological university for this country, but of several.

I welcome the small steps that have been taken already by the present Government to build up one institution of university rank devoted predominantly to the study of technology. The intention is to use the Imperial College at South Kensington as the nucleus for this experiment. I also welcome the forthright declaration in "Challenge to Britain" on the same topic. I think this represents a victory in the Labour Party for progress over shabby genteelism, for I admit that it is not unknown within our own ranks. But not enough has been done, and certainly much should have been done a very long time ago.

If we had had a technological university 20 or 30 years ago in this country on the lines of those which have existed in the United States of America or in Germany, I believe that the situation in relation to the supply of technologists, applied scientists and engineers today would be very different. I am not impressed by the argument that this is a long-term solution and that what is needed is a short-term solution. The fact is that if we were to invest a sum of money in the creation of a number of full-scale technological universities, we should reap a real reward five, 10, or 15 years from now.

I should like to make a point about the ultimate use of engineers and technologists in industry. I am an engineer myself, and I do not speak without some bias, I admit. I deprecate the increasing tendency in industry today to put the professional administrator, the man who is trained purely as an administrator——

Mr. Pannell

Not pure.

Mr. Palmer

—and the accountant particularly, in charge of large business undertakings. I believe that the successful competitive standards of British industry have fallen back as a result, and I think that if we want a sufficient supply of technologists and engineers we must give them sufficient incentive. An incentive which they need is the fair opportunity to rise to the highest positions. They do not want to find themselves short-circuited and cut out at a later stage by financial gentlemen and accountants coming in and taking the plums.

I should like to say a few words also on another subject which interests me, and that is the work of the Anglo-American Council on Productivity. During my temporary absence from the House I went to the United States as a member of one of the industrial teams that went over to investigate American ways of doing things. I was a member of the team which went to study the training of supervisors and foremen. I admit all the limitations of the A.A.C.P. method. It was not perfect by any means, but I believe that it was still a great experiment and one that was, in the main, worth while.

In the present study of these reports and their application to British conditions it is necessary to sort a great deal of objective wheat from much subjective chaff. We have to allow for the fact that there was no standard method in the reports; they were mixed and varied in approach. Most of the teams that went over went from particular industries in this country to study affairs in the like industries in the United States, but there were some teams—and the education and training teams were among them—who looked at problems common to the whole range of industry.

A team, for instance, investigated the relationship between the universities and industry in the United States. I am sorry that the hon. Member for Edinburgh, South (Sir W. Darling) is not here, because he made the remarkable statement that in the United States industry was so good and so efficient because it did not depend upon the State education system. What utter nonsense. The fact is that in the United States there is often a close relationship between the universities and industry. It is a pity that there is not an equally close relationship here.

Mr. Leather

I agree that some universities over there are run by the Government, but it is quite wrong to say that because they co-operate they are tied up with the State.

Mr. Palmer

I was trying to make the point that in the United States there is, generally speaking, quite a close and useful working partnership between the State education system and industry. The hon. Member for Somerset, North might investigate some of the work done by the University of Chicago.

Mr. Leather

That is not a State university.

Mr. Palmer

It is supported, in part at least, from public funds.

Mr. Leather

No.

Mr. Palmer

There is a difference between the hon. Gentleman and myself on the definition of what is the State and what is the community. I should have thought that even such a staunch individualist as he would agree that a university is an example of collective community enterprise.

As far as industrial education and training in the United States is concerned, I think that one can draw the general conclusion that sound and intelligent management can contribute a great deal to increased productivity, particularly at lower levels, and in the matter of skilful and understanding supervision. The importance of having good management at the foreman and supervisor level cannot be too strongly emphasised. I should like to know what the Government are doing in this matter of supervisor training in industry. I know that they cannot do a great deal directly, but I should like to know what they are doing indirectly, and what kind of encouragement they are giving.

I agree that we cannot have enough consultation between management and workpeople. We need much more everyday informal consultation on the job, and a little less of the formal kind of consultation through committees, agendas, reports, and all the rest. There is no particular secret about high productivity. It depends upon three main essentials: first, there must be a high level of fundamental research and technological application; secondly, much depends on good and intelligent management; and thirdly, and perhaps above everything else, much depends on a high level of capital investment.

When I talk of capital investment I mean not only capital investment in terms of basic machinery and processes, but mechanisation and electrification at every stage of the productive process. If we are to do this successfully and adequately in post-war Britain we must use a great deal more electricity everywhere in industry. I hope that no one in the Committee will argue today, or in future, that we are investing too much of our available national capital resources in new power plant.

I have some figures here which show that the average level of investment in new electrical plant and equipment is 7 per cent. of the total national capital investment, as against 9 or 10 per cent. in Western Europe as a whole. That is something which we must look at with concern. Adequate supplies of electric power are essential in post-war Britain, and they have a direct contribution to make—together with the other matters I have mentioned—to productive efficiency.

5.37 p.m.

The Parliamentary Secretary to the Ministry of Works (Mr. Hugh Molson)

The Government welcome this debate on science in industry and the relation of the Government to it, because this is the first debate upon this subject which we have had since the war. There was a debate in another place upon this subject, and it is only right that we should discuss the matter here. My noble Friend the Lord President takes the closest interest in all the activities of the Department of Scientific and Industrial Research and, last year, in the debate in another place, Lord Woolton—who was then Lord President of the Council—said: There is a need for some general review of the effectiveness of current arrangements for ensuring that the results of research make their contribution to the development of the British economy at the present time. Earlier in the debate, he said: …I should be much less than frank …if I were to say that I am anywhere near satisfied that British industry is making sufficient use of science or that it is fully equipped to do so."—[OFFICIAL REPORT, House of Lords. 11th June, 1952; Vol. 177, c. 55.] In the course of his speech he emphasised the point which has been made by my hon. Friend the Member for Somerset, North (Mr. Leather), that it is not so much a question of the amount of research and the work that is done as a question of how far we are successful in making information available to industry, and to what extent industry is making use of it. Lord Woolton informed the House that he was going to ask the Advisory Council on Scientific Policy to report upon this matter. As I understand it, the main purpose of this debate is to discuss the Report which the Council have now presented.

The findings may be summarised under three heads. Firstly, the volume of investment in our manufacturing industry is too small; secondly, there is inadequate interest in scientific development, and, thirdly, there is an inadequate supply of scientists and technologists.

The results are very serious and very startling. The United States, with only twice our labour force, spends five or six times as much on equipment, and the result is that in every year they are investing about three times as much per worker in equipment, so that instead of the gap between the productivity of American and British industry getting less, there is every indication that it is increasing with every year that passes. In 1900, output per manhour in the United States was approximately the same as in Western Europe. Now, output is about two-and-a-half times as great or, to put it another way, as was said by the Paymaster-General, in the last 50 years United States' productivity has increased by 3 per cent. annually while productivity in the United Kingdom has increased by only 1½ per cent., annually.

It has become generally accepted that there is need for a new pattern in British industry and that costly scientific modern capital equipment is likely to be the kind of production in this country in which we shall have the largest exports. We can no longer rely to the same extent on the old staple consumer industries which have served us so well in the past. I think the most interesting and arresting public exposition of that idea was in a series of articles in the "Observer," reprinted in a pamphlet as "Rethinking our Future." That is also the view of the Advisory Council on Scientific Policy, who, in paragraph 7 of their Report, point out that this changeover, although it is taking place, is much too slow. Out of total exports of £2,500 million, those of postwar inventions like penicillin and radar and so on amount to only £34 million. and even if we take into account new kinds of aircraft it brings these exports up to only £200 million a year, or less than 10 per cent. of the total.

Ever since 1917 we have had a Department of Scientific and Industrial Research. I was sorry to hear the criticisms of that Department by my hon. Friend the Member for Edinburgh, South (Sir W. Darling), who, in particular, suggested that there was less Government expenditure upon research in the United States than there is here. I think he is entirely misinformed. In the United States, through one agency or another, the Government are paying more than half the total expenditure on research on steel compared with only 15 per cent. in this country.

The hon. Member for Preston, South (Mr. Shackleton) complained that there had been a reduction in the expenditure by the D.S.I.R. Although, as a result of financial difficulties, the increase has not been as rapid as at one time had been intended, in point of fact the expenditure in 1949–50 was less than £4 million, in 1950–51 was £4½ million, in 1951–52 was £5 million, in 1952–53 was £5¼ million and in 1953–54 is estimated to be £5,688,000. Those are the net figures. I hope the hon. Gentleman will take that as definite proof that the present Government attach the very greatest importance to the development of research.

This expenditure is divided between what I might call two broad categories of work. We have 14 research establishments which are directly controlled by the Department. A very large proportion of that work is being done for the Government and for Government Departments. I want to give two remarkable examples of the kind of benefits which we have derived from it. The Water Pollution Research Laboratory, for example, has developed a new system of alternating double filtration of sewage, as compared with the single filtration, and this one development has resulted in a reduction from £480,000 to £87,000 in the cost of the erection of a new sewage works.

Talking of sewage, in order to have a little light relief perhaps I might also give an example of what has been done in the case of blowfly. This is information which I have received of work which has been done by the Pest Infestation Laboratory. Flies breed at an enormous rate in the offal of slaughterhouses. The Pest Infestation Laboratory has been investigating this and, as a result of quite a simple routine of treatment, this can be eliminated even in hot weather and the spread of flies in the surrounding areas prevented.

This should result in an immense saving of cost in the erection of slaughterhouses as well as an improvement in public health and a reduction in sickness which cannot possibly be estimated. In addition to all this, about one-third of all the work which is being done in these research establishments is now being done in order to assist in the defence programme.

I pass from these 14 which are directly controlled by the Government to 41 research associations which have been set up as a result of co-operation between industries and the D.S.I.R. Either the hon. Member for Cleveland (Mr. Palmer) or the hon. Member for Preston, South complained that there were a great many large industries in this country which still had no research association. As a matter of fact, of these 41 more than half have been established since the war, so that we can show that very rapid progress is now being made.

Of the D.S.I.R. total vote of a little over £5½ million, £1⅓ million is paid in grants to these research associations, whose total income and expenditure is now over £4 million. We try to arrange the grants in such a way as to give the greatest possible incentive to the associations to make large contributions themselves. For example, in the case of the British Rubber Manufacturers' Research Association, it was agreed on 1st January, 1949, that for a period of five years there should be a block grant from the D.S.I.R. of £15,000 conditional upon the industry themselves providing £25,000, and for each £100 in addition to that which the industry provide, the D.S.I.R. contribute another £100, up to a maximum of £15,000. In the last year the total income of that Research Association was £66,000. That, I hope, is an example of a happy co-operation between the D.S.I.R. and industry, and that is a system which results, I hope, in the maximum and best results being obtained.

I was sorry to hear my hon. Friend the Member for Edinburgh, South complaining generally about these associations. The Electrical and Allied Industries Research Association, which, presumably, represents the industry with which he is connected, has done extremely valuable work. The Government grant is £73,000, while the industry itself is contributing £143,000 a year. It can hardly be supposed that those hard-headed manufacturers of electrical apparatus would be contributing £143,000 a year to work of this kind unless they were satisfied that the work was valuable. So it has been, because this Research Association designed improved forms of electrical switch gear which are now in general operation, and I am sure he will be glad to know that they are being employed in the North of Scotland Hydro-Electric works.

We in the D.S.I.R. encourage these research associations as much as possible for three reasons. First, because we desire to economise the expenditure of public money, and we, therefore, want to encourage the industries to make as large a contribution themselves as possible. But that is not the most important reason. We believe also that when the industry itself controls its research we can be sure that the research is relevant to the problems of the industry. In the third place, we believe industry will be much more likely to make use of the results of this research if it both provides the money and also controls the policy.

There has been a very interesting example just recently. Hon. Members, especially those representing Lancashire constituencies, will be aware of the Shirley Institute and the very remarkable work which it has done for the cotton industry. A short time ago—two years ago—the Shirley Institute floated a special company called Shirley Developments Limited. The scientists in the Institute did not feel that they had the knowledge or the outlook or the time to arrange for the machines and gadgets which they invented in the Institute to be put into production as soon as possible and to be made readily and quickly available to the industry as a whole, and, therefore, they floated this company for the particular purpose of popularising, manufacturing and distributing the things which they had invented.

One of the things they recently invented was a new automatic size machine, which is likely to save the Lancashire cotton industry something between £100,000 and £200,000 a year. Progress in the manufacture and distribution of it was rather slow until the floating of this company two years ago, and it is now going a good deal better. I have given that as an example because several hon. Gentlemen who have spoken have referred to the difficulty of making sure that the discoveries that are made in research establishments are made available to industry.

I now come to the three causes to which the Advisory Council attribute the relatively slow progress that has been made. The first of these is insufficient investment in industry. The Chancellor has tried, in his Budget this year, to deal with that problem. In the first place, he has announced that the licences will be provided for building factories almost without any limit. There is, therefore, in future practically no restriction imposed on the modernisation of British industry by building licences. Secondly, there is the increased depreciation allowance. As regards anything further in that direction, it will, of course, be necessary to await the findings of the Royal Commission on the Taxation of Profits and Income.

In the third place, he has reduced the standard rate of Income Tax, which will make an additional £45 million a year available in undistributed profits to be ploughed back into industry. In the fourth place he has announced the termination of the Excess Profits Levy, which, it is estimated, in 1955–56 will make an extra £100 million available. Summarising the whole of that, whereas before the Budget 59 per cent. of total company profits were being taken by the Exchequer, after the Budget it will be reduced to 56½ per cent. this year, and although that may appear to hon. Members to be only a rather small reduction of a very heavy burden it is in total a very substantial relief to industry, and it does meet exactly the main point which was emphasised by the Advisory Council.

Mr. J. A. Sparks (Acton)

I think the hon. Gentleman said that in future there would be no restriction placed on building licences for industrial development. Does that mean he is to extend to British industry a measure of priority? Otherwise, they certainly will not get the building materials to meet the licences.

Mr. Molson

I was referring to licensing. Restrictions will still be applied—and it is the Ministry of Works which issues the licences—in the miscellaneous sector and so on, in the case of any factory which it is desired to extend, or in the case of any company which desires to build a new factory, there will be practically no restriction so far as licences are concerned.

The Advisory Council also emphasised the lack of risk capital, and they emphasised in paragraph 13 that it was extremely difficult at present to persuade industry to invest in anything which involved any considerable risk. To a large extent I believe that that difficulty will be alleviated by my right hon. Friend's Budget this year.

The second point which the Council emphasised was the inadequate supply of scientists.

Mr. Stokes

Before the hon. Gentleman leaves that may I put this to him? He has recapitulated the great advantages which he claims from the Budget. Will he deal with the point which I made? That is the tremendously increased cost of replacement, which was not adequately covered by his remarks that industry was left with more now to plough back into industry for the purpose of further development. The replacement problem is a real difficulty at present.

Mr. Molson

I was under the impression that that was one of the matters which was being considered by the Royal Commission on the Taxation of Profits and Income. Until their report is presented, the right hon. Gentleman, I am sure, will not expect anyone to express a definite view upon the subject.

Mr. Stokes

I would.

Mr. Molson

At any rate, I think that the right hon. Gentleman would have abstained from doing so when he was sitting on the Treasury Bench.

I pass to the question of the supply of scientists. Hon. Members may have noticed that in the previous year the Advisory Council on Scientific Policy devoted the whole of their Report to this very difficult and complex subject. I think that it would be a mistake for us to be too distressed by the fact that at present there is a deficiency of technologists. Very soon after the war, the Barlow Committee was set up by the previous Government to consider the need for additional scientists and to estimate what the number required would be. It is extremely satisfactory that the universities have doubled the output of scientists in a shorter time than the Barlow Committee believed was the minimum time in which that could be done.

So far as technologists are concerned, hon. Members will remember that the Financial Secretary to the Treasury, on 29th January, announced that the Imperial College of Science is to be greatly expanded. In 1962, it will have 3,000 technological students compared with 1,650 at the present time. But it is, unfortunately, the case that the second and third problems which the Advisory Council emphasise react unfavourably upon each other.

Hon. Members should remember that they said: The primary reason why our industry as a whole does not make more use of scientists is not because their numbers were, and are, insufficient but because large sections of industry, being conservative and complacent, have neither missed them nor asked for them. We must, at the same time, ensure that there is such a change in the attitude of industry that it will be asking for the scientists and technologists and will give them employment when they are produced.

The Fifth Report emphasises that this shortage of scientists is by no means general. There is, in the case of biologists, an over-supply and in the case of metallurgists there is no shortage. We politicians ought not, I think, always to refer to industry as if it were only industry which does not take a sufficient interest in science. When I paid my visit to the Water Pollution Station I was rather shocked to find that I was the first Minister who had ever visited it and only the second Member of Parliament to have done so.

Reference has also been made just recently, in several articles, to the building of a science centre. I can only repeat what has been said by the Chancellor of the Duchy of Lancaster, in a debate in another place, that the Government intend to build a science centre, as was the intention of the previous Government. [An HON. MEMBER: "On the South Bank?"] Probably on the South Bank. The site on the South Bank is still reserved for that purpose. But, obviously, this is not one of the matters of the very greatest urgency.

The main recommendation of the Advisory Council was for the increased use of development contracts. The Advisory Council pointed out that the Ministry of Supply have been giving development contracts for a long time, and that the development of weapons for the Armed Forces, especially of aircraft and jet engines, has been largely due to the development contracts which have been given. As regards Government Departments, the Advisory Council are of the opinion that it is only in the case of the development of raw materials, or sources of energy which are likely to involve a very long period of research and not likely to be remunerative in the near future, that it would be expedient for a Government Department to go in for these contracts. I am glad to say that the Ministry of Fuel and Power have already embarked upon the development of three extremely interesting ideas in this way.

First, they are desirous of developing a gas turbine run on peat, and a contract has been granted for that purpose. They are also developing, in the same way, gas turbines run on coal, and, thirdly, a large heat pump has been developed for heating the Festival Hall in winter and for cooling it in summer, taking heat from, or getting rid of it into, the River Thames. This heat pump has several novel features and there have been several development contracts.

As regards other projects, the great difference between the contracts which the Ministry of Supply have been using with so much success and most of these others is that in the case of these aircraft and weapons the Government is itself the ultimate consumer and it therefore knows exactly what it wants. It is obviously much more difficult, in the case of a new development in industry, for the Government to intervene. For that reason, the Advisory Council suggested that the research associations which have been set up would be very much more flexible and practical organisations to use for development of that kind. In making this recommendation they are, in fact, only suggesting a further development of the technique which has already been started.

For example, the Wool Industry Research Association have already placed a contract with a firm for the development of a roving levelness tester. The Cotton Industry Research Association have already floated a company, as I have said, through the Shirley Institute, for the same kind of development. The D.S.I.R. Road Research Laboratory, the British Road Tar Association and the North Thames Gas Board are collaborating in the preparation of a special type of tar for surface-dressing roads. The British Electricity Authority, in collaboration with the Building Research Station, is developing the manufacture of bricks from the ash of power stations. These are examples of what has already been begun. We believe——

Mr. Shackleton

The hon. Gentleman says what has been done, but he does not say what is to be done. Here is a concrete proposition which will obviously call for Government funds. Are the Government considering taking the suggestion any further?

Mr. Molson

That is exactly the point that I was coming to. The Report was presented only a short time ago and it was only published last week, but already the D.S.I.R., which welcomes the suggestion, has taken the matter up with the research associations. We are unable to go further at present than say that we believe that this is an extremely practicable suggestion. We believe it is on the right lines because it involves the cooperation of industry itself. I have already said that we contribute, and intend to continue to contribute, grants to these research associations, and we believe that in that way it should be possible greatly to expedite the development that we all want to see.

I have tried to give a brief sketch of the work which is being done by the D.S.I.R. in order both to do research which is needed for Government Departments and to help and encourage industry to increase its expenditure upon laboratory research and to increase the operational research which is an increasing activity of the research associations. We entirely agree with what was said by the right hon. Gentleman about the great importance of the human factors in industry, and those are, generally speaking, matters which fall more within the scope of my right hon. and learned Friend the Minister of Labour, who will reply to the debate. The D.S.I.R., in collaboration with the Medical Research Department, has, as I announced to the House some time ago, set up two committees, under Professor Bartlett and Mr. Waring, to consider individual efficiency and human relations in industry, and they are now hard at work.

I hope that I have been able to satisfy the hon. Members that we are pressing on with scientific activities as fast as we can and that the Government are fully aware of the importance of providing all the facilities that they can both for research in itself and also for putting it over to industry.

6.15 p.m.

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

I and my hon. Friends expected that this subject would provoke a violent reaction from those on the Government side answering the debate, and we are very disappointed that the Parliamentary Secretary to the Ministry of Works has merely recited a series of matters which most of us know, having heard about them endlessly from our acquaintances or through the medium of scientific journals.

Instead of the exciting and enthusiastic exposition that we had hoped for, all we have had is the Parliamentary Secretary letting us into the secret of his own private interests in water pollution and sewerage schemes. I believe he brought those things out on his own; I do not for a moment believe that they were in the departmental brief. The Department should be ashamed of itself for having produced a brief of that description on such an important occasion. If there is an important occasion for the discussion of the condition of the country and, in some respects, the industrial malaise from which we are suffering, surely this is it. and this is the forum for it.

While much has been said about what the direction and the drive should be, we cannot emphasise too much that we ought also to have a lead from the Government and an announcement of what they intend and what they think ought to be done not only about research but also about capital investment. I wish to refer to capital investment in terms of building. If the Committee will listen to me patiently, I will give them an example.

The Anglo-American productivity teams have all made some expression of opinion about capital investment in America and its proportions, the ratio of capital investment in buildings and the ratio in machines. In terms of production in the long run, I believe that having the right machines in the factory is more important than anything else, and people should be able to change those machines at proper intervals so that they can get better results from them, but the basis of being able to put machines into factories in a proper manner is that one has proper factories into which to put them for a start.

Since the Anglo-American productivity teams returned, many people have spoken of the amount of machinery going into factories and its relation to the amount of capital investment going into buildings. Graham Hutton did so in his book "We Too Can Prosper," and so did Professor Rostow in his analysis of what is wrong in production in terms of human relations in industry. A lot of humbug is spoken in comparisons between American industry and our own. People say—this appears in Graham Hutton's book and in the reports of the Anglo-American productivity teams—that America spends 75 per cent. of its capital investment upon machines and only 25 per cent. upon buildings. That has come about since 1932, when the amount spent on machines and buildings in America was fifty-fifty. It is still fifty-fifty here.

May I draw the Committee's attention to the fact that America is different from us in the matter of raw materials and of her background. If we are not careful, we are going to get the wrong end of the stick. Hon. Members may recall that in about 1910 political stirrings took place in industries in Lancashire and Yorkshire. America had exactly the same experience, but what did she do? She moved the industry concerned. In 1910, 86 per cent. of the cotton industry was in the Fall River area. At the present time 90 per cent. is beyond the Mason-Dixon line.

The American industry was moved and, as I heard one of the presidents of the biggest banks say, it mopped up the pool of cheap labour in the South. However, that is not what we are arguing about this afternoon. We are not concerned in this debate with the ethics of using cheap labour, but with the application of science to production. It helped the Americans to get this improved ratio of three-quarters of their capital investment going into machines as compared with one-quarter going into buildings.

The Americans went South with that particular industry at a time when comparatively new development was taking place. At that time they built adaptable buildings and so they were not tied to the old-fashioned type of machines. They built buildings which would enable the new machines to be housed. That is why in these industries, and particularly in the older industries, we have not been able to take advantage of technical knowledge and development in machines. In many cases, it is because we have not buildings to house them. In the cotton industry the mills of today were built for the reception of mules, and when the introduction of rings takes place there is either a waste of space or they are overcrowded.

What I am suggesting to the Committee is that science applied to buildings is one of the most valuable contributions that can be made. Buildings in industry at present are not adequate enough to serve our purposes. We have to get to the ratio of a half or three-quarters for machines and a quarter for buildings. We must catch up with the most progressive nation in the world, and keep the machine industry busy. We have also to make tremendous strides in the cheapening of our buildings so that the industry can acquire them.

What have the Government done? They cut the grant to the building research associations. The building industry is not sufficiently progressive to be a partner in its own research association. The Government are so lackadaisical about this matter that they are not taking notice of the fact that the building of factories in this country must be so undertaken that they will be more adaptable and able to take in the new machines when they come along without a lot of structural alterations such as we are faced with at the present time. In other words, we have to plan for the future.

I do not believe that this planning for the future can be done at all in terms of private enterprise as it is. I do not believe it can be done under the aegis of the present Government. I believe it can be done industry by industry with Government assistance and the setting up of an organisation for the production of an industry's own factories is essential. That is not new; it is the general policy in America. General Motors have their own estate company, which provides buildings for General Motors on a commercial basis. It is because of that system that we have large-scale American industry, and if it is good enough for the Americans it is good enough for us in some form. Unless there is some control of output of buildings and assistance given to cheapen prices, then the present generation will be blamed for its blindness in not seeing the necessity to plan for the future.

I want to pass now to the subject of machines, which follows closely on that of building. There has been a lot of humbug talked about the consumer goods industry. We are going to have such industries with us for a long time to come, and it is escapism to think in terms of setting up a new industry and believing that by that process the needs of an area can be satisfied. It cannot be done. That is allowing people who are responsible to escape their responsibility. A lot of nonsense has been talked on both sides of the Committee about the establishment of Development Areas either in Lancashire or in any other place. It shows that sufficient thought has not been given to the subject.

When we talk about a new industry, what do we mean? Do we mean the establishment of a few garages or some light industry which will go out almost at once in the event of a recession, or are we thinking of a modern industry which will use the by-products of coal, make synthetics, or use plastics? If it is a case of the latter, the capital to be employed per single person in those industries will be £10,000, and if we are thinking of displacing the present consumer goods industry then we are doing a service to the industry itself. We should concentrate on making industry as efficient as possible, and there is no doubt in my mind that the machinery side will have to be stepped up. There must be greater efficiency in the consumer goods industries as well as in every other if they are to take their place in our economy. I do not think that can be done at the present rate of progress, but there will have to be new co-operation, and there will have to be three partners in that co-operation—the Government, the machinery makers and the industry.

When the hon. Member for Edinburgh, South (Sir W. Darling) was speaking, he said that the Government had never done anything like that. I took him up on that, and I pointed to the aircraft industry. Those three combined can do exactly the sort of job that the Government, through the Ministry of Supply, have had to do in the case of the aircraft industry. There again, considerable thought must be given.

In my opinion, this is the solution. The initial allowance, depreciation, and all the financial side of the economy will have to be fitted into the need for replacing machines in a given number of years, whether it is eight or 10, or whatever it is. We are getting to the time when the Americans, who are expert in this, can take a census of their industry and decide how long it is reasonable and profitable to keep a machine in operation, and 100 per cent. of them say that 10 years is the longest time it should be kept.

There has to be a real change in our thinking in terms of replacements. It is no use either the Government or industry, or a combination of both, concentrating on the supply of machines if those machines do not represent an economic set-up in terms of productivity. On the other hand, we cannot get a sufficiently high step-up in productivity unless the entire resources of the industry itself are bent on seeing to it that the need is supplied.

I am bitterly disappointed at the lack of seriousness shown by the Government on this topic. No wonder that there is a feeling of malaise in the country. It cannot be solved just by providing a framework for industry. There has to be something in the way of a dynamo.

6.32 p.m.

Sir Hugh Linstead (Putney)

I think the Committee expected something more concrete in the way of practical suggestions from the hon. Member for Ashton-under-Lyne (Mr. Rhodes), who should be able to bring to our debates considerable experience in productive industry as well as experience as a Minister.

I was disappointed when the hon. Member chose to use the United States of America as his main criterion for criticising productive industry. He must know from his own experience in that country, as I know from a visit which I paid a year ago to industrial establishments with which I am familiar, and as the reports of many of the teams sent out to investigate developments of productivity in the United States have shown, that, given our conditions, we have not a great deal to learn from the United States in the matter of factory production and modern machinery.

I think, too, that the hon. Gentleman was a little hard on my hon. Friend the Parliamentary Secretary to the Ministry of Works when he suggested that his examples of research work undertaken by Government agencies in this country showed a lack of appreciation and energy on the part of the Government. After all, research is not the Book of Genesis. One cannot wave a hand and say, "Let there be results out of research" and there will be results out of research. It is a slow, patient business.

I thought that an hon. Gentleman opposite showed a similar lack of appreciation when he said that the Government should not be content with one technological university but should start up several, from which in five, 10 or 15 years' time we should draw immense benefit. We cannot draw immense benefit from a university in five years. Where are we to start, where are we to get the laboratories from? In the matter of both research and university education, short-term policies and an expectation of short-term results are not what we need.

I have been a little surprised that our discussion today has been directed mainly to our short-term problems, because what we are really discussing is far more important in its long-term aspects. This country must either exist because it is right in the forefront of scientific development or our standard of living will fall calamitously over the next 20 or 30 years. This is a process which has been going on already for a century. It is a slow process, but it is hastened by wars, by rearmament and by other external affairs. Inevitably, the development of secondary industries in countries which, at one time, were the consumers of our products will threaten steadily, decade by decade, the standard of living of the 50 million people in these islands.

The debate has brought out clearly, as does the White Paper which is the basis of it, what is needed if we are to fulfil that basic need of our people. It is research, it is the understanding that research within industry, the production of men who undertake it and apply it, and the capital which will make the application of their work possible. I would agree with the sentiments expressed on the benches opposite, though not with the terms in which they were expressed, in regard to the duty of the universities in this respect.

We may have to face the fact that even at the expense of deliberately distorting university education, for the sake of our salvation we may have to devote more and more of our university talent to scientific and technological work. We have to find the best brains in the country and we have to turn them to that work rather than to literature and the humanities, and all the things that, up to now, the universities have existed to foster.

It is regrettable, perhaps, but the universities will fail in their task to the nation if they do not reorientate their ideas. The hon. Gentleman opposite who referred to the universities clinging to shabby genteel ideas was not doing much to encourage them to fulfil this new rôle. It is no good pouring contempt upon what they have done in the past. We have to see that they have the finance and the encouragement to take up that new rôle.

Mr. Nabarro

How does my hon. Friend suggest that we are to get rid of the excessive number of B.A. (pass) degrees and substitute a larger number of B.Sc. (engineering) degrees?

Sir H. Linstead

That can only be done by a system of education of those who have the direction of university affairs in their hands. We have the University Grants Committee, which has, from being a mere distributor of Treasury money, become a mentor and guider of universities without directing. Through that channel alone it is possible increasingly to indicate to universities the direction that they should be following. That is only one possibility.

We have also to face the problem of the proper payment of our scientific teaching personnel in the secondary schools and universities. We have had to face and we have overcome the same problem in medicine. When consultants in the full-time employ of the National Health Service were able to get £5,000 a year with their medical awards from the State, it no longer was possible to employ professors of medicine in the universities at, say, £2,500 a year, especially if men of the right calibre were needed. The universities, therefore, have had to upgrade the status and pay of the posts of professors in medicine.

Whether we like it or not, the same problem has to be tackled in relation to professors of engineering, which my hon. Friend the Member for Kidderminster (Mr. Nabarro) had in mind. If we are to get men of the calibre that we want in the universities, we must be prepared to pay them, I do not say comparable salaries to what they might receive in industry, but, at least, such substantial salaries as would guarantee them reasonable standards of life and would attract the best men to these posts.

It is along those lines that the long-term salvation of the country can be found: by an understanding between universities of the country's need of technological development; by providing, by means of much increased attractiveness, the right salaries and conditions of pay to attract men from industry to stay in research and technological posts; and also by letting it be understood in university circles that the status of the technologist is no less than that of the man who is in one of the faculties of, for example, pure learning.

Mr. Scholefield Allen (Crewe)

The hon. Member has mentioned the universities and the question of attracting the right type of person, but as I see the problem it is a tier lower than that. The real difficulty today—I hear it on all sides—is to get scientifically trained teachers in the secondary schools who will produce the first class products to go on to the university. The salaries for scientific teachers in the universities just will not compare with the attractive salaries of industry. That is the real problem.

Sir H. Linstead

I should not put that as the real problem. It is another problem and one of almost equivalent weight.

Mr. Allen

That is where the flow comes from.

Sir H. Linstead

Yes. If the top posts in the teaching profession can be made attractive, this will have a general effect on encouraging entrants into the teaching profession, although I admit at once that the transfer between secondary and university education is extremely slow. I would go a long way with the hon. Member and say that the problem of the science teacher in the secondary school is another and most important problem, because physicists, biologists and, to some extent, chemists are scarcely obtainable in secondary schools today.

The only other subject which I want to touch upon very briefly is the question of finance for industry. The hon. Member for Ashton-under-Lyne (Mr. Rhodes) seems to have a general impression that capital for industry could be provided, or could, one might almost say, only be provided, from Government sources and not from private enterprise or the private investor. The account in the White Paper of the activities of the Government Development Corporation does not encourage one to think that Government-provided finance measures up to the needs of industry. The Government had authority to advance up to £5 million, but have advanced only up to £1 million.

One can hardly blame a civil servant in charge of an investment organisation if he is cautious in the way he lets out his money. He wants to avoid—and who shall blame him—getting a rap over the knuckles for having poured out Treasury money on projects which have not succeeded. Government finance can never be put at risk to the extent which is necessary for really substantial industrial development. It may be that the private investor, because his savings do not exist, will increasingly find it difficult to invest, and more and more the Government will find it necessary to encourage companies to plough back as much as possible of their profits into their own concerns.

I hope that, increasingly, my right hon. Friend the Chancellor of the Exchequer will find it possible by his Budget policy to make it more and more worth while for the capital assets of the country to be increased by a ploughing back process, instead of by profits being distributed and passing into circulation and adding, incidentally, to inflationary pressure. I hope that that will continue to be, as it was in the last Budget, a basic policy of the present Government.

There is an enormous process of education to be done. The public have to be educated as to the desperate position of the country on a long-term basis unless we keep our industrial supremacy, and people in industry must be educated up to the necessity of providing facilities for industrial research and making use of it when that industrial research has produced its results.

6.47 p.m.

Mr. Charles Pannell (Leeds, West)

I should like to address myself to one or two of the remarks of the hon. Member for Putney (Sir H. Linstead). My interest in his contribution is that I am still the chairman of an education committee. The hon. Member said he was disappointed with the speech of my hon. Friend the Member for Ashton-under-Lyne (Mr. Rhodes), but I think that in this debate everybody has been disappointed with everybody else. Not least we were disappointed with the speech of the Minister and his example of Conservative complacency. I could not care less what he said about water pollution, coal tar or peat. I am interested in the engineering industry and want to address myself to that subject. What we had from the Minister seemed more like the reading of a complacent sort of essay on secondary issues.

To the hon. Member for Putney I would say that quite recently I went to Charleroi with the British Parliamentary Delegation to Belgium, and I went over the A.C.C. works. The managing director told us, although not as a matter to crow about, that they had 600 graduate engineers on their staff. That was rather breathtaking.

Sir H. Linstead

What did the managing director mean by "graduate"?

Mr. Pannell

I took it in the connotation in which he spoke and allowed for the deficiencies in the language, but at least he was speaking about 600 people who had got beyond, say, our Higher National level. I think that is a fair opinion.

This theme of industry is something that has to be tackled. It is no use the hon. Member for Kidderminster (Mr. Nabarro) saying that this springs from the structure of the 1944 Education Act and that we should do away with B.A. passes and get on with B.Sc.'s in engineering. What is the pattern of education throughout the country? Broadly speaking, of the whole of primary school children 15 per cent. go to grammar schools, 10 per cent. to secondary schools and 75 per cent. to secondary modern schools, yet we blah about parity of esteem between all.

I heard it put well at a school speech day and thought there was a great deal of truth in what was said. It was said that under our educational set-up 15 per cent. were trained as teachers and civil servants, 10 per cent.—the technical people—as foremen and supervisors, and the other 75 per cent. are left to do the world's work. I do not want to argue about classes this evening. Hon. Members opposite who oppose the whole conception of the class war, as I do, must really search their consciences as to whether the class society does not begin at 11-plus. They really must think about it.

Mr. Nabarro

I am sure the hon. Member does not wish to misquote me. I did not say anything about doing away with B. A's as he suggested. What I said—it is borne out by statistics and employment arrangements—is that there are too many arts degrees and not enough science degrees.

Mr. Pannell

The only difference is that I misquoted the hon. Member; I said "doing away with" whereas he would radically reduce them, I take it. That seems to me to be a distinction without too much difference.

Most of the problems we are considering this afternoon are problems of full employment. When we had the technique of the whip and the carrot, we had very little freedom. My right hon. Friend the Member for Ipswich (Mr. Stokes), when he talked about the application of Christian principles, appreciated the fact that these man-management arrangements arose from the fact that no longer could a man be shown the door. We have to consider the changed climate of industrial relations. I am old enough to remember that in my last year of apprenticeship the apprenticeship was broken because I refused to go in to work while men were out on strike in 1923 when the great engineering dispute took place on managerial functions. That was over the right to joint consultation in management. There are fathers of hon. Members opposite who went into the Lobby against even an inquiry or arbitration on that matter. Look at all the sinners who have come to repent.

Mr. Raymond Gower (Barry)

I come of a different generation.

Mr. Pannell

The hon. Member for Barry (Mr. Gower) has not been here very long. The hon. Member for Somerset. North (Mr. Leather) said that it was not a good thing that people could ask for another dose of unemployment and that at election times we should not raise these things against one another. It is all very well to talk of that now, but in the days when I grew up there were never fewer than 1,700,000 unemployed and that meant 6 million on the poverty line. The relations in those days must have been different from what they are now. We are glad that they are different. We do not want to hark back to far-off, unhappy days, but the fact is that on this question of man-management all sorts of respectable people fly off the handle.

On the Austin dispute recently there was a most ridiculous leading article in "The Times" which tried to argue that shop stewards should take their place in the queue for dismissal in times of redundancy. They argued that the representative of the workers should not receive preferential treatment. I wrote a letter in reply, based on long experience as a shop steward, but of course it was never published. I suppose the answer is that "The Times" view this sort of thing as rather undignified.

I turn to the subject of the location of industry in this country, and I am speaking now more to the Minister of Labour. It will be taken as a commonplace that the cradle of the Industrial Revolution was in the West Riding and in Lancashire, in the oldest part of our industry based on cotton textiles. But it is rather remarkable to consider the change in the disposition of industry which had taken place in the space of about 50 years.

In 1750 the South of England had been the richest part of the country and the Eastern counties of Norfolk and Suffolk and the West of England were the manufacturing areas. In 1700 the six most populous counties were probably Middlesex, Somerset, Devon, West Riding, Lincolnshire and Norfolk. The North was a bare barren district with a few roads, a struggling small cotton industry in Lancashire and a developing woollen industry in Yorkshire. The City of Leeds, part of which I represent, was not one of the towns and cities created by the Industrial Revolution but was much older and it was swamped by the Industrial Revolution. In the first 30 years of the 19th Century it doubled its population. The early engineering industry was built on textiles. It was built on locomotives to a degree, but it was also built on textiles.

What I am rather afraid about today is that because Lancashire and the West Riding are the oldest industrial parts of the country they need more re-tooling than the rest of the country, and because they need more re-tooling they will be the most vulnerable parts of the country in a trade recession. The industrial slums in the engineering shops are in Lancashire and the West Riding. No one who has served the industry in peacetime, lived the life and used the tools, doubts that.

Industry has got completely out of gear. If we take a map showing the depressed areas of pre-war days, we see that the West Riding is not there, and certainly not Leeds. Depressed areas before the war have been given special attention. We put capital into them and located industry in them. Those industries, in the main, are the secondary industries today. They are modern and up-to-date. In the Midlands the car industry has arisen and it has been tooled up to a state of the utmost efficiency. It is a case of high wages and intense production. It is all very well for Northerners to talk of engineering, but 25 per cent. of all the engineering industry is in London.

Mr. C. R. Hobson (Keighley)

In Acton and Willesden.

Mr. Pannell

My hon. Friend mentions Acton and Willesden. Last night an hon. Friend led a protest march down the Great West Road, where there are engineering factories on either side of the arterial road. That is chaotic planning; and every week people are being killed because we have pushed industry into London. That industry is modern and up-to-date but quite recently the Ministry of Supply closed an ancient forge, Monkbridge, in the City of Leeds. I went and had a look at it, and I could not make out a case for the men who wanted to retain it. It was a place which should go and give way to something very much more efficient.

In a place like Leeds the buildings are not the semi-permanent kind about which my hon. Friend spoke, which can be put up and taken down. Like the old L.C.C. schools, they were made to last—and they have lasted. Look at the lay-out of many of these shops. Not very much can be done with them. I thought it was bad enough when, before I came here, I worked in one of the Royal Dockyards built by convict labour. It had walls about six feet thick. Many of our factories in the North follow that pattern.

When licensing was in operation, I made a discovery when I was interested in a licence for a world-famous firm. Booth's of Rodley. They and another local firm, Smith's, are the two most famous crane-making concerns in the world. People who live in Rodley think that Leeds is a village just outside. Every house has a member of the A.E.U. in it—which is rather fortunate for me. I was concerned in getting a licence for about £30,000 for a new drawing office, and I had consultations on the spot with the Ministry of Supply and Ministry of Labour people. That was at the time when my right hon. Friend the Member for Vauxhall (Mr. G. R. Strauss) was the Minister.

The capital allocation in respect of licences in the West Riding—or that region—was broadly on a formula which was similar in every respect to that applied to the new industrial areas. I do not know what was the basis of the formula, whether it was based on population or on the capital within the industry, but whatever it was the West Riding was only on the same basis of priorities as were other districts. The West Riding needs a very heavy capital allocation to put it on its feet.

My hon. Friend the Member for Sowerby (Mr. Houghton) is not an engineer; he organises the tax catchers. He could tell the Committee that his constituency is a very static one. Leeds, with its great diversity of industry before the war, was largely insulated from worst unemployment to the degree which was a world-wide experience. At the height of unemployment there were 33,000 people out of work there; even in 1939 there were 20,000 people out of work. Though Leeds was one of the least hard-hit of all the cities, there was a time when one out of every four members of my organisation in the city was out of work. That was bad enough, but it represented a comparatively good position when viewed against the background of harder-hit places like Glasgow and North-west Lancashire.

I have no doubt that I shall get into trouble with the weekly papers when this is reported, but when I go round my constituency I notice a certain air of complacency which I find most disquieting in that place, where there are so many good craftsmen, where there is a tradition of industry—one of the oldest traditions in the country. It seems to me desirable that a "comer-in," as we call someone from outside, should vent his opinion about the kind of thing he sees wrong with the place.

There is another aspect of this matter which I wish to mention, reverting to the point which one of my hon. Friends made when he mentioned that in our party programme we envisaged that the enginering industry, in which one in four of the population of this country was concerned, had to grow even more and more. I want to know where the labour is coming from. It is no use putting these sorts of things in policy documents, or for people to speak here about scientific needs, without our being told where the labour is coming from. The heart of this problem is not the scientists who are to be trained but the craftsmen who have to be brought in—the toolmakers, the turners and the millwrights. They are the backbone of the industry. Where are they coming from?

I do not want to say one word which may be taken as a reflection on the people who represent the unskilled unions, but I remember that when I went into the industry in 1916 the differential between the labourer and the fitter was about 67 to 100. It is now about 86 to 100. No one is more pleased than I am that the unskilled and semi-skilled workers now receive a living wage. If I were asked what was the priority for industry I would say that it would be a living wage for those on the ground floor.

Having said that, and having seen the wage bill throughout the country in industry, I say that there is something wrong when there is a difference of only £1 per week between the earnings of a labourer on the floor and the man who carries £60 worth of tools and can do any engineering job from engine to rear axle. The differential is often very much smaller. I do not say that the wage of the labourer is too high. It is right that he should have a good wage. What I am considering, however, is the slice that the craftsman takes out of industry.

Mr. Cyril Bence (Dunbartonshire, East)

Is my hon. Friend aware that in the Midlands between the wars many of us who were toolmakers—all-round tool-makers—were working in the factories for a smaller weekly wage than semiskilled men on production? But we were craftsmen and stuck to our craft, and if we had not done so this country would have been in a bad position in 1940.

Mr. Pannell

My hon. Friend has referred to a fact that bedevils the industry.

I am not really criticising wages within the industry at all, but I remember my right hon. Friend the Member for Ebbw Vale (Mr. Bevan) giving his blessing to the N.A.L.G.O. Charter, under which the average rank and file clerk who just sat down and behaved himself and did not answer back attained a maximum of £400 a year while the most skilled craftsman in London was getting a reward of £6 10s. a week, so lopsided had rates of payment become. It is about time we stopped talking in the grammar schools about the wonderful things which men do with their hands and the appreciation of art and that kind of thing; it is time we tended to remunerate better the men who do the job.

The engineering craftsmen have slipped back in the scale. I quote from the national census of 1841, which says: this most important branch, comprehending the most intelligent and best paid of persons both of masters and handicraftsmen. That has gone by 1953. The craftsman has tended to be belittled and overlaid. The sort of situation that affects the best craftsmen is one of the dilemmas which face us, not least those of us on this side of the Committee.

My hon. Friend the Member for Newton (Mr. Lee), who will speak tonight, comes to the Dispatch Box as one of a long line of members of my union. The first trade unionist ever to fight a constituency in this country was William Newton, the General Secretary of the Amalgamated Society of Engineers, who fought Tower Hamlets in 1852. In his election manifesto he protested against the sort of things that cramped industry, including at that time bad patent laws. There there was John Burns. There later came to the House another member of my union, G. N. Barnes. Then there were David Kirkwood, Arthur Henderson and one of the greatest orators that our union has produced, the late Member for Hayes and Harlington, Walter Ayles, who died a few weeks ago.

The distinctive thing about all these men was that they left school at the age of 14 or less, but they were what is known as the "grade A stream" in education. Consequently, by the time they were 21, or 22 or 23 they had not only great natural ability, but great experience as well. There were many such men. I have at home a little book on education written around 1870. This book was provided for old craftsmen in order that they would not feel at a disadvantage among boys coming from the elementary schools. Those people are lost to us today. Their sons go to the grammar schools and the technical colleges. They return as civil servants or technologists and sometimes they return to these benches as middle-class intellectuals. That is what we mean by progress—that very often man finds that he has left behind a fading dusk only to proceed to an even more doubtful dawn.

I am not complaining about this kind of thing. After all, it is a fundamental feeling among parents that they should wish their children to have a better chance than themselves. That is what the engineering industry is up against, the prejudice of our time, the belief that to do a job which requires getting one's hands dirty and wearing overalls is somehow less respected and less respectable than going into an office. That attitude of mind was born of the hard days of unemployment.

Mr. Gower

Would not the hon. Member agree that the belief is partly due to the growth of machinery which in some cases lessened the need for craftsmanship?

Mr. Pannell

The hon. Gentleman is repeating an old argument which has no foundation. It so happens that I was given a text book about 30 years ago, when I was taking some W.E.A. lectures. It was written by Charlotte Knowles and entitled, "Industrial and Commercial Revolutions"——

Sir W. Darling

Gibbons was the writer.

Mr. Pannell

No, this was written by Dr. Charlotte Knowles—after the Socialist days of the hon. Gentleman. She enunciated the theory that the coming of machine tools did away with skill in the engineering industry. It did no such thing: it changed the skill. Now we have the skilled machinist, the turner, the miller and the grinder. No one would suggest that these men are unskilful. As a matter of fact, the engineering industry is the least static of all the industries. Its skills change from year to year, and when I walk through the workshops today I see men whose type of skill was unknown when I was in the industry.

Instead of looking to the ends of the earth for things to help industry, let us look to the homelier things. Let us look at the position and the prestige of the craftsmen. There is a good deal in the statement of one of my hon. Friends that industry is still shabbily genteel compared with the arts. Let us see that in our educational system we educate our children to be without a sense of snobbery, and with the idea that people shall be known by the contribution they make to society. That alone should be the test.

We often speak of the scientific things we mean to do, the long-term schemes we have in mind, and we ignore things nearer home. What is the use of discussing an increase in industrial efficiency when we are faced with the cowardice of the Minister of Transport over the 30 mile-an-hour speed limit for heavy vehicles?

Mr. Nabarro

Hear, hear.

Mr. Pannell

We know the difficulty, that men consider they should get an increased wage for going faster, but that should not be beyond the wit of both sides of the industry. Members of the staff of Leylands, A.E.C., and those other firms who produce the best and finest engineering job among the mechanically-propelled vehicles used in the transport industry feel they will have to pay the penalty. They are saying that now if we were to run into a depression the men who make this fine equipment would be put out on the streets. It is no use talking about creating a spirit of enterprise in big things when we shy at such a small administrative action.

I am glad that I finish in agreement with the hon. Member for Kidderminster. I am all in favour of long-term planning, but it should be built on a sound society, with proper esteem between the classes, in which all make their proper contribution towards building what we respect as our goal—a national maximum output and the preservation of full employment.

7.18 p.m.

Mr. Robert Crouch (Dorset, North)

I have listened to this debate with great interest, particularly to the remarks of the hon. Member for Ashton-under-Lyne (Mr. Rhodes), who referred to the buildings and the amount of machinery used by the cotton industry in America and in this country. In our agricultural industry we have a number of old and substantial buildings quite unsuitable for accommodating modern machinery. A great deal of agricultural research is being carried out, but I regret that, so far as I am aware, there is no study being given to the modernisation and equipping of farms with better buildings than they have today.

The right hon. Gentleman the Member for Ipswich (Mr. Stokes) devoted the latter part of his speech to agriculture, which he described as an important industry upon whose prosperity depended the prosperity of industry as a whole. The right hon. Gentleman told us of his experience as a fanner. His farm is near to my constituency. I am familiar with it and the progress which has been made. I confirm his statement about the conditions when he took over, and I hope he will afford me an opportunity of visiting it now that the farm is in a more prosperous state.

The right hon. Gentleman said something about poaching. I shot over that property with some friends of mine for a number of years. We suffered from poachers. I hope that now the right hon. Gentleman has the estate the poachers will leave him in peace so that he can enjoy its amenities.

Modern agriculture is a science. We have so developed the industry with our use of machinery and chemicals that we need to employ all the modern knowledge available. We want to have the use as quickly as possible of the findings of research workers. It is my experience that our farm workers are only too anxious to co-operate on any new idea or new piece of equipment. I should like the Government to take steps to make much more widely known the results of research.

Last week probably all hon. and right hon. Gentlemen received the Report of the Agricultural Research Council. I wonder how many read it. I wonder how many noted the various types of research work that are in progress I wish to mention some features of the work which is in progress not only for the benefit of industry but of the nation. As a result of work over a number of years at the plant breeding station at Cambridge we have been able to produce better varieties of cereals. We have now achieved the highest yield of wheat in the world.

Not only does the station concentrate on increasing the yield of the various cereals but they also give greater attention to the problem of producing cereals and plants which are more resistant to various diseases, such as rust in wheat, mildew in barley, and so on. The Report mentions the work at Drayton in Warwickshire and Hurley in Berkshire on the better management of grassland. I do not think that the great advance made as a result of years of hard work by William Davis on the better management of grassland is sufficiently well known.

The future of British agriculture depends on the better cultivation of grass. It has been discovered at Drayton that if, instead of sowing pastures solidly with grass, land is sown with grass in rows two feet wide interspaced with two feet of lucerne, livestock can be kept out of doors on the land through the year. It is only in severe weather that they need supplementary feeding and that difficulty can be overcome by the conservation of grass in the form of dried grass or silage.

Is sufficient known about the work at the dairy research station at Reading? As a result of that work not only have milk yields been improved through better feeding, but stock generally has been improved and better use has been made of the milk. The public receive much better quality milk than ever before. It is not only through research sponsored by the Government that industry benefits. During the last few years the lot of the farmer and the farm worker has been eased by work carried out by I.C.I, and Messrs. Boots on the destruction of weeds by spraying. There is still a lot to be done. When these organisations have made discoveries they have been only too happy and willing to put their knowledge at the disposal of the Ministry of Agriculture.

Other research has been in progress for the benefit of agriculture, and that is the work devoted to finding a better use for human habitation waste. Efforts are being made to collect together the various by-products and waste from our homes and to convert them into fertilisers. By this new method we may have available about 7 million tons of fertiliser each year.

The right hon. Gentleman said that very little space was given in the Report to the better use of fuel. As a result of work on the treatment of habitation waste about 500,000 tons of coal could be saved each year. The central Government have been holding up the development of this form of processing because they fear that there may be a danger to health in its use. They have not made the necessary loans to the local authorities.

I have mentioned Government research and that done by large companies. There are also other research workers who in their own way make a great contribution not only to agriculture but to industry generally. For instance, there are men like Bomford and McConnell in Worcestershire. They are probably the best agricultural designers we have today. They are in a small way in business but they go forward. They have introduced a hop picking machine which has proved of great benefit. It has relieved people of a great deal of hard work. They have succeeded in developing such implements as hedge trimmers and a new form of plough. The service to industry as a whole of men of that type should be recognised.

In future we should devote much more attention to the development of grassland. Production from grassland is only in its infancy. We have ample evidence that modern methods and the use of new seeds and fertilisers, coupled with better management, can double output. If we can double output per acre we shall be in a position to sell our products to the consumer at lower prices. I have always contended that it is the duty of the agriculturist to sell as cheaply as possible to the consumer. If this is being done now by a few people, more money should be made available to draw the attention of the majority to what is happening.

The belief that grassland agriculture must be confined to the cheaper land un-suited for cultivated crops is unrealistic. Recent studies reveal that properly managed grasslands return economic gain comparable to other competitive crops. Crasslands treated as cropland give low cost feed of high yield and quality, extended periods of green feed production, and reduced costs of animal feed. At the same time, they help to maintain and improve the soil on which they grow. Western grasslands, vitally influenced by heavy rainfall, are capable of production as much as five times more feed than they are now producing. To accomplish this, adequate water must be available, with proper fencing, desirable forage species established, better grazing management practice and the grasslands properly fertilised. Grassland wealth, harvested as meat, wool and milk, will continue to be a factor in the western half of our island's economic development.

7.31 p.m.

Mr. Austen Albu (Edmonton)

This debate has been a very wide one, and I hope the hon. Member for Dorset, North (Mr. Crouch) will forgive me if I do not follow him on a subject on which my knowledge is almost entirely theoretical, although, from what I have seen, I entirely agree with him about grassland.

I have no doubt that the Minister of Labour will be able to find his way through the very wide range of subjects in this debate, because there is running through it a single thought in our minds. It is the thought which led the Opposition to put down this subject for debate—the thought that, unless we can improve the scientific content of our manufacturing industry, we shall not succeed in balancing our payments and maintaining or raising our standard of living. I only hope that the Minister will bring a little more vitality and enthusiasm, and even understanding, to the subject than, I regret to say, the Parliamentary Secretary to the Ministry of Works was able to bring to the debate.

If I had had the opportunity of following the Parliamentary Secretary, I would have found it very difficult indeed not to have been critical and even extremely rude of the way in which he handled the subject. If it is typical of the view of the Government on its importance, I can only say that the sooner the country understands that the better, because if that is the position of the Government, their chance of carrying us through the next few years of economic problems and difficulties is very slight indeed.

The question we are discussing is not only that of raising efficiency in our manufacturing processes and of raising productivity, but also that of ensuring that industry produces the right sort of products in the years ahead. One or two of my hon. Friends have referred rather slightingly to long-term planning, but I believe that, if we do not have in one form or another long-term planning of our industrial development, we shall inevitably, in some years' time, find ourselves bankrupt.

What are the right sort of products that, in the years ahead, industry ought to be manufacturing? More and more, these products will have to fulfil two major requirements. They must be goods, in whose background of research, design and manufacture there is a great advance over the type of goods that our customers overseas can make themselves. I am not myself a believer that we are likely to return or should return to the sort of 19th Century free trade world in which similar goods were sold without trade barriers by market competition between countries. Whether we like it or not other countries will close the door to the entry of our goods, even though those goods are better or cheaper. Of course, that is a generalisation, and I have no doubt that many examples can be shown where at the moment, this is not the case, but I am talking at present of the long-term trend. For the other countries, it would not matter very much, because many of them have both the raw materials and the foodstuffs necessary to keep their people and maintain their industry. Therefore, they can very largely trade entirely within themselves, but we cannot do so. We have, in fact, only our skill and our brains to sell.

The second requisite of the type of industry which we should be developing is to be found in those which, in the course of manufacture, save imported raw materials, either by a direct substitution of home-produced raw materials or materials of a very low import content, or by methods of design and manufacture which reduce the proportion of imported raw materials to the other factors of production in finished cost. The hon. Gentleman the Member for Dorset, North was talking about the possible use of certain wastes, and I entirely agree that this country can no longer behave, as if it were naturally wealthy. We must continuously develop the use of waste and salvage, and exercise the greatest economy in the use of all types of materials.

Both the requirements that I have specified—that our goods must be in advance of those that can be produced by our customers and that there must be increasingly less and less use of imported raw materials compared with skill and labour—are satisfied in a large degree in those industries where there is a very large proportion of scientifically trained staff employed. This staff is not only required in the research establishments, but also in the development of the product for manufacture and in the organisation of production itself. If we compare the newer expanding industries with the older industries in which we have great production difficulties or in which trade is contracting, we find that the newer industries have a much higher proportion of trained staff.

My hon. Friend the Member for Ashton-under-Lyne (Mr. Rhodes), obviously with a certain feeling about the attack made on the textile industry in recent years, was trying to defend these industries against the sort of criticism I have been making, but it is not only a criticism, because I agree with my hon. Friend the Member for Leeds, West (Mr. Pannell) that for some of them, it is very largely a question of their history. They were the cradle of the British industrial revolution. But that is not the only problem. It is also the fact that the products of these industries will not in the future be received by the countries which, in the past, used to buy them. Again, that is a generalisation, but anybody who studies the figures of that proportion of the products of the textile industry which is exported will know that I am right. The proportion is continuously falling, and these industries today are, from the point of view of the balance of payments, a net loss.

The only hope for these older industries—and I entirely agree with my hon. Friend the Member for Ashton-under-Lyne—is that they should take advantage of the new ideas produced by the scientists and technologists. They will have to employ a much higher proportion of highly trained scientific and technical staffs capable of adapting these new scientific ideas to their own requirements.

My hon. Friend the Member for Leeds, West spoke about the position of the craftsmen, and I do not want to have a misunderstanding with him. If by craftsmen is meant the worker by hand who makes, as he made through the centuries, a single commodity, beautiful in design and well constructed—a work of art—it may be deplorable, but his day has gone. I doubt whether British industry was ever built up on that type of craftsman. We adapted the integrity and the working traditions of the craftsman to the new machine age which we developed in this country in the 19th century.

Fortunately or unfortunately, those traditions are no longer enough. Industry today is not dependent upon the craftsman in that sense but upon the technologists. The traditions of the craftsman are not enough in the technological age. I am sure that my hon.

Friends will agree with me that the members of our own union, the A.E.U., find it increasingly necessary to become technicians in the higher ranks, in the toolrooms and the other places where they now work. Less and less is the skilled worker in the union concerned with direct production and more and more is he concerned with the research and development department or the tool rooms of industry. These sections of the industry, the tool rooms, research and development, using scientists, technologists and technicians and the now much more highly skilled craftsmen, in the new sense of the word, are generally known in industry as overheads.

Paradoxical as it may seem, one of the greatest troubles of British industry is that its overheads are much too low. That can be seen in any examination of the Census of Production and other figures. The hon. Member for Kidderminster (Mr. Nabarro) is looking sceptical. He speaks a lot about the coal industry. He should know that in no industry in the country is there a lower proportion of overheads, of skilled scientists and properly trained managers. That is probably the real reason why we are finding it so difficult to raise the production of coal.

Mr. Nabarro

Yes, but the hon. Gentleman is referring to just one item in the industry, its scientific and technical staff. My criterion of the efficiency with which industry is run is the lowest possible percentage of payments on account of administrative and office staff and the highest possible percentage of wages applied to directly productive work.

Mr. Albu

I am not suggesting that we want a lot of unnecessary office workers but only that what are generally known as "overheads" in British industry are far too low. There is far too much brawn and not nearly enough brain, and that applies particularly to the coal industry.

What I have been saying about the need for changes in the nature of British industry applies not only to the older industries but to the newer, of which the chemical and engineering industries are the best examples, and it applies within the engineering industries themselves. Before the war there was a very distinct trend in this country away from the older, heavier branches of the engineering industries—shipbuilding, railway carriage and wagon building, textile machinery building, and so on, towards the newer and lighter branches of industry, those that are more complex and require more scientific development.

The danger that we are in at the present time is that since the war we have been too dependent upon two trends or developments. One was the reversal of the pre-war decline in shipbuilding and heavy engineering, and the second was the abnormal expansion in the exports of motor cars and tractors. Looking ahead, not to next year or the year after but a few years further than that, can we be certain what the level of shipbuilding will be? Are we satisfied that the proportions of different types of ships that are being built at the present time can ensure the maintenance of all our yards? Taking the world as a whole, can we be certain that we can go on building and exporting the same number of ships that we have been doing since the end of the war?

At the other end of the scale, the mass production industry of motor cars and farm tractors, can we be certain that it can go on expanding or even maintaining its present level of production and exports? I believe the estimate was very recently made by the Economic Commission for Europe that the level of consumption of motor cars in Europe would remain steady for the next 10 years at something like one million, and unless the standard of living in this country and Europe as a whole rises very rapidly, it is unlikely that the level of consumption can very much rise.

I should have thought that the export market for motor cars was very vulnerable. We have read recently of the proposals to build motor-car factories in India. I have no doubt that advanced countries like India can make and assemble components and that eventually they will be able to make the whole motor car if they are provided with drawing and design staffs, a few production engineers and a few toolmakers. There is no reason why they should not do so. Therefore we must not rely even upon the mass production in the motor car industry.

This brings me to the very difficult point which has to be faced by some of my trade union friends in this Committee and in the country, the question of where the labour is coming from for the more highly-skilled industries which may have to take the place of some of the mass production industries. I have sometimes asked a question. I have asked it at trade union branches. What would happen in Coventry if we wanted to expand the machine tool industry in Coventry, as one might very well want to do in pursuance of the idea which I have been putting before the Committee, and to contract the motor car industry? Do we think we could take men from the assembly belt in the motor car industry and put them to manufacturing machine tools? We could not. This is a problem that people in these industries and the Government have to face. We shall need the greatest number of semi-skilled and highly skilled craftsmen if we are to maintain and expand our exports of machine tools which satisfy the criteria for the sort of exports I have been trying to describe.

But the important thing is that we should maintain a very considerable variety and flexibility in our engineering industries and in industry as a whole. Most of the great modern developments, for instance in the chemical industry, which has made such enormous strides since the end of the war, have taken place in large firms. The engineering industry is a particularly good field for the smaller and medium-sized firms to make their contribution towards this more complicated type of manufacture, which covers machine tools, electronic equipment and scientific instruments and many other products. But it is the small firms, especially in the older industries, which find it most difficult to undertake the necessary research and technical development.

It is for these firms that the industrial research associations were designed, but we have to face the fact that these research associations, admirable though their working has been, have not been as effective as they could be, very largely because of the fact that the scientific and technological knowledge of the directors and managers of those firms was inadequate. Let me quote the Report which has just been published by the Advisory Council on Scientific Policy. They say on page 2: It is no accident that the enormous growth of American production has coincided with an increasing representation in management of men with a strong scientific or technical back ground. It cannot be too strongly emphasised that unbalanced boards of management, on which technical representation is small or nonexistent, are unlikely to be able—even if they were not limited in other ways—to take full advantage of the results of scientific research with the speed and enterprise which are required under modern conditions. Last Session the Parliamentary and Scientific Committee addressed a questionnaire to a number of research organisations and scientific organisations associated with it. The replies almost universally bore out what the Advisory Committee said. Perhaps I may quote one or two to the Committee. Dr. F. C. Toy, Director of the British Cotton Industry Research Association, which has already been referred to, spoke of the use of science by the cotton industry and said: Where rapid application fails is through lack of trained men, including technicians and technologists, in responsible positions—men with enquiring minds, not content with things as they are. Mr. Leslie Kekwick, President of the Oil and Colour Chemists' Association, said, dealing with the obstacles to the more rapid utilisation of scientific research: … The absence of scientifically experienced but commercially minded men on many Boards of Directors—a deficiency which is being gradually remedied. He gave that as one of the main causes.

Mr. D. A. Oliver, Director of Research, The B.S.A. Group Research Centre, said: If we consider now the larger firms, the degree to which they make effective use of the results of scientific research is a powerful function of the commercial directors in charge of those organisations, many of whom have not had a University education, nor have they attempted to keep abreast in a superficial way with what is going on in the world of science and technology…. Too many firms are now controlled by accountants, who, from the technical aspect, rarely have those qualities of imagination and desire to live (slightly) riskily, which are concomitant with progressive leadership. Mr. G. L. Bailey, of the British Non-Ferrous Metals Research Association, said: The small firms are less well-staffed scientifically, frequently having no University graduate or qualified technologist in their employ at all. They find it therefore more difficult to use the results of scientific work in their own factory and if the management does not include technically trained men they may not appreciate the need for making the effort to do this. These conditions existed before the war when there was no question of a shortage of risk capital for investment in industry, so that they cannot be blamed on the shortage of either risk capital or capital in general, however important that may be as a factor. I believe that only a very strong lead from the Government can change this situation. What do we find? The Parliamentary Secretary to the Ministry of Works said that there had been an absolute increase in expenditure on the Vote for the D.S.I.R. in the last few years but in fact, since 1950–51, because of the rise in prices, there has been an effective cut of 10½ per cent.

The Advisory Council, dealing with the Department of Scientific and Industrial Research in its Report this year, complained that much of the long-range basic work is handicapped by the hand-to-mouth policy of the Government. The plan which was drawn up by my right hon. Friend the Member for Lewisham, South (Mr. H. Morrison) when he was Lord President of the Council—a long-term plan for research and development and capital investment in research—has never been carried out.

I suggest to the Committee that the Research Associations must have some assurance of continuity. The Parliamentary Secretary made no reference to this and I ask the Minister to give us some indication, in his reply, of what is the Government's attitude towards this very important problem and an assurance of a plan over a number of years so that the research associations and D.S.I.R. can undertake this long-range work.

I was glad to hear what the Parliamentary Secretary said about the recommendation of the Advisory Committee on Scientific Policy for the extended use of development contracts in the civilian field. I do not think he went far enough, however, and I sincerely hope that the Government will press forward with this very valuable way by which one could get the results of the Industrial Research Associations' work more quickly into practical use.

Mr. Molson

I do not know what the hon. Member means by saying that I did not go far enough. I said that the Report was considered as soon as it was issued, that we accept the general principle and that we are already getting in touch with the research associations upon this subject.

Mr. Albu

Perhaps I was deceived by the hon. Gentleman's tone, but I did not feel greatly reassured that there was drive behind what he said. Nevertheless, I accept the statement which he has just made and I hope that he will come back to the House very shortly and tell us what the Government intend to do.

There is only one matter in this field on which I can congratulate the Government, and it is on the increased grants for higher technological education in the technical schools and the intention to double the size of the Imperial College of Science and Technology. I was disappointed when he said that this latter project would not be completed before 1962, although I agree that it is a very big job. I should like to know when it will be started and when more students will begin coming into the College.

I think this is a very important thing indeed and I entirely agree that we cannot build a whole lot of new technological colleges. Indeed, I am glad that we dropped the idea of the Paymaster-General of building a technological university, and I believe what we are doing in the Imperial College we should afterwards extend to Manchester College of Technology and the Royal Technical College, Glasgow.

It is disturbing that in spite of the continuing demand from larger firms and newer industries for scientists and technologists the number of technological students at the universities fell three times as much as the numbers in all faculties in the years 1949–52. On the other hand, there has been a very substantial, continuing and gratifying rise in the number of those who have taken National Certificates and Higher National Certificates in industry, and the number is now many times that of before the war. It includes civil, mechanical and electrical and production engineering, metallurgy, applied physics, chemistry, textiles and mining. This is very important. The Higher National Certificate is certainly as good as a first degree, although perhaps lacking in some of the fundamental science, while the ordinary National Certificate provides the technicians who are so badly and increasingly needed.

If industry uses the men it should be using—technicians, technologists and scientists—the demand will grow from year to year and the question really is: will industry use the men? If they do not, and if there is not a continually growing demand, that will be a demontration that the higher ranks in industry and the Government do not really understand the age we live in.

Why is that? I believe it is, as the Advisory Committee said, because there are too many accountants on boards of directors, and it is also because there are too many classicists and arts graduates, in the narrower sense of the term, in the Civil Service; and also because there are too many lawyers in the Government. I apologise to the Ministers replying to this debate, but anybody who listened to the Parliamentary Secretary will know what I mean. We fully appreciate that he read his brief reasonably well but he had not the slightest clue what the debate was about. He had no spirit or fire in him; he was not fired by the importance of this subject.

That is not surprising because this is, for him, not a continuing interest. This is the interest and responsibility of the Lord President of the Council who does not sit in this Chamber and who now has other arduous duties. I repeat a request which I have made to the Government several times before—that there should be a senior Minister in this House responsible for this very important aspect of our national life.

7.58 p.m.

Mr. Gerald Nabarro (Kidderminster)

I have had the good fortune on many occasions in the House to follow the hon. Member for Edmonton (Mr. Albu) in debate, and I have no doubt that this fact springs from the fact that we have a certain identity of interest in the efficiency of industrial management. I shall not attempt to follow him today in his speech because I want to switch straight back to a most important matter mentioned by the right hon. Member for Ipswich (Mr. Stokes) in his opening speech, namely, the vexed question of an extension of industrial two-shift working.

There is hardly an Anglo-American productivity report which has been published in the last two years which has not stressed the essential difference between the arrangements made in American and British factories on this matter—how the Americans indulge to a very much larger extent than we in this country in industrial two-shift, or more, working arrangements. Here, in Britain, in the coal industry and the steel industry we have almost continuous processes; some of the arrangements are good and some are bad.

But in the industry to which we mostly have been devoting our attention in this debate—the engineering industry—over the whole field there is very little shift working. In fact I think the tendency seems to have been in the last year or two more for it to decline than for it to increase. The right hon. Gentleman the Member for Ipswich, in a rather rumbustious manner, suggested that we did not want single-shift or double-shift working, but that we must work all our expensive machine tools right round the clock. That is the optimum arrangement from every theoretical and economic point of view, but it neglects the simple human element.

Why does the industrial worker not like industrial shift working very greatly? He does not mind so much for himself—the male worker in industry: it is his wife who minds. The wife of the industrial worker by and large dislikes very much indeed the disruption of home life caused by the principal breadwinner of the family having to go out to work at 10 o'clock at night or having to go out to work at six o'clock in the morning. Very often the transport facilities then are not available to get him to his factory, and he has to take sandwiches because the excellent works canteen, working eight hours in the daytime, is not working over night and he cannot get a hot meal.

There are all sorts of social objections in this very difficult matter of extending shift working in industry. Therefore, I deprecate at once the oversimplification of the right hon. Gentleman the Member for Ipswich when he said that we must have 24-hour working round the clock almost immediately, as though it could be accomplished by some magical action almost over-night.

Indeed, there is an overwhelming case for a steady extension of industrial shift working, and I hope that my right hon. and learned Friend, when he replies to this debate tonight, can give us a little more information than he has been able to do in the last few months as to the progress of his negotiations with both sides of industry for more general acceptance of the two-shift or more working basis.

There are objections from both sides, not only from the workers but also from managements. Managements, of course, dislike the duplication of managerial duties over night. They have to find twice as many charge hands, twice as many foremen, twice as many works managers, twice as many canteen superintendents, twice as many doorkeepers and watchmen, and many of the administrative staff. Maintenance duties are complicated. All of these are matters which must be carried in mind, but the case for two-shift working could never have been put more clearly and succinctly than it was in the Report of the Committee on National Policy for the Use of Fuel and Power Resources in paragraph 184 under the heading, "Shift Work": Double-shift or continuous working means a further use of the more efficient electricity plant capacity, saving coal burnt in the less efficient plant used at peak hours, and less risk of load shedding. Apart from the benefits of improved electricity load factor and the saving of coal, the advantages of shift work include the more intensive and economic use of efficient industrial capital equipment, coupled with the possibility of scrapping obsolete and inefficient plant. That is, in my view, the most simply expressed summary of all the reasons why we should try to secure the highest common factor of agreement between both sides of industry and press on with this most important policy.

I want to turn now to the question of the application of the results of industrial research, and the products of technical research at our universities and in Government establishments. I wish to express this view quite simply and forcefully, that I do not believe that the sum of money being spent today by the Government on industrial and other forms of technical research is inadequate. I consider that it is probably, in the present circumstances, approximately right. There are three instruments, as I see it, which are today participating in this supremely important field of technological research and development: first, the Government establishments, of which the most famous, of course, is the Department of Scientific and Industrial Research; second, the universities; and third, the larger firms within industry.

Those are the instruments, and the contribution that they make, in the aggregate, to the broad stream of scientific development and research is, in my view, adequate for British industry as a whole, and I would not advocate the expenditure of larger sums from public funds for research and development work On the other hand, here is surely the crux of the problem: how are we to obtain proper and maximum value within industry, from the large sums of money that are in the aggregate being spent?

There is far too little advantage being taken by industry as a whole of the products of research and development that have already been made available to them. Why is the full advantage not being taken by industry? The reasons, in my view, fall briefly under two headings. There are the physical deterrents and there are the fiscal deterrents. Let me deal very briefly with the physical deterrents.

I am not raking my right hon. Friends on the Front Bench with fire in this matter. I am commenting on the obvious difficulties that arise from an over-centralised economy in a world that is becoming more and more freely competitive. Let me give just two examples. Why must we continue industrial building controls? That is first. Second, why must we have the Capital Issues Committee at the Treasury any longer? Both are redundant and unnecessary; both ought to be scrapped. Both were necessary in the war years, both were necessary in the straitened and impoverished economy directly after the war; but today economic circumstances have very largely changed, and neither of those instruments is necessary any longer.

The Parliamentary Secretary to the Ministry of Works said—and I wrote down his very words—on the question of industrial building licences: "There are no restrictions on industrial buildings." In other words, he inferred—and I think I quote him correctly and in the proper connotation—that anybody who wanted an industrial building licence could have one. Let me tell the Committee what happened a few months ago when I was trying to pursue, with a company with which I am associated, a measure of industrial efficiency.

It so happened that this company had a railway siding with 15 or 20 railway wagons coming into it every day during the winter months. It was open and exposed to the weather. There was no roof over the top, with the result that whenever it rained or snowed the manual labourers engaged in unloading the wagons, with the mechanical appliances they used to aid them in discharging the railway wagons, had to stop work and take cover. I applied for a licence for work costing £3,000 and a few tons of steel to put a roof over the unloading yard. What did the Ministry of Works say? They said, "You cannot have a licence unless you get an industrial planning certificate first."

So I went through all the processes, and I got an industrial planning certificate. Then they said, "Oh, no, but you have got to have the parent Ministry's support for your application for a licence." So I got hold of the Board of Trade. They were very hesitant about it, and after six months of effort I still could not get the wretched licence for a few thousand pounds worth of work to enable that team of men to be fully and productively employed.

What was the answer that came back from that monstrosity of all Ministries, the Ministry of Materials? This is the answer that came back: "We consider that the manufacturing capacity of the industry of the country as a whole"—of which this factory formed a small part—" is adequate, and so it is not necessary to grant a licence to roof over this unloading yard to enable the men there to be kept continuously at work."

That is the sort of frustration and exasperation that arises from the intrusion of bureaucratic Bumbledom in industry today. I am sure my hon. Friend will not think I am being unkind to him. [Interruption.] I am referring to a personal experience. My hon. Friend has suffered from a system which has been handed on to him. I personally was engaged for some weeks with the Minister of Works last year in trying to persuade him to raise the licensing limit for industrial buildings, and he raised it from £500 to £2,000 a year.

It is no good Her Majesty's Government telling industry to increase efficiency and use the products of research if by restrictive action, by a licensing system that is outworn and out of date, they are going to negative everything that private enterprise industry wants to do. Today no industrial firm will spend £I on a new building unless there is going to be a profitable return arising from an increase of production. Sweep industrial building controls away; they are totally unnecessary and a relic of a bygone age.

Mr. Molson

Can my hon. Friend tell me the date of the application?

Mr. Nabarro

It was 12 months ago.

Mr. Molson

What I said was that after the Chancellor of the Exchequer's speech these licences are now being granted freely.

Mr. Nabarro

I am grateful to my hon. Friend. I shall re-apply for this licence and see what happens. I am not at all sure, knowing the ways of Government Departments so well, what will happen. Let me go on to my second point.

The Capital Issues Committee today, sitting at the centre, controls the flow of funds to British industry. It decides how much money may be raised by subscription by any particular firm, and it decides whether or not the investment has merit. I am not an economic anarchist; but I say that today there is no longer any need for control of that kind and it is militating against the efficiency which we hope to derive from the products of research.

The answer to it is surely this. No company today is going to seek to raise additional capital unless it can usefully employ it. It has to be able to put that money to productive purposes, to show a profit on the enterprise, to use the capital satisfactorily, and it should not be necessary to apply to a Capital Issues Committee to do any of these things in the present much freer state of our national economy.

I listened to the right hon. Member for Ebbw Vale (Mr. Bevan) the other evening on a Prayer to annul a Northern Ireland Order, The party opposite were praying against the abolition of industrial building controls in Northern Ireland, and the right hon Gentleman's case on that occasion—and my hon. Friend replied to him magnificently—was that if we took off building controls in England we would immediately have a long line of cinemas going up, and all sorts of unnecessary buildings of that kind. I wonder if we would? A cinema would not be put up unless it could pay its way. There are enough cinemas in the country today. We heard all about that on the Finance Bill quite recently.

Why not let the laws of supply and demand in a free economy really operate? I am at one with my hon. Friend the Member for Orpington (Sir W. Smithers) on this matter. In this question of the application of the products of research and development within industry, only if we are prepared to remove physical control of that kind can the full benefit be obtained.

I am not alone in this matter. The hon. Member for Edmonton (Mr. Albu) quoted cogently from replies to a questionnaire sent out by the Parliamentary and Scientific Committee. I noted with interest one of the replies from the technical director of the Dunlop research centre whom he quoted. The Committee were very interested to hear that, but he left out this quotation: We are affected by the general limitation of building facilities. There is full confirmation for my case that industrial building controls ought to be scrapped at once, and I would remind my hon. Friend that this questionnaire is dated 11th June, considerably after my right hon. Friend's Budget.

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

Does the hon. Gentleman agree that national investment ought to take place in the national interest?

Mr. Nabarro

I quite agree, but I doubt very much whether there is any validity at all in the suggestion made by the right hon. Gentleman the Member for Ebbw Vale that if this control were removed it would result in all sorts of undesirable projects, such as luxury cinemas being erected. Hon. Members opposite were foremost during the debates on the Finance Bill in imploring the Chancellor of the Exchequer to reduce the Entertainments Duty because they claimed that so many of the cinemas in the country were going broke. The two arguments are totally incompatible.

Also in this field of technological development my view is that our fiscal arrangements in the United Kingdom are a great deterrent. There cannot be any reasonable doubt that a primary cause of the high rate of replacement of industrial capital equipment La the United States is because of their much more enlightened fiscal system which grants full and proper wear and tear and obsolescence allowances.

What happens in this country? I am sorry that the hon. Gentleman the Member for Sowerby (Mr. Houghton) is not in his place, because he would confirm every word I say. An arbitrary body called the Inland Revenue decide what shall be the period of years over which a new piece of industrial equipment shall be depreciated. They say, for example, a motor lorry, five years, a piece of boiler plant, 20 years, a machine tool, such as a lathe, 14 years, a building, 50 years without any regard for——

Mr. Ellis Smith

A Lancashire mill 200 years.

Mr. Nabarro

The hon. Gentleman is evidently confusing the actual length of life of a building with the notional length which the Inland Revenue apply for depreciation purposes, and the two are very different.

Mr. Ellis Smith

I accept a good deal of what the hon. Gentleman is now saying, but that did not apply between the two wars.

Mr. Nabarro

I do not want to go back to an historical survey of industrial conditions in the 1930's. I am concerned with the future. I want to make this point which, I think, should not be entirely lost on Members opposite, that our present wear and tear and obsolescence provisions, as arranged by the Inland Revenue, act as a grave deterrent to industry spending money on new capital equipment, in the form of capital investment, and using the results of scientific and industrial research.

My right hon. and learned Friend, when he replies, will say, no doubt, that the Royal Commission on Taxation will be considering this matter in due course. I would remind him—he is older than I am and he will probably remember the circumstances—that the Macmillan Committee on the Simplification and Codification of Taxation sat from 1928 to 1936 to produce a Report of hundreds of pages which no one ever took any notice of, and not a single provision of that Report was ever applied. The Royal Commission can do a certain amount by way of recommendation, but I believe that the very heart of this problem is the consideration that unless we are prepared to alter our fiscal arrangements in order to give proper incentive to industry to spend money on capital goods and the projects of research, then our deliberations today will practically have been wasted.

There is no field in which I feel greater frustration than in the field of fuel technology—[Interruption]. The hon. Member for Stoke-on-Trent, South (Mr. Ellis Smith) has said, "Now he has got on to his pet subject."

Mr. Ellis Smith

No, I did not. I said that the hon. Gentleman is now playing on his own ground.

Mr. Nabarro

I apologise.

Mr. J. Slater (Sedgefield)

Does the hon. Gentleman really believe that our industrialists are as keen upon industrial development as he is asking the Committee to believe?

Mr. Nabarro

I think so. The hon. Member has not had the pleasure of listening to the entire debate. Had he done so, he would have heard a similar point made by one of his hon. Friends. I quote again from the replies to the questionnaire sent out by the Parliamentary and Scientific Committee. This was one of the major points: A second difficulty is a psychological one, as described by a leading industrialist, in that companies declare themselves unwilling now to take the same risks as formerly, when there were sufficient swings for their gains at least to counterbalance roundabout losses. They argue that gains are now as speculative as ever, but much smaller, so that they can afford to take fewer risks. The answer is that if the investment by an industrial company upon a new piece of plant succeeds, the Treasury takes two-thirds of the profits, but if there is a loss the Treasury contributes nothing. The Chancellor's policy is eternally "Heads I win, tails you lose." That is the greatest deterrent to an accelerated rate of industrial investment, and the subscription of risk-bearing capital.

To go back to fuel technology, there is undoubtedly no field in which hon. Gentlemen in all parts of the Committee feel so much frustration as in the application of the great many known principles which have resulted from technological research in the fuel and power industries.

The right hon. Gentleman the Member for Derby, South (Mr. Noel-Baker) set up the famous Ridley Committee in July, 1951. It sat for 15 months and produced a magnificent Report of hundreds of pages. It was an encyclopaedia containing thousands of facts and figures, all generally accepted and well-known facts, but it said little new. That is a perfect example of what I mean by the delay which takes place between the finding of a new method, the product of research in our laboratories and scientific centres and the knowledge seeping through to those engaged in the industry. The Report itself was tepid and timid. So far we have adopted a few of the recommendations, but very little progress has been made.

I quote from an eminent technologist in this field, Professor Simon, Professor of Thermodynamics at the University of Oxford. Writing recently in the "Financial Times," he said: The Ridley Committee Report is in many ways very valuable, but its recommendations really boil down to saying that all will be well if everyone does what he likes—assuming that the rates for the various forms of energy are realistic.

An Hon. Member

Free enterprise.

Mr. Nabarro

Free enterprise, but the industries happen to be nationalised, and, as that is the case, it happens to be the responsibility of my right hon. Friend the Minister of Fuel and Power to try to run them.

My point is that in the field of fuel technology, as in the fields of so many other branches of scientific research, we have spent endless years talking about already well-known and established facts, but it is the lack of application of what is already known that is so sadly lacking. What we want is much more drive in the application of what we know and in the administration of those industries. I see my hon. Friend the Under-Secretary of State for Air in his place. I know he will have read with avidity the letter from Lord Trenchard published in "The Times" today, a letter very pertinent and very appropriate to our debate. What did Lord Trenchard say? He complained of the extraordinary delays in bringing the finest four-jet military aircraft into full production. He wrote of the Valiant, the Vulcan and the Victor, and spoke of the disproportionately great length of time which is elapsing from the time those machines leave the drawing board until they become operational in the squadrons.

Lord Trenchard's view—he is a greater authority than I am—is that, with all the resources available, and the engineering capacity and production that is available to us, we ought to be able to bring a modern aircraft from the drawing board to production and into service in the squadrons in two years from start to finish. It is taking us a great deal longer. [Interruption.] The right hon. Gentleman the Member for Ipswich gave us a dissertation upon Christian ethics. I have never understood that he is an authority upon the Royal Air Force. In case he missed the earlier part of what I am saying, I was quoting from Lord Trenchard's letter in "The Times" today. Lord Trenchard may be right or he may be wrong, but I should prefer to take his opinion on these matters rather than that of the right hon. Gentleman.

Mr. Stokes

You would.

Mr. Nabarro

It is an example of the all-too-great failing that this nation has had for the last few years. We have for ever been seeking new facts, but we have been failing to apply what we already know.

I am the twelfth speaker in this debate. Not one speaker before me has mentioned atomic energy. That is probably the most important single aspect of scientific research and development in the country. The British Electricity Authority, which was eulogised by the hon. Member for Cleveland (Mr. Palmer), will within a few years from now be burning 50 million tons of coal a year. At present it is burning 35 million tons of coal a year. The coal position in Britain is not a crisis, because a crisis is short-lived and soon finishes; it is an aggravated and aggravating economic problem which cannot quickly be overcome except by the one means of furnishing atomic power at a relatively early date.

Some scientists think it will take 20 years. I think not. I believe that the plant which is being built at Sellafield, in Cumberland, as a pilot plant will probably be generating electricity within four years. I implore my right hon. Friends on the Treasury Bench not to stint capital investment in this supremely important field of technological research and development, for it will undoubtedly contribute to solving our coal problem, our electric power problem, our locomotion problem, our balance of payments problem, and many others, all within a span of 15 to 20 years. We can surely lead the world in this vital field of the industrial application of atomic power, as we have led the world in the production of aircraft during the last two decades.

Let us concentrate on the proper application of what we already know. Do not let us clamour for more and more money to be spent in chasing the delusion that expenditure of money can be directly related to greater scientific and technical benefits in industry, because certainly that is not always the case.

8.29 p.m.

Mr. Cyril Bence (Dunbartonshire, East)

Whenever I listen to the hon. Member for Kidderminster (Mr. Nabarro), I find that he unfortunately always says something that reveals his complete ignorance of the subject about which he is talking. He quoted Lord Trenchard when he posed the question that we should have aircraft off the drawing board in two years. I would tell the hon. Gentleman that I well remember in 1945 the chairman of a company coming to a factory where I worked and calling all of us toolmakers together. He told us that a new design of a motor car body, not an aircraft, was coming off the drawing board, and he wanted the body and the chassis with the engine in it in the spring of 1947. That was 14 months for a motor car body. In 1938, 1939, 1940, and 1941 I helped in the tooling of a night fighter, and it took us four years to tool it.

It is nonsense talking about modern aircraft coming off the drawing board in two years. There is no engineer working today who could bring an aircraft off the drawing board in that time.

Mr. Nabarro

I did not say so. Lord Trenchard suggested that it was desirable, and that was all I said.

Mr. Bence

The hon. Member for Kidderminster poses as an expert. Lord Trenchard is not an expert; he is the user of aircraft but knows nothing about their manufacture.

There is another point I want to emphasise. I get tired of people from the executive side of industry saying that engineering workers in particular and r factory workers in general do not like night shift because their wives think that they upset all sorts of domestic arrangements. I accept that, but the hon. Member for Kidderminster says, "Of course, employers have to employ two sets of technicians and two sets of managers." He never mentioned the difficulty of getting the managers or technicians to work at night. In fact, they will not have it. Employers cannot get managers to work at nights, and I have seen men promoted from the bench for night work because it is not possible to get administrators.

Another important factor I want to mention. I was jig boring and making tools for aircraft components. There were four of us at the jig boring with a, fortnight on day and a fortnight on night. After doing this for 12 months, we had to make an arrangement whereby whoever was on the day shift did all the complicated work because we found that between 3 o'clock and 5 o'clock in the morning our greatest mistakes were made. For the benefit of the Committee I might say that a jig borer can make a mistake and destroy thousands of pounds worth of work. When we talk about 5 the double shift system, I hope the Committee will remember that often in the trade it is impracticable to put a skilled toolmaker, who is working on close precision work, to work at night.

In the years between the wars there I was great concern about efficiency in industry. It was a common saying in the; Midlands—and I worked there for many years as a tool-maker—that the tool-maker and the toolroom were a necessary evil.

Mr. Nabarro

Nothing of the sort.

Mr. Bence

Oh, yes. It was said that we were a dead loss.

Mr. Leather

Was it only the toolroom the hon. Member was in?

Mr. Bence

No, it was them all. In the Midlands many wished they could dispense with the toolroom.

Mr. Nabarro

The hon. Member should not be silly.

Mr. Bence

It was between the wars, and I could quote the industries in the Midlands which adopted this attitude. I myself in 1938 worked in a toolroom making various tools for different jobs such as laying out cams and pressed tools for producing special equipment, and our wages were £4 7s. 6d. a week. Production and semi-skilled workers were getting up to £12 a week, and it was not until my union compelled the employers to adopt a toolroom agreement that our wages were increased. If they had not been increased we would have done everything possible to get on to the production side because we were fed up with the low wages. The same applied to the period of the Great War.

Sir W. Darling

What was the name of the union that brought the wages up to £12 a week for production and semiskilled workers while the A.E.U. only got its members £4 7s. 6d.?

Mr. Bence

I do not think I said any wages, but it was commonly known that the skilled men in the industry prior to the war were paid those wages.

Sir W. Darling

Skilled men?

Mr. Bence

Semi-skilled and skilled men working on capstans and such like work were getting £12 a week——

Sir W. Darling

What union did the hon. Member say? Was it a black shop?

Mr. Bence

No, some were in our union.

The Deputy-Chairman (Mr. Hopkin Morris)

This discussion may be interesting historically, but it has very little to do with the Vote.

Mr. Bence

That brings me to the question of the division of labour in the industry. I want to refer to something the hon. Member for Kidderminster said on this subject. I shall deal with the hon. Member for Edinburgh, South (Sir W. Darling) a little later on on another issue. The hon. Member for Kidderminster talked about costs in industry. If he is acquainted with the engineering industry he should know as well as I do that technological progress and the techniques of mass production have increased the capital costs and progress costs, and have decreased the actual labour costs so that to suggest that the success of industry should be measured by the amount that capital and administrative costs are below labour costs is falacious. The on-costs are far greater in industry than the actual productive and labour costs.

When my hon. Friend the Member for Edmonton (Mr. Albu) spoke of accountants dominating industry, I was reminded of an occasion in 1940 when the director of a company in Birmingham was discussing at a meeting some processes in the factory. He wanted a heavy deposit of chrome on a certain date. He did not know anything about this and therefore the chief chemist of the factory was there and gave him some figures. The director said to the chemist, "Where did you get those figures?" "Oh," was the reply, "those are Faraday's figures." "Fetch him" said the director. "He has been dead a hundred years" said the chemist. "Don't quote to me a man who has been dead a hundred years. Get some up-to-date figures." That director was an accountant.

On another occasion I went into the office of the assistant works manager because he had sent for me. He was on the telephone and this was the conversation: "What about those castings? We are held up for them. Two or three hundred men are held up." Then he was silent for a few minutes. Then he said, "Never mind about the cores, we will have those later." And he was the assistant works manager in the factory. My hon. Friend who is a tool-maker will understand the importance of that. This is what we got in British industry between the wars and during the war. Industry has been too much dominated by men who do not understand engineering technique.

I was amazed that the hon. Member for Edinburgh, South openly admitted that he was a great individualist and a buccaneer. I believe that any engineer on this side of the Committee will agree that if there is any man in a factory who is a nuisance, it is the man who is a buccaneer. Modern engineering production demands team work. Excessive individualism can be very awkward——

Sir W. Darling

Not in the selling field.

Mr. Bence

If the hon. Gentleman wants to indulge in buccaneering I recommend him to apply to the Royal Naval air workshops at Almond Bank where there has been a great deal of buccaneering in the last few years. Perhaps he can get a job there and join in the game. The hon. Member spoke again about State education. He is tired of State-educated children coming into the factory. He told us that they come too late, and said, "Let us have them and we will educate them while they are working. Take them at five years of age"——

Sir W. Darling

See HANSARD.

Mr. Bence

"—and do not let them have any State education. Deny them that, and we will educate and train them."

Sir W. Darling

I said, "Take them and train them."

Mr. Bence

Can the hon. Member educate them between the ages of five and 14? Even when they go forward to the great universities, those universities are State supported. The hon. Member wants to do a bit of buccaneering. He wants to catch them young and mould them to his pattern. Then we would have a nation of buccaneers. That is his theory, but it would not work.

Sir W. Darling

The hon. Member will never be much of a buccaneer.

Mr. Bence

I agree. I have never had any respect for the skull and crossbones, but I know that the hon. Gentleman is a great admirer of them.

The hon. Member for Kidderminster evidently has something in common with his hon. Friend the Member for Edinburgh, South, for he says, as many Members opposite are saying, that all the controls should be taken away and the industrialists will invest and modernise their industries. Did the industrialists do that before the wars? Oh, no. Between the wars I worked in an industry where some of the plant was 100 years out-of-date. Some of the plant in the factory was built in 1825 and was still working in 1925.

Sir W. Darling

Sometimes it was very good.

Mr. Bence

That company was not making certain products, but was buying them broken down from Austria, Germany and Japan, and was using an assembly plant that was cheaper than installing new machinery. British industry stagnated between the wars, and since the turn of the century the cheap labour in Britain made it unnecessary for the British industrialist to indulge in heavy capital investment.

In the United States—the hon. Member for Somerset, North (Mr. Leather) should know this—the heavy capitalisation was caused by the pressure of the trade unionists, who have forced the payment of high wages. It is high wages—expensive labour—that compels the industrialists to indulge in mechanisation.

Mr. Leather

I agree entirely with the hon. Member's diagnosis. He is completely distorting it, however, by forgetting that we in Britain were second only to the United States of America and way ahead of the rest of Europe. We were way ahead of Germany.

Mr. Bence

Between the wars, Germany put us out of the market.

Mr. Leather

Their wages were not as high as ours. That is exactly the point the hon. Member has been making.

Mr. Bence

In many parts of the country, and particularly in Scotland, apart from the big units, where there is a division of labour inside the unit, there are a large number of factories that were built between the wars off the railways, very often on second or third class roads. In the majority of industries today, except the very smallest, which cannot take full advantage of much of the scientific and technological development, the price of the product of many factories is considerably increased by the inefficiency of the road network between the factory and the market.

The roads of Great Britain now constitute a very heavy cost on industrial efficiency. Eight years after the war, it is time that more money was spent on the roads. In the county part of which I represent, there are roads which are little more than lanes that now carry very heavy traffic which cannot move, on an average, at more than 10 miles an hour. That is so in central Wales and in Lancashire. All this constitutes a heavy price on the product, but all the time we hear criticism of efficiency within the factory.

The major part of British industry, from the workers point of view, is as efficient as any industry in the world. I have worked in numbers of toolrooms in the Midlands and our managers have been across to America to see toolrooms there. I remember the last one coming back. He is a director of the company now. He went to one of the biggest toolrooms in America; and I was working in one of the biggest in Great Britain. He said, "They can teach us nothing." Tools have come from the States to that factory which would have collapsed if they were put in our presses and worked at the speed—the strokes per minute—with which we worked our tools. We tried it. The British toolmaker and the British engineer can lick his counterpart in the United States in turning out a job and producing a component.

The difference between the two countries is that the American businessman is a driver. He goes in for organisation and for advertising. He will take up a new idea and plug it to get the best product. But the British employer, in his trade association, with the tallest protective barrier around him and his grand faith in the eternal economic union of the Commonwealth, with his trade association fixing the price level, does not move out if he can possibly help doing so. In the aircraft industry the Government have jumped in and spent £7 million with the Bristol Aeroplane Company for one aircraft and have spent millions on the development of the Comet. The whole aircraft industry are producing aeroplanes under Government sponsorship.

Mr. C. I. Orr-Ewing

Will the hon. Member agree that, apart from the engine, the whole of the Comet was a private enterprise product?

Mr. Ivor Owen Thomas (The Wrekin)

Where would it go without the engine?

Mr. Bence

We know that private enterprise built the wings and the fuselage to Air Ministry's specification and guarantees. But they knew that if they produced an article the Government would place orders and the research which goes into the aircraft industry is in the main sponsored by the Government.

8.49 p.m.

Mr. William Shepherd (Cheadle)

I am sorry that so much of the time of the Committee has been taken up with wrangling. The level of this debate has fallen far below that at which it should have been maintained in view of the importance of the subject to the country generally.

It is not true to say that the industrialists of this country as a whole are as progressive as they ought to be; nor is it true, as some of my hon. Friends have said, that the workers are to blame. In this issue there is fault on both sides, and we have obvious lessons to learn. I had hoped that we would devote more time to an objective consideration of what we have to learn than to what we have in fact done. No one will deny the seriousness of the situation in this country. With 50 million people, with no raw materials, and with only our capacity to do things well, we have to keep abreast of all developments in order to live.

I am afraid that many Members have spoken today as if we have nothing on which to commend ourselves. Indeed there is a good deal to be said for the United Kingdom, and I am by no means a pessimist in this field. In the first place, we have a long record of scientific achievement which has not diminished in recent years but has perhaps been enhanced. Even in the industrial field we have since the end of the war had a greater increase per year than the United States. No one can explain that away. There are good reasons for our industrial expansion having been at a more rapid rate since the end of the war.

In talking about the United Kingdom and the United States, we should bear in mind that there are such basic differences between the two economies that comparisons in this respect are really futile. Why is there such a high standard of productivity in the United States? The first reason is one which we on both sides of the Atlantic can accept, that is, they have accepted the concept of an expanding economy. It is perfectly true to say that nothing which we attempt to do by any improvement of our university services or integration of educational services or any improvements in any direction will be of any use unless we get in this country the acceptance of the concept of an expanding economy. The basis and fundamental of any real improvement in productivity and any widespread acceptance of new ideas rests upon this capacity to accept the concept of an expanding economy.

I know it has been said by hon. Gentlemen opposite that there are many difficult things in recent past history to overcome. I think that to some extent we are overcoming them. I am not disappointed at the way in which labour as a whole is trying to face the new conditions of our industrial life. I am certainly not disappointed at the efforts made by trade union leaders in this field. On the whole, they have been courageous. When one considers the trade union leader of today in comparison with A. J. Cook, one realises how far we have come in a relatively short period of time.

The second reason the Americans do much better than we do in terms of industrial output is their high labour costs. There is no denying that it pays to put in machinery there which it would not be possible to put in here. It is not true, as some hon. Members have suggested, that all that has to be done is to pour new and modern machinery into the factories. There we come up against the second or third difference between the United States set-up and our own.

Mr. W. R. Williams (Droylsden)

Will the hon. Member agree that if only we had re-equipped our mills in Lancashire we would certainly be in a better position at present to meet any competition either from Germany of Japan?

Mr. Shepherd

The hon. Member needs to be careful about that. The total labour content in a piece of cloth is about 25 per cent. of the total cost. Therefore, it is not true to say that we would solve all our problems merely by using the most up-to-date machinery.

I was saying that the second or third reason the United States have a set-up different from ours is the acceptance by the domestic consumers there of standardised products. I strongly urge upon the Committee the consideration that the difference to the set-up is enormous when the consumer accepts a standardised product. One can pay for one's expensive, highly mechanised set-up if one can turn out a standardised product. It would be more expensive in a country like ours where one has to keep changing designs.

It is a fact that the United States export about 6 per cent. or 7 per cent. of their total production, whereas we have to export a large percentage of our manufactured articles to meet very diverse needs all over the world. Therefore, we cannot compare, as some hon. Members have today tried to compare, the position in the United States with that in the United Kingdom. I wish it were different. I know that we can go some way along the road towards standardisation; but we have to consider costs, and the ultimate test is the quality and cost of the end-product. When we realise that in the United Kingdom our costs generally are lower than in the United States, we may think that we are not so far behind as we may have been led to believe.

There is one field—and this is a point I wish to stress—in which we can copy American methods. We can standardise more and have a bigger output at lower cost. But it is no use saying, as some hon. Gentlemen opposite have said, that we should throw over everything we have and start a new and beautiful industrial world. What nonsense was talked by the right hon. Gentleman the Member for Ipswich (Mr. Stokes) about the cotton industry being finished. That is absolute nonsense. We cannot suddenly switch all the people making cotton to making Comets——

Mr. Stokes

I never said anything of the sort. Precisely what I said was that cotton had "had it"—and that I believe. I emphasised that possibly we would have to switch and that we must recognise the trend.

Mr. Shepherd

I do not for one moment accept what the right hon. Gentleman says.

Mr. Stokes

I know the hon. Gentleman does not.

Mr. Shepherd

The cotton industry has been contracted from its global employment figure of 750,000 to 300,000, and I fully believe it will continue to employ 300,000. The textile industry is not static. The right hon. Gentleman probably does not know that the production figure of cotton rayon mixtures in recent months is the highest in the industry. The textile industry will go on developing new ideas and combinations to keep its place in the national economy.

I say it is wrong to take the view that we must start a fresh industrial world, to be created possibly by someone in the House or by the Treasury. If I were to point to any country to which we should look with interest, it might not be the United States. It might be a small country called Switzerland. I believe we have more to learn from the work of the Swiss—a small nation with a five million population and certainly no industrial or economic advantages from the point of view of raw materials—than from America.

There is a great deal that we may learn from the Swiss. We do not necessarily need a big and widespread industrial organisation in order to be progressive. If there is a desire to be progressive, a search for knowledge and an intensity of application there will be progress, despite the size of the economy. That has certainly been proved in Switzerland. I invite the Committee to consider the fact that we are between two different forms of industrial enterprise. In the United States they are able to have huge organisations spending enormous sums of money on industrial research. General Motors, for example, spend enormous sums every year. In Switzerland there are small companies, or at any rate companies run almost as family concerns, by engineers and technicians whose life is lived in that industry and to whom the technical progress of the industry is a most absorbing factor.

We are between these two forms of industrial organisation. We have not the capacity to set up huge industrial organisations for research, and we are losing to some extent the control of businesses by individuals. The right hon. Member for Ipswich is almost the only one remaining in that capacity. I feel we are losing ground because we have chosen an instrument of centralised research which is not really doing its job. The trade association research station is all very well, but who takes any notice of it? Who can say that people pay as much attention to the work done by such an organisation as they do to research work done for themselves?

I suggest that more sponsored work should be carried out. Assignments should be accepted from individual industrial concerns to produce work and proceed upon lines of inquiry. In America there are institutions which are supported by outside funds, like the Rockefeller and Mellon institutions, to do such work. They obtain a substantial amount of their revenue from sponsored work paid for by industrial concerns. We should try to open up the associations in this country and persuade them to take on paid work.

Mr. Stokes

Some of them do.

Mr. Shepherd

Very few do. They are far too narrow in their outlook. If they were to open out a little more they would become more virile.

The second consideration is to alter our attitude towards industrial life. The man who goes into a factory in the United States of America is not looked down upon as inferior to the man who works in an office. We must do away with this concept from the top to the bottom. Unless we do there is no hope of progress. When I say from the top to the bottom, I mean that if one is a professor in a university and one deals with applied science one should not be regarded as inferior to a professor who deals with pure science. In the United Kingdom the prestige of the pure scientist has been very high and that of the applied scientists has been very low indeed. We must alter all that if we are to get the right sort of attitude and the progress we need in this field.

Another thing I wish to mention, even though we cannot do much about it here, is the necessity to get on to the boards of companies men who have a scientific and technical interest. It is useless to depend entirely in a company upon advice tendered by men below, for the simple reason that the men below do not want to chance their arm. It is the job of the board of directors and the managing director at times to chance an arm.

If a man is an employee he holds back. He advises only when he is absolutely certain. In the application of new ideas one cannot always wait until one is absolutely certain. The lead does not go to those who wait and hang back until they are sure about everything. I hope that industry generally will do everything possible to see that men who are technicians and who are scientifically interested become employed as directors in companies where the full authority of directorship can go behind their recommendation.

Another hope I want to express is that we shall encourage the greater use of consultants in industry. Here again, this is something we cannot do much about in this Committee. I believe that a good deal of the progress in the United States of America is due to the use of consultants on a wide scale. If a company uses consultants it is true that it does not keep its secrets for so long In the United States the consultant is a recognised man. He goes like a bee from flower to flower. He gives to one company the knowledge that he has attained at another. It is true that they do not keep their secrets for so long, but this has the effect of bringing the whole of industry up to a higher level. I hope that in this country we shall use consultants more freely in future.

I hope, too, that we shall do all we can to increase the number of inter-factory visits. We see them in the American setup. We know that the best here is at least as good as the best in America, but what is more important is the way in which our knowledge is applied in the United Kingdom set-up. I hope that English factory owners will realise that one cannot walk into a factory and apply new ideas overnight. One must consider the long-term position. I hope that factory owners will open up the factories and cooperate with the Productivity Council in spreading knowledge of up-to-date methods in British industry.

I apologise for having had to speak so rapidly because I had little time. I wish to end on this note. It is wrong to take the view that British industry is dormant or that our industrial prospects are low. We want stimulation, as most bodies do, but at the same time we have now a great opportunity. Our costs of production, especially in the engineering field, are probably more competitive today than they have been for many years. If we can improve our scientific achievements in the next five or 10 years as we have done in the past five or six years, if we can keep our costs down and even reduce them, we shall probably be able to put ourselves in a better position than any industrial community in the world. We have the men, we have the ideas here in our own country, and we certainly have the inventive capacity, and that is a situation which should be viewed, not as a cause of concern and despair, but as a great opportunity and challenge to the people of this country.

9.5 p.m.

Mr. Frederick Lee (Newton)

This debate has shown just how varied an approach can be made to this all-important topic of industrial efficiency. We have ranged from engineering to agriculture and have mentioned many other industries, and, in trying to draw together so many of the strands which have been developed during the course of the debate, I think I can say that at least one vital and important point has been agreed on all sides; namely, that unless we as a nation can master the complicated issues contained within this general subject matter, not only will it be utterly and completely impossible to think in terms of a higher standard of living for our 50 million people, but, indeed, it is most improbable that we shall be able to maintain even our present standard.

I was very pleased indeed that the hon. Member for Cheadle (Mr. Shepherd) struck a more optimistic note. He mentioned the achievements of this nation since the end of the war, and I think it would be quite wrong in a debate of this sort to give the impression that we in Parliament are despondent about the possibilities for the future of our economy. If one looks back to 1945, one thinks of the background against which we started our industrial effort at the end of the war.

I believe that we have reason to be very proud indeed of the effort our people have made. Starting with the knowledge that hundreds of millions of pounds' worth of our capital investment—machines, factories and so on—had been utterly destroyed in air raids, from 1946 to 1951 we achieved heights of production which had never been conceived in the whole of our industrial history. I believe that that period will rank in importance with that effort which our people accomplished during the dark days of Dunkirk when the history of these times is written in the days that lie ahead.

I do not believe that we should be despondent but that, in a debate of this sort, we should render our homage and appreciation to the great nation which has done so much during the past six or seven years. Indeed, that performance was even more remarkable when we recall that the expansion in our production took place despite the most serious shortage of raw materials and the inevitable restriction of sales to the home market. During the same period, we were investing 20 per cent. of the national product in capital investment, and the Labour Government of those days was most adversely criticised for its efforts to build up our industrial strength by insisting upon that percentage for capital development. One could claim that the productive triumphs to which I have referred were due in no small measure to the fact that, in those days, we refused to listen to the advocates of the "Set the People Free" policy, and I suggest indeed that those productive achievements were a complete vindication of the policy of my late and very dear friend Sir Stafford Cripps.

One of the greatest threats to our ability to maintain our existing share of world trade lies in the fact that, especially in the United States of America, the total investment per head has been at least twice as high as it is in the United Kingdom, while investment in plant and machinery for manufacturing has been relatively higher still.

I notice in the Sixth Annual Report of the Advisory Council on Scientific Policy that the same point is made in paragraph 9, which says: In the first place, there is reason to believe that the pre-war rate of investment in this country was insufficient even to maintain the then existing stock of capital assets. Secondly, much of the investment since the war was used to make good war damage and arrears of normal replacement. Thirdly, existing capital assets have to support a volume of industrial production 50 per cent. higher than pre-war, some of which comes from entirely new industries, e.g. oil refining. Some figures for current gross investment in capital goods in the United Kingdom and the United States are set out in the attached two tables. This refers to the tables which are included in the Report. Although direct comparisons are misleading, partly because of differing costs of building and plant, the tables indicate that investment in British manufacturing industry (including the making good of depreciation) is much less per person employed than in American industry, which suggests that our competitive position is worsening rather than improving. With their labour force in manufacturing industry only twice ours, the Americans now spend five or six times as much as we do on new plant and equipment, i.e., the equivalent, at its face value, of about three times as much per person employed. I suggest to the Government that we cannot hope to bridge the gap between ourselves and the United States by trying to compete with them purely in terms of capital development, in the percentage of the national product that we invest in capital equipment. If we agree that we cannot compete with them, we must obviously find some other avenue to make up our deficiencies in that field. If we look at the position in manpower, there is no room for difference on that issue either. It is purely a statistical matter. We cannot hope for many years to come to improve our position by being able to employ more people in industry. That point is brought home in the Fifth Annual Report of the Advisory Council on Scientific Policy, which was issued last year. The Council says: It is common ground that we cannot pay our way in the world or discharge our obligations as a great Power unless there is a large increase in national production. Productivity has to improve not only if our output is to increase, but also if we are to maintain our position in the world of trade in the face of competition from others who are every bit as alive as we are in to the need to improve the efficiency of production. All this must be accomplished with a labour force that is ageing fast and which is relatively stable in numbers. The proportion of persons 65 years of age and over was 53 per 1,000 in 1911 and 105 per 1,000 in 1947. It will be 160 per 1,000 in 1977. The number of young persons reaching the age of 15 was 740,000 in 1939 and 635,000 in the present year. Again there is no room for difference between the sides in this Committee that, so far as our ability to get more hands for the job is concerned, the possibilities do not exist at all.

If there is no hope of being able to invest a bigger percentage of our national income in capital equipment and get more hands to the plough, upon what can we rely, and in what sort of field should we invest as a manufacturing nation, in order to get into the same market as the United States of America? This problem has to be looked at not only from the point of view of how many factories we can erect and whether our industries are correctly sited, but remembering that any nation in the second half of the 20th Century which does not invest all the wealth it possibly can in scientific research is courting utter disaster.

We therefore invite the House to take the closest possible interest in the work of the Department of Scientific and Industrial Research. I have no time to attempt a complete analysis of it, but I give it as my opinion immediately that the Government are not investing anything like the amount of our national wealth in research which, under the circumstances I have tried to outline, is clearly necessary. One can hardly think of any Department less appropriate for the swinging of the economy axe than the Department of Scientific and Industrial Research.

If our resources as a nation are too slender to enable us to think in the same sort of figure of capital investment as the United States, surely the logical corollary is to spend to the limit on scientific investigation so as to forestall our competitors in its applications. The Report of the Department of Scientific and Industrial Research for 1951–52 reads as follows, on page 13: In our last Report we expressed considerable anxiety at the delay in giving effect to D.S.I.R.'s post-war plans. We pointed out that they had been approved by Government in 1946 as the minimum necessary to enable D.S.T.R. to play its part in ensuring that science made its full contribution to national problems and particularly to increasing industrial efficiency. We urged that special steps should be taken to remove the obstacles hindering the development of these plans which the economic position of the country and its defence alike required. Nothing has since occurred to mitigate our anxiety. In fact, we find ourselves reviewing the relation between our scientific needs and our scientific resources with steadily deepening concern. Again, on page 9, we find almost an air of despondency and gloom when we read what they say about the provision of staff. The Report reads: In the economic position which prevailed at the beginning of the year we reluctantly decided that some contribution must be made by the Department to the general economies that were being made in the Government Service as a whole. The effect of this decision was not to eliminate any major plan or activity, but to slow down some work and to arrest, for the time being, most of the planned expansions of activities. On the 1st October, 1951, the non-industrial staff actually employed in the Department was 3,079, though a large number of authorised vacancies also existed. We decided, for the time being, to cancel these vacancies and to reduce the staff employed by 25. Surely, if the Government agree that it is in this field that we must try to maintain our position in the great competitive race which is even now starting, it should be common agreement that it is quite wrong at such a time to frustrate the Department of Scientific and Industrial Research. We all agree that it is in the national interest that we should employ more science and bring more science to the disposal of industry rather than frustrate the Department as we are.

I have not time to refer to more than one other part of the Report—pages 14 and 15, in which they look at the geological survey. Many of my right hon. and hon. Friends have from time to time asked the Government what is their intention in this connection. The other day we were talking about helping the Colonies, but if we can believe the Report of the Department it seems to me that they will be in a position to help us long before we can help them. They point out that at the present rate of progress it will be over 100 years before that geological survey is completed. I put it to the Committee that it really is not good enough for the Government to come along to a debate of this type and expect the Committee to believe they are serious about the question of getting more science at our disposal when that sort of Report is presented to us by the Department itself.

In September, 1951, the Labour Government produced a White Paper proposing the establishment of a college of technology. What is the Government's intention so far as that college is concerned? We, in our "Challenge to Britain," have made it quite plain that we intend to set up such a college, and we should like to know what are the Government's intentions so far as that is concerned.

When we were in office the Department of Scientific and Industrial Research was extended very considerably. In 1944 to 1945 the expenditure on it was only £913,000. By 1951 to 1952 it had risen to £4,596,000 and it was only when this Government came to power that the Department received its first check since the end of the war. I put it to the Government that it really is not good enough, at a time when our fortunes are balanced as they are, to be economising on issues like that.

Let me turn now to what is, perhaps, an old hobby horse of mine, the question of the supply of scientists and technologists. I know there has been a limited improvement during the past year. In 1951 to 1952 the number we were turning out was one in 3.000 of the population. Two or three months ago I got a reply from the Government that it was one in 2,600, but in the United States it was one in 400 two years ago, and the hon. Member for Cheadle was telling us of the enormous performances of the Swiss in this field. Moreover, we are getting information as to the enormous advances which have been made in the Soviet Union. So it is essential we should push ahead at a far greater pace with the producing of scientists and technologists than the Government are.

Mr. Shepherd

What is the basis of the comparison of the technologists here and in the other countries the hon. Gentleman mentioned? My information is that the figure was one in 1,400 in 1949 to 1950.

Mr. Lee

I can only quote the figures that the Chancellor gave me, or, before that, the Minister of Materials. They gave me the figures I have just given now. I cannot go further than that. If we cannot ask for improvement in capital development, if we cannot ask for improvement in manpower, the Government must tell us what they propose, and whether they will agree to stop this business of wielding a sort of Geddes Axe on the whole of the development of science, and will allow the development to go ahead in the same ratio as the Labour Government did.

The Parliamentary Secretary to the Ministry of Works used words like this. He said it would be a mistake to be depressed about the shortage of scientists. Really, I do wish he would give us some concrete facts to show that we need not be. Nobody has disputed that we are falling farther and farther behind in this race all the time, and though the hon. Gentleman comes to that Box and tells us about his visits to sewage works and various other pleasant interludes, that does not give us any factual basis on which to feel any optimism, or that the Government are seized of the importance of this question of the production of more scientists for our industries.

So far I have dealt with what are, perhaps, points of Government policy, but I do not believe that it depends solely on Government action itself. I believe that in industry we must ask for a better response, not only from one side but indeed from both sides. We must ask industry to make the greatest use of their associations not for restrictive purposes, and not to keep secret the results of their scientific investigations, but to place the discovered improvements unreservedly at the disposal of trade as a whole. If indeed the nature of capitalist production is such that this is impossible when it is so clearly in the national interest that they should do it, then I should have thought that puts the case for social ownership far better than we on these benches can ever hope to put it.

I now return to the trade union side. For many years prior to the war, the trade unions had interested themselves in matters connected with industrial productivity, but in those days it was the ever present fear of unemployment which conditioned their approach to the subject. The war years, bringing with them the acceptance of the necessity for joint effort between employers and workers in the general struggle to avoid defeat at the hands of Fascism, saw a remarkable advance in consultation between the two sides on questions relating to production. Unfortunately, some of the machinery which was set up during the war was afterwards allowed to fall into disuse, but the general principle had been firmly established that great improvement in productive methods, and in the atmosphere of factory, mine and workshop, could be obtained by an enlightened approach to these problems.

I believe it is essential that we should continue to profit by our experiences in this field to bring our machinery for consultation to a far higher pitch of perfection than even before. I believe that in the nationalised industries we have a great opportunity and, indeed, a great challenge to prove that effective consultative machinery can achieve outstandingly successful results. I think that the managements of these industries can, by bringing their workers fully into their confidence, give a lead to those managements in the private sector of industry who refuse to discuss fundamental questions with representatives of their employees.

It is frequently pointed out that we must aim at the elimination of the two sides to industry idea. The only way to achieve this is to make it clear that every person employed has the opportunity open to him to advance to the highest levels of management in a nationalised industry. Consultative machinery cannot function effectively in an atmosphere of "so far and no farther." It is also vital that the old cry of "managerial functions" should cease, and that we should advance to a position in which the workers should be given the opportunity of making a contribution to the policy of the firm and industry upon whose success their own well-being depends.

If the workers are to play an increasingly important part in joint consultation with management, we of the trade union movement must face the logic of our own position. For fifty years the Labour Party and the trade unions have actively campaigned against the class bias in our educational system. We have sought to show how the country has suffered from the failure of past Tory Governments to give to millions of working people an opportunity to study the scientific, technical and administrative side of the industries in which they were employed.

Considerable advances have now been made in the provision of facilities for further free or assisted education, but I believe that the time has now come when instead of waiting for the State educational system to repair the neglect of past years, the trade unions should assist in the process. We rightly criticise the type of employer who refuses to take the counsel and advice of his workpeople into consideration. Our job is to ensure that the counsel which the workers can give is based not only upon their experience and skill but on a high degree of that scientific knowledge which has previously been denied them.

The more knowledgeable in these matters that the workers become, the more speedily will that knowledge reflect itself in the industries they serve. I know that most of the large unions now have summer schools and weekend schools at which their members receive instruction in the general economic condition of the country and other kindred subjects. That is quite excellent, but I do not think that it goes far enough.

I have heard complaints from trade union leaders that these classes are not attended by as many of their members as they would like and, therefore, it is a waste of time and money to provide further facilities. I believe that the opposite is the case. I think that it is, in fact, because there is no next step in the educational process that some of their members who are interested in the project do not take the initial step of attending summer schools. I therefore suggest that the trade unions should now consider the formulation of educational schemes by which those members who display ability above the average while at the summer school could be given the opportunity of going on to technical college and university to undertake scientific and technological studies peculiar to their own industries.

I tried to do a little about this when I was at the Ministry of Labour. I did not get very far. I understand that the principals of many of our universities would be happy to assist in such schemes. I also know that, in many instances, the people who would have to be withdrawn from industry to undertake such schemes would need financial assistance, and I believe that the Government should ensure, by financial grant, that their families would not suffer economic hardship as a consequence.

I turn now to the question which has been mentioned by a number of hon. Members, that of wage structures, differential rates and so on. I believe that in many of our older industries this is one of the greatest impediments to progress. In most of the older industries we have obsolete wage structures based on a phase of development which has now gone. Instead of amending the structures as degrees of skill changed, we were satisfied merely to set up new grades all of which were supposed to be related, on varying grounds, to the original tradesmen's rates of pay. I could quote 30 different rates in the engineering industry alone. If anybody will show me the difference in skill represented by 9d. or Is. in a week's work, I will withdraw what I have already said.

If we are really to make spectacular progress it is important that we should now try to relate our advances financially. My right hon. Friend the Member for Ipswich (Mr. Stokes), rightly said that people go to work for what they get out of it, the pay, and that must always be the basis of our discussions. We have structures, not only in engineering but also in a great many other industries, which can result, as I have experienced, in a stoppage in industry because men have reckoned their bonus to be 4d. or 5d. more than they have actually drawn. First, there is the basic rate. Then there is the cost of living bonus superimposed upon that. Then there is a piece-work structure on top of that, but that is based not on the whole wage but on the basic rate, and the basic rates themselves sometimes vary by Is. While we have that sort of pay structure it is impossible to make any real progress in those industries.

Since 1947 it has been necessary for the Government to ask trade unions to limit their wage demands and, in the main, to rely upon increases in production to give increased earnings to their people. That brought great advantage to the nation, but it can never be a permanent or long-term policy. The Chancellor is now carrying on that type of policy. He would be well advised to realise that, while we rely only on advances in production to obtain wage advances, the people who are not employed on a payment by results basis and have to work harder because of the increase in production brought about by the productive workers, are working harder and getting practically nothing for it. This leads to dissension and lack of team work. I should have thought that, in view of those conditions, it was time many industrialists and industries followed the great example of my right hon. Friend the Member for Ipswich and sought a basis on which they could bring practically all their employees within a payment by results scheme. This is the way in which very great progress can be made.

I should have liked to develop the subject at greater length, but I hope I have said enough to show that, as we now are in this country, we are utterly dependent upon utilising our wealth to lead the world in finding a scientific basis upon which to increase our production. We have so much to gain from the sinking of our national wealth in that sort of thing. If the Government will say that they are conscious of this problem and give a lead in that direction, I know my many friends in the trade unions will face up to the problem. They realise that we have got to compete successfully in world markets with other engineering producers, and I know that they will ask for the greatest possible effort from their members.

The history of our trade union movement is such that we have no need to fear—I do not wish to use the word "patriotism" in its wrong sense—what other nations can do. I have no doubt that they will get a great effort from our workers, because we have not changed our view in opposition. We know that we still need increased production if we are going to maintain that standard of living for which this great movement of workers has pledged itself for over 50 years.

9.37 p.m.

The Minister of Labour (Sir Walter Monckton)

I am sure no one in this Committee, and certainly no one on this side, would complain of the tone or emphasis which the right hon. Gentleman the Member for Ipswich (Mr. Stokes) used when he introduced this subject, and I am sure we are all grateful to the hon. Member for Newton (Mr. Lee) for the way in which he concluded his speech. He said he did not want to use the word "patriotism" in the wrong sense. He did not use it in the wrong sense, but he showed a sense of responsibility which we have come to expect not only from him and from many of his hon. and right hon. Friends but also from the trade union movement for which he spoke.

The right hon. Gentleman in opening this discussion reminded us that …one man in his time plays many parts, and he certainly played many parts in his speech. At one stage, he was almost the jovial monk and towards the end of his remarks on science and industry he became a farmer's boy. We shall remember his contribution because of his skill and experience as an industrialist, which is known to all of us, and it is a great help when a subject such as this is introduced to have someone who has such a firsthand knowledge of the problem with which he is dealing. If I may be allowed to say so, I do not quarrel with what he said when he stated that the fundamental question had associations with Christian principles. There is a lot to be said for that view of this matter.

Nobody who heard those two speeches or, indeed, the other speeches delivered in this debate can doubt how important is the matter which we have been discussing here today. Its importance lies in this, that all the matters which have been discussed bear directly or indirectly upon the central theme of all our economic thinking today, that is how to increase our exports in an increasingly competitive world market.

We have to get this into its right setting. Our difficulties are not to be found so much in limited supplies of materials, or to the same extent as they were not so long ago, though still to some extent, in delivery dates, nor indeed in general in producing goods of the right quality. The trouble—and to my mind it is a growing trouble—lies in producing them at the right price. That is where the importance of productivity comes in, a matter about which everybody has talked, some directly, some less directly, but it has been at the back of our minds throughout this discussion.

If we are to keep our costs down nothing can help more than being able to produce more from the same resources. When the hon. Member for Newton was speaking of the difficulty we should have in not being able to invest enough to compete with our biggest competitor, and when he was saying that it did not look as if we should have a growing manpower available for the necessities of our industrial life, I thought how important it is to get more than we have been getting out of the same resources because, if investment and manpower cannot be increased, we must try to get more out of what we have.

That is not merely a matter of research and technology, though I do not underestimate the importance of both, as I hope I shall convince the Committee before I sit down. Nor is it mainly a matter for the Government. The impetus in the drive for greater productivity must come largely from within industry itself. That, I think, has been in the minds of many hon. Members who have spoken from both sides of the Committee. Of course, there are things that the Government can do. My hon. Friend the Parliamentary Secretary to the Ministry of Works spoke of some of them—the restoration of initial allowances over a large field and a gradual reduction of taxation, some of which has already taken place, go towards enabling industry to find some of the wherewithal with which to modernise—though I do not under-estimate the difficulty which has been present in all our minds—and then the removal of controls on building.

It was said in the Report which has so often been quoted today that in 85 per cent. of cases licences for industrial buildings are now granted. Those are not final steps, but they are steps in the direction in which I suggest the Government should go. But that is not the prime factor. The prime factor is that upon which the right hon. Gentleman put his finger. It is the human factor, the human will.

It was said in the "Economist" on 11th July, almost in the words which the right hon. Gentleman used today, and far more aptly than I have been trying to say the same thing for the past two years—again following those who now sit opposite me—that unless the ordinary man or woman sees the virtue, or at least the necessity, of producing more, more will not be produced. That is the fundamental thing, that is the prime factor; and that will not happen unless human relations are good—again I agree with the right hon. Gentleman.

A good many hon. Members have spoken today about changes in working methods of one sort or another, of organising double-shift systems, and so forth. It is difficult to introduce any changes in working methods unless human relations are good and there is readiness to entertain such changes. There is no doubt about that. One of the chief obstacles to the rapid introduction of new and more efficient processes today lies in the fact that many employers refuse to consider the reorganisation of their undertakings because they are afraid of the resistance which reorganisation might arouse among those who work in them. Because of this they sometimes hesitate to disturb traditional practices which have grown up around old-fashioned ways of doing the job. I am not saying that the old-fashioned ways are wrong or should necessarily be abandoned, but I am saying that we should not hesitate to introduce changes when we are satisfied that they are wise and necessary for efficiency.

There I say again that if the relations between the employers and workpeople are on a sound basis, the difficulty, such as it is, in introducing those changes will be greatly reduced. If they are bad, each side will take refuge behind a screen of privileges and customs which really serve as defences in an undeclared war, and in those conditions to raise productivity becomes a very difficult task indeed.

If that is the right approach to this, and good human relations are of vital importance, there are some things which the Government can do to try to help in producing them. More than a year ago, in March, 1952, I called a conference, as Minister of Labour, on this very problem, and discussions took place which led to a great deal of sensible thinking about it, which is very important if one wants to improve a situation.

Then there is the programme of research now being launched under the auspices of the two committees to which my hon. Friend referred, set up by the Department of Scientific and Industrial Research and the Medical Research Council. There we shall get what I like to see, leading industrialists sitting down with the professors who have studied these things, with the members of the trade unions and with Ministry of Labour assessors, to think out what can be done to improve the position. The subjects they will take include the very things that hon. Members have been discussing here. One of them I noticed was "Factors affecting the effectiveness of incentive bonus schemes" and "Promotion and training in industry," to which the hon. Member for Newton referred. Those are just two examples of the sort of thing about which we want to gather our thoughts, not in an atmosphere of controversy, but to get the right results, and I welcome that form of research being undertaken.

Next, there is the British Productivity Council, which, going forward with Government support, is starting to set up local committees all over the country. We all wish it well, because its work could not be more important. Then, by no means least important, there is the opportunity—I have one again next Wednesday—to discuss these problems of human relations and greater productivity with the National Joint Advisory Council, to which, I know, the hon. Member for Newton attaches as much importance as I do.

What we are trying in all these ways to do—and we are all trying—is to encourage organisations of employers and work-people to inform their members and to bring home to them an understanding of what is at stake for their industry, for the factory in which they work, and for themselves. National exhortations are made, but they need to be followed up at the level of the individual industry and. indeed, of the individual firm. We need to explain the point to them in the language they understand, the language of their own industry and of their own people. This, in my judgment, is the critical thing.

It is fairly easy to convince a worker or an employer that higher productivity is desirable for the economy as a whole. What is not so easy is to satisfy him why he himself may have to change his job or reorganise his business. He is entitled to an explanation of that, and it is our duty to provide it; and these means which I have been discussing are means by which we hope to do it.

While on this subject I want to say a word about joint consultation. Both the hon. Member and the right hon. Gentleman, together with a number of other Members of the Committee, referred to it. I am sorry to disagree with my hon. Friend the Member for Edinburgh, South (Sir W. Darling), but while I realise that it is not easy to get good joint consultation, I think, after two years of trying to do it, that it is worth while. To get frank discussions between employers and workpeople is necessary, quite apart from the information about the circumstances of an industry which ought to be given to them. It is already the case that this joint consultation takes place at a national level—that is what I have been describing—but I am not at all satisfied that comparable opportunities are offered and accepted for discussion within each industry, although I am sure it ought to be done. I agree with the right hon. Gentleman that it is important it should be done at the right levels.

Where I want the people persuaded is on the shop floor, and it is important that there should be proper representation on both sides. Without proper representation there will not be genuine consultation, but merely the passage of information, which is not enough. What must be done is to get the facts of the situation explained from the management side—the facts which affect the industry and its prospects, the difficulties about competition at home and abroad, the prospects of doing well, and so on—and then together face what is, after all, a common problem. Each side has its contributions to make. If the information about such things as I have spoken of—materials, prices, supplies, market difficulties and the types and severity of competition—are stated frankly, there is something for the workers to examine and something upon which they can express a useful view from their experience of the industry.

This joint consultation will not of itself—we must not deceive ourselves—give us magic answers to all the difficult questions. They are not easy, and there are no quick results from having a paper constitution with a secretary and sitting round a table. Much more important is the attitude of mind in which both sides approach the question. It is mutual confidence that we want to instil. There are some employers who think that joint consultation is just a road on the way to joint management, and there are some workpeople who think that joint consultation is simply a chance for the management to pull wool over their eyes; but essentially both of them want the success of the industry in which they are, because unless that is prosperous, neither the one nor the other will be prosperous.

I spoke a few moments ago about research into incentive payment schemes, illustrating that from what the Parliamentary Secretary to the Ministry of Works said. That brings me to that part of the discussion which has been dealing with the wages structure. I listened with the greatest interest to all that was said on that complicated and difficult subject from various quarters of the Committee. But in my mind there was the feeling, speaking from where I stand, that wages structure, wages differentials, payment for night work—I know about time and a fifth—and industrial agreements bearing on the training of workers, are matters which have to be decided between the representatives of the employers and the workers. This is really fundamental to the industrial system in which negotiation has its part to play.

Government interference in wages and the related questions to which I have referred would do far more harm than good. But of course there are things which the Government can do and ought to do. Government can provide all relevant information about our national economic position and then it is up to the leaders of both sides to take that into account in fixing the level and shape of the wages structure.

Mr. Stokes

When I referred to the matter at the opening of the debate, I was not suggesting that the Government should take the lead, but I was asking if it was not time that the employers took the lead. Surely the right hon. and learned Gentleman has no objection to that?

Sir W. Monckton

I would not mind whether it is the employers or the trade unions who do it, so long as I am not called upon to do it myself. There are some things I should like to say about wages structure. It is not just an academic question and I do not say that I am not interested, because I am interested, but this is not an easy question to solve. If we take the case of coal mining, there is a case where no doubt an industry has fully recognised the need to overhaul its wages structure. The National Coal Board and the National Union of Mineworkers have gone a very long way in joint examination and formulation of proposals, but I do not think we have reached the stage yet where it will be easy to solve the problem.

Take the industry which the right hon. Member for Ipswich knows so well. I think one could fairly say that the system of wages structure there is hideously complicated. I think it is a hardy perennial there to say, "We recognise it is time to put this right and simplify it, but it is not going to be easy." Hon. Members have put their fingers on the real point of the problem. First, the lower paid feel that they need the increase most. That, naturally, is recognised by everyone. On the other hand, it is said—craftsmen say it and the hon. Member for Leeds, West (Mr. Pannell) said it very effectively—that there must be an incentive to skill. All I say again is that we have recognised the point and encourage people to discuss it and negotiate on it. I am sure that, with the assent of the right hon. Member, the Government themselves ought not to try to impose a solution.

The right hon. Member said another thing about overtime payment for night work. I have mentioned it casually in passing, but I want to say a word about it because many hon. Members have discussed the matter in one form or another. That is the question of double-shift working and what the right hon. Member called proper remuneration for the night shift. As one hon. Member said, it is very easy to over-simplify the problem. We cannot say that double-shift working is appropriate for all industries, or all firms in a particular industry. The difficulties to which our attention has been drawn today apply in some more than in others and the need to apply double-shift working applies more in some than in others.

In an industry where the cost of putting in machinery and plant is very much greater in relation to the cost of labour, to get efficient working double-shift working is needed more than in another industry. I am satisfied about this and it is something I have tried to encourage in industries as far as I could by bringing it to the notice of the industry concerned. Here again, having given them an opportunity of looking at it, I hope and expect that they will give a lead, or rather follow the lead I have suggested, by negotiating on it in the industries concerned and telling me what the answer is.

There is a little more I wish to say before I finish but I hope that I have said enough to satisfy the Committee that on this question of wages structure and the related questions to it one must leave it to the good sense of industry to come to the right conclusions by negotiation, while giving them all the help and information we can to assist them along that course.

I should like to say a few words about the training of technical personnel. Something was said about this by the hon. Member for Newton. He knows, as I do, that a good deal of technical training is now done by individual firms, but not all industries have found it necessary to make industrial agreements which lay down the standards for that sort of training. There are any number of examples of industries which do that voluntarily. The subject of training workpeople for the higher ranges of employment, perhaps particularly in the nationalised industries, is one which the hon. Member himself realises is one in very large measure—as his appeal was in effect directed to them—for the trade unions themselves.

If anything can be done to encourage the training of technical personnel, especially by giving opportunities to the workers in the industry, it would be very welcome to the Ministry in which I serve. The Committee will know of the interest we take there in improving the training arrangements for technical personnel in all grades of industry. I hope that the approaches that I have made from time to time to a number of industries, with the assistance of the National Joint Advisory Council, to make training arrangements for apprenticeship more elastic will bear fruit, because Members have rightly drawn attention to the shortage of skilled men; that is where the shortage is in manpower. We want, out of the resources we have, by elasticity, by dilution, however it may be, to try to increase the supply of skilled men in relation to the unskilled men.

I wish particularly to refer briefly to fuel saving in industry, to which several Members have referred. If the right hon. Member for Ipswich will forgive me for saying this, I do not want to throw away the possibility on the domestic side; I do not want to treat the domestic side as chicken feed. About 30 per cent. of our fuel consumption is in that field. So far as industry—which is vastly more important—is concerned, we are encouraging the use of insulating materials to which reference has been made as a barrier to the loss of heat in factory buildings. Since the end of last month there has been an extended loan scheme which enables industrialists who wish to install approved fuel-saving equipment and to insulate factories to take advantage by that scheme of a loan which will run for two years without interest, which I think the right hon. Gentleman will consider is a step in the right direction.

I wish to say a word about cotton. We do not regard the cotton industry as something which is dead. When the right hon. Gentleman said it has "had it" he used a phrase which may mean many things but it does not mean that we have taken the cotton industry—or that any of us want to—out of the basic industries. It is still an integral part of our economic life.

Time does not permit me to say as much as I should like on some of these subjects, but one in particular I should like to say a few words about. We do not under-estimate the importance of applied science. We see the importance of a proper status being given to the man who deals in applied science. Also I shall be glad to see, although we cannot impose it, directors with scientific qualifications on many boards. All I would say is that by means of improved human relations and applied science we hope to see British industry flourish as the right hon. Gentleman and I both think it will.

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

Committee report Progress; to sit again Tomorrow.