SHIPBUILDING INDUSTRY

HC Deb 09 March 1954 vol 524 cc1999-2178

6.58 p.m.

Mr. Godfrey Nicholson (Farnham)

I beg to move, to leave out from "That," to the end of the Question, and to add instead thereof: this House, convinced of the unquestioned importance of the shipbuilding industry in peace and of its vital role in war, urges Her Majesty's Government to promote the greatest measure of stability in all matters affecting the industry, and recognises that its well-being depends upon a flourishing Merchant Navy enjoying the freest possible conditions of international trade. I am afraid I shall not be able to make half such an amusing speech as has the hon. and gallant Member for Hull, East (Commander Pursey). Indeed, I am going to make a rather serious speech about a serious subject.

Commander Pursey

Was not mine serious about serious subjects?

Mr. Nicholson

I ask the House to turn from the affairs of the Royal Navy itself to those of the fourth line of defence, by which I mean the shipbuilding and shipping industries. Each is a great subject. Mr. Gladstone used to say, "A great subject should be treated copiously." I am not Mr. Gladstone, and I can assure the House that I shall speak as briefly as the subject permits. The pictures which I shall paint will be done with broad strokes, and much that is essential will have to be left out, but in advance I ask the forgiveness of the House if I speak at greater length than I usually do. Nobody detests long speeches more than I do. I shall begin by talking of shipbuilding and go on to some of the problems affecting the industry's customer, namely, the shipping industry.

Before I do so I want to say, more or less in parenthesis, that I shall not deal with the wage structure or with alleged restrictive practices. A court of inquiry has just been considering those questions so that they are, as it were, still sub judice. I recommend hon. Members to read the Report of that court, which is contained in Cmd. 9085. I am glad that I am not dealing with those subjects because I do not want this debate to be contentious or partisan. I shall not weary the House by discussing at any length the great importance of merchant shipbuilding in its relation to our economic structure or its vital role in time of war. The Amendment calls it "unquestioned," and that needs very little substantiation.

But I must say that its economic significance is immense. At the end of 1953, the estimated value of orders on hand and of vessels under construction was £580 million, of which £170 million was for export to foreign countries. So far as employment is concerned, on shipbuilding and repair work, more than 125,000 men are employed, of whom 106,000 are engaged on Merchant Navy work and 19,000 on naval work. And, of course, a very large number of men which it is impossible to determine are engaged on the manufacture of components, because it must be remembered that shipbuilding is an assembly industry. To say anything about its r61e in war is to indulge in platitudes, but I must say one thing.

During the war, 6.6 million tons of dry cargo ships were sunk and four million tons were replaced. Half our tankers were sunk and all but 300,000 tons were replaced. British yards were responsible for nearly all these replacements, and that on top of an immense volume of new construction for the Navy which, of course, was given first priority during the war.

This Amendment, however, was not put down for the purpose of stressing the obvious. It was put down because during the past six or eight months the industry has undergone a complete change of climate. A year ago the barometer was set fair. Today the future is full of doubts and uncertainties. This sudden change of climate has given rise both to exaggerated pessimism and to complacent optimism. Both inside and outside this House alarmist speeches have been made. So far as complacency is concerned, I am afraid that I cannot acquit Government speakers of it; I need only refer to the speech made by the Paymaster-General in the other place on 9th December.

I do not think that either method of approach is very helpful. What we need is a calm, untendentious, factual assessment of the situation. This debate will have justified itself if it helps the House and the country to take a balanced view. The more critical the situation, the more need there is for a right perspective. I must inflict a few figures on the House in order to try to attain this perspective.

Our share of the world output total is falling. In 1948 it was 48 per cent., while in 1953 it was 25 per cent. Over the last few years output has, on the average, remained pretty steady at about 1¼ million tons a year. Since the war, immense sums have been spent on modernisation and on the re-equipment of yards and today, if all shortages were overcome—and, of course, in talking of shortages in the shipbuilding industry one primarily means steel—an output of 1½ million to l¾ million tons a year could be achieved. Berths, labour, skill and equipment are all available.

I now turn to the order book. At the end of 1953 the merchant order book stood at 5½ million tons. I have already said that output is 1¼ million tons a year at the present time. On the face of it, therefore, it looks as if the industry is on a pretty good wicket for the next four years, but I ask the House to beware of generalisations. The outlook is not nearly so bright as it appears.

Eighty per cent, of the total output is due to 22 firms, about one-third of the principal shipyards of the country. These firms may expect to maintain their present level of activity up to the end of 1956 or well into 1957. But the smaller firms are far less heavily booked. Some of them have sufficient work to carry them to the end of 1955, but, in some cases, not beyond the end of this year.

Secondly, 57 per cent, of the output is represented by tankers, and tankers are not wholly reliable as an early source of further orders. The important thing for us in this country is to maintain our dry cargo fleet. Thirdly—and this is most grave—the order book, far from expanding, is contracting. In 1953—and I ask hon. Members to bear the annual figure of 1¼ million tons in mind—only 520,000 tons were ordered and 250,000 were cancelled. Twenty-eight firms booked no orders at all. We are well into the third month of this year, and, so far, there have been virtually no new orders. There have been some cancellations, and a good many more are believed to be pending. Those are the plain facts about the output and the prospects.

Mr. Edward Evans (Lowestoft)

Does the hon. Gentleman include fishing vessels in his figures?

Mr. Nicholson

I am including everything.

Mr. Edward Evans

Is the hon. Gentleman aware that a contract to the value of £6 million for trawlers—some of considerable size—was negotiated with the Russians?

Mr. Nicholson

It is not yet a firm order. I should be obliged if hon. Members would not interrupt me because I do not wish to detain the House longer than necessary. I have a herculean task in trying to paint a picture of these tremendous industries in half an hour.

I was about to ask what comments could fairly be made. The first is that the industry has always suffered from fluctuations. It suffers from such unpredictable fluctuating factors as the late war and the Korean crisis. The industry depends in the main on building for the British Merchant Navy, and if—and it is a big "if "—shipowners can afford to pay for new ship orders must sooner or later be coming in again.

We must remember, however, that the yards cannot be idle for a long period and then suddenly burst into full activity. It is important that both the industry and the Government should read the signs of the times and should realise that 14 years of a sellers' market is a thing of the past. We must resolve that the industry shall be fit and able to take full advantage of any upward trend in orders when it comes, in a highly competitive world.

I must say a word about foreign competition. There has always been foreign competition and there always will be. The cessation of orders is not peculiar to this country alone. Foreign order books are shrinking too. It is easy to exaggerate the menace of foreign competition, particularly when foreign Governments grant subsidies and other forms of artificial assistance. A considerable number of countries today are granting subsidies and other forms of artificial assistance. I need only cite France, Germany and Italy as the chief offenders, more or less in that order.

There is no question that, provided our shipbuilding industry is healthy and our national economy is sound, foreign competition can be met successfully. None the less, it would be folly to deny that at the moment foreign competition is greatly intensified. The picture which I am trying to draw is one of a great industry in a state of doubt and uncertainty. There is no need for panic, but neither is there room for complacency. I hope there will be none of either tonight.

As to what the industry asks of the Government, the Amendment … urges Her Majesty's Government to promote the greatest measure of stability in all matters affecting the industry … The key word is "stability." How is it to be achieved? The industry does not ask for special treatment, such as subsidies or artificial aid. Of course, it welcomes Admiralty orders, and hopes that they will be spread wisely, but it does not come to the Admiralty cap in hand. It not only seeks no help from subsidies and artificial aids but believes that they would be disastrous in the long run.

What it wants is some certainty that delivery dates will not be held up for lack of supplies, especially steel. The steel position has vastly improved over the last year or two, but shortage is still a restricting factor. I hope that the Civil Lord will not tell us that all is well with steel supplies, for he will not be justified in saying that. The industry asks for a reasonable stability in all factors affecting costs and, consequently, prices. In other words, the greatest service which the Government can render the industry is to govern wisely and well.

Unless the £ retains its purchasing power, rises both in wages and cost of materials will price the industry out of existence, and unless there is peace in industry as a whole this industry will come to a stop. Those are statements which affect all industry and are not peculiar to shipbuilding. The moral I wish to draw is that the red light which is now shown by shipbuilding will be shown by every other industry if the Government fail in their duty. All that is peculiar to shipbuilding is that it will be one of the earliest casualties, and one of the most damaged.

Mr. Jack Jones (Rotherham)

Does the hon. Member not agree that the Government's recent decision to increase the profit on steel by selling it back to private enterprise and giving a guarantee of 7½ per cent, will increase rather than decrease the problems of the shipbuilding industry?

Mr. Nicholson

In the long run increased production will bring the industry easier and better supplies of steel. This debate will range widely enough, but a discussion of the nationalisation or denationalisation of steel would be ruled out of order. The industry believes that it will be helped by the action of the Government. I do not speak for the industry, but I have asked its views on this question, and it is in favour of the action which the Government have taken. That is all I can say in answer to the hon. Member for Rotherham (Mr. Jack Jones).

The second part of the Amendment asks the House to recognise that the well-being of the shipbuilding industry … depends upon a flourishing Merchant Navy … I make no apology for those words. We cannot discuss the future of a factory without discussing the purchasing power of its customers, and it is impossible to consider the future of this industry without considering the position of shipping, in its turn. I want to give the House a broad and, I hope, sound, but to some extent superficial picture of the prospect facing British shipping in respect of its ability to order and pay for new ships and so keep our shipyards busy and prosperous.

The picture which I shall paint is extremely sombre. The plain truth is that British shipping is suffering from a wasting disease which, unless checked, as bound to prove fatal. The name of that disease is "the incidence of taxation." Unless radical changes are quickly made, within 15 or 20 years the British Merchant Navy, as a source of wealth in peace and our most vital lifeline in time of war, will virtually have passed out of existence. One incidental consequence will be that there will be no shipbuilding, and another will be a serious gap in our balance of payments.

It is not a pretty picture or prospect, but if it contains any substantial element of truth it is high time that the facts were displayed brutally and baldly to the public gaze. I hope that this debate will be the beginning of such a display of the plain, unpalatable facts, and I should like to think that by what I have said I have given the House a shock, for I certainly intended to do so.

I must now justify what I have said. Our sea-going merchant fleet, which includes only those ships which are seagoing and of over 500 tons, totals nearly 17 million gross tons. That is roughly the same figure as in 1939. It is one-fifth of the world's total. Fifty years ago the British Mercantile Marine comprised one half of the world's total. But it is no use bewailing the passing of a golden age that will never return.

Merchant fleets today are partly dry cargo and partly tanker. Their problems are rather different, and to be comprehensive I should deal with both, but for the sake of brevity I shall deal only with the dry cargo problems. The House must not forget, however, that the story of tankers is analogous. We have a dry cargo fleet of 10.9 million tons. The average useful life of a dry cargo ship is between 20 and 25 years. I should say that it was nearer 20 than 25. It is accepted that 20 years is the maximum useful economic life of war-built ships. I ask the House to cast its mind forward to the year 1965, which will be the critical time for our Mercantile Marine. By then, only 3¾ million tons of our present dry cargo fleet will still be in service, and even that figure is dependent on no ships under 20 years' old being sold abroad.

If we take a more optimistic view— which is thought to be an unrealistic one —and assume that half the war-built ships will still be in service then, the figure in 1965 will be 5½ million tons. But if we make the reasonable and generally accepted assumptions as to the life of our present fleet, the increase of world trade and the demand for carrying power —and it is generally held that material increases and various other factors will cause a considerable increase in the demand for world carrying power in the next 15 years—it is clear that our dry cargo fleet must be replaced at the rate of at least 900,000 tons a year.

I do not ask the House to accept these figures as being cast-iron accurate, but I ask it to accept that over the next decade or so we must build dry cargo ships to the extent of one million tons a year if we are to retain our present share of the world's carrying trade. If this were a purely shipping debate I should go on talking about tankers, freight rates, the transfer of tonnage to foreign flags—such as Liberia and Panama—flag discrimination, and so on. But I am primarily concerned with shipbuilding, and I hope I have made the point that the present rate of building, on the average over the years, must be at least maintained if our Merchant Navy is to continue to play its proper part in our economy in peace, let alone its vital rôle in war, and if its present valuable contribution to our present balance of payments is to continue.

It all hangs on the question whether the shipbuilders can afford the money, or have the money, to replace their fleets to the extent required. I state categorically that there is not the remotest hope that they will be able to do so unless the present incidence of taxation is changed. I ask the House to look at the facts. Obviously, we can assume that the shipowners can pay for the ships already ordered, or they would not have ordered them. It is reasonable to suppose that collectively they have considerable reserves—how big is known only to themselves and to the Chancellor of the Exchequer. But unless these reserves can in their turn be replaced when they are exhausted, their existence amounts only to a postponement of the day of reckoning. I do not think that they can be so replaced.

The problem has two aspects. The first springs from the fall in the value of money and the second is inherent in the present system of taxation. As to the first, I think hon. Members know how ships are depreciated for Income Tax purposes. They are depreciated at the original cost price. In other words, after an initial allowance of 20 per cent, has been written off, over every year 5 per cent, of the original cost price is written off and at the end of 16 years the shipowner should have enough in reserve to build a new ship to replace the old ship, provided that he can buy a replacement at the same price. But today it costs three times as much, and in many cases four times as much, to build a ship as it cost before the war.

The difference has to be made up out of profits of which over 50 per cent, is paid in taxation. Even if costs do not rise any higher, the replacement of our present merchant fleet is bound to throw a titanic burden upon the industry. For, however large the reserves are, I find it difficult, indeed impossible, to believe that they amount to three times the cost price of our present Mercantile Marine—-and that is the minimum figure which will be needed merely to replace, without any question of expansion. It is not unreasonable to suppose that the present accumulated reserves cannot shoulder that gigantic burden.

The second, and in the long run more serious, aspect is that present taxation makes it practically impossible for the industry to keep its capital equipment— namely, its ships—up to what is demanded in the way of numbers and quality in a highly competitive world. I will give the House an example of a typical shipping company owning tramps. These figures have been published.

In 1913 it operated 14 ships. The gross profit was £166,000. Taxation took £8,000–5 per cent.—and enough was left to build three new ships, which were in fact built. This gives some indication of the extraordinary way in which the value of money has changed. In 1952, which was the best shipping year which has ever been known, the company operated 19 ships. The gross profit was no less than £l¾ million, of which taxation took £900,000–51 per cent. Anybody would think that the balance was enough to keep the fleet going very satisfactorily. As a matter of fact, enough was left only to build 1½ new ships.

The truth is that the life blood of the industry—and by "life blood" I mean hard, unromantic cash—is being drained away to such an extent that unless the Chancellor changes his tune—

Mr. Speaker

I have allowed the hon. Member to make a reference to taxation but what he is now asking would involve legislation, and that is out of order on Supply. We cannot discuss taxation and legislation on Supply.

Mr. Nicholson

I was relying on the words of the Amendment, which asks the House to recognise that the well-being of the shipbuilding industry "depends upon a flourishing Merchant Navy." It is common sense to say that there cannot be a shipbuilding industry unless the Mercantile Marine and shipowners can pay for new ships, and I am, first, pointing out the difficulties facing the shipping industry and, second, asking the Civil Lord, who has responsibility for the shipbuilding industry, to place certain crude economic facts before the Chancellor of the Exchequer. I have almost arrived at the end, and if I may be allowed two or three minutes' grace to complete my argument I should be most grateful. Unless there are changes in certain directions, then in a comparatively few years the Merchant Navy will dwindle away.

The next words on my notes are, "It would be out of place in this debate to say more than a few words on possible remedies."

Mr. Speaker

I think that the hon. Member ought to stick to his notes in that connection.

Mr. Nicholson

I shall.

I have three sentences to say in dealing with this subject. The first is that concessions relating to initial allowances and percentages of depreciation are not to be despised, but they do not touch the root of the problem. [HON. MEMBERS: "Order."] There seem to be many Speakers in the House. My second sentence is that the only possible solution lies in the direction of the relief of taxation—

Mr. Speaker

I did not know that was in the hon. Member's notes. What he read out was that it would be out of order to pursue this subject, and I think it is out of order. I must ask the House to remember that on Supply we cannot discuss taxation or legislation, and that is what the hon. Member is doing. He was allowed to make his point and he has made it, but he must now conform to the rules of order.

Mr. Nicholson

I will, indeed. I quite see the difficulty with which the House is faced in these matters.

Mr. Hector Hughes (Aberdeen, North)

I want to try and help the hon. Gentleman to be relevant, if I can. The last words of his Amendment deal with the Merchant Navy enjoying the freest possible conditions of international trade. He has not said one word about that or about East-West trade, and I offer that to him as a suggestion. Would he end his speech with it?

Mr. Nicholson

I am grateful to the hon. and learned Gentleman for offering that suggestion. I intended to say nothing about that because I feared that Mr. Speaker's gaze would fall upon me before I reached that point. Indeed, it seems to have fallen upon me. I will complete my sentence by saying that there are certain matters affecting the economic strength of the shipping industry which, unless attended to, will be fatal to the shipbuilding industry. I believe that it is essential that reserves set on one side for shipbuilding should receive special treatment, whether by legislation or otherwise, by relief from taxation, either in whole or in part. I will leave it there.

The shipping industry is in a very precarious position. Neither the Government nor the public seem to realise it or to face the facts. I have given figures to show that unless the shipping industry can afford to order new tonnage on a very considerable scale over the next 10 or 11 years, then by 1965 our dry cargo fleet will almost have vanished. My task tonight is to hoist a gale warning to the shipping industry. It is such a gale as has never blown before.

Commander Pursey

Is it blowing up or down?

Mr. Nicholson

It is a gale warning, whichever it is.

Commander Pursey

It ought to be up.

Mr. Nicholson

The hon. and gallant Member has had his gale, and we can leave the matter there. I am here to hoist a gale warning to the shipping industry, and I hope the House will insist that the captain of the ship, the Chancellor of the Exchequer, will act wisely and rightly and, above all, that he will act in time

7.30 p.m.

Mr. Paul Williams (Sunderland, South)

I beg to second the Amendment.

This is a subject of vital importance for all of us who are the slightest bit concerned about the survival of British merchant shipping. I agree with my hon. Friend the Member for Farnham (Mr. Nicholson) in much that he has said, and I hope to be able to tread delicately on the path on which he trod rather heavily towards the end of his speech.

I think that everyone will agree that over the last 12 months one of the major difficulties on the shipbuilding side has been the question of steel supplies and steel plates. There is no reason at all for any one to be complacent on this issue. I have no doubt that there has been a considerable improvement in the position in the last six to eight months, largely as a result of the setting up of an inter-Departmental committee on this matter, but, in spite of the improvement, there are still shortages and there still exists a wrong sequence of delivery and of sizes of plate.

It is this question of sequence of deliveries which has led to less efficient production in the yards than might otherwise be the case. I do not want to overstate this point by suggesting that there is inefficiency, but there is less efficiency than might otherwise be the case, and so long as such a position obtains the British shipbuilding industry is under a disadvantage which should not be placed upon its back.

I understand quite well that the call for plates has increased enormously of late, but it is not sufficient merely to say that this position does exist, and do nothing about it. There is still the need for some attention by the steel mills themselves to the demands of the shipbuilding yards and repairing yards. [An HON. MEMBER: "And the Government."]

It is not only a question for the Government. It is a question of companies meeting the demands of the shipbuilders themselves. It is up to the two sides— the shipbuilders on the one hand, and the steel producing industry, on the other— to try to work out a method of making greater progress on this issue.

The question of the delivery dates being offered by the shipbuilders is one which, to a certain extent, has frightened away further orders. We know a great deal of the history of this issue. The length of delivery dates is largely because of the size of the orders and not because of inefficient production in the yards themselves. I am not trying to belittle our shipbuilding industry, or to say that we are losing orders to foreign countries because of internal inefficiency. That is just not the case.

The truth is that the order books have built up to such an extent since the outbreak of the Korean war that long delivery dates are inevitable. We are now going through a period of readjustment, and the length of delivery dates will be declining.

We can easily compare the position with Germany. Germany has had special advantages as a result of the war and the developments arising out of post-war planning. The destruction of her yards and their complete rebuilding with new machinery, new equipment and new layout altogether has resulted in increased efficiency coming to the German yards as a by-product of the war. If we had been able to effect large-scale replanning and rebuilding of our yards in this country we would have been considerably more efficient and more competitive than the Germans ever could be.

Dr. H. Morgan (Warrington)

Why was it not done?

Mr. Williams

For the simple reason that we defended ourselves adequately during the war and did not have our naval yards razed to the ground. It is purely the fact that the German yards were razed to the ground, and as the result of their re-equipment after the war, their yards have a more efficient layout and a more efficient supply system from behind. It is as simple as that. There is undoubtedly a need for shorter dates for delivery coming out of our yards, but this is a question to be remedied in the coming months as the present order books can be fulfilled.

When we turn to the question of prices, there, again, it is alleged that other foreign countries can compete and can quote prices considerably lower than can the British market. I would say that our shipbuilders in this country can quote competitively where the conditions are fair and equal as between different yards and different countries.

Where, however there is subsidy and special assistance and tax concessions—I hope that I am not out of order in mentioning that—by foreign Governments, the foreign builders inevitably have heavy advantages. I think it is right that we should investigate the advantages given to foreign shipbuilders in an attempt to have these differences ironed out, so that we can compete on fair and level ground. We feel that when level ground does exist, British shipbuilding will take the orders every time because of quality, efficiency and speed of production when conditions are equal, and because of its high standard of technique and ability.

In relation to future prices, we are going through and perhaps we are coming towards the end of the difficulty which arises through wage increases. I do not intend to trespass on the highly dangerous ground of discussing wages, because I do not think it will add one useful word to this debate, especially when this question is due to be settled, as we all hope, by the two parties most actively concerned in it. I ask hon. Members to try to steer the debate through finance, because it is an issue which cannot do much to add to the debate.

Again, when we talk about our ability to compete in prices, we can compete against foreign builders provided that the conditions are equal and provided that there are not hidden subsidies, hidden assistance and hidden help given to builders in foreign countries. On the shipbuilding side, although there has been a decline of orders and although there has been difficulty over supplies and cancellations, we are still in a position to compete and to get orders when conditions are equal.

When we turn to the question of the order book, we remember quite well the sort of position the order book had got into just before the outbreak of the Korean war. It may be that we shall return to the same sort of position now that obtained in those months immediately before that outbreak. Since the Korean war, and the position which obtained immediately after, there has been a simmering down and certain readjustments and a certain fear in the minds of people working in the industry that there is danger ahead. Now, I believe, is not the time for undue optimism or undue pessimism. I would quote a few words which the Paymaster General spoke in another place on 9th December when he referred to the re-equipment of our merchant fleet.

He said that the question of replacement was not immediate and that we must accept that replacement would not in any case fall due for the next five years, so that it was not an absolutely immediate problem. He was referring to the technical problem of older vessels. In the shipbuilding sense, I would submit to the House that something that affects the next five years is an immediate problem. It is not something that can be resolved in five years' time. This question of the replacement of our older vessels is an immediate problem, in spite of what has been said by the Paymaster-General. I myself feel that there is a complacency on the part of the Government on this issue of the replacement of the merchant fleet. I certainly hope that a greater sense of urgency will be shown by the Government in their reply to this debate. Unless this problem is faced, it will be too late to face it in five years' time.

Again, talking about the order book, we are worried about German competition. Let us look at the launchings from British yards in recent years. As my hon. Friend has said, in 1948 our percentage of the world output was 50 per cent.; in 1949, 40 per cent.; in 1950. 37 per cent.; 1951, 36 per cent.; 1952, 29 per cent., and in 1953, 25 per cent.— a progressively diminishing total through the years. Admittedly, part of this can be accounted for by increased German production, but it is an unfortunate trend over these immediate post-war years that, from the position of supplying 50 per cent, of the world's output, we are now supplying only 25 per cent. In spite of the increase of German production, these figures show quite clearly that our position relative to the world in general has declined. The conclusion to which I am drawn is that there is need for a greater sense of urgency in applying solutions to this problem.

When we refer to the percentage of the world's fleet that is registered under the British flag, we come down from a figure of something like 50 per cent, early in the century to a post-war 21 per cent., declining in 1953 to 19 per cent.—again, a decline in the influence and numbers of the British merchant fleet. Although the position is by no means good, it is not beyond rescue. I suggest trying to bring a sense of urgency to this issue in that a solution is needed quickly; and if we are to apply a solution quickly, it must be at the ship operating end of the line. That is why it is worth placing on record a few of the figures of the earning capacity of the shipping industry.

From 1948, our foreign earnings have gone up from £255 million to £436 million in 1952. Our dollar earnings from shipping have risen from £46 million in 1948 to £77 million in 1952. Shipping is an industry which employs 210,000 people. Although this may not be a particularly large figure when compared with certain other industries, the industry has a vital significance, and if allowed to run down it cannot be gathered together again in the twinkling of an eye. It is an industry which, while employing 210,000 people, was estimated in 1951 to have a gross output of £234 million. These figures demonstrate to a certain extent the importance in the economy of the nation, and in that much hackneyed part of our economy the dollar trade, the vital significance of the industry as a dollar earner.

But it is not with the shipbuilding industry alone that we are concerned; it is with the ancillary trades—the supplying industries, the catering and furniture industries, the manufacture of heating coils and similar things for tankers, and so on. All these industries behind shipbuilding should gather our attention on a day like this. If there is to be a decline still further in British shipping, we must admit, at the same time, that there is to be a further decline in our position as a world power and as a world trading power. We can have our position as a first-class nation only if we are a first-class trading nation, also. Therefore, we come to consider what remedies we must have.

I do not want to trespass too far on to the subject of taxation, and I do not wish to be out of order, although that is the one subject which is at the root of this issue. It is all right posing the problem, but there can be no conclusion to this debate unless—

Mr. Deputy-Speaker (Sir Rhys Hopkin Morris)

The hon. Member says that he does not want to trespass. I hope he will observe his own ruling.

Mr. Williams

All I would say then, Mr. Deputy-Speaker, is that there is a case for financial aid being given to this industry. There is no question of any preferential treatment, but there is a case for a new approach to the whole level of assessment for taxation throughout British industry.

Mr. Deputy-Speaker

The hon. Member must not pursue that line.

Mr. Williams

If one cannot pursue that issue, which is of the most important aspects affecting the Amendment, I merely conclude this part of my speech by referring to the burden which the industry is bearing in helping other forms of expenditure in the nation. It is too high and too heavy a burden.

There is reference in the Amendment to a flourishing Merchant Navy enjoying the freest possible conditions of international trade. I do not want to go too much into detail in what, I know, is a contentious subject. I should merely like to quote from the Annual Report of the Chamber of Shipping for 1953–54. In a reference to the Suez Canal, the report says: From the course of their daily business they "— that is, the British shipping interests— can see, more clearly than most perhaps, how much world trade will lose in freedom unless agreement with Egypt provides not only paper safeguards but real ones for the effective continuance of the Canal as an international waterway at the service of international trade.

Mr. Deputy-Speaker

The hon. Member is opening up too wide a subject.

Mr. Williams

I was merely trying to follow the wording at the end of the Amendment, which refers to: enjoying the freest possible conditions of international trade. One of the greatest waterways used by British shipping is the Suez Canal. If it were to be closed, or if facilities in the area were withdrawn it would be a tragedy for British shipping.

Mr. Cyril Bence (Dunbartonshire, East)

All shipping.

Mr. Williams

Yes, indeed, but more particularly for the British, because we are particularly concerned with trade with the Far East and with the Persian Gulf. Those words which I have quoted are sage and sensible words on this issue. They are a request for real safeguards for British shipping in order that it may have not merely a paper agreement, but real safeguards, which will look after the best interests of British shipping in this vital waterway in the Middle East.

In view of your Ruling, Mr. Deputy-Speaker, I do not intend to elaborate on that subject. I merely repeat that unless British shipping can have some definite guarantee about the freedom of the Canal, I should be very doubtful about the worth of any other agreements relating to that area. One of the first needs in the area is that the Canal should remain open for international shipping.

I conclude by urging the House, and, more particularly, the Admiralty, to consider this matter of the British shipbuilding and shipowning industry as a matter which needs urgent attention. There can be no delay. If there is delay, there may well be trouble ahead. If the Government are willing to take action on the sort of lines that my hon. Friend and I have tried to argue, there is a chance that we will prevent a further decline in British shipping. Unless action is taken quickly and unless the mood of complacency is thrown off, there is danger ahead. I hope and pray that the Government will take action while the time is ripe.

7.50 p.m.

Mr. E. Shinwell (Easington)

If I intervene briefly in this debate—and I apologise to my hon. Friends and to hon. Members in other parts of the House— it is because I have been a long time here and have always been attracted by debates which refer to shipping and its kindred industry, shipbuilding. I congratulate the hon. Member for Farnham (Mr. Nicholson) on having brought this important subject forward. He was somewhat embarrassed because he transgressed the rules of the House, but that is not unusual, not for the hon. Gentleman but for many other colleagues of ours in this assembly.

Nobody will deny the importance in the national economy of shipbuilding and shipping. But let us not indulge in too much pessimism about the position of those industries and services or, indeed, their future. I agree that a distress signal has been hoisted by shipowners in particular, and also by many shipbuilders, because of the difficulty of obtaining adequate and speedy supplies of raw materials. But ever since I can remember, in the debates we have had on shipping and shipbuilding in this House, now a matter of 30 years or so, hon. Members who have spoken from the other side of the House have always complained about the difficulties and dangers that beset those industries.

I remember that away back in 1910 the cost of a dry cargo ship—we did not build so many tankers in those days— or even the cost of a passenger liner, was infinitesimal compared with the enormous cost of those vessels nowadays. I can also recall the rates of pay for the men who sailed in those vessels. When I first came into contact with the seafarers of this country, on the Clyde in particular, the able seaman going to the River Plate received the enormous monthly wage of £3 15s. and the man in the stokehold was paid £4 a month. Nowadays, of course, wages are very much higher. They are four or five times as much, but even in those days shipowners complained how difficult it was to carry on.

The same applied to the inter-war years. I remember the debates we had in those years, and hon. Members are saying the same things now. The position is not disastrous. It is not fatal, but, nevertheless, there is the danger that our shipping and shipbuilding industry may suffer a decline unless we are extremely careful. The thing we have to do is to consider how best we can promote our shipping services and, of course, render services to the shipbuilding industry in turn.

It is not to be done by means of taxation or, for that matter, by ensuring that the Suez Canal will be left open, but it can be done by promoting international trade. In the absence—surely this is obvious to everybody—of international trade, the shipping services of this country and, indeed, of the whole world are doomed. It is only by promoting international trade, by one country trading with another and by the removal of quotas and restrictions—in other words, condemning the policy frequently advocated by hon. Members opposite—that we can hope to render a service to our own shipping and shipbuilding industry.

It is true, as the hon. Member for Sunderland, South (Mr. P. Williams) said, that the German shipbuilding and shipping industry has revived in the last few years. It is also true that the reason for it reviving is that the industry in Germany has been completely exempt from taxation. What has been the effect of it? A recent announcement appeared in the newspapers which, no doubt, hon. Members have seen, indicating that as a result of the almost complete exemption from taxation of shipping in Germany the shipowners had built up no reserves. Now the German Federal Government have decided that they must abandon exemption from taxation for the shipping industry in that country, and shipowners really do not know what to do.

In contrast, in this country the shipowners have built up very large reserves. Very few shipping companies have not got reserves which would enable them to replace a part of their fleets. Moreover, let it be freely admitted, whether hon. Members like it or not and whether the shipowners or even the ship builders like it or not, that in the last few years both the shipowners and the shipbuilders, taking them by and large, if I can use a nautical expression, have been doing exceedingly well and making large profits.

It is true that if one or two shipping or shipbuilding companies are selected, we could point to difficulties that they have encountered. No doubt they are apprehensive about the future, but, generally speaking, they have not done badly at all, and it may be that if they had put more to reserves instead of liberating profits for dividend holders their position would be less precarious than it is today.

I bow to Mr. Deputy-Speaker's Ruling, of course, and I will not discuss taxation, but I should like to make this observation. When hon. Members suggest that shipbuilding should be exempt, or partially exempt, from taxation, we must recognise that as soon as this is done and there is any kind of taxation relief, then every industry in the country will make the same claim. It is quite impossible to single out the shipping and shipbuilding industry for that purpose. We must look elsewhere for a remedy.

One of the main reasons, if not the main, why I have intervened in this debate is that during the past week I have had conversations with people associated with the shipping officers' organisations, and I can tell hon. Members what they think about the position. They are alarmed, but they are less alarmed about foreign competition, strangely enough, than they are apprehensive about the effect on the shipping industry, and, through it, on the shipbuilding industry, of competition from air transport. Indeed, some shipowners have now embarked on air transport organisation because they realise that this air transport has come to stay not only for passenger traffic, but, in the long run, it may well be for certain kinds of freight traffic, although at no time would it be able to carry the heavy freight carried by the shipping industry.

What the Government ought to do is to examine the difficulties very closely. Apart altogether from the questions of taxation, financial relief, anything in the nature of subsidies or questions concerning foreign policy, such as the freeing of the Suez Canal from intervention by the Egyptians or any other Government, what they have to do is to see whether the shipowners and shipbuilders are devoting sufficient of their profits to reserves so that ships can be rebuilt.

I know I am on firm ground in saying to hon. Members that shipowners with initiative—and there are many enlightened shipowners, men of imagination and enterprise—are capable of building up out of the reserves which they have carefully safeguarded in recent years, when the going was good, an adequate modern fleet providing the best conditions, apart from pay, for those who sail in their vessels. And what can be done by some shipowners can be done by all if they adopt the same methods.

I do not want to proceed farther along those lines, because many of these facts are well known to those who have examined the position. At present, the care of the shipping industry is in the hands of the Admiralty, but I say quite frankly that when it was first decided to transfer shipbuilding from the old Ministry of Shipping and, subsequently, from the Ministry of War Transport to the Admiralty, I was opposed to it. I recognise that there is a close connection between merchant shipbuilding and naval shipbuilding, particularly in relation to the supply of raw materials and that this must be properly co-ordinated, but I have not been happy about the change.

What is the history of all this? Before the last war we had in this country the Mercantile Marine Department of the Board of Trade. It was not altogether successful, at any rate in giving an impetus to our shipping industry, and it was decided by the Government of the day to create a Ministry of Shipping. That was supported by the Labour Party. During the war the Ministry of Shipping was amalgamated with the Ministry of War Transport.

That Ministry has gone and shipping is now the responsibility of the Minister of Transport, but I sometimes feel that, so far as the Ministry of Transport is concerned, shipping is the Cinderella of that Department which pays less attention to shipping than to road or rail transport or to the reconstruction or reorganisation of our road system. While I make no complaint about what the Admiralty have done for shipbuilding, particularly during the war and in the post-war years, I believe that the time has come when the matter might be reconsidered.

If it has, I want to make a suggestion which has nothing to do with legislation, Mr. Deputy-Speaker, because it can be done by administrative action. I suggest that if we do not revert to the Ministry of Shipping—and there may be strong arguments against appointing another Minister; because we may have too many already, though I do not single out anybody in particular—at any rate the Ministry of Transport should have a Parliamentary Secretary who devotes all his time to the care of our shipping industry.

While we ought not to be unduly apprehensive about shipping and shipbuilding, the position should be as carefully watched by the Government as are the industrial interests of the country. There must be no question of neglect, because we cannot afford that. On the other hand, let us not be too much alarmed by foreign competition. For many reasons I doubt whether the Germans will ever be able to compete with this country in shipping and shipbuilding services because of the high quality of our shipbuilding and the excellent condition of a great deal of our Mercantile Marine.

Let me give an example. Hon. Members will recall that there was a time before the war when we were alarmed at the competition coming from the United States, which had built a vast number of ships. But the United States was never a successful mercantile marine country, despite its large number of vessels. We overcame that difficulty and, later, we overcame competition from Japan to a large extent.

I agree that competition is emerging again, that it may become a menace and that it must be watched, but I do not believe that we should be unduly alarmed about the position, though we have to watch it and see that there is no further neglect or deterioration. If we do that, and, at the same time, appoint somebody whose sole responsibility will be that of the care of our shipping and shipbuilding interests, we shall have done a very good job.

8.6 p.m.

Mr. G. P. Stevens (Portsmouth, Langstone)

I find myself in complete agreement with right hon Member for Easing-ton (Mr. Shinwell) in at least one thing he said, which was to the effect that the House should be grateful to my hon. Friend the Member for Farnham (Mr. Nicholson) in introducing this important subject into our discussion. Although I represent part of a Navy seaport, I make no excuse for intervening into a Merchant Navy discussion because it is obviously true that in war-time the Royal Navy derives a large part of its strength from the peace-time Merchant Navy.

My hon. Friend referred to the fact that 50 years ago this country owned about half the total world shipping. He went on to say that we could not expect to return to that position because those times are gone for good. That is true, but we have to ask ourselves two questions. I am not sure that the right hon. Gentleman has asked himself the first one, which is the simple and fundamental question: Are we slipping any lower down that scale? If the answer to the first question is "Yes," the second question is: Is there anything we can do about it? So far as the first question is concerned, my hon. Friend the Member for Sunderland, South (Mr. P. Williams) quoted some figures which I should have thought had a definite and clear meaning. They referred to the tonnage of merchant vessels built in recent years in the various countries. My hon. Friend did not go far with those figures, and I shall quote a few more.

First it is important to realise that for the world as a whole the tonnage of merchant vessels built has increased by nearly 40 per cent, in the last three years, from 3,557,000 tons in 1951 to 4,938,000 tons in 1953. So far as this country is concerned, the tonnage completed year by year has fallen every year since 1949, and in the last three years that fall has amounted to 6½ per cent, which compares with a world increase of 39 per cent.

When we look at the countries in which that increase has taken place, we find food for serious thought. In the last three years the German figures were 265,000 tons, 498,000 tons and 712,000 tons.

Mr. E. Fernyhough (Jarrow)

From what?

Mr. Stevens

Starting from zero.

Mr. Fernyhough

Exactly.

Mr. Stevens

That point was dealt with earlier.

I admit that Germany had her yards razed. But let us look at a few more countries where that did not happen. Japan, which did not start from zero, has the following figures: 431,000, 513,000, 732,000 tons. The right hon. Gentleman had a little tilt against the United States of America so far as its Merchant Navy is concerned, but the figures there for the last three years were 153,000, 397,000 and 600,000 tons. The same trend is true of Holland.

In all these countries there has been an upward trend in recent years. The percentage of our share of world tonnage, on the contrary, has shown a steady decline and now stands at 20 per cent. There is no doubt whatever that we are slipping away and that a distress signal is flying, visible for all of us to see. That being the case, can we do anything about it? As some hon. Members have learned today, this is not the appropriate occasion to suggest that more generous taxation terms for shipbuilding companies might be of considerable assistance.

I make a suggestion which I think will be within the rules of order. I think that there should be a good deal more cooperation between masters and men, there should be a good deal less talk in the shipbuilding industry, as in other industries, of the two sides of industry. There should be greater realisation that there is only one side in industry and that is the side that brings the bread and butter to every man whose livelihood depends on industry.

There should be more consultation and mutually agreeable solutions. I was very pleased to notice that spirit in the wind and to see the result of the Court of Inquiry into the engineering industry, which recommended some such body as I have in mind, a body which would have constantly under review not only wages and matters of that kind but other related matters, including questions of dividends and their relationship to profits and wages.

It is obviously true that most Royal Navy ships are built in private yards. That gives us in the Royal dockyard towns some cause for anxiety about the continuity of employment in future. I wonder whether it would not be possible to build a larger proportion of Royal Navy tonnage in the Royal yards, not only from the point of view of continuity of employment but also because apprentices and other young workers, when occupied solely on repair and conversion, miss the vital experience that can only be obtained in new construction. If more new constructions could be allocated to the Royal yards that would be of enormous importance and advantage as a contribution to the experience of these young people. If that cannot be done I wonder whether it would be possible to arrange some kind of scheme whereby these young men could spend periods of training of three months or so in a private yard in the Clyde, or wherever it might be. I think that my hon. Friend the Member for Farnham has done a good service to the House by putting his Amendment on the Order Paper, and I look forward with the greatest interest to the Minister's reply.

8.14 p.m.

Mr. Jack Jones (Rotherham)

We have listened with tremendous interest to the speeches of the hon. Member for Farnham (Mr. Nicholson), the hon. Member for Sunderland, South (Mr. P. Williams) and the hon. Member for Langstone (Mr. Stevens). They should be congratulated on bringing to the notice of the House the condition of the shipbuilding industry. But I cannot understand their line of reasoning. They argue, and rightly, that this country requires a flourishing shipping industry and high quality ships at the lowest possible cost so that freightages can be obtained at the lowest price and trade obtained to bring about the salvation of the country's economy.

The price of steel enters into shipbuilding. Not long ago the Government did certain things. I know companies in this country that are primarily ship's plate producers. For two and a half years the price of ships' plates have carried a profit in interest of £3 10s. for every £100 worth sold. Ship's plates cost approximately £20 per ton, but the hon. Members who have been speaking tonight not long ago went into the Lobby to make certain that a further 4 per cent, interest at least should be put on the price of steel. They argued then that it would be a good thing if the production plant to which I have referred—and others like it—was returned to private enterprise so that remote investors could make more money. I do not know how they can argue as they do today, for a subsidy by means of a special form of taxation when one remembers the tricks that they were up to when they deliberately went into the Lobby to increase the profits on steel.

We on this side of the House argue that shipping, engineering and all things ancillary to our world-wide trade are a matter of national importance and should be looked at within the framework of the national economy. We argue that shipbuilding should be a national responsibility—not that it should be nationalised but that there should be priorities and a sufficient amount of plant and material earmarked to safeguard that industry. History proves that the present Government have done exactly the opposite. I do not blame the hon. Member for Sunderland, South so much because he was not in the House at the time, though I know what Lobby he would have entered if he had been here. But the hon. Member for Farnham cannot deny the fact that hon. Members opposite walked deliberately into the Lobby to improve the position of their friends in the steel industry. The hon. Member for Farnham said at that time that I forgot that immediately on denationalisation there would be an upsurge of efficiency and the price of steel could come down. If that could be done overnight then hon. Members opposite are guilty of not having done what should have been done.

Mr. Nicholson

I never said that it would be done overnight. It is a question whether the shipbuilding industry thinks that it will do better under the present arrangements than under nationalisation. I am sure that the hon. Member will agree that the question is whether the consumer is satisfied or not, and the categorical answer is that the shipbuilding industry welcomes the Government's measures.

Mr. Jones

Of course it does. It is behind the Government politically but not economically.

Mr. Nicholson

Surely that is a crazy argument. It is sheer nonsense to say that the shipbuilding industry, because it is allegedly behind the Government—whatever that may mean—for political reasons, is glad when steel is sold to it at less favourable terms. The industry wants the best steel at the lowest prices.

Mr. Deputy-Speaker

May I remind both sides of the House that an argument on nationalisation is not in order?

Mr. Jones

I agree, but one cannot get away from the fact that the hon. Member for Farnham and the hon. Member for Sunderland, South adduced to the House arguments on the cost of producing ships, and ships are not made from egg shells. They are made from steel and the cost of producing the steel is of vital importance. And that brings into the argument the question of the amount of profit made per ton produced.

I have only brought that point into the discussion to show the hypocrisy on the part of some hon. Members opposite when they have gone into the Lobby to add another £4 10s. profit per £100 worth to the price of steel. Ship's plates were being sold at approximately £20 per ton and the amount of interest was £3 10s. per five tons, that is per £100. Hon. Members opposite went to the Lobby to increase that by £4 10s. That means that on five tons of ship's plates costing £100 there is an increase of £4 10s. in interest, which is 18s. per ton.

Mr. Nicholson

I take it that the hon. Member is saying that there is a 4½ per cent, dividend, but does he think that the whole of a dividend comes off every transaction in business? His arithmetic is quite right and if it is £4 10s. on 100 tons one gets £108, but the dividend is not paid by increasing pro rata the selling price of every article.

Mr. Jones

The hon. Member should get the simple arithmetic firmly fixed in his mind. Ship's plates are sold at the approximate price of £20 a ton—

Mr. Burden

rose—

Mr. Jones

Wait a moment. One dog, one bone. The amount of State interest is £3 10s. per £100 worth, and the hon. Member went into the Lobby to increase that to an amount of not less than £7 10s. per £100 worth sold. That means an increase of 90s. per £100 worth sold, and that is 18s. per ton. It is no use going into the Lobby to vote that and then to come here moaning about the effect on the shipbuilding industry.

Mr. Burden

Will the hon. Member give way?

Mr. Jones

No, indeed. I have given way three times in succession to hon. Members who do not have the habit of giving way. I want to put the point that people who make difficulties for themselves should not come back to the House and moan about those difficulties.

8.22 p.m.

Mr. Graham Page (Crosby)

I am glad to follow the hon. Member for Rotherham (Mr. Jack Jones), not because I agree with his mathematics, but because he was perfectly correct in devoting his remarks to steel in a discussion on shipbuilding. The whole root of the production in shipbuilding is the speed at which one can get the steel plates through the production sheds. That does not necessarily depend only on the delivery of steel but, as I understand the position, the shipbuilding industry is at present well satisfied with what is happening about deliveries of steel and preparations for the future.

Before I go further perhaps I ought to declare an indirect interest in the matter as advising certain shipbuilding firms on legal matters.

Dr. Morgan

That is not an indirect but a very direct interest.

Mr. Page

In the course of the debate the word "complacency" has been mentioned on several occasions, and it has been thrown in the face of the Government. We know that the shipbuilding and shipowning interests are facing difficulties at present. Even though they have 5¼ million tons on their order books, which is something like four years' production, they point to the competition of German and Japanese trade and to the subsidising of those foreign industries. They point to the wages and restrictive practices related to labour, and so on.

When these two industries say that the Government are complacent it is perhaps a case of the pot calling the kettle black. There has been so much work for the shipbuilding industry since 1940 that there has been little need for them to think ahead. Perhaps one cannot blame the industry for not thinking ahead when hon. Members opposite held the sword of Damocles over the head of the industry, threatening to nationalise it at any moment if they had the opportunity.

Mr. Burden

Would my hon. Friend agree that the argument of the hon. Member for Rotherham (Mr. Jack Jones) was not true, because the price of steel has not increased one penny since denationalisation?

Mr. Page

That is true, but I did not want to rouse the hon. Member for Rotherham into mathematics again and I wanted to proceed with my own argument. I think it is a little unjustified to call the Government complacent when the shipbuilding industry over the past years, when orders have been good, has perhaps been a little complacent itself. Now, since the peak of September, 1952, it has been caught napping in two respects—

Dr. Morgan

Under this Government.

Mr. Page

I am speaking of the industry.

I think the owners were fairly prepared for competition from air transport immediately after the war and were prepared to join in developing air transport. That was prevented by the wholesale nationalisation of air transport by the Socialist Government and it seems that the shipowners lost interest in that aspect of the matter. The Act of 1953 has given an opportunity to progress along those lines, but I do not know whether they are ready or have any plans ready.

I think that perhaps they should look to that question and not be frightened that air transport will take away their sea passenger transport. There should be some possibility of working the two systems in harmony. Personally, I do not know the answer, but I am sure the answer can be found by good will between the two concerns, air transport and sea transport, and, no doubt, by the assistance of the Government.

I believe that the shipbuilders have been caught napping over the sudden popularity of the very large tankers. Only recently has it been realised that the future lies with the 40,000-ton and 45,000-ton tanker. We have not the docks in this country in which to build tankers of this size and until recently no effort has been made to produce them.

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

Is the hon. Gentleman aware that an effort is being made to provide dock accommodation for just the type of vessel about which he is speaking?

Mr. Page

I am aware of it, and I am obliged to the hon. Member; that is just my point.

It was not until the peak in shipbuilding production had been reached in September, 1952, and a decline had started that the shipbuilders seemed to realise that they were, if I may say so, in the wrong boat, and that they should be concentrating on the much larger tankers of 40,000 and 45,000 tons. It was only then that they thought about building large docks.

If I may be permitted another pun, they certainly missed the boat, because this was already being done in the German yard of Howaldt's Werke, at Hamburg, where they produced the "Tina Onassis" the largest tanker in the world. It was launched last July and took only three-and-a-half months for fitting out. So far as I am aware there are only three shipbuilding firms in this country concentrating on the construction of large docks capable of accommodating that type of vessel.

Mention has been made in the debate of the modernisation of yards and the explanation was given that Germany had progressed with her yards because they had been bombed during the war and so it was possible to have a new layout. Hon. Gentlemen opposite murmured something about the nationalisation of our yards, but that would not help because the old yards have not the space for modern development. They have not the space in which to construct yards for 40,000 and 45.000 ton vessels. There is not the space to put up the production sheds in which to carry out the modern method of prefabricated shipbuilding. We have to find new land in this country on which to construct these docks.

Mr. Emrys Hughes

The Germans have not a rearmament programme.

Mr. Page

That may well be a very good reason why they have been able to make such progress in shipbuilding. I think there may be some way in which the Government can assist in the building of docks large enough for these vessels, but I must not develop that argument or I shall be ruled out of order.

Mr. Fernyhough

It would be interesting.

Mr. Page

I wish to make one or two suggestions about ways in which the Government might help both the shipbuilding industry and shipowners. There is the rather wide aspect of trade with China, and its development would be of great assistance to shipowning interests in this country. The question of the Suez. Canal has already been ventilated and there are some minor points which might be dealt with by the Government and afford assistance to the industry, such as relief from the restrictions on the transfer of ships on sale.

There is the Ship and Aircraft (Transfer Restriction) Act, 1939, which may be ended not by legislation but by Order in Council. I suggest that it is time that came to an end, because it is restricting the sale of ships from this country abroad. The proceeds of a sale have to be placed in a blocked sterling account in this country, which prevents the use of that money for development. It can also have the effect of forcing the shipowners to sell to the British Iron and Steel Corporation at controlled prices. I consider these controls are now unnecessary, as is the control which still exists on the voyage licensing of tankers carrying cargoes outside the Government programme. There are other minor considerations of that kind which might be dealt with by the Government and which would be of assistance to the industry.

From the point of view of the shipowning interests, the Government can best give assistance by ensuring that State air transport does not carry uneconomic loads which can more economically be carried by sea; from the point of view of the shipbuilding interests. I hope that some assistance can be given towards the construction of adequate docks.

8.35 p.m.

Mr. Walter Monslow (Barrow-in-Furness)

I join my hon. Friends in expressing our deep sense of gratitude to the hon. Member for Farnham (Mr. Nicholson) for introducing a subject of vital importance to the House and the country. It is certainly one of the most vital features in our internal economy today.

I would, however, point out that many of our problems result from Governmental policy. There has been a policy of procrastination about future orders for British shipyards. I believe that the orders for 1954 will be considerably less than those for 1953, and they will certainly not bear favourable comparison with foreign shipyard construction. As many hon. Members have reminded the House, we are faced with keen competition from Germany and Japan. I had occasion last week to speak to a number of prominent businessmen associated with the shipbuilding industry, and they emphasised the tremendous pace at which work is now going on in German shipyards. There is no relaxation of effort in Germany to capture the market either by price or, indeed, by delivery. That is an important feature.

I noted that the hon. Member for Crosby (Mr. Page) suggested that Germany was in the strong position she occupies because she has no rearmament programme. That demonstrates convincingly that a country which can spend more on productive and social services and less on non-productive and destructive services is likely to have an improved economic position. There can be no doubt that the shipping authorities in this country are complaining vigorously about the dearth of orders and are expressing the fear that there may be great unemployment in our shipyards. If I now refer to my constituency, I do so because a measure of redundancy exists in the finishing trade there. I can only express the hope that what is happening at the finishing trade end will not ultimately affect the craftsmen who build the ships in our yards.

Many of our economists are talking about the possibility of an American recession. This has undoubtedly caused a worried flutter in the rest of the world. Just what will be the future for the economies of the world no one can accurately foretell. The fear of a slump is real in shipbuilding and engineering and other basic industries, but we ought not to be weeping Jeremiahs and adopt too pessimistic an outlook. I believe that it is possible, with strong Governmental action, to improve the situation and thus give a measure of stability and security to those who are engaged in the great shipbuilding and engineering projects of our time.

I charge the Government with being responsible to some degree for what has happened. Let us examine in particular what has happened in the last year. There has been the problem of granting licences for the building and export of dredgers to countries in the Soviet bloc. The Civil Lord cannot help but be aware that three dredgers are now being built in Dutch shipyards for the Soviet Union and Poland.

The Civil Lord of the Admiralty (Mr. Wingfield Digby)

I hesitate to interrupt, but I am not quite clear how the hon. Gentleman holds the Government responsible. The fact is that the Government received no application for licences, and if the order was not given to British yards and no application for a licence was received by the Admiralty I am not quite clear how he thinks the Government is responsible.

Mr. Monslow

I want to return to what I said earlier, that when application was made by the firms building dredgers in this country to the Board of Trade for licences they were distinctly informed that it was no use making such applications.

Mr. Digby

They had to apply to the Admiralty.

Mr. Monslow

I welcome the Prime Minister's statement last week that we should endeavour to open out East-West trade, and that a greater volume of trade would certainly ease the present international tension. It would be well if the Prime Minister were to direct his energies and those great characteristics of drive and courage of his into some of his own Government Departments.

Mr. Burden

Is it not a fact that, because the international situation has cooled down, hon. Gentlemen opposite— who when they were in Government had to impose the most stringent restrictions on exports' to Russia—-because under this Government there has been an easing of tension, are now asking the Government to increase sales to Russia? The Prime Minister himself has shown the way in his recent speech.

Mr. Monslow

I would remind the hon. Gentleman that the Korean war has finished, and I take the view that we should expand our trade with the East, even to the extent of exporting capital goods. I think the Prime Minister in his fine declaration had a greater sense of balance and a better understanding of what is needed in the present hour of trial than have some hon. Gentlemen opposite.

8.42 p.m.

Mr. Frederick Willey (Sunderland, North)

I at once will disclose a personal interest in shipbuilding. The whole future and prosperity of the town whose representation I share with the hon. Member for Sunderland, South (Mr. P. Williams) depends on k. It is for that reason that I must continue to be disturbed at the complacency of the Admiralty. I am now really in very distinguished company. The Chamber of Shipping in their annual review, complained of the "smoke screen" put up by the Admiralty. Sir Donald Anderson in his last speech as President of the Chamber of Shipping, complained of the "dangerous complacency" at the Admiralty. Mr. Denholm in his presidential speech broad-coast "a gale warning," and I should like to quote one passage of that speech, because it very fairly puts the case. He said: In the last few years we have tried to drive home to the public at large, and the Government in particular, our fears for the future, but it seems to me that we have not succeeded and that there is still a large measure of complacency, engendered, perhaps, by the balance sheets we have produced in the last few years, showing, we must admit, large gross profits. That fairly puts the case, because both these industries have been profitable for the past decade or so, and for that reason are not in a strong position to call attention to what is a real problem facing the industry.

Mr. P. Williams

The hon. Gentleman did say "gross profits"?

Mr. Willey

Yes; the point is that both industries have been very profitable and not in a position to exercise a powerful lobby on the Government. Again, "The Times" recently said: Yards not equipped to build tankers or liners will feel the pinch soon. and, indeed, a few weeks ago the Civil Lord himself changed his mind a good deal. Only last summer he was talking about four years on the order books, but when we last debated this subject a few weeks ago he said that the larger yards ' alone had booked work well into 1956. No longer did he talk about four years and his reference was only to the larger yards.

But the fact is that two-thirds of the yards of Britain are classified as small yards, so that the situation is one that demands serious attention. The output figures by themselves would be quite misleading. As several hon. Members have conceded, what happened was that the Korean war gave an artificial stimulus, and I would concede with the hon. Member for Sunderland, South that this is a situation corresponding to that obtaining in 1949 and 1950. In other words, we are now examining what are the long-term prospects of the shipbuilding industry.

There is a significant point to which I would call the attention of the House. In the Report of the British Iron and Steel Federation, reference is made to plate production, and it talks about the "temporary demand" and of how we shall soon be over the hump. This is the steel industry making an estimate of the future position of shipbuilding, which is disturbing in the sense that it demands analysis, examination and realistic appreciation.

The essential figures have already been given. In 1951 the new orders put on the books were over 4 million tons, whereas, last year, they were just over half a million tons, and against that we have to offset a quarter of a million tons by way of cancellations. We must realise that this year there has been very litle put on the order book and further cancellations. I am disturbed by the references made to foreign competition. This is not the result of foreign competition. It may be aggravated by foreign competition, but it does not result from that competition.

I welcome the Amendment because we cannot divorce the future of shipbuilding from shipping. The fundamental difficulty lies in the prospect for shipping. After all, the foreign yards are suffering the same difficulties as our own yards. We only have to look at the Japanese figures to realise their difficulties, and now the German yards are facing similar difficulties. The short explanation is that shipping is no longer sufficiently profitable to induce the placing of orders on the scale that they have been placed in the past few years.

We only have to appreciate that the freight rates, taking 1952 as 100, dropped on an average last year to 77, and in December they were as low as 71.5. In fact, since May they have fluctuated around the 74 mark. This is a very appreciable fall in the freight rates and it is bound to affect the shipbuilding position.

Another index is the number of British vessels tied up other than for repair. We have about a quarter of a million tons of idle shipping tied up. This figure is fluctuating, but it has tended to fluctuate round about the 200,000 ton mark. If shipping is tied up in this way, it is not likely that we will have orders placed in the yards. This is a reflection of world trade, and we have to safeguard our own essential industries against that background. We cannot complacently accept it as inevitable.

I have stressed that foreign competition is not the cause. The fall in the profitability of shipping is the cause, but we have got to realise that this has been aggravated by what has been happening in world shipbuilding as a whole. It is significant, as previous speakers have said, that our percentage of the world output has fallen at this time when the profitability of shipping has slumped. Last year we produced 26 per cent, of the world's shipbuilding, compared with 30 per cent, the year before and compared with from 34 per cent, to about 50 per cent, in the immediate pre-war years.

Let us look for a moment at the output of the main competing countries. Sweden, last year, turned out 485,000 tons. That is a third more than Sweden produced the previous year. It is the largest output in the history of shipbuilding in Sweden. In 1938, the output of the Swedish yards was 166,000 tons. Japan, last year, turned out 557,000 tons. That was less than the previous year's output, but the previous year's output was the highest in the history of Japanese shipbuilding and has to be compared with a tonnage in 1938 of 442,000 tons.

Somebody referred to Germany as not ever being in a position to compete with this country. The output of German yards last year was 818,000 tons. That is certainly comparable with our present output, and was 300,000 tons more than in the previous year. It was an all time record in the history of German shipbuilding. We have to compare it with the pre-war output of the German yards, whose output in 1938, when they were at maximum production, was 481,000 tons.

Mr. P. Williams

In all Germany.

Mr. Willey

Yes.

The United States last year produced rather more than 500,000 tons of shipping, which was a larger output than in the previous year and, of course, was larger than prewar. We have also to recognise the whole time the tremendous potential of the United States. In five years, between 1938 and 1943, the United States increased their output from 200,000 tons to the tremendous figure of 11½ million tons.

The point is that at the time when the profitability of shipping has slumped and drastically affected shipbuilding, there is a larger shipbuilding capacity available in the world.

Mr. Page

The hon. Gentleman has quoted Sweden, Germany and the United States. Would he agree that in all these cases there is a far more modern method of shipbuilding adopted than in this country? Are those figures due to that more modern method?

Mr. Willey

I would say that these figures demonstrate the point made by the hon. Gentleman. I was going on to say that there is not only an enlarged capacity but also new capacity. I concede at once the point made by the hon. Gentleman. New capacity has great advantages in production over old capacity.

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

Why are we not modernising?

Mr. Willey

I am afraid that a lot of nonsense is talked about foreign competition. Too many people are trying to seek that as an avenue of escape.

There has been a lot of talk about the Hamburg yards working round the clock. If we worked round the clock it would add to the costs, and with our present steel supplies it would mean that men would work round the clock for four months in the year and be unemployed for the other eight months. I do not know why this comparison with Hamburg is made. We have to remember that Hamburg has 80,000 unemployed. If one has a background of unemployed then it is possible to work with an occasional third or second shift.

Our yards are in a competitive position largely because they have cheaper supplies compared with foreign yards, and the main difference between ourselves and the West German yards is that our yards get their steel at £10 a ton cheaper than do the German yards, thanks to nationalisation. The reason why our yards are being prejudiced at present is because this differential is being narrowed the whole time for two reasons. The first is that denationalisation adds to the cost of steel in this country, and the second that the Schuman Plan is operating to reduce steel costs to our main competitors.

The fundamental problems of the shipbuilding industry are, as I have said, the fall in the profitability of shipping and the increase in the world capacity of the shipbuilding industry. This is aggravated by the fact that the increase of shipbuilding capacity today is governed by strategic and national considerations. That is why I mentioned the United States. We do not know what the United States may feel driven to do regarding its own shipbuilding capacity. It means as a consequence— and this has been touched upon by other hon. Members—that there is a large measure of Governmental aid and interference in the shipbuilding industry in most other countries.

Mr. Burden

The hon. Gentleman is making a very important point, but surely the one important factor is that the German yards are working round the clock and we are not. One appreciates the difficulties, but that means that people going to the German yards are getting quicker delivery. That is a vital factor.

Mr. Willey

The difficulty about that is that one cannot have long order books with immediate delivery. The yards without order books can, of course, give a better delivery date than can the yards with full order books. I do not agree with the hon. Baronet the Member for Farnham (Mr. Nicholson) that shipbuilding should not have preferential treatment.

Mr. Nicholson

Since when have I been made a baronet?

Mr. Willey

I was merely anticipating developments.

In Italy, Japan, West Germany and in almost every other shipbuilding country the State has accepted a responsibility in one form or another for the industry. We have to recognise that we have without question a claim to some preferential treatment for British shipbuilding, and, if necessary, for British shipping. The first thing is that the country must accept its responsibility.

To go back to Mr. Denholm's presidential address, he went on to say: our defence expenditure is running at the rate of £4½ million a day. What is the use of this if we do not have the tonnage with which to maintain our vital communications.

Mr. Nicholson

Yes.

Mr. Willey

I am very glad that the hon. Member accepts that point of view. It logically follows that shipbuilding, and, if necessary, shipping demands preferential treatment from the Government.

This matter must be urgently considered. I have pleaded previously for a working party; the Trades Union Congress wants a development council, and the "Newcastle Journal," which devoted much of its energies to this problem, has-said that we should have a fact-finding inquiry. Such a body should include shipping interests, and should deal with, technical questions, such as the 45,000-tonner which can be loaded and unloaded in nine hours, and which is beyond the capacity of most British yards.

I am not satisfied that sufficient attention is being paid to research in shipbuilding. I remember raising the question of the experimental tank when we were considerably behind competing countries. There is also the question of replacement finance especially in relation to dry cargo tonnage. There is the anomaly of the excavation of a dry dock not having certain advantages which it ought to have. I shall not mention the advantages because I might transgress the rules of order.

There is the vital factor of space, which is emphasised by the comparison between ourselves and other countries. We have to have more space for the yards, and this is a very difficult problem, as we can see if we consider the Wear or the Clyde. The problem cannot be tackled by single yards. We have to look at the Wear as a whole to see how we can make the most of it and provide the proper space for straight run prefabrication.

We have also to promote co-operation and efficiency throughout the industry, I regret that this industry has been disturbed by the recent wage dispute, which is a reflection upon the shipbuilders. It is difficult to call for the utmost cooperation in the face of these very long and protracted negotiations. The sooner the matter is dealt with and out of the way the better it will be. If it were out of the way there should then be discussions about the demarcation question and the problem of the structure of this industry. But, first, we have to resolve the wage claims.

We must examine two essential problems. First, there is the determination of the need and extent of Government aid and, as a consequence, Government interference. Secondly, there is the unavoidable problem of the redundant capacity which has to be maintained in the national interest and the interests of the men who are to be used in those yards when the emergency arises. In other words, we have to examine and re-examine the question of redundant capacity being maintained and alternative work being provided for highly-skilled workmen.

We talk about American efficiency, but our shipyard workers on the Wear out-competed the men in the Kaiser yards. Although they overtook us during the war, we regained the lead before the war was ended. These are men of great skill, and they are hard-working. This is true both of management and men. We have a resourceful management. It must be remembered that the Liberty ship was designed on the Wear. We have initiative both in management and men which cannot be allowed to go to waste again. This problem must be considered by the industry, by the shipping interests, and by the Government.

I want to conclude by making a plea for something further. It is time for international action. For example, I was very disturbed to learn that American naval officers are in Western Germany discussing with the Germans the placing of tanker contracts. I should like to know what discussions the Americans had with us about the placing of those contracts. It is a matter of Western defence. The problem of shipbuilding has to be tackled not only nationally, but internationally.

Against the background which 1 sketched tonight, I hope that there will be mot only national, constructive discussions by all sides of the industry but that the Government will also endeavour to give a lead in promoting international discussion.

9.6 p.m.

Mr. E. Fernyhough (Jarrow)

Like my hon. Friend the Member for Sunderland, North (Mr. Willey), I have a substantial constituency interest in this subject. I, too, should like to thank the hon. Member for Farnham (Mr. Nicholson) for giving us the opportunity of discussing this subject tonight.

It is true that shipbuilding does not today play quite the same part in my constituency as that which it played before the war. Then, due to the deliberate concentration and decline of the shipbuilding industry, Jarrow became known as the town which was murdered. That can hardly happen again, because the shipbuilding industry today represents only between 20 per cent, and 25 per cent, of the total employment in the area. Nevertheless, that is a substantial percentage, and because it is substantial and because of the fear which the people of Jarrow have at present—the outcome of past bitter memories—I hope that the Government will do all they can to see that the highest level of employment is maintained in this industry.

I want to correct the Parliamentary history of one or two hon. Members opposite, including the hon. Member for Sunderland, South (Mr. P. Williams). This Government have made it more difficult for the British shipbuilding industry to compete in international markets, because one of their first actions on coming into power was to compel the Steel Board to increase the price of steel. The board said that this was not necessary and that it was making enough profit to pay its way and to provide capital investment. Indeed, the Government compelled the Chairman to resign because he said he did not believe it was necessary to increase the price of steel. The subsequent balance sheet of the nationalised industry showed a £60 million to £70 million profit as a result of all this.

How much better it would have been if the Government had allowed the price of steel to remain unchanged, thus enabling British ships to be delivered at a much cheaper price. It was the policy of the Government which had a direct effect in undermining our ability to compete, and it ill becomes the Government or any hon. Members opposite to talk about the dangers which the wage claims of the workers may have upon employment when they themselves, by actions of the kind which I have described, deliberately undermine our ability to compete. Obviously, one reason why the price of steel was increased, making it more costly to build ships, was to make the steel industry more profitable when it was handed back to private enterprise.

While I want everything possible to be done for the shipbuilding industry, I am always alarmed when any special privileges or preferences are given to an industry. I come from a mining locality, and I remember in the early twenties when the mining industry was given the special privilege of a subsidy. I know what happened to the subsidy—how it was frittered away and how, ultimately, the industry which was supposed to be saved by it was left in a condition worse than its condition before it received the subsidy.

When hon. Members talk about the high level of taxation today as being one of the deterrent factors and one of the problems which make it most difficult for this industry to compete, and as one which makes it more difficult for the shipowners to replace their fleets, never let them forget that the biggest contribution towards that high level of taxation which the people of this country today are bearing is of course, the arms burden. The very Estimates which we are considering now total £353 million, and I cannot think that anyone would believe that it would be right and proper that any section of industry should not, from its profits, make its contribution to that sacrifice and the amount that is required.

I should like to get from the Civil Lord tonight some decision with regard to our attitude to building ships for the eastern European countries and the Soviet Union. It may be true, of course, that no orders have ever been submitted and, therefore, no question of a decision by the Admiralty or the Government arises, but what is true, and what all those Governments know, is that there were two tankers built in this country which were paid for before they were delivered and which, when the time for delivery came, were not delivered.

I am not blaming the present Government for that because that happened under our Government, and I protested as strongly against that when our Government was in power as I want to protest against the attitude which, I think, the present Government may probably take if any further orders come along. While it is true that we are not supposed to deliver strategic materials because the terms of the Battle Act prohibit it and we shall not get American aid if we do, it is also true that every other country which is affected by the Battle Act has just disregarded it.

Sweden built the two tankers that we failed to deliver. The French, last July, made a trade agreement with Russia under which they would build and deliver certain ships. The Danes likewise have continued, despite the Battle Act, to build and deliver shipping to the Soviet Union. I want to know if the businessmen who have been to Moscow recently have been able to obtain any orders, and whether those orders are to be permitted by the Government. I want to know whether the Government are going to be like Denmark who, when the Americans challenged their right to deliver, just turned round to the Americans and said, "This is our business and we can look: after it very effectively without any outside interference."

I am quite sure that substantial orders in that direction could be obtained. When British businessmen had been given the right to accept orders there has been no question of foreign competition being able to beat us. The Germans were competing for the contract for the 20 trawlers that are to be built at Lowestoft, and Britain was able to submit much the lowest tender and got: the contract. I think that in view of the reduced international tension and the need to maintain, so far as possible, full employment in the shipbuilding industry, the time has come when we should review the list of proscribed exports to the various countries.

No matter whether it be the shipbuilding, the metal, or any other industry we are considering, the only hope of any Government being able to provide the people with full employment is upon the basis of an expanding world trade. The possibilities of that substantial expansion in world trade now exists. It is for us to take this chance, and it is for the Government, who have the opportunity, to grasp it with both hands and thus make certain that the days of depression, of which there are so many bitter memories in so many parts of the country, are never allowed to return.

9.16 p.m.

Mr. Cyril Bence (Dunbartonshire, East)

I, too, thank the hon. Members for Farnham (Mr. Nicholson) and Sunderland, South (Mr. P. Williams) for raising this subject tonight, although I entirely disagree with the proposals of the hon. Member for Farnham as being suitable to save the shipbuilding industry, A good deal of propaganda is carried out by the Shipbuilding Conference to stimulate the idea that taxation relief is necessary to save the industry, but I do not believe that this is the remedy. Obviously, this sort of thing could be done over a wide field; every industry could demand the same kind of thing, but in the result the position would be the same as that from which we started.

I was surprised that the hon. Member for Sunderland, South did not raise the question of prefabrication. The Liberty ship, as was rightly said by my hon. Friend the Member for Sunderland, North (Mr. Willey), was designed on the Wear. The contract was given to Kaiser to produce the Liberty ship on the west coast of America, and it was produced with British and British-designed equipment.

The Liberty ship could not be produced in this country. If John Brown's, of Clydebank, had the area in which to work and could get at a reasonable price the land on which to build big covered shops for prefabrication, they could stand up to any competition in the world in quality and price. One of the greatest handicaps of British shipbuilding, as we see it on the Clyde, is the lack of space for the development of intensive prefabrication.

I am aware that these processes are being carried out in Hamburg and in the United States. Although they were British designed, they cannot be carried out here because our shipyards are closed in on the riverside, with expensive land and big buildings all around them. The capital cost is too great for our companies to move out to get the space for prefabrication.

Of course, work can be carried on for 24 hours of the day if there are great covered sheds where prefabrication can be done by men employed on three eight-hour shifts. I doubt very much, however, whether at Greenock or Clydebank one could get three shifts to work out on the stocks on the slipway in winter. In any case, John Brown's would not get me doing it on the night shift.

Mr. Jack Jones

My hon. Friend would be like John Brown's body.

Mr. Bence

If we are to compete with the processes now being operated on the west coast of the United States and at Hamburg, where the surrounding built-up area was smashed and the resulting vacant land was put at the disposal of the shipbuilders, obviously something has to be done to help the British shipbuilding industry to extend its area of land for prefabrication, which it certainly cannot do with all the expensive land surrounding it, from its existing resources.

I consider that the Admiralty has wasted an awful lot of money in building hulls that are outmoded. I should have thought it would have been much better if the Admiralty, in the interests of shipbuilding in this country, had enabled the shipbuilders to get land such as I have mentioned. For instance, Messrs. John Brown and Co. Ltd. have established in Clydebank away from the river, the building of land boilers. If John Brown's could establish a new industry and get the land for it, why cannot the Admiralty assist these companies to get land alongside their yards for prefabrication?

There is another development of which we have to take cognisance, and that is the process going on in St. Nazaire and in Newport, where they are converting docks into dry docks and building prefabricated ships. I think there is only one such dock in Newport, but they have three in St. Nazaire.

Mr. Digby

They have built a shallow dry dock for the express purpose of undertaking construction by that method. There was no dock there, so far as I could see.

Mr. Bence

That was in St. Nazaire, and they have a dry dock for building ships and then floating them out. They have big fabricating areas as well, thus ensuring continuous use of capital equipment. This sort of thing would be difficult on the Clyde, because the river is so shallow, and it would be very expensive to cut deep into the land because the river silts up quickly.

One other point with which I want to deal is the question of world trade. Obviously, unless world trade is worked up to its maximum the shipbuilding industry, not only in this country but in every country in the world, must fall considerably. I think it is dishonest to keep quoting this percentage figure of British shipbuilding and. the British Merchant Navy and comparing it with the overall figure for the world. What we should consider is, are we achieving a reasonable production from our potential, our raw materials and our labour? What percentage it is of the world figure does not very much matter as long as all our resources are being used. If this Government and other Governments pursue a policy which will reduce trade then trade will fall all round. I do not see why we should worry if Germany and the United States are producing more, provided that our full capacity for production is used and our potential employed.

With other countries, with larger areas and greater sea coasts, becoming increasingly industrialised, they will produce more, so we have to see that world trade is kept moving at the same tempo. If this potential keeps going up, I do not see that there is any reason for us to be despondent. As soon as the present Government got into power business began to tighten up. There was a slackening off, for it was recalled that a prominent member of the Government when in opposition said that what we wanted in this country were more and bigger bankruptcies. When businessmen found this Government in power they began to be careful. One of the first things that the Government did was to put up the Bank rate. On a ship costing a couple of million pounds it meant that the cost increased tremendously.

Mr. P. Williams

The hon. Gentleman is talking about bankruptcy, but he must realise that one of the greatest bankruptcies that was avoided was national bankruptcy.

Mr. Bence

No, a nation does not go bankrupt.

I have heard some extraordinary statements tonight. For instance there was the statement from the hon. Member for Farnham that the reason why Germany was in such an advantageous position was that she was defeated in the war and could start afresh. Perhaps it would be excellent if Britain went bankrupt and paid Is. in the £, because she could start all over again with no National Debt. That would be very useful indeed. If the British Government went bankrupt and put in an official receiver and decided to pay 1s. in the £, the National Debt would be wiped out and we could start afresh.

It is only a couple of hundred years ago that the National Debt was a few million pounds, but my grandchildren will probably see it in figures as long as the space between my two hands. But nations do not go bankrupt. That is not a term which can be applied to a nation. A nation always gets out of it in some way or another, because the wealth of a nation is its human beings and their capacity to produce.

When I heard the hon. Member for Farnham talking about the golden age of half a century ago, I asked myslf, a golden age for whom? The shipbuilders? I ask the hon. Gentleman to go with me to Clydebank and ask the retired shipyard workers of 60 or 70 years ago if 50 years ago was a golden age for them.

Mr. Nicholson

Of course I was not meaning that. I was merely saying that if we could go back to the time when we owned half the world's shipping, it would be a repetition of the golden age.

Mr. Bence

Surely no one would suggest that Britain has an inherent and natural right to retain that percentage of world production, either in shipbuilding or motor cars or sewing machines. The rest of the world will go on producing, and it is better that all the world should produce as much as possible. Surely the more the world produces the richer humanity will become? Why should we be despondent because the world is producing more? It is only because hon. Gentlemen opposite measure the output of human labour by the profit it brings to those who control that labour that they are despondent.

I remember the rationalisation schemes of the late Stanley Baldwin before the war. His argument was that we were poor because we were producing too much. He said that if we rationalised industry and cut down production we should all get richer. I stood up at the public meeting he was addressing and asked, "Then if we all produce nothing at all, we shall all be millionaires?" That was the logic of it, and I was nearly blue in the face about that argument.

I believe in the maximum production of all resources, but the trouble is that then profit cannot be made. Even today there is too much. I have been connected with an industry which has not produced to the maximum capacity because its output was at a figure which gave the maximum price for its product and the maximum profit was obtained at that figure of output. I do not say that is the case in the shipbuilding industry, because I have never worked in it, but in the industry which I have mentioned that was so. Our market research saw to that. That is the major difficulty in this country, and it is the difficulty of the right hon. Gentleman and his hon. Friends.

I say that the shipbuilding industry of this country will only be saved if there is a world planned economy based on agreement between the nations to use the resources of every country to build up the trade of the world. We shall not do it by fostering the idea in Germany that we are working more cheaply or longer hours or by building up the idea here that they are doing the same because, by doing that, every industry in this country will be crippled, the trade of the world will be crippled and the lives of millions of men and women and their families will be crippled.

9.30 p.m.

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

It should not go out from this House that none of our British yards is making a proper effort to modernise and meet the challenge of the present time. When, very rightly, we have had this very valuable examination of this important problem it is only fair that we should know, also, that in some areas at least we have been able to make very real advances in shipbuilding modernisation. As I represent an area where many of these most outstanding changes have taken place, it is only right that I should say something about them.

On the Tyne it has been possible over these last years for two major shipbuilding firms to make considerable changes by way of modernisation. One of them has already carried out a vast reorganisation, including the prefabrication to which reference has been made several times in this debate. It is acknowledged that we have there a modern yard fully capable of meeting modern competition. In a neighbouring yard, probably one of the largest in the country, there is now being carried through an expensive modernisation scheme which the Minister examined when he was in Tyneside a short time ago. This scheme will enable the Swan Hunter yard to deal with the largest size of tankers that can be built and will enable the Tyne to compete in world markets.

All this raises the problem of space which several of my hon Friends have mentioned. In many cases there is not the space to carry out this work. One must not only have the largest slips, but one must also have the prefabrication shops so sited as to give easy access to those slips. In many cases that is not possible without almost the replanning of some towns. In one Navy yard it has been possible to carry out reorganisation and in another yard schemes are now well advanced which I am sure will succeed before long in producing the size of slipway and the prefabrication shops that we want.

But reorganisation of this kind is much more difficult to carry out when the slips are still working, as compared with the problem of our foreign competitors who are building from scratch. One must pay tribute to the firms that are involved in these very big reorganisation schemes and in the planning that is involved to ensure continuity of work in existing slips while the reorganisation of the rest of the yards is going on.

I quite appreciate the impossibility of carrying out schemes of this sort in many parts of the country without great changes in the planning and layout of streets. It is a problem which requires the active cooperation and help of the Government. I suggest that there is a very strong feeling that with regard to these life and death problems the Admiralty has not shown the drive and keenness that many parts of the country would have liked to have seen.

I do think it is pertinent at this point to refer to proposals put forward on many occasions in the House and in the Press by my hon. Friend the Member for Sunderland, North (Mr. Willey) and his suggestion that there should be a working party set up between the two sides of the industry, with the assistance of the Admiralty, to tackle some of the problems of organisation both of labour and capital in the yards so as to face the problems which undoubtedly will be coming upon us before long.

It is important that we should get the wage claim out of the way first but, once it is out of the way, it is highly important that the two sides of the industry should discuss these long-term problems. Unless they do so, I am afraid that we shall be in very real difficulty.

A further point which I have raised at Question time on several occasions is that, although it is true that steel plate is now much easier to obtain in the yards, there are certain types of plate which are still very difficult to obtain, in particular boiler-plate. The more I try to find out why boiler-plate delivery should be two and even three years from our own manufacturers the more difficult it seems to get an effective answer. So far as I understand, some of the larger types of boilerplate are only manufactured by one firm, that of Colville's.

For reasons which 1 do not pretend to understand they have not been willing to expand their production to meet the undoubted need for a greater quantity of boiler-plate, with the result that very large orders from the Tyne and elsewhere are having to be placed abroad and we are obviously coming at the end of the queue as against our competitors. That is putting our firms in a disadvantageous position.

It is the responsibility of the Admiralty to look into the matter to see whether it is possible to secure an extension of the production of this very heavy plate. I fully recognise the problems and difficulties and the reorganisation of plant which would be needed to expand production in this field, but here is a matter of great public importance and one in which I should have thought the Admiralty should attempt to take action. I think it would be a pity if there went out from this House any report of general gloom about our prospects, because I do not think that that would be wholly justified.

Neither do I think that the Admiralty ought to feel it can sit back comfortably and do nothing about it. Many firms are showing great vigour and activity in dealing with problems and their lead ought to be acknowledged and encouraged. It is the responsibility of the Admiralty to attempt to get the two sides of industry together to work out more effective measures for the future of the industry.

9.38 p.m.

Lieut.-Colonel Marcus Upton (Brixton)

The Amendment rightly draws attention to the question of the importance of the shipbuilding industry and its vital role in war. It also draws attention to the need for promoting the greatest measure of stability in all matters affecting the industry. For these reasons I hope that we shall never see a repetition of an incident, fully reported the other day, in which a trawler returned to the sea the body of an airman, apparently one of the casualties from the loss of the Washington bomber over the Irish Sea on 26th January last.

It is true that the Admiralty or the Service Departments and the Merchant Navy must have the closest degree of co operation in time of war, but that co operation ought to exist without exception in time of peace. It can happen that in time of peace an unfortunate incident takes place and it is only right that the Admiralty and the Service Departments should be able to rely to the utmost possible extent on the co-operation of the Merchant Navy if and when such circum stances arise. As a result of this incident, so far from improving the stability in all matters affecting the industry to which the Amendment refers—

Mr. Speaker

I do not know how the hon. and gallant Gentleman relates what he is saying to the problems of shipbuilding.

Lieut.-Colonel Lipton

It was pointing out that the Amendment refers to the need for promoting the greatest measure of stability in all matters affecting the industry. In my submission, it does not tend to promote stability in the industry when, as a result of the incident to which I have referred, four deck hands have refused to sail in the trawler to which—

Mr. Speaker

That is far too remote from the Amendment to be in order.

Lieut.-Colonel Lipton

Do I under stand, Mr. Speaker, that any further reference to the need for stability in the Merchant Navy is out of order, because—

Mr. Speaker

What the hon. and gallant Gentleman is referring to is far too remote from the Amendment to be relevant.

Lieut.-Colonel Lipton

I was trying to argue—[HON. MEMBERS: "Oh."] If hon. Members opposite are not concerned about the deplorable episode to which I have referred, that is their business.

I was trying to indicate, Sir, that the Merchant Navy, as is pointed out in this Amendment, has a vital role in war and that we must have—

Sir L. Ropner

On a point of order, Mr. Speaker. Would you consider the advisability of pointing out to the hon. and gallant Gentleman that we are talking about the shipbuilding industry and not the shipowning industry?

Mr. Speaker

I thought I had already done so and I hope that the hon. and gallant Member will now accept my Ruling.

Lieut-Colonel Lipton

Of course I accept your Ruling, Mr. Speaker, although hon. Members opposite seem to think I am departing from it. I am trying to suggest that it is not sufficient merely to talk about building ships if we do not also consider the use to which they are put and the competence of the people in charge of them. I am asking the Admiralty—

Mr. Richard Stanley (North Fylde)

rose—

Lieut.-Colonel Lipton

No, I will not give way any further.

I am asking the Admiralty to ensure that there is a close degree of co-operation between the Admiralty, as the Service Department concerned, and the Merchant Navy, so that investigations may be carried out into circumstances which lead to incidents of the kind I have mentioned, involving Service personnel. The Merchant Navy can be of the greatest value to the Admiralty. If, in peace-time, the crew of a merchant ship see a mine floating in the sea, it is their duty to notify the Admiralty so as to keep the sea passages safe and prevent the destruction of the shipping of which hon. Gentlemen opposite are saying we should have more.

I hope that the Admiralty and the other Service Departments will make it their business to see that such deplorable incidents as the one to which I have referred do not occur in the future.

9.44 p.m.

The Civil Lord of the Admiralty (Mr. Wingfield Digby)

I wish, first, to congratulate my hon. Friend the Member for Farnham (Mr. Nicholson) on the able way in which he introduced the Amendment. He mustered a remarkable number of facts about this industry which revealed that he had given careful study to the problem. I would also congratulate my hon. Friend the Member for Sunderland, South (Mr. P. Williams) for the way in which he seconded the Amendment in what I thought was a very interesting speech.

It may seem strange to hon. Members that in a debate on Service Estimates we should be discussing shipbuilding, but I think that, on reflection, they will see the very close connection which exists between defence and the shipbuilding and shipping industries. Indeed, anyone who reflected on the part which those two industries played in the two recent wars would certainly be convinced of their relevance on a day like today.

The Admiralty is concerned in a dual capacity with the shipbuilding industry. First, it is the sponsor of the industry; second, it is its best customer. As sponsor of the industry, it is the Admiralty's duty to watch events in the world which affect the industry, and that we endeavour to do to our best advantage. The First Lord and I have frequently visited shipyards throughout the country, and there we have had a chance of learning about the problems of the industry at first hand, and have been able to talk to the management side and the trade union side alike about those problems.

The hon. Member for Sunderland, North (Mr. Willey), and another hon. Member, asked whether it might not be necessary for the Admiralty, as sponsor of the industry, to have the advice of a working party. The Admiralty has considered that and has come to the conclusion that it is not really necessary. There is already the Shipbuilding Advisory Committee which was set up in 1947 specially to advise the Admiralty on the problems of the industry. The committee's terms of reference are extremely wide, and the committee includes representatives of both sides of the shipbuilding industry and both sides of the shipowning industry. I feel that the Shipbuilding Advisory Committee, which has been doing very valuable work, is fully qualified to do the same kind of work as would be done by a working party.

The second way in which the Admiralty is connected with the industry is as a customer. Defence orders at present with the industry amount to £120 million. It is perhaps not generally realised how close and technical a link there is between the Admiralty and the shipbuilding and repairing industries. The results of much of the technical research carried out in Admiralty establishments such as Haslar are made available, and are, I believe, of use, to the merchant shipbuilding industry. The Admiralty has a very close link with the industry there.

At the present time 20 per cent, of the men in the industry employed on new construction work are engaged on Admiralty work. Many Admiralty orders, especially for minesweepers, go to the smaller yards, which, as a number of hon. Members have shown they realise, are those which are at present most in need of help. The work of the smaller yards is running out very much faster than that of the larger yards which build the bigger ships.

The Amendment speaks of the importance of the shipbuilding industry. The Admiralty needs no convincing about that. If it were technically possible, we should have been willing to accept the terms of the Amendment, but that is not possible owing to the rules of order. Not only is the industry important to a number of towns and cities represented by hon. Members who have spoken in the debate and, therefore, important for the employment of a very large number of people; it is also important to the economy of the country as well.

I do not want to bore the House with too many figures, but there are one or two that I should like to give. The earnings of shipbuilding from United Kingdom owners last year amounted to £90 million and from foreign owners £35 million, a total for the year of £125 million. Turning to the shipping industry, we find that the indirect earnings of foreign currency are about £135 million, excluding oil.

I now turn to another aspect of the importance of the industry to the country. There is the question of war potential. It is most important for us in time of war to have available yards where we could build the necessary ships, both warships and merchant ships. As several hon. Gentlemen have clearly recognised, the history of this industry has tended to be one of booms and slumps, and I suppose it would be true to say that there is no industry in the country more sensitive to world trade than the shipbuilding industry.

Since 1939 the industry has enjoyed a long period of unbroken prosperity, and in 1952 a record was reached, when more than seven million tons were on the order books. At the present moment the position is not quite so satisfactory. There were 5,500,000 tons on the order book at the end of last year, two million tons of which are under construction. Last year employment in the industry rose by 7,200, although some of those men have come from the ship repairing industry, where the work is not so heavy as it was, largely because of the volume of new construction which there has been since the war—

Mr. Dugdale

Would the hon. Gentleman say what is the total increase or decrease, including shipbuilding and ship repairing workers, because he cannot change from one to the other?

Mr. Digby

They are two separate industries, but the total would be about the same and the 7,000 increase in the shipbuilding industry would about cancel out the decrease in ship repairing, but I am speaking without the relevant figures being before me.

As to the future of the industry, there is. of course, the question of steel. Undoubtedly, with a greater flow of steel, output during the coming year could be increased. A number of hon. Gentlemen have spoken about steel plate, particularly the hon. Members for Rotherham (Mr, Jack Jones) and Sunderland, South There is no doubt that the action of the Government, and of the Ministry of Supply in particular, has eased the steel position considerably. Nevertheless, more steel would be useful to cancel out difficulties because of bad sequence deliveries. I do not suppose that enough steel is likely to be available to the industry until new plate capacity is available, because of the great increase in the proportion of plate which is used today.

Undoubtedly, the main problem of the industry is no longer so much that of steel as of future orders. I think that this has been generally reflected during the debate which we have had this evening, and it has been the central problem which the Admiralty has been watching for the last six months or more. Until early 1956, work is there, and the position is satisfactory for the larger yards, although smaller yards will need orders before that. We have naturally to ask ourselves [whether orders will come along after that to make good the deficiency.

Some hon. Gentlemen seem to have assumed that the Government are able to obtain new orders in some easy fashion. But this is essentially an industry which depends upon world trade, and the help which the Government can give is very limited. I think the right hon. Member for Easington (Mr. Shinwell) put for ward that point of view—

Mr. Dugdale

May I ask one question? There is one form of help which the Government can either give or withhold. Certain firms would like to trade with countries behind the Iron Curtain. They would like to sell ships to them. What encouragement or discouragement do they get from the Admiralty when they wish to do so? It is not just a question of refusing permits. Are they discouraged even from asking for permits? From the knowledge which I have, that would appear to be the case.

Mr. Digby

I was coming to that point a little later in my speech. I think that the right hon. Gentleman is misinformed on his last point, but I will deal with that later.

As to the kind of help which the Government can give, they are obviously able to give naval orders, and I have already given figures indicating the kind and degree of help which that will be to the industry. But these naval orders are not likely to increase, and in any case they are relatively small compared to the capacity of the industry. Secondly, the Government can help with regard to steel supplies; they have already done so, and further efforts are being made to increase the flow of steel plate to shipyards.

Mr. Blenkinsop

Would the hon. Gentleman say whether he has any information on the problem that I raised several times about boiler plate and the problem of the single firm that is producing it?

Mr. Digby

Boiler plate has been one of the most difficult aspects of the steel problem, but it has received attention by my right hon. Friend the Minister of Supply. Then again, the Government are able, by their general economic policy, to be of help to the shipbuilding industry, and I believe that in that way the present Government have achieved a lot.

One or two hon. Members have gone on to speak about the possibility of fiscal measures or subsidies being used for the shipbuilding industry in this country. That is something for the Chancellor of the Exchequer to consider, and it is rather outside anything that I can deal with. In any case, I have to be careful what I say, Mr. Speaker, or you will call me to order. I am, however, authorised to say that a few days ago the Chancellor received a deputation from the General Council of British Shipping and he is now giving the most careful consideration to what was said. For these reasons, and because the Budget is so near, it would be inappropriate for me to say anything more on this subject at present.

As I have said before, the central factor in obtaining orders for the shipbuilding industry is the state of world trade in general, and freight rates in particular, and I was very glad that the hon. Member for Sunderland, North emphasised these points. With regard to world trade, it is interesting to note that world tonnage of merchant shipping rose in the last year for which figures are available by no less than three million tons, or 3.5 per cent. As to freight rates, the position is not quite so encouraging, the latest index figure being 72 on a base year of 1952. There we see one of the reasons why inevitably the flow of orders must tend to be damped down. Nevertheless, when we come to consider—

Mr. Callaghan

Was that the highest year for freight rates?

Mr. Digby

That was the key year.

Mr. Callaghan

The key and base year? The hon. Gentleman does not seem to appreciate the significance of this. He said that was the base year. It is not of any particular good to know that, or to tell us that the index is now 72. Will he tell us what the freight rates are by comparison with, for instance, 1947 or 1949 as the base year?

Mr. Digby

I do not think I could do that offhand. It would fall in the province of the Minister of Transport rather than in that of the Admiralty. When we consider the movement of oil in ships I think the outlook is a little more encouraging because in recent years the movement of oil has been increasing by about 5 per cent., although that is only a very rough figure. The world fleet of tankers has been going up considerably more rapidly than that of dry cargo ships.

In addition to these general considerations, in buying ships there are certain other considerations that are bound to be in the mind of every shipowner, in particular early delivery, because very often ships are ordered for a known demand. There is always a heavy financial commitment involved which a shipowner is unwilling to undertake unless he has a fairly clear idea when the ship is likely to be delivered. As has been pointed out in this debate, the mere fact that the order book is getting shorter will of itself help delivery by making delivery dates very much shorter than they have been for some time. Plentiful steel will cut down the length of time it takes to build a ship.

Above all, modern methods, which have been described tonight, for instance, by the hon. Gentleman the Member for Dunbartonshire, East (Mr. Bence) will help to reduce the building time of ships and increase the efficiency of the yards. During the last five years no less than £20 million have been spent on modernisation of one kind and another, and owing to the relaxation of licensing it is now very much easier for shipbuilders to spend money in this very important way.

Then we come to the question of cost. Many of the factors in cost are the same as those which affect delivery dates. Cost has gone up three to four times what it was pre-war. This is an assembling industry, depending largely on components. I think all this adds up to the need in this industry for increasing certainty both as to delivery dates and as to price; and, therefore, the return of the fixed price contract is highly desirable whenever that can be achieved. Some of our competitors overseas are already able to offer a fixed price contract, so that the shipowner knows what the ship is going to cost him when delivered, and it is not very difficult to see that that is an advantage.

In obtaining foreign orders, which have represented in the last few years about a third of the ships produced, there are many factors to be taken into consideration. One is the traditional links which happily exist between shipbuilders in this country and shipowners in countries overseas. In most other respects the kind of considerations that will persuade foreign owners to place orders for ships here are largely the same as the considerations I have been describing. Only last December the Chancellor of the Exchequer altered the credit restrictions with regard to foreign owners placing orders for ships here. Up to that time they were pledged to. repay loans six months after delivery of the ships. That rule has now been relaxed, and I very much hope that as a result further orders will be attracted to this country.

Several hon. Members, and in particular the right hon. Gentleman opposite, have referred to the question of orders from Russia and from countries behind the Iron Curtain. Only the other day we issued licences to a Lowestoft firm for an order for trawlers to a value of nearly £6 million. I should say that we are willing to take orders not only for trawlers, dredgers and tugs, but also for ordinary merchant ships subject to security and quantity controls. The industry have full details of these, and some firms are at the moment in contact with the trade delegation of the Soviet Government.

Mr. Dugdale

Does the hon. Gentleman know that there are cases where firms could have accepted orders which, in fact, have gone to the Continent?

Mr. Digby

A number of firms have been in negotiation for orders, but have failed to secure firm contracts. Therefore, they have not been in a position to come to us for licences. We cannot negotiate the contracts for them. They must do that themselves, and if they fail there is, of course, no firm order to licence at all.

Mr. Fernyhough

Can the hon. Gentleman give an undertaking that if an order for tankers was obtained their delivery would be allowed? If he cannot, will he say why other N.A.T.O. Powers are allowed to construct and deliver tankers?

Mr. Digby

It is quite true that there are certain types of vessels which for strategic reasons we should not be willing to licence. But, in that case, we are in the same position as the other N.A.T.O. Powers.

Mr. Fernyhough

No.

Mr. Digby

Yes.

I must say a word about the question of foreign competition. It has been quite rightly pointed out by one hon. Member that this is not the chief reason for the present decline in orders. Nevertheless, it is something which has come to stay. Our chief competitors— Germany, the Netherlands and Japan— have received great advantages from the reconstruction of their yards owing to the war. Last year Germany increased her output of ships by no less than 57 per cent.

Many of our foreign competitors enjoy State subsidies. They have an adequate supply of steel, and almost without exception they can offer earlier deliveries than we can. In addition, they have an adequate labour force. However, I still believe that on balance we have the advantage with regard to price, and, of course, we have a splendid tradition and a reputation second to none.

The hon. Member for Farnham dealt at some length with the question of the Merchant Navy. That matter is really outside the province of the Admiralty. It is a Ministry of Transport responsibility, though, of course, the Naval Staff is most anxious that there should be a large and healthy merchant fleet. The figure 18 million tons has again been reached after the depredations of the war. The standards of the merchant ships which are being built and are going into that fleet are going up, both with regard to speed and to the accommodation of the crews. The latter has improved very much indeed.

The prosperity of this very important shipbuilding industry depends essentially on world trade, and on many factors of world trade which are outside the control of any Government. Nevertheless, the Government are watching the industry and, in particular, developments with regard to orders which we shall need after 1956, and which we should like to see placed as soon as possible.

I believe that this industry, with its traditional skill both of management and workers, will be able to respond to the undoubted challenge which now exists because of the difficulty of getting orders in the face of strong competition from overseas. It is an industry in which we have a great deal of experience upon which to draw, and in which we are still the undisputed leaders of the world. We should take a balanced view of the industry's future and be neither too pessimistic nor too optimistic.

Mr. Nicholson

I hope that this has been a useful debate. I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Main Question again proposed.

10.11 p.m.

Mr. Michael Foot (Plymouth, Devonport)

I wish to return to some of the general themes which we were discussing before the hon. Member for Farnham (Mr. Nicholson) moved his Amendment. I am sure that all Members welcomed at any rate one part of the statement made by the First Lord. In all our debates on the Navy Estimates since the end of the war, hon. Members from one side of the House or the other—and usually from both sides—have raised the question of the period of foreign service. Most people agree—certainly those who come from naval ports—that the greatest deter- rent to recruitment in the Navy, and the sorest grievance of the men, has been the lengthy period of foreign service.

Many proposals have been made for dealing with this problem. I believe that when my hon. Friend the Member for Cardiff, South-East (Mr. Callaghan) was at the Admiralty he gave instructions for a full inquiry into this matter, to see if something could be done to alleviate the position. I realise that great difficulties are involved in carrying out such a proposal, but from what was said by the First Lord it seems that the Board of Admiralty has now made definite decisions in the matter. We shall all watch with great interest to see how these are carried into effect. We are nil very pleased at the announcement made by the First Lord, and we congratulate him on having made it.

On the more general issues of strategy which were discussed at the beginning of the debate it is not possible to pay quite the same compliment to him, because he did not deal in a very detailed or graphic way with the real problems which were posed in the remarkable speech made by my hon. Friend the Member for Cardiff, South-East. That was an extremely interesting speech, and it seemed to me that my hon. Friend had been successful in carrying out a feat in which such notable persons as Philip of Spain, Admiral Van Tromp and Admiral Villeneuve had all failed, namely, to destroy the main Fleet of the Royal Navy in a single engagement. That appeared to be the total effect of his speech.

I am not saying he is wrong on strategic grounds, but whether or not he is it is necessary that we should be told how the Government regard these main problems. It is quite impossible that we should have debates of this nature in which the fundamental strategy on which the Navy is to be based is not discussed by the Government spokesmen. In the recent debate on the Air Estimates there was considerable discussion about the strategy which should underly the policy of the Air Ministry.

Although there were strong differences of opinion in different parts of the House as to what the strategy should be, nevertheless we discussed the general defence strategy of this country, whereas in this debate the discussion on the main issue of strategy has been very one-sided. I hope that the Government will make a statement on the subject or try to give a clear indication of how the rôle of the Navy fits in with the general defence policy of the country.

Some speakers have referred to an issue which has arisen in all the dockyard towns in the last few months because of the Admiralty's decision to revert to the system of having the holiday periods all at the same time, thus abolishing the system of staggered holidays. Protest has been made from both sides of the House, but it is necessary, on this subject, too, that the Admiralty should state its position much more clearly. What it has done in abolishing staggered holidays, which have existed since the war, is to defy the clear statement of Government policy made by all the other Ministers.

It has been the policy of successive Governments to encourage staggered holidays. During the war the Catering Wages Commission and its two standing committees, each appointed by the Ministry of Labour to encourage the idea of spreading holidays and seeing that they were not all cramped into the same period, inquired into the matter. After the war considerable efforts were made, through Government encouragement, to get individual firms to take such action and to ensure that the holiday period all over the country extended over the longest possible time.

A national publicity campaign was organised, through the Press and the B.B.C. and backed by the Government, in order to stagger holidays. That was continued until 1950, when the campaign was take over by the British Travel and Holidays Association, in consultation with the Board of Trade. As recently as last January, the President of the Board of Trade announced that it was the Government's policy to encourage individual firms and others to stagger their holidays instead of having them all in the same period.

But the Admiralty has flouted the whole of this policy of other Government Departments, and we have the right to ask whether it consulted the Board of Trade before it reached the decision. Did the Admiralty consult any of the holiday associations? We know that the trade unions were consulted, because they gave an emphatic "No" to the proposal. Were the corporations and city councils consulted? Had they been consulted it would have been discovered that in all the dockyard towns there was a unanimous opinion against the Admiralty's decision.

We have all the hotel associations, all the city corporations, all the trade unions, all the Government Departments concerned—except the Admiralty—opposed to this decision. I can discover no one except the Board of the Admiralty who approves of the decision. A much clearer explanation should, therefore, have been given of the detailed grounds on which the Admiralty reached the decision, because obviously it involves enormous inconvenience for all those employed by the Admiralty.

For the people in the Devonport or Portsmouth dockyards, and all other dockyards, to be told to have their holidays during the same fortnight is a gross inconvenience to them. Surely the Admiralty should have a strict regard for the interests of those who work for it. The Admiralty must have known this subject would be raised on all sides, and I hope that we shall have a clear statement of how much money is involved and how much the Admiralty thinks it will save by this process of planning the holidays over the same period.

When we are told how much will be saved we may be able to judge whether it is worth while involving so many thousand people in so much inconvenience as will be the result of the Admiralty's decision. In any case, I hope that the Admiralty is going to give much closer consideration to this matter before next year and make sure that it consults in very good time the trade unions concerned to see if we cannot get a better arrangement and one which really looks after the interests of the workers in the dockyards better than the Admiralty has done this year.

Now I wish to turn to some other matters connected with the Royal dockyards. When I mention that, I see some of my hon. Friends wincing, but I will put them out of their misery at once. I do not propose to make the same speech as I have made on seven successive occasions on the Navy Estimates. Needless to say, it is not the case that the Admiralty has adopted any of the recommendations that I have made on previous occasions. It has not adopted any of them properly, and the reason I am proposing to take a fresh course this year is that I am adopting a different strategy.

Instead of attacking on a broad front, I hope to be more effective on one point at least. I do so because it has been suggested, and indeed the Admiralty makes a great song and dance about it in the White Paper which it has issued with the Estimates, that the Admiralty has in fact made a concession to one of the appeals which some of us have been making for the last seven years. If we read the White Paper, it says that the Estimates provide additional resources in the next few years towards modernising dockyard plant and equipment. That has been published as a great new plan and ambitious programme to be embarked upon by the Admiralty.

I want to examine this programme to see whether it is really so big, and in order to discover whether it is real we have to examine carefully what is said in Vote 10 of the Estimates. On the whole of Vote 10, covering works, building and repairs at home and abroad, there is a net decrease for this year of £1,203,000. Vote 10, so far as I know, is the main Vote governing the provision of works and buildings in dockyards and elsewhere, but in this main Vote there is a decrease to start with, and so it does not sound like a great modernisation programme. If we look more particularly at Vote 10. under the special item dealing with new works and additions, there is also a reduction of £1,574,000, so we have to inquire into that a little more closely to see where in fact this great modernisation programme is to be undertaken.

When we look at the detailed amounts to be spent on Vote 10, and the amount to be spent on dockyards and factories, as shown on page 140 of the Estimates, we see that there is an increase of the amount to be voted in 1954–55 on new works of £39,000 over last year. It is quite true that the total amount that will be spent eventually on some of these new works amounts to £1,500,000, but the actual increased amount, according to the statement made in the Estimates, to be spent on new work to be started in 1954 and 1955 in the dockyards and factories is no more than £39,000.

That is £39,000 between all the dockyards. It is not exactly a tremendous indication of great enthusiasm for the modernisation programme when the amount to be spent on new works in the dockyards at home amounts to £39,000 increase out of a total Admiralty budget of £400 million, and out of a total increase this year of £23 million. So all that the dockyards are going to get out of this huge increase is this very small amount of £39,000 on new works this year. If I am wrong about these figures, I should be glad to be corrected.

Anyone who examines the figures will see that there is not only a general decrease under Vote 10, but there is in particular a general decrease on the amount for new works and buildings. It is only when one comes down to the particular item on the dockyards that there is a slight increase; and, as I have pointed out, it is very small indeed. It is certainly quite insufficient to deal with the real problems of the dockyards, which we have been describing for the past six or seven years and which the Admiralty has never fully comprehended.

I should also like to know whether, even in this small amount which the Admiralty proposes to devote to the new programme, the individual admiral superintendents are to have any greater powers over how the money is spent compared with what they have had in the past. One of the main recommendations of the Select Committee on Estimates, which went into the problem of the dockyards, was that each admiral superintendent in each dockyard should have a bigger sum of money voted to him and much greater discretion as to how to spend it.

The ridiculous fact came out in the cross-examination by the Select Committee that each admiral superintendent had discretion over only £1,000 during the whole of the year, which is fantastic. It was the evidence of all the employees in the Admiralty—all the heads of departments—who came forward and gave evidence at the time of the Select Committee investigation that this was not the real way to do the job. On page 284 of the minutes of evidence taken before the Select Committee on Estimates, Session 1950–51, will be seen the evidence given by the heads of the engineering department in Devonport Dockyard.

This was the answer given by one of them: I think we ought to replace all our obsolete plant in five years and get new plant, plant not now in design, faster tool cutting plant and everything else. If we could get a sum of money to replace that obsolete plant in five years we should increase production probably by 50 per cent. Does the Admiralty want to increase production in the dockyards by 50 per cent.? This is the way it could be done. If the Admiralty took more money off some of the other Votes and put it on to Vote 10, it would make a real economy and in a few years would be producing much more. The Admiralty need not take my word for it but can take the words of the heads of the engineering departments at Devonport Dockyard, who gave this evidence to the Admiralty: but, of course, all the recommendations of the Select Committee were turned down flat.

The heads of the engineering departments were asked whether it would be an advantage to have greater discretion over the money that was allocated and to decide how best it should be spent, and the answer was "Yes" from everyone. But still the Admiralty thinks that it knows better than the people on the spot who are doing the job. We have given many examples before, but we must go on giving them until the Admiralty realises what this problem is.

A statement was made in Devonport the other day by the superintendent naval store officer, who said: The rectification of the conditions for road and rail traffic in the yards is long overdue. The North Yard, in particular, is appalling, but I am afraid it will probably be a long time before anything can be done about it. I have quoted before statements that were made to the Select Committee by several other employees of the Admiralty. The Admiral Superintendent in Devonport Dockyard, for instance, said: Give us the money to build some decent shops for the men to work in … The position is frightful. It is amazing how the people turn out the work they do … The dockyard is in a very bad state. All the evidence is in the Select Committee Report of how the whole of the plant and equipment in these dockyards is appallingly antiquated. The surest economy that the Admiralty could make would be to spend much more money on Vote 10 instead of thinking that it can carry on with the same old equipment and in the same old way in which it has been run for generations past.

Mr. J. J. Astor

If the hon. Gentleman is right in his interpretation of the figures, would he not agree that, according to these Estimates, in the last year this Administration has done more for the dockyards than any other Administration since the war has done in one year? Or is it a decrease?

Mr. Foot

Taking the whole question of works and buildings, I say that on Vote 10 it is a decrease this year, but taking the individual amount on the dockyards it is, as I have said, an increase of £39,000 this year. I am afraid the hon. Gentleman must have misunderstood what I have been saying about the dockyards for the last seven years if he thinks I was satisfied with what was done before.

Mr. Astor

No, I do not.

Mr. Foot

It may even be possible that what we have said before has penetrated, that the Admiralty has begun to understand the importance of Vote 10, because we have been shouting about it for seven years. But the Admiralty has not learned sufficiently.

Mr. Walter Edwards (Stepney)

Is my hon. Friend not aware that the main portion of the money spent in the dockyards in the last two years has been spent because the Labour Government had a planned programme, as a result of which this money had to be spent?

Mr. Foot

Some of the money has come forward because it was allocated before, but as I said to my hon. Friend when he was in office, and as I say to him again, it is nothing like enough. He need not take it from me. He can take it from the Admiralty Superintendent of Devonport Dockyard or all the trade union leaders in the Admiralty dockyards, whichever one he likes.

Mr. Edwards

We did it.

Mr. Foot

My hon. Friend may say he did it, but the work is not done. Take the way they run the lorry system, with lorries parked all over the place in Devonport Dockyard, blocking the shops and ships. It is a hopelessly chaotic system. The lorries have to go some distance away to fill up. Streams of lorries can be seen going off half empty or completely empty, and the taxpayer can look on and see how a great part of his money is being wasted.

As I said to my hon. Friend when he was in office, this is the opinion of everyone who inquires into it on the spot. The dockyards are hopelessly antiquated and inefficient. People have to work in workshops that are a disgrace. Therefore, even though some extra money was voted under the Labour Government, and even though a little extra is perhaps to be voted this year, it is nothing like enough to do the main job which has to be carried out. I say the Admiralty has got its priorities wrong in this, just as I believe it has got its main strategy wrong. If the Admiralty decided what money to spend in improving the equipment of the dockyards and to step up the amount in terms of millions instead of a few thousands it would be the very best economy that it could make.

Whilst the Admiralty is puzzling its head so much in discovering what ships to build, and whilst it is very uncertain about what kinds of ship it ought to be building, it might at any rate take some money from those Votes and use it to put in proper order the machinery which it will require for building the equipment that it will need in future, which would be a much wiser course than the one which the Admiralty has followed in the past.

I know that many hon. Members who do not come from dockyard towns may think this is a small matter, but if they take the trouble to read through the Report of the Select Committee on Estimates which went into this matter they will see that all those working in the dockyards say exactly what I have been saying. Much more should be spent under Vote 10. I have quoted one eminent authority in Devonport Dockyard who has said that doing that could very quickly increase production in the dockyard by 50 per cent. This is what I am asking for in the interests of the nation as a whole, because it is wrong that these vast industrial organisations, which is what the dockyards are, should be left in an antiquated state.

The Admiralty must embark upon a capital investment programme in the dockyards. The case has been proved by the quotations I have already given, but which I propose to go on giving until the Admiralty decide to take some action. I have got to be grateful for the fact that out of the £400 million we have now got a few thousand pounds extra. Some hon. Members opposite are easily satisfied, but if they want anything out of the Admiralty they should not need to go about in in that way.

I do not want to end on a note that is not cheerful. Last year we got one small concession from the Admiralty, the appointment of a deputy manager for a limited period in one of the dockyards. That was a great, daring experiment in the civilianisation of the dockyards. Are we to have some report of what has happened? Has catastrophe followed? Have there been all the appalling consequences which some people foresaw? The Admiralty embarked on the terrible programme of interfering with the naval officers in the dockyards, but we know that it was a sop thrown to the Select Committee—one small, timid, miserable experiment in the face of the massive proposals put forward by the Committee.

Now we have got another, a few thousand pounds extra, a pious hope in the White Paper. We have had two concessions from the Admiralty in two years, which shows what daredevils we have got at the Admiralty now. I hope the Admiralty will be encouraged to go on, but, as I have said before, it must be very careful. It can be dangerous to grant only a few concessions now and then, as dangerous as the obstinacy of Louis XVI and Marie Antoinette, who gave a few concessions but not the main ones needed. I warn the Admiralty that if it continues this policy there is going to be a revolution, a revolution which is going to carry into effect all the recommendations not only of the Select Committee two years ago, but those of the Committee which made the same recommendations way back in the year 1927.

Commander Noble

Before the hon. Member sits down, I should like to correct a point on which he has been harping for some time. He seems to have forgotten that the new equipment and machinery for the dockyard does not come under Vote 10 but Vote 8, and in Vote 8 we have a £7 million programme for a period of four years, and this year we are going to spend £1 million on it.

Mr. Foot

The hon. and gallant Gentleman interrupted me before I sat down. I am afraid that his main argument only confirms what I have said, because under Vote 10 comes the money required for the overhaul of roads, railways and other things in the dockyards, and it is there that the hon. and gallant Gentleman's interruption is most misleading. However, no doubt we shall have an opportunity to examine these individual Votes. If the Government do not attempt to report Progress, enforce the closure or anything of that sort, I can assure the hon. and gallant Gentleman that I shall be most happy to examine the Votes in great detail.

10.38 p.m.

Commander J. W. Maitland (Horn-castle)

It has been my lot to follow the hon. Member for Devonport (Mr. Foot) on several occasions when he has been making one of his famous seven speeches, but I have never heard him in such optimistic voice as he is this evening. It is a great achievement for the Government, because they seem to have put him in such good humour.

The main theme of this debate has been, as I always thought it would be, first, the question of the strategic future of the Navy and, following from that, the difficulty of recruiting. I agree with the hon. Member for Huddersfield, East (Mr. J. P. W. Mallalieu) that until the long-term future of the Navy is settled and the shape of things to come is more clearly seen, it is very difficult to expect young men to devote their whole lives to the naval service.

I was much impressed by the speech of the hon. Member for Cardiff, South-East (Mr. Callaghan). I thought that it sized up the whole matter clearly and fairly. I do think that it is vital that we should face these rather difficult problems and not be frightened of them merely because they are controversial and difficult. We must settle them, for to settle them is to the great interest of the country.

These problems obviously devolve on who is to control what kind of weapons in the future, and here, without doubt, the question of aircraft comes in. For example, are they to be shore-based or sea-based; who is to control them? These, I suggest, are problems for the real experts to settle. We in this House who have a great love for and faith in the Service in which we have served, often feel that any criticism or doubt which may be cast on the importance of our particular Service is quite wrong. Our anxiety complexes are apt to throb, and we are apt to say things which are by no means for the good of co-operation between the Services.

Before the war, I remember the controversy which raged over the Fleet Air Arm, and I do beg some of the retired senior officers—and this applies equally to each of the three Services—not to give tongue on matters which, sometimes, do not help the proper solution of these great problems. Particularly, I suggest, that should be remembered in another place. I do believe that these problems would be easier to face if we politicians left them to the expert and only expressed our determination that they should be faced and solved.

The solution of these problems does not only affect this country. The Royal Navy today is part of the N.A.T.O. setup, and all these problems have to be solved together; we have to co-operate very carefully with other countries. In that connection, I was very interested, when looking at the United States estimates devoted to their Army, Navy, and Air Force respectively to see that the proportion of money which they devote to each Service respectively is quite different from our allocations here.

We have to decide on a general strategy and, when that is approved and agreed, I think a great many of the difficulties of recruitment will end. It would be lamentable if the great traditions of the Royal Navy were lost to the service of our country. We have some of the finest of our young men in the Royal Navy, and it is only right and just that their future should be made secure and that they should be able to serve their country with that knowledge.

I should like to turn for a moment to one aspect of the problem of recruitment. I do not think it could be denied that one of the anxieties which prevent men from signing on for a given number of years is their doubt of what they will do when they come out of the Service. All of us who have served have probably had that anxiety ourselves, and it means a great deal to feel that there is security about the future. I know that in the depots people are advised about getting jobs when they leave the Service, but we ought to go much further than that for these men who have come forward to serve in an arduous and difficult life.

Let us remember that whatever we do cannot make it much less arduous because, among other things, there will always be foreign service. There will always be separation for wives. Life on the mess deck will never be like living in a comfortable house. We owe a debt of gratitude to the men who devote their lives to serve the country in the Royal Navy, and there is a strong case—perhaps this is the moment to deal with it, now that we are short of recruits—for the Ministry of Labour, the Admiralty and the trade unions to get together to see what can be done to help men who are leaving the Navy.

I have discussed with people in the Ministry of Labour a suggestion which I believe to be practicable. I suggest that it is possible to take retired members of the Services, both officers and men from the lower deck, into the service of the Ministry of Labour to help the Navy to get these men into jobs. It is true that some such organisation exists in the Appointments Bureau. We should extend it so that every sailor may feel that his country is doing its utmost to see that he gets a good job when he leaves the Service. If we are to do that, we must have people available who can look at a man's history sheet and say, "Here is an able seaman with two good conduct badges and a first-class record, and he should be capable of holding down such and such a job." Such people would know what sort of job the sailor could do. This work could be done by recruiting to the Ministry of Labour men who have special knowledge of the capabilities of sailors and of the way in which the Navy conducts its affairs.

Another matter which has always worried me is the way in which the Navy deals with promotion. It promotes by merit, and its promotion is perhaps the most highly competitive form of promotion anywhere. That is right, for we must make great efforts to get the best men into the right places. On the efficiency of the senior officers depends the happiness and safety of all the men under their command. It is essential that we should choose the best.

Our mistake is that we divide our promotion periods into zones, and once men get to the top of their zone they have no more hope. I have seen that happen so often. I have seen lieutenant-commanders pass out of the zone, and for a few more years they are pushed about from one job to another. They know that they cannot be promoted. It happens, too, on the lower deck. I have seen so many chief petty officers who can get no further.

Yet remember how efficient were some of the officers and men we promoted to acting rank in the war. Who could say that the acting warrant officers we made straight from chief petty officers did not earn their keep? A chief petty officer because of educational reasons, has failed to become a branch officer. Why should he feel that he can go no further? The man who has just failed to attain commissioned rank and has become a chief petty officer at an early age, has no future. Is it not natural that he should leave the Service? How can we expect him to sign on for a long period?

I have always felt, both with officers and men, that the door should always be open. Everybody knows that when a man has passed a certain age he is not likely to be promoted, but it should not be impossible. There should always be a chance so that by some brilliant action, possibly the wiping out of a black mark which he has been given in the past, he can get a little further in the Navy. I would ask the Admiralty seriously to consider this point. It means a big change in things that have gone on for many years, but it would be a great advantage in getting people to sign on for longer periods, as they should.

Finally, I should like to say that the Navy today is going through a period of change. Things may be very different soon. There was a peculiar expression which emerged in the defence debate— "a middle-piece" officer: I have never heard it before. It is a shocking expression. But there is a great need for the Admiralty to use the ideas of lieutenant-commanders and commanders, whom I suppose to be middle-piece officers, more than it has done in the past. I think it interests ships' companies to be set problems. I remember one admiral under whom I served did do that, and it went extraordinarily well. One can get a lot of ideas from men aged 35 years who have given much thought and study to their profession. I should like to see more of that sort of thing done.

In one ship I was in we were told we would have to have a big refit to produce a new form of ammunition supply. We did not want the ship cut to pieces. We did not think it would be efficient if it was. So we all set to, from the captain down to the gunner's party, to think out a different way of doing it. The chief ordnance artificer produced the best scheme, and it was accepted and the country was saved many thousands of pounds. He won a prize of £5. Much can be done by the use of prizes to assist in studying ship's problems and asking men what their views are on a particular subject. That might help to solve the grave problems which lay before us. I commend these ideas, for what they are worth, to the Admiralty.

10.54 p.m.

Mr. Percy Wells (Faversham)

The hon. and gallant Member for Horncastle (Commander Maitland) will pardon me, I hope, if I do not follow him, because it is 40 years since I left the Navy, and I have not had an opportunity of keeping in touch with my branch of the Admiralty service to the extent that would justify my following the line which he has taken in this debate.

I was rather surprised when I listened to the speech of the First Lord to find that he almost completely ignored what was happening in the Royal Dockyards. We have had some discussion about this by Members on both sides of the House today, and I want to reinforce one point which was made by all of them. My right hon. Friend the Member for Rochester and Chatham (Mr. Bottomley), the hon. Member for Plymouth, Sutton (Mr. J. J. Astor) and my hon. Friend the Member for Devonport (Mr. Foot) have all referred to the closed period which the Admiralty has enforced on workers in the various dockyards. I do not want to elaborate that matter, although it is a very serious one. All I would say is that I hope that the First Lord has noted that from all parts of the House that he has been asked to give some further consideration to it.

There is only one point that has not yet been made that may usefully be made now, and that is about the effect on education of the Admiralty decision. I understand that there is some difficulty at Chatham Dockyard. The hon. Member for Gillingham (Mr. Burden) will, I hope, excuse my mentioning this, but I also have constituents employed there. The education officer is desirous of avoiding a clash between the dockyard closed period and the school holidays. In my constituency there is a very large firm, Bowater Lloyd Ltd., which also has a closed period that does not coincide with the dockyard closed period, and that makes it doubly difficult to arrange matters satisfactorily from the point of view of education. I hope that the appeals made from both sides of the House for reconsideration of this matter will not be lost sight of.

I want to turn to a constituency matter about Sheerness Dockyard. Many years before the war I was concerned in a difficulty that arose there over C109 coaling hulk. It was hoped to start a payment-by-results scheme, which was resisted by the members of my trade union at that time because of the then considerable amount of unemployment. They were under the impression that if they entered a scheme of payment by results it would mean that eventually some of their comrades would be put out, as they said, "on the stones." After some difficulty we got such a scheme accepted. My information is that after the first teething troubles had been overcome the scheme worked excellently, and that it is working so to this day. I understand that there have been no complaints from the Admiralty to the employees' side of the shop committee about this coaling operation as performed in Sheerness Dockyard.

Recently, so I am informed, a proposal has been made to let this work out to a private contractor. I understand that representations have been made through the usual channels at Departmental level, but that no satisfactory answer has been obtained so far. It may be that it is only a rumour, but if that be so it is difficult to understand why satisfaction could not have been given to the trade union representatives at Departmental level. In any case, the rumour exists; there is a feeling of uncertainty; and 1 appeal to the Parliamentary and Financial Secretary to do all he can to assure the employees on that job that there is no substance in the rumour.

Another matter I wish to mention is the allocation of tugs. I understand that this has also been dealt with at Departmental level. The question arises as a result of a memo, exhibited on the notice board at Chatham Dockyard. As a result, it is thought by many employees at Sheerness Dockyard that an attempt is to be made to reduce the number of duty tugs. At present there are two. There have been two ever since I was first connected with the dockyard over 40 years ago. I understand that the proposal is that one duty tug should be stationed at Chatham: in other words, Sheerness is to lose its duty tug.

The question has been taken up at Departmental level. Employees' representatives have been told that the matter cannot be discussed because it is top secret and the memo, to which I referred was put on the notice board in error. I hope that I can be given an assurance on this point. It is the opinion of skilled craftsmen that if we are to have only one tug, though it is to be hoped that the Admiralty will not run the risk of having only one, the most sensible place at which to station it is Sheerness rather than Chatham.

I do not want to place myself in competition with Chatham, for I am advised by those who have been operating the tugs for many years that two tugs are essential. I hope that note will be taken of my comments. If I can be assured that there is nothing in the matter, I shall be as happy as the men for whom I speak.

Commander Noble

I will certainly look into the two points about Sheerness Dockyard, and let the hon. Gentleman know my view as soon as possible.

Mr. Wells

I am pleased to hear that.

There is a feeling in Sheerness that work is gradually being taken away from the dockyard. About three years ago the naval stores department was taken to Chatham. The Fleet Reserve has recently been taken away. Now we have these rumours about the removal of other work. When one remembers that employment in the dockyard is almost the only work open to men on the Isle of Sheppey, one realises that this is a serious matter. I am informed that the removal of the naval stores department, taking into consideration the transport and the waiting for materials and components, hardly achieves the saving which was anticipated when the change was made.

Finally, I wish to refer to what was happening at Sheerness just over a year ago when the dockyard suffered considerable damage in the floods. A frigate and a submarine were submerged, and it was thought for a time that they would be total losses; but because of the skill and loyalty of the men concerned they were saved. I understand that they are either in service or are about to come into service soon. Not only was the dockyard staff able to give service in the dockyard but it was able to perform wonderful work for the civilians in the nearby area. I hope, therefore, that we shall not be faced with the position of this continual whittling away of work from a yard on which such a large number of my constituents depend for their livelihood.

11.5 p.m.

Mr. G. R. Howard (St. Ives)

I am sure that the hon. Member for Faversham (Mr. P. Wells) will forgive me if I do not deal with the topics which he has raised, as my only experience of that part of the world was confined to my R.N.V.S.R. training days before the war. I should like for a few minutes to mention a few points that have been exercising some of us recently, and this seems to be the opportunity to raise them.

First, I think that some of us were alarmed to see an article in a national newspaper regarding disaffection in the Navy. I feel quite sure that there were no grounds for this concern and that when the Parliamentary and Financial Secretary comes to reply he will reassure us on that aspect. But it seems to me that the trouble here is one which was touched on in the opening of the debate, that of man versus machines. Those of us who have come up against this problem in the war will know the constant struggle and battle it was to reconcile old ships which were constantly having new equipment put in them, especially on the mess decks, where the equipment had to be under cover, thereby taking space from the men.

It is a problem which will always be with the Navy, and, as has been said several times today, life in the Navy can never be easy. But one must be assured that everything is being done— and I am sure it is—to study that problem and to see that as far as possible these articles of equipment are not put into ships as an afterthought if it can be avoided; and I think there must be, and probably is, in future planning new thinking regarding the accommodation of ships' companies from smaller warships and auxiliary ships, ashore as much as possible. What the hon. Member for Huddersfield, East (Mr. J. P. W. Mallalieu) said about conditions of the heads and bathrooms in his ships reminded me of what happened in one of my own ships during the war, where we had no bathrooms at all. So hurriedly, before coming home across the Atlantic, we slopped down some cement on the iron deck, and put up some iron stanchions, and when we got back to the dockyard said that our bathrooms had been washed away, and we got new ones built.

Regarding recruiting, I should like to make a suggestion concerning the Sea Scouts and Sea Cadet movements. I understand that Sea Scouts are not granted entry into the Navy unless they are Queen's Scouts, and that Sea Cadets cannot be granted entry into the Navy unless they are Cadet petty officers. Of course, they can go in through the R.N.V.R., but in distant counties like Cornwall it is often very difficult for them to serve in the R.N.V.R. because of the distances they have to travel for their training.

I wonder if recruiting could be helped by improving our propaganda. After all, although all the means of entry into the Service are made known to the various units, some units are better than others. I suggest that perhaps the Service could be helped by the inclusion of more highly qualified officers, who could inspire enthusiasm by going round lecturing to these units and telling them more about the Service and how they can get into it, and what they can do when they get there.

I think there is something in what my hon. and gallant Friend the Member for Horncastle (Commander Maitland) said about asking for advice. I remember on one occasion during the war when we had a piece of equipment put into the ship which every single officer and all the gunnery ratings said was useless. We simply steamed from one port to another, where it was ripped out and thrown away.

I wish to ask about minesweeping training, especially as it concerns R.N.V.R. personnel. Have they got modern ships and enough of them in which to train, because, as my hon. Friend the Member for Ilford, North (Mr. Iremonger) said in a most excellent maiden speech, there is no substitute for sea training, especially in the complicated procedure of minesweeping? We know that problem is going to be one of the most appalling which any country will face at the beginning of a war, with ports being sealed up, and so on. I hope that I detected a more hopeful note in the First Lord's speech this afternoon as regards dealing with that menace. I also hope that their Lordships are satisfied that there are enough R.N.V.R. officers and ratings successfully carrying out this training.

In this connection, I want to raise once more the question of the travelling allowances of R.N.V.S.R. officers. Many of these officers had six years' continuous sea experience during the war. They are young enough to be very valuable still today. They do not mind about the pay, but it would help if their travelling expenses could be made up to them.

Regarding fishermen's training, I understand that adequate numbers are coming through under the List B scheme whereby they do four periods every five years. It is hoped that many of them will join the Patrol Service at the end of the five years. The Outward Bound Trust is considering training young men to go into the fishing industry, and educational grants are being provided. I stress this because I am sure that all hon. Members will agree that the fishing industry is vital, not only in peace-time for the purpose of providing food and manning our lifeboats, but as a reserve of trained seamen to go to sea in the Patrol Service, minesweeping and so on instantly on the outbreak of war, because men in that service know more about seamanship than most of us will ever know.

I wish to make two points regarding this vexed question of the Fleet Air Arm. The First Lord today mentioned trade protection carriers. Are they the kind of ships which we used to know as "MAC" ships, or are they light carriers or what is their official description? Can we be told if there has been any development in this country of the seaborne jet aircraft? I understand that considerable research and development have taken place in America in regard to these aircraft, and that a certain amount of success has resulted. Without having gone into this development very fully, it would seem that there might be tactical advantages in it. Aerodromes are not needed for these aircraft. Have we cooperated with America in the matter?

Regarding the tactical use of aircraft and aircraft carriers, I only wish to say, in conclusion—and I say this without any disrespect to the Royal Air Force—as one who spent many years going backwards and forward across the oceans, that it appears to me that the problem of shore-based aircraft is surely the fact that there are times when such aircraft cannot get off the ground because of prevailing conditions, but when, if the convoy is being protected by carrier-borne aircraft, the weather for them may be perfect. There are many occasions when it would be not advisable for this task to be in the hands of another Service.

From my experience in the war, under very arduous conditions, such as Russian convoys, when we had carriers operating inside the destroyer screen in extraordinarily hazardous conditions, the service that they gave to the convoy could not have been beaten by anybody, and we had the advantage of having them with us all the time. I do not think that we need be too worried about the position of the Senior Service. I am quite sure that it will meet any changes that come. It always has done in the past, and I hope and I know that it always will in the future.

11.16 p.m.

Mr. Edward Shackleton (Preston, South)

Many hon. Members in this debate, and particularly on this side of the House, have spoken on behalf of their constituents, representing, as they do, dockyard towns. I hope I shall be allowed to inform the House, as probably most hon. Members are not aware, that Preston, my constituency, is also a dockyard town. We have a small but very efficient municipal port.

That brings me to a question of substance—and I see that there is a Vote which is concerned with the organisation in peace-time of shipping services—namely, how far is the Admiralty considering the use of these small and efficient ports, like Preston, in the event of a serious emergency, when the main ports might possibly be put out of action by atom bombing? I ask that consideration should be given to Preston as well as to Sheerness in this matter.

I am glad to see that the First Lord is back in his place, and I hope that my hon. Friend the Member for Cardiff, South-East (Mr. Callaghan) will also soon be back. I shall reserve some of my remarks in the hope that he will come back.

Mr. Ian Mikardo (Reading, South)

He is refuelling and refitting.

Mr. Shackleton

The First Lord did not say very much about the subject of N.A.T.O. I want to draw his attention to the enormous hazards that afflict both the Navy and the Air Force in peacetime due to the institution of N.A.T.O. My hon. Friend the Member for Maldon (Mr. Driberg) will, I am sure, be sympathetic on the subject of the extraordinary jargon that has been introduced into N.A.T.O. terminology.

During the last war we used to hear about such institutions as Cominch. I spent a difficult period doing some Reserve training and spent most of it in learning a new vocabulary, including, for instance, Cinceastlant, Saclant, Giblant, Bisclant Comnerlant, Cincairchan and Cincaireastlant. Additional complications arose when we found that Cincairchan was the same as Cincaireastlant. But Cinchan is not the same as Cinceastlant.

The result is further complicated by the extraordinary performance of the Prime Minister, brought about by his original opposition to the appointment of Saclant —namely, the American Admiral Supreme Commander for the Atlantic— as a result of which the Atlantic area of operations, instead of extending right to the coast of Europe, stops, for some fantastic and arbitrary reason, at the 100-fathom line. We therefore find that a submarine, whether in a war or in an exercise, possibly attacked and sunk just inside the 100-fathom line, is of no interest apparently to the Supreme Commander of the Atlantic. It is of interest only to Cinchan, and also to Cincaireast, who wears the other hat of Cincairchan.

I hope that the First Lord will give some attention to the confusion which is obviously apparent. I fully realise that those who live in this atmosphere of—

Mr. Emrys Hughes

Chu Chin Chow.

Mr. Shackleton

My hon. Friend always has the right word. Those who live in this atmosphere of civic "Chu Chin Chow" may understand it, but it is not always fundamentally a very sound situation, and I would ask that the whole question of the demarcation of these various naval commands be reconsidered, and in particular that this ridiculous 100-fathom line rule should disappear, because I can assure the Minister—and I am quite sure he will agree—that there is no military or strategic sense in that decision.

Having got these names off my chest, I should like to turn to the other more important issue which has been discussed, and discussed with great moderation in the debate—and I shall try to do the same—namely, the role of the Navy in our defence Services. My hon. Friend the Member for Cardiff, South-East made an extremely reasonable survey of the situation. I realise that it is difficult for the House to take these technical decisions, but certainly an impression exists, I think, among many hon. Members on both sides of the House, that in the decision taken about the allocation of resources for defence a kind of bargaining game goes on between the various chiefs-of-staff. I do not condemn them for it; it is only human nature.

They all believe, rightly, in the importance of their particular field of responsibility, and they want as big a slice of the cake as they can get for their own Service, conscious of the multitudinous obligations that are imposed upon them. I found the First Lord's speech not very convincing when he said that the Navy has a deterrent rôle to play, which is to deny the use of the sea to a potential enemy. I find some difficulty in seeing what deterrent is involved in that.

I can see that the prospect of the slaughter of hundreds of thousands of one's fellow citizens in violent form from an atom bomb might be a deterrent, but I do not see how the threat to deny the use of the sea can be, especially since, as we know, the possible potential enemy is not fundamentally very interested in the sea compared with the interest taken in it by our historic enemies in the past. I really think it is nonsense to suggest that the Navy has a deterrent rôle.

We know that the Navy has its worldwide tasks, and that is all that the Statement on Defence can find to say about the role of the Navy. I assure the First Lord that I am not trying to pursue a vendetta in this matter, but when we find the Statement on Defence talking—and I am sorry to repeat the horrible expression—about "broken-back warfare" again, it seems to me an extraordinary thing that we are prepared to devote nearly a quarter of the funds available for the prevention of war and the defence of this country on a Service the purpose of which, according to the accounts we have so far, is mainly for the conduct of war in its ultimate stages, when the major blows have already been delivered.

I fully realise that there is enormous skill, self-reliance, discipline, ability, tradition and, indeed, magnificent qualities in the Navy, qualities which I say quite frankly are not to be surpassed and possibly not equalled in the other Services.

Mr. Callaghan

And certainly not to be thrown away.

Mr. Shackleton

Certainly, not to be thrown away, but that in itself is not a sufficient reason, when we are faced with these hard decisions and the defence budget is as high as it is today, unless, of course, there are strong military and strategic reasons in addition.

We have had some talk about some of the jobs that the Navy might have to do. Everybody must concede that there is an important anti-submarine role, although it is likely to come after the initial and terrible first shock of war. None the less, it is there, and the Navy is largely planning its development for that purpose. But it is questionable how far it should devote resources in the way it is doing to capital ships, including carriers, even the light Fleet carrier.

The hon. Member for St. Ives (Mr. G. R. Howard) asked a question about convoy carriers or aircraft carriers, and whether the First Lord was referring to "MAC" ships or escort carriers. I think we ought to know what type of vessel is intended to provide the anti-submarine escort for the convoys. Quite clearly something smaller and a great deal less expensive than even the light Fleet carrier is adequate for the job, but what, then, are the major capital ships for? What is not fully realised is that today practically the whole of the world and the whole of the ocean is within bombing range of land bases. I concede that the question of escort by shore-based aircraft is totally different. But for striking and offensive purposes, whether on the land or on the Navy at sea, long-range strategic bombers, operating in a tactical role, can be used.

During the recent "Exercise Mariner" one striking fact emerged, and I hope the First Lord noticed it. The Fleet was theoretically atom-bombed in Denmark Strait by Canberra light bombers operating from a British base. We have the so-called medium bombers coming along, and the vulnerability of these large ships will be tremendous. This bombing took place from a height of 33,000 feet. There are guided missiles and various anti-aircraft devices available in the Navy, and I have strong reason to believe that they are not effective at the moment, but the atom bomb is known to be available and is only too effective.

Mr. Mikardo

More effective on sea than on land.

Mr. Shackleton

Yes.

There are one or two points I should like to put. The first concerns the future of the Navy and the money that is to be devoted to it in these Estimates. I am afraid that I do not agree with my hon. Friend the Member for Cardiff, South-East about the natural affinity between the R.A.F. and the Royal Navy. There are tremendous differences in the outlook and the roles of the two Services. That brings up once again the question of whether some attempt ought to be made to try to unify all three Services, because the consequence of these separate Services is the devotion of an unreasonable and unjustified amount of money to one Service, whose role some people might feel, for sentimental and understandable reasons, has declined very much.

I would say to hon. Members, and particularly those on this side of the House, and especially those who supported the Amendment during the recent defence debate, that here is one field where major economies and reductions can be made. Let me say at once that I supported that Amendment in principle, but found it somewhat difficult to demonstrate in practice. Let the Government look very seriously along the lines of the proposition of my hon. Friend the Member for Cardiff, South-East as to whether or not the Government are spending too much money out of that available for defence on this particular branch of the Armed Forces.

It may be, and I confess to some prejudice in this matter, although I am trying to put the case in an unprejudiced way, that when the Parliamentary and Financial Secretary replies, we shall have a rather more convincing account than we have had so far to justify this expenditure. If we do not have a satisfactory account, and one which does answer the question posed, then let the Government face up to the logic of the matter and plan for a reduction in this field.

11.32 a.m.

Captain Robert Ryder (Merton and Morden)

I hope to touch on some of the matters of which the hon. Member for Preston, South (Mr. Shackleton) has just spoken, but, first, I want to say how much I welcome the announcement by the First Lord as to the arrangements for the Home and Mediterranean Fleets by which ships' companies can remain together longer, and the reduction in overseas service. This, and the facilities for men to buy themselves out, are substantial improvements in the administration of the Navy. In fact, I have no particular quarrel with the administrative arrangements of the Admiralty. My quarrel happens to be on a somewhat different plane.

From the First Lord's statement there is a lack of any apparent strategic plan. At least, it is difficult to see one either in the Explanatory Statement or in what the First Lord has said. Some two years ago, an hon. Friend and I raised on the Air Estimates the question of the control of maritime aircraft. We asked for an impartial inquiry into this matter, but found ourselves surrounded with much hostility.

Mr. Shackleton

No.

Captain Ryder

Looking back, I feel that it was a bold attempt.

Mr. Shackleton

I said then that if the hon. and gallant Gentleman was prepared to extend the inquiry into the whole status of the Royal Navy and the R.A.F. I would not oppose him. But I thought, as did some of my hon. Friends, that this was a deliberate attempt on that part of the Royal Navy to extend its empire and take in Coastal Command.

Captain Ryder

If the hon. Member will let me go on, perhaps he will come to agree with me. Anyhow, having decided to raise this matter originally, I am encouraged by the increased interest which is now being shown. And I very much welcome the speech of the hon. Member for Cardiff, South-East (Mr. Callaghan) in dealing with this matter. He put the problem very clearly and forcefully.

I endeavoured to call attention to this problem in the defence debate, and I do not wish to repeat what I then said, except to add that the problem is much more serious than is generally realised. From reports reaching me, I would say that there is a feeling of growing frustration and indignation in the Royal Navy at the way in which, in the development of its principal offensive arm, the Navy is still restricted by an arbitrary decision dating back to 1937.

It is all very well for hon. Members to cast doubts on the value of the carrier, but the Navy is intensely air-minded and looks on the air as being the decisive factor in any future warfare at sea. If the carrier becomes obsolete for offensive purposes, the Navy will be relegated to an entirely defensive role in any future war. If my hon. Friend cares to send for the Admiralty War Manual he will find that first in the list of the principles of war is the well-known platitude that offensive action is the necessary fore runner of victory. It seems to me that if the Navy is to be relegated to an entirely defensive rôle we are heading for very serious trouble at sea in any future conflict.

Indeed, to feel that the high seas should be regarded as a vast no man's land instead of our seeking to play our traditional part in controlling sea communications is most frustrating to those interested in these problems. That is why I say that it is high time for the whole area of co-operation between the maritime branch of the R.A.F. and the Navy to be examined by an impartial inquiry. I do not exclude any solution. It may be that a fusion of the two Services is necessary. But this situation is rapidly becoming intolerable, and the results are beginning to show in the absence of a clear-cut statement on future strategic policy in the debate on the Navy Estimates. I ask the Minister, therefore, if he will take this matter seriously and see whether it can be impartially investigated?

11.39 p.m.

Dr. Horace King (Southampton, Test)

After the number of ex-naval men who have taken part in the debate, I am diffident about intervening, and the only excuses I can offer for doing so are those which I offered last year—that Southampton is not only a great Merchant Navy port but also provides as many young men for the Navy as any other town of its size in the country, that it had the distinction of providing probably the first naval V.C. of the last war and always gives a cordial welcome to units of the Navy when they visit Southampton Water.

The other reason is that to me equality of opportunity is not merely a slogan but a fundamental goal in life, and any move the Navy makes towards equality of opportunity is something that I welcome. Tonight I should like to congratulate the First Lord on the decision which he has taken about cadet entry into the Navy. We have debated and questioned him on this subject on many occasions, and on every occasion we have discussed it the First Lord has unhesitatingly declared that he shared our desire to secure the best officers for the Navy irrespective of their social origin. His actions in the past 12 months have been an abundant indication that he has meant what he has said on many occasions, and if it does not embarrass him some of us would like to hand a bouquet to him across the Floor of the House.

Eighteen months ago the First Lord set up a working party to investigate the question of cadet entry. Entry had for a long time been at 13-plus and 17-plus. The Labour Government abandoned the 13-plus, and introduced a 16-plus entry into cadetship. That was a good thing, I believe. But even after that reform many of us were worried about the preponderance of public schoolboys who managed to succeed, not at the written examination, but at the personal examinations which took place after the written examination. I do not want to repeat all that I have said on this topic in the July debate last year.

The report of the working party, or the Montague Report, as it may be called after its distinguished chairman the Hon. Euan Montague, was a scrupulously fair one. It came down on the side of re-introducing the 13 plus entry. It is true that it safeguarded children of State schools compared with preparatory schools by proposing that 60 per cent, of the places should go to State schools. But, despite its recommendations, the evidence that the Montague working party reported revealed that educational opinion was almost unanimously in favour not of entry at 13-plus, nor at 16-plus, but only at 17-plus. Educationalists in the country wanted boys to complete their general primary and secondary education before they were selected and began their career education as cadets with the Royal Navy.

The majority report said, in clear and emphatic terms, that despite its recommendation in favour of the 13-plus entry, all the members of the working party were prepared to scrap the 13-plus recommendation and any of the major recommendations rather than have the cadet entry a party political matter or one of class division any longer. The First Lord has abandoned the findings of the majority of the working party who reported to him. That was a courageous action.

In spite of all the heartaches which Dartmouth-educated naval officers under the old regime must feel, in spite of the anxieties that people who cherish the old system must feel, I think that the First Lord has made a very wise decision. He has abandoned all idea of going back to the 13-plus entry. He has even abandoned the 16-plus entry, and from 1954 the cadets for the Royal Navy will be recruited under the method educationists recommended to the working party, and at the age of between 17 and 18.

In announcing his decision on 25th November last year, the right hon. Gentleman said something which I want to commend to the House. He said: The overriding need is to establish a system of cadet entry into the Royal Navy which not only gives the Navy adequate numbers of cadets of the required standard but also conforms beyond dispute with the general trend of educational policy and is entirely outside the field of controversy."—[OFFICIAL REPORT, 25th November, 1953; Vol. 521. c. 358.] That, I submit, is an excellent declaration of policy, and anything that furthers such a policy should have the wholehearted backing of both sides of the House. Now the general trend of educational policy under the 1944 Act and in every step which we have taken to implement it is to secure that, in measuring anybody for a job, measuring anybody for a career, what we measure is what is essential and not what is accidental

Those of us who are concerned with the survivals of the caste system in education which still remain in our national system, and who welcome every move towards breaking down the caste system in education, hold the views that we do because we believe that the stratification of our children according to the accident of birth and wealth is not only unjust but is also inefficient. The Navy will draw on richer seams of material if it draws from the whole social structure of the country.

We have heard recently in this House from my hon. Friend the Member for Stockton-onTees (Mr. Chetwynd) that an eminent Army general has discovered that the South produces more potential Army officers than the North. My hon. Friend tells me that the actual figure of cadets is about three to one of Southerners against Northerners. If this were really true then it ought to concern the psychologists, the educationists, the sociologists of this country to know "upon what meat this South country feeds," to paraphrase Shakespeare, that gives it such predominance in young men of leadership and initiative over the North. I do not believe that it is true. I believe that we have not yet emancipated ourselves from equating accent with ability.

Be it remembered that this question of dialect and of the differences between dialects is not a question of good speech versus bad speech. Southern English, which has become standard English, owes its predominance to the fact that for centuries it was the language of the governing class, of the Court, of the Metropolis, of Parliament, of high society. It is really quaint—it is worse: it is ridiculous—to think that northern English, which is as pure in its own way as any dialect spoken in the South, should carry with it any social connotation, any mark of social, moral or personal inferiority.

I believe that the Army selection boards, in the decisions they come to, are guilty of the same faults that we endeavoured to suggest were to be found in the selection board for Dartmouth Naval College. They are confusing personality, initiative, ability and qualities which we find in any social group of our English children, with the mere veneer of an accent or of a grade of society. To link dialect with personality and the qualities we need in an officer is a snob survival, and a very foolish one.

I understand that Napoleon spoke French with a shocking accent. On that ground he would have failed to satisfy many of the selection boards if he had appeared before them. We want to be certain that, whatever method we use to select at this new fixed age of between 17 and 18, it is one which is free from any social hangovers of class distinction.

I pointed out last July in the debate on the report of the working party that the figures in the report bore the same unhappy features for both age groups in that there was a predominance of public schoolboys in the 17 plus entry for naval cadetships. I do not want to repeat the figures. They can be found in the report. We ought to be certain that the selection boards that we set up to select our young cadets for the 17 to 18 entry embody the reforms which the Montague Report suggested. There should be something like parity between civilians and naval men; there should be parity between State school men and private or public school men; the team which selects should be as free as possible from any suggestion of social prejudice.

In the last 12 months the Admiralty has done a grand job of public relations. There was the open invitation to the Press to see the selection board at work at Dartmouth, and there was also the broadcast of an interview. These were excellent steps to remove some of the suspicion which had grown up. The public relations work of the Admiralty in the last year has done something to assure us that the best men in the Admiralty, like the First Lord himself, want the best of our young men and are not fettered by the old school tie tradition.

However, publicity and negative assurances are not enough. I, therefore, urged the First Lord, as soon as we heard of it, to take a leaf out of the book of his colleague at the Air Ministry when he launched the Cranwell scholarship scheme. I am delighted beyond all measure that today the First Lord was able to tell us that he proposed to introduce a parallel scheme.

The Cranwell scheme sets up 60 R.A.F. scholarships for youths aged 16. These are earmarked for the sons of citizens earning not more than £1,500 a year. The scholarships are to be awarded at the age of 16, when there will be medical tests, flying aptitude tests, academic and personality tests and an appearance before a selection board, the constitution of which-—again I would urge—is vital.

Having been picked out as a likely lad at the age of 16, the young scholarship holder will carry on at the secondary school at which he is being educated. He takes his advance level certificate subjects, and so on in the VI form. The scholarship is worth about £50 a year if the boy's parents are earning less than £14 a week, about £40 a year if they earn under £1,000. This means that a potential officer who might be lost to the R.A.F. because his parents could not afford to keep him at school will stay on at school, and his parents will get about a pound a week towards helping to keep him there. Then, at eighteen, if he continues to make the grade, and if he is considered worth it, he proceeds to Cranwell and begins his real cadetship.

This means that the Air Minister is pinning his faith on finding 60 likely young cadets in the lower income groups of Britain. It is a positive declaration of confidence in the boys of the ordinary schools of this country, and it by no means excludes the able lads in the public schools, who can compete for Cranwell in the ordinary way. I am glad the First Lord has said that he proposes to adopt something similar. I hope that the scheme will be identical. I hope that he will, in his own way, earmark a number of cadetships in this way by scholarships for the ordinary lads of this country. After all, the Montague Report itself, in advocating the return to the 13-plus entry, did want to earmark some 60 per cent, of the 13-plus entry for boys at State schools. I believe that if the First Lord will copy the Air Minister he will be carrying out the spirit of the Montague Report.

I have never advanced my beliefs in this House or anywhere else for democratic principles by decrying what older systems have provided. I yield to no one in my admiration of the quality and character of naval officers recruited in the old way. By the same token—and we have had a striking lesson in the speech of the hon. and gallant Member for Hull, East (Commander Pursey) tonight, no one can challenge the fact that the recruitment of officers from the lower deck has by no means impoverished the officer cadre in the Royal Navy, that officers who have come up that way hold their own with their brother officers who came into the Navy the privileged way.

I do not think we should minimise the experimental work of the 16-plus period at Dartmouth. The younger men recruited this way, now reaching officer-ship in the Navy for the first time are, I believe, going to give a good account of themselves. I believe that the old Dartmouth, and what we might call the experimental Dartmouth for this recent short period, have done a great job of work for this country. But I believe that so, too, will the new Dartmouth, if we use it, as possibly we shall, for the cadet training of these older entries.

But now that the controversy is over, now that we have settled on late entry, we must, I hope, agree on both sides of the House to take every positive step we can to see that neither lack of money nor lack of social origin is allowed to stand between a potential naval officer and a career in the Royal Navy. Napoleon, if one may refer to him again, once said that every one of his soldiers carried in his knapsack a marshal's baton. We ought to be able to assure the young naval enthusiast that every young naval recruit carries in what I believe is called his ditty box an admiral's sword. Any steps that we can take, and particularly the steps that the First Lord has taken towards this goal, we welcome. We congratulate him on what he has done.

12 midnight.

Mr. John Baldock (Harborough)

I wish to speak on the human element in the Royal Navy rather than on strategy, weapons or material. But first a word about the mine position, which was among the subjects in which I specialised. I think that most of us felt that one of the most gratifying parts of the First Lord's speech today was his reference to some progress having been made in developing techniques for sweeping or dealing with the many extremely complicated and highly dangerous varieties of mines which were evolved in and after the last war.

It is hardly possible to exaggerate the potential dangers of these mines if they are laid in our waters, and the problem which has been set the scientists in tackling them is probably as difficult as any they have to deal with at the moment in any of the Services. One can well understand that progress is not likely to be very rapid. In the meantime, however, we must rely to a considerable extent on the minewatching service, and that remains an important organisation.

I was very impressed when watching some extremely senior gentlemen carrying out their drill in minewatching technique with the aid of a very good device which shows little splashes coming up as the mine falls into the water. But I am afraid that, generally speaking, not very much is being done in the way of providing equipment or training for that force. I hope that we are not going to allow the enthusiasm of these people to disappear for want of proper equipment, training, and recognition which they should certainly have.

I wish to refer to the human element in the Royal Navy itself and, first of all, to consider it from the standpoint of training. I feel it is rather disturbing, when £2½ million more is being spent on the Royal Navy this year than last, that there is to be a reduction in manpower of 10,000, because that means that fewer ships will be at sea, which, in turn, means fewer opportunities for training at sea. This is a particularly acute matter for senior officers.

At the present time captains often spend only one year out of 10 as captains at sea, and this at a time when their duties in war would largely be concerned with being in charge of convoy streams or of anti-submarine task forces consisting of groups of small ships largely manned by the most experienced of my own force, the permanent R.N.V.R., but mainly by the temporary R.N.V.R. There are nearly 200 of these ships in reserve at present, and they would have little or no experience. Therefore, it is particularly essential that the senior officers in command of these groups should be thoroughly experienced in handling them at sea. The tactical table and the games which are played to such a considerable extent in shore establishments are not enough. Wooden models and perspex sea have their place and their value, but they cannot replace the real thing.

As I say, the shortage of manpower is preventing more ships being at sea as opposed to being in reserve. As far as I remember, the chief trouble with the quarter drill was manning the armament to the first degree of readiness. Could not this be overcome in peace-time by having a complement which is only sufficient to man the ship at cruising stations? Surely the whole of the armanent need not be manned. So long as there are sufficient men to steam the ship and to man the control side of the armament, all the necessary exercises and evolutions can be carried out, and if certain people have to show greater flexibility that, surely, is all to the good.

If there is more room on the mess decks by having a smaller complement, surely that is all to the good too, because it will certainly increase the comfort on board. But even this would not preclude the need, which a. number of hon. Members, including my hon. and gallant Friend the Member for Haltemprice (Major Wall) stressed, for some fresh thinking about cluttering up the mess decks with all the new gear and apparatus.

More men are to be found for the Navy this year from National Service. This could be a valuable source of recruitment. The idea of trying the Navy for two years may well appeal to a number of lads. Having had a good sight of it from the inside, they can then make up their minds whether they would like to continue for a longer time, without having entered into any commitments other than those which they already have to carry out. But how many of them will continue for a longer time will entirely depend on how well the training is planned.

Turning to the more personal side, I admit that the recent cases of damage to ships, however unimportant, as we all appreciate they are, as far as the individuals are concerned, are disturbing. They indicate that all has not been quite well, or as well as we should like it to be, with the Service. Some most important steps have been taken today and in the last week or two which should go a considerable way to alleviating the causes which have been behind some of these outbreaks.

There is the improved pay; the release of retained officers and men. which was a matter of great importance and a source of considerable grievance; the reintroduction of release by purchase, which puts the Navy in a parallel position with the other Services; and more stable ships' companies as a result of the new two years' general commission, which should allow ratings to enter into closer relationships with their divisional officers and generally develop the sort of spirit which a happy ship requires.

But the new system of a general two years' commission obviously contains certain dangers, the chief one being that it might be detrimental to those who are on the brink of promotion or are wanting to qualify as higher non-substantive ratings. I hope that my right hon. Friend the First Lord will closely watch the position and make it always possible for those who want to take these further steps to be able to do so readily where that cannot be achieved within the ship itself.

After the removal of these grievances and difficulties, however, several others still remain, including the re-engagement bounties, and the difficulties that families find in getting accommodation when they return from overseas, having relinquished their council or other houses, when no married quarters are available. I wonder whether the dockyard towns might not be able to make special arrangements in this direction. In addition, there is the present situation of branch officers and the condition of junior married officers, who still often find themselves with great financial problems, particularly with regard to the schooling of children.

Nevertheless, at the back of all this feeling of doubt, grievances and unrest, there is perhaps, really more than all these matters, a sense of uncertainty, a doubt about the future place of the Royal Navy in the part of defence. Why should this uncertainty exist? There are still just as many tons of materials and goods —perhaps even more—which have to come into this country as at any previous time. As far as we can see for any possible distance ahead, they cannot come in in any other way than in ships. And yet, with this great defensive role to play, one cannot fail to feel the onset of a slight feeling in the Service that it may be now a Service which is starting to die back towards the roots, to die back to small groups of small ships—frigates, submarines and minesweepers—which are a great contrast with the battle lines, or even the vast aircraft carriers of today.

The Fleet Air Arm is greatly improving, but it is, nevertheless, a truncated and unbalanced service. It is not large enough; it is not sufficiently well-equipped, even now, to be able to disperse the onset of this feeling of the contraction and obsolescence in the Navy. Yet that is not so in all navies. Perhaps it has escaped the attention of some hon. Members that the Douglas Skyray, which at present holds the official world speed record in the air, is a carrier-borne aircraft, but it seems a far step from the days when our own Fleet Air Arm could produce an aircraft which could regain the world speed record for this country.

The defence of our vital convoys requires the closest co-ordination of sea and air. whether close inshore or in the open sea, whether threatened by submarines or air raiders. Like my hon. and gallant Friend the Member for Merton and Morden (Captain Ryder) and the hon. Member for Cardiff, South-East (Mr. Callaghan), I believe the question of the place of the Navy, of Coastal Command and the Fleet Air Arm merits fresh consideration at the highest level. It deeply concerns not only our very safety but the future of two highly-respected Services.

12.12 a.m.

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

The House will not be surprised if I ask a few questions of the First Lord with reference to the general health of naval personnel, and say a few words about it myself. I am under certain difficulties, because nothing has been published since 1937–38, so far as I know. Before the war the Navy published each year an account called "Navy Health," and very interesting and full reports they were, giving vital statistics, showing what was happening to enable naval people trained in medicine to get quite easily a bird's eye view of the general life of people according to their rank in the Navy itself. Although published in 1937–38, the figures referred to 1936.

We understand that we could not get anything during the war, but my first request to the First Lord is that, now that we are in 1954, we should, as I think we have a right to expect, return as quickly as possible to this very important custom and have these annual reports published again as we did in the past. For the years when they were published, these reports showed that men were prone to sickness, and there was therefore a wastage—a very important factor and something which we should avoid, if possible—very much as in civilian society. However, special hazards are run by men who have to live together under crowded conditions, where amenities associated with hygiene and lavatory accommodation are perhaps not as good as are normally found on land.

I note that in 1936 there were a considerable number of outbreaks of food poisoning, and there were listed over 700 cases of enteritis and over 500 cases of acute appendicitis. I should very much like to know, if possible—although I doubt whether it is possible tonight— whether there has been, as I think there must have been, a very real improvement since that year. It is interesting to read that in a year like 1936 medical men thought that the cause of duodenal ulcers was because men had a tendency to bolt their food. I very much doubt if there is any truth in that and whether any of us believe it today.

A much more important illness is lung disease, particularly infectious lung disease, and I note that in the printed reports before the war there was a variation according to the depot of the men. There is a variation according to where they served and the sort of ship in which they served. I do not want to place too much reliance on these figures, because sometimes the number of men is small and the percentages can be deceiving. But I note that there were two people out of 1,000 on an average who suffered from pulmonary tuberculosis, a high figure for a healthy group of men who are so carefully selected. Then two out of every 1,000 suffered in each year on an average from pleurisy, which today we would also accept as tuberculosis, so that it makes the total four out of 1,000. It would be interesting to know whether the figures for the Navy have really improved. Those for the civilian population have improved considerably since 1935 and 1936.

The Navy has a very proud record in mass radiography. It has been using miniature mass radiography for 15 years, which is much longer than any other Service. I think it is only about a year ago that we were able to get from the Army the information that every recruit was being mass X-rayed before he was taken into the Service. We have heard in this House of the tragic consequences of recruits for the Army being taken in suffering from tuberculosis, and how there had been no X-ray before they were brought in.

The Navy is to be complimented because it is so far ahead, and it has been far ahead of the other Services for obvious reasons, namely, that in some of these ships there is not much accommodation, and if one man suffering from tuberculosis is allowed in he can infect those with whom he is sleeping or with whom he is dining because they must be grouped together in certain circumstances.

It is interesting to note that men in submarines are not so badly off on the bases of the figures that I have been able to look at. Indeed, only the men in the training ships are better off. The training ship figures are the best; that is to say, there are fewer cases in training establishments, about one per 1,000. In submarines the figure is 1.75 per 1,000. The worst off are those in the destroyer depot ships where the figure is 6.6 per 1,000. Again I would warn the House not to place too much reliance on figures for a few years when the numbers are small and, therefore, the percentages might be misleading.

One figure I do accept is that amongst commissioned officers the cases of pulmonary tuberculosis are few and far between as compared with the artisans, who are the worst off. I can understand the position where the officer is concerned, because obviously he is going to have more cubic feet of air in his sleeping accommodation and elsewhere than would be available for some of the other personnel. But I only want to emphasise that the important thing is to see that no one is accepted who might infect anyone else. That means rejection in the first place. Secondly, we ought to have an assurance, which I am sure we can get, that everybody in the Navy, whether at home or abroad, should be able to receive the benefit of mass radiography, say once a year. I have a suspicion that that is probably what the Navy aims at, and it is a desirable thing in the circumstances.

One of the other reasons I want to see the reports printed again is the type of remarkable information that they give. For example, a hundred years ago, whereas the death rate per thousand from all causes was, say, 15, disease accounted for 12 of that number. In 1914, when war started, and ships went on active service and casualties were being caused, deaths had risen to 37 from all causes; but, disease accounted for only 2½, which shows the enormous progress made in only about a hundred years. So it was disease rather than casualties which slew our men. Now, I suppose, the figure would be very low, and I can only guess because I have not the figures.

The hon. Member for Harborough (Mr. Baldock) made reference to the fact that there must be something wrong if we get these cases of minor sabotage. There is another index—the number of suicides. In 1935 there were 13 suicides. There are no figures for 1936, but such figures as we have are important, and we should ask, "Why does this sort of thing happen?" We are only able to guess, but we should try to get the information to see if we can solve the problem which causes it.

Lastly, I have noticed that fatal accidents in the Royal Navy, out of action, are nearly always associated with motor cycles or pedal cycles or falling over cliffs. In fact, out of a total of 16 in one year, seven deaths were due to motor cycle accidents; one was due to a fall from a train, one a fall off a balcony, and one was associated with a pedal cycle. If the Royal Navy can look after its personnel so well that men have to come to land and fall off motor cycles in order to become injured, there is much to be said for the Royal Navy.

12.23 a.m.

Mr. Hamilton Kerr (Cambridge)

The hour is late, and other hon. Members wish to speak and I shall, therefore, not give all the pearls of wisdom which I had prepared. I shall be brief and deal only with a very cold subject, the Arctic Circle. The Soviet Government and the United States are making tremendous preparations in the area of the North Pole; the United States have established an air base at Thule, and the Canadian Government are commissioning an icebreaker for service with their Navy in the Arctic, and the Soviet is not inactive.

The reason is obvious. The North Pole provides the shortest line of communications between the Soviet and the United States' areas of production, and in the event of a future war, that will be the scene of interception of atomic bombers and of parachutists, as well as commerce raiders, and of submarines skirting the ice cap at full speed on their way to the trade routes, or seeking shelter under the ice blocks from their pursuers.

As one of the great Powers, have we the ships to act in the Arctic Circle? I should like to ask if we could commission a vessel to operate there and give a continuance of the training which, hitherto, has been available only to a limited number of naval officers.

12.25 a.m.

Mr. Ian Mikardo (Reading, South)

Like the hon. Member for Cambridge (Mr. Hamilton Kerr), I am conscious of the lateness of the hour and of the number of hon. Members who wish to participate in the debate, but we are discussing the expenditure of £400 million, and when we have expenditure of that magnitude to discuss for civil purposes we generally spend several days, either consecutively or spread throughout the year, and it therefore seems to me that, despite the lateness of the hour, we cannot escape from the responsibility of giving the closest examination to these Estimates.

This is the first time I have ventured to take part in a debate on the Navy and, unlike hon. Members on both sides of the House who have preceded me, I have little direct qualification for doing so, unless it be the qualification that I was born in the shadows of the walls of Portsmouth Dockyard and spent the early years of my life falling into Portsmouth harbour from the green, slimy rocks which hon. Members will have observed as they have gone to catch a train from Portsmouth harbour station or the ferry across to Gosport. As a result of that experience, while I have almost certainly spent less time on the surface of Portsmouth harbour than many hon. Members, I venture to think that I have spent a great deal more time under the surface there than almost anyone else present.

Another and more serious reason why I venture to intervene in the debate is. that the Estimates cover not merely a righting Service. They cover the expenditure of a large-scale administrative and industrial organisation; indeed, during the debate I have heard a great many contributions which have not been concerned with the truly Service element of the Estimates. It is on that aspect that I may claim to give the House the benefit of some experience, and certainly on that subject that I may fairly claim the right to ask for some further explanation from the Parliamentary and Financial Secretary than is given in the Estimates themselves, which are not always clear.

The First Lord published his book of 319 pages, which costs 10s., and presumably he published it in order that somebody should read it. I cannot believe that he published it in the hope and expectation that nobody would read it, and if he published it so that somebody should read it, presumably it was in the hope and expectation that those who read it would do so with a fair degree of intelligence; and that if they did that they would find amongst the many thousands of words and the tens of thousands of figures something which they would be bound to query.

Before I go into the Estimates in detail, there are one or two points raised by previous speakers to which I wish to refer. My hon. Friend the Member for Devonport (Mr. Foot) made some play on a point which was new to me and which I thought extremely valuable, in fact, it rather horrified me when he sought to compare the organisation with what is done in an organisation similar to the Royal Dockyards but outside the control of the Admiralty. He told us that an admiral in charge of an organisation is authorised to spend during the course of a year, on his own responsibility, only a derisory amount.

I find it difficult to see how anybody could justify that, and I find it even more difficult to see how it could be justified by any member of the party at present forming the Government which, after all, has always argued, in respect of almost every piece of large-scale organisation, that what we want is the maximum amount of decentralisation and devolution away from the centre to the people carrying out the executive action on the perimeter. I have known hon. Members, for example, to say of the National Coal Board, which is a large-scale organisation about the size of the Royal Navy. that it is monstrous that the people out in the areas should be able to spend no money off their own bat without consulting the great central bureaucracy in London.

But people in those areas can spend £100,000 a year on their own bat without consulting the people in London. Here we have the head of an enormous industrial enterprise, for after all that is what the Portsmouth, Devonport and other dockyards are, a man who is highly paid, and quite rightly highly paid as we see from the Votes, who is not given as much power to make expenditure on his own account as the manager of a branch shoe shop in one of the chain shop companies. I should have thought that the First Lord would have been losing some of his best people who run the naval dockyards to Wool-worth's and Marks and Spencer's, not because they could get a more thrilling job, but because they could get a job which would enable them to do something on their own account.

Another thing which horrified me was the revelation of war-time experiences by the hon. and gallant Gentleman the Member for St. Ives (Mr. G. R. Howard), who was complaining that people who have to use apparatus are not consulted by those who design or instal it on a ship. The hon. Gentleman said that they were forced to take a piece of apparatus, he quite rightly did not describe what it was, which all the officers and gunnery crews knew to be totally unsuitable. What they did to instal it at one port, sail to another port and jettison it. That in itself is a wasteful way of settling a difference of opinion between the planners at the centre and the executives at the perimeter.

It shows a breakdown in communications and a total lack of consultation between those designing the apparatus and those who have to use it. We know that all sorts of queer things happen in war-time, but I should like an assurance from the First Lord that people who serve in Her Majesty's ships who are required by his technical officers to use some piece of apparatus are asked their opinion of it before it is installed, and I hope that if there is some difference of opinion between the technicians and executives they have some better way of settling it than by taking a piece of apparatus and throwing it into the sea.

There is one point in the First Lord's Explanatory Statement which accompanies the Estimates to which I would like to refer. Hon. Members have already pointed out that this statement is considerably less informative than the parallel statements explanatory of Estimates of the other Services. My hon. Friend the Member for Cardiff, South-East (Mr. Callaghan) complained, and two hon. and gallant Gentlemen speaking from the other side of the House, have complained, that here is a statement about the work of the Navy in the immediate future which does not even set out what the tasks are that the Navy will have to carry out. It is a Statement which purports to be for a purpose without describing what that purpose is.

That is not the only respect in which the Statement is highly uninformative. Almost all the observations it contains concern matters about which the Board of Admiralty are clearly not too happy, and are statements designed by their wording to obscure rather than to reveal information. For instance, in the section dealing with new constructions, what is to be made of this statement? Progress on the frigates, minesweepers, seaward defence boats, and fast patrol boats has been less rapid than was hoped, partly owing to production difficulties … How much less rapid? By how much have the production plans fallen short? What were the production difficulties that emerged in execution of the programmes of new construction? To what extent could those difficulties have been foreseen? Why, to that extent, were they not foreseen?

Here I make a point that I ventured to make when we were discussing the Air Estimates the other day—if day it was. Surely this is a confession, though not made in the explicit terms that the Secretary of State for Air or the Secretary of State for War would have been willing to have made it, of the failure of the planners, the so-called planners, who think that because they provide for expenditure in financial terms they are automatically providing the men, the machines, the materials and the facilities which will turn sterling values on a piece of paper into cold, hard actualities.

We see from these confessions of failure, whether explicitly announced like those of the Secretary of State for Air, or cryptically like those of the First Lord, who is not only more modest than his colleagues about his achievements but also more modest about his failures, the absolute justification of those who have said over the last few years that defence expenditure and the planning of defence expenditure has been done too much on a sterling basis and not on a physical basis, and, because of that, has been unrelated to the capacity of the nation to carry it out.

I turn to this formidable book of 319 pages of which, as I have said, I have read all the text, and its admirable figures. As a result of that examination I am afraid I have either to make observations upon or ask for further information about a dozen or so points of detail which, I recognise at once—and I apologise to the First Lord for it—are rather Committee points than points for a general debate. However, we discovered the other night, when we were debating the Estimates for a sister Service, that when we got to the Committee stage, we were not allowed to have it, and those of us who had reserved one or two specific points to ask questions about on the Votes were debarred from putting those questions. So I am afraid I have no alternative but to put my Committee points now in the general debate.

Mr. Deputy-Speaker (Sir Rhys Hopkin Morris)

Order. I would remind the hon. Member that in a general debate it is not in order to put Committee points.

Mr. Tom Driberg (Maldon)

Committee points, metaphorically speaking.

Mr. Mikardo

With the greatest respect, Mr. Deputy-Speaker, we were advised in the contrary sense the other night. The term "Committee point" is a conventional one. It is a subjective term. I do not believe that the Standing Orders contain any definition of "Committee points." I shall, therefore, if it will put me in better grace with you, which is a state of affairs I always seek to attain, withdraw the expression "Committee points" and substitute for it "points of detail." I wish, therefore, to take up with the First Lord—

Mr. Deputy-Speaker

I am afraid that, according to the practice of the House and the rules of the House, points of detail, if Committee points, are not in order in a general debate.

Mr. Stephen Swingler (Newcastle-under-Lyme)

On a point of order. May I have your guidance, Mr. Deputy-Speaker, on this important point? We must have regard here to the new procedure to which we have been subjected in recent years. Is it in order in this general debate to raise any question that arises in the Estimates? Is that in order in this debate or not?

Mr. Deputy-Speaker

If they are general points, yes; but I understood the hon. Member to say that it was his intention to raise points now which he could raise only in Committee. That would not be in order. He can, however, raise any question on the Estimates within the general debate.

Mr. Foot

Further to that point of order. Earlier in the proceedings I referred to certain matters in Vote 10 when Mr. Speaker was in the Chair. He did not call me to order. Presumably, my hon. Friend would be entitled to do what I did.

Mr. Deputy-Speaker

I do not object to that. I objected to the phrase of the hon. Gentleman that he intended to raise Committee points.

Mr. Foot

My hon. Friend would be entitled to refer to a point on a certain Vote, which was exactly the procedure I followed earlier.

Mr. Deputy-Speaker

Yes, that would be in order because this is a general debate, but he ought not to raise Committee points.

Mr. Mikardo

I am very grateful for what you have said, Mr. Deputy-Speaker. The position is now absolutely clear. It is perfectly in order for anybody to raise any question on any figure which is contained in the Estimates. So long as that is clear, I do not mind whether the raising of any question on any figure contained in the Estimates is called a general point or a Committee point. I am content to leave the phraseology to anybody with a taste for phraseology. I want to get on with the figures.

The first comment I want to make— and this is certainly a general point because it runs right through the whole of the Estimates—is that here, as in the Estimates which we examined the other day, there is a fantastic amount of work done purely for the purposes of inter-Departmental charges. I beg the First Lord, as I begged the Under-Secretary of State for Air the other day, to have a look at this matter and to find out how many clerks, accounting officers and senior accounting officers and the like he is employing merely to make charges upon some other Department of the Government, or merely to check charges made on him by some other Government Department and to pay them, or to issue some voucher in payment of them.

It is quite staggering. There are certainly not fewer than 100 such examples, there may be more than 200—I did not count the odd 100 or so. Clearly, a great deal of accounting work is done for no purpose other than that of ensuring that money is taken out of one compartment of the public purse and placed in another. We really cannot afford the luxury of using the accounting and clerical staff for that purpose. Indeed, with regard to the Navy Estimates, the position seems to be worse than is the case in the other Services. Sometimes there is no charge between Departments, sometimes the charge is done on an approximating basis, about which nobody could complain, and sometimes the charge is done on a detailed basis, which is bound to take a lot of work; and in respect of the Navy Estimates the third classification is the one most common.

Over and over again, there are appropriations-in-aid which consist of charges on other Government Departments that are made up of labour plus oncosts. You may be aware, Mr. Deputy-Speaker, that not even the most eminent accountants have yet been able to agree on a definition of what constitutes an oncost. You may be aware that in all accounting the calculation of oncosts is the most complicated and the most time-taking and in most respects the most wasteful part of the whole process.

I do think it is silly, if a Royal Dockyard does a very good job for some other Government Department or the Air Force, or one of the civilian Departments, to have someone clock on and off precisely, so as to get a precise labour cost, and then for someone to sit down and figure out the allocation of Departmental and overall on costs on to that job card— and for what purpose? So that the Army can have a charge of x pounds and the Navy an appropriation-in-aid of x pounds, which, so far as the public purse is concerned, precisely cancel each other out.

What I do not understand is that sometimes the Services can be quite sensible on this matter. If they can be sensible sometimes I do not understand why they cannot be sensible always. For example, Vote 11, Subhead A, deals with travelling expenses and passage expenses of naval and civil personnel, and that is done on a capitation rate. It is clearly the quick and simple way of effecting the charge without making too heavy weather of the matter.

An even better example is contained in the case of interchange of medical treatment between the three Services, because an explanatory note on Vote 3 says that in pursuance of a policy of co-ordination to promote the most economical use of the hospitals of the three Services, naval hospitals undertake the treatment of Army and Air Force patients; similarly hospital treatment for naval personnel is undertaken at Army and Air Force hospitals on certain stations; no financial adjustment is made between the three Services for such patients. Here is a case where they have agreed to let the swings and the roundabouts look after themselves.

Yet there is a startling contrast in another part of the Estimate, regarding the teaching and training carried out by one Service for another, in the precise charges made by one Service on another for the training work carried out. I am bound to say that I cannot understand the justification for that. If the Royal Air Force looks after the body of a naval rating it does so without charging the Admiralty for it. If it looks after the mind of a naval rating then it gets out a proper invoice, labour charges, oncosts and the rest of it, and effects a charge from one Service Department to another.

Where is the justification for it, and the logic of it? It means a double transaction, one in each Service, with two people at either end doing in reverse, or rather two images doing symmetrically identical operations, except that what is a credit to one is a debit to the other, and vice versa, no doubt ringing each other up on the long-distance telephone because they cannot make their totals coincide.

I pass from that to another detailed point—I must not call it a Committee point—which is concerned with the statement of the total estimated expenditure for the naval service. This is on page 6 of this formidable document, and under the heading "Civil Estimates" there is: Estimated expenditure under— Class III. Vote 13, Law charges, England, and Vote 22, Law charges and courts of law, Scotland. From the figures provided not merely of the Estimate but of the expenditure for last year, it seems that the Admiralty will spend somewhat more on law charges in England in the coming year than in the past, but in Scotland rather more than two-and-a-half times as much in the coming year as in the past year.

I see the hon. Member for South Ayrshire (Mr. Emrys Hughes) looking very curious about this. He doubtless wants to know, as I do, why it is forecast that there is to be some increase in litigation on the part of the Royal Navy during the coming year. Why that increase in litigation should break out more in respect of Scotland than it does in respect of England, I do not know. I can hazard all sorts of guesses about it which are as uninformed as they are amusing, but I would not venture to put them before the House. I only ask for information on the subject.

On the next page of the Estimates there is a note which seems to me to cover a matter of the very highest importance. It reads: Local procurement in Germany. The Navy's local requirements in Germany are obtained generally at the expense of the German Federal Government. No provision is therefore made in the Estimates for these requirements. It may, however, be necessary by Supplementary Estimate or other means later in the financial year to make some provision for these requirements, because, of course, if the E.D.C. Treaty and the Bonn Contractual Agreements come into operation, the German Federal Government will cease to bear the charges of the Navy's local requirements in Germany, and the First Lord will have to find the money for those requirements himself.

Of course, I do not blame him for making no provision in these Estimates for those requirements because he has no method of knowing when those Agreements will come into force, and whether they will come into force during the year for which he is estimating, or at any time after that. But I am quite sure that his Department has calculated what would be the annual expenditure in hard currency —because it will have to be paid in hard currency—which will fall upon the Department annually or monthly from the time that the E.D.C. Treaty and the Bonn Agreements come into force.

I do not know whether this a large or a small amount, and I should very much like to know. I hope I am not asking too much when I ask the hon. Gentleman who is to reply if he can give us any sort of estimate of the monthly or annual charge which will have to be added to these Estimates for the cost of local requirements in Germany from the time that the Treaty and the Agreements come into force, and when the Admiralty will have to bear this cost itself.

I should think that when we get this information we shall find that those charges in respect of the Navy will be much lower than those in respect of either the Army or the Royal Air Force, but they will doubtless still be a significant amount. As I have already observed, they are an amount which we shall not be able to pay in sterling, but shall have to pay in currency which is not only hard, but is becoming increasingly hard.

This ought to give the House some food for reflection when it thinks about expenditure on the Services and other things during the forthcoming year. It seems that we do not always take into account the direct economic effect of the change in the relationships between our Armed Forces and those of other countries which will flow from the ratification of the E.D.C. Treaty and the Bonn Contractual Agreements. It is sometimes argued that following their ratification we shall get some advantage for British industry because one of our competitors will be loaded with arms costs with which it is not at present loaded. But against that we have to set the factor that services which are at present needed for our three Services in Germany and which are paid for by the Germans will have to be paid for in hard currency out of our own resources.

On Vote 5, Subhead H—"Further education and vocational training"— there is a point which appears to me to be anomalous, and I should be grateful for some explanation. It seems to me that in general the provision which is made by the Navy for further education and vocational training is not only fair, but might reasonably be described as generous. The only thing I would say about it in general terms is that I am sure that the Government spokesman listened with sympathy, as, I believe, we all did, to the plea of the hon. and gallant Member for Horncastle (Commander Maitland) for better post-service employment opportunities for ex-naval personnel.

The First Lord ought to be invited to consider whether, in the planning of this further education and vocational training, though ought not to be given, not merely to vocational training for vocation within the Service, but to vocational training for a parallel vocation outside the Service after a man has ceased his Service life. Having said that on the general point, there is a small anomaly, about which I should like information, in respect of the paragraph which says: For ratings in small ships for whom organised educational provision is intermittent and for those wishing to study at an advanced level, a wide range of Forces correspondence courses is available. A nominal fee is charged and this is included in Subhead Z, Appropriations in Aid. I cannot see why this should be so.

If a man is serving at a shore station or in a large ship, where organised educational provision is regular, he can get a direct course in a wide range of subjects, which are set out towards the top of page 61 of the Estimates; it is an excellent range of subjects. A man can get what appears to be, on the evidence of this document, a very good course with direct verbal teaching, entirely at the expense of the Admiralty. But if he happens to draw a blank in the ballot and is put into a small ship in some remote out-of-the-way place, not because he asked for it—a ship in which the Admiralty, through no fault of his, even if through no fault of the Admiralty, can only provide intermittent training—and he still wants to continue the course which he started in his shore establishment or his previous ship, he has to pay in order to do it. Where is the logic and the sense of that? I hope I am not too much troubling the Parliamentary and Financial Secretary if I ask for some explanation.

Now, I turn to Vote 8, to which the attention of the House was directed from the Government Front Bench early in the proceedings; so I certainly cannot be trespassing on any rules of order if I refer to it also. Section III of Vote 8 concerns contract work, and Subhead A of that section concerns ships and aircraft. The subhead, as the text says, also covers the cost of aircraft and repairs to aircraft by contract.

The total amount for aircraft, including repairs, is of the order of £24,500,000, a very substantial amount and nearly 50 per cent, greater than the amount for the same item in the previous year. But it is not broken down as between purchase and repairs, and there seems to be no sensible reason why it should not be so broken down. There are a number of points in this Vote in which the Admiralty has not gone as far as it could reasonably be expected to go in breaking down global figures of the sub-divisions. This is true not merely of sterling figures, such as those I have quoted, but also of figures of strength, which it will be more appropriate to discuss later.

How much of this £24,628,000 is for aircraft and how much is for repairs to aircraft by contract? How much of the repairs to aircraft by contract goes to establishments owned and operated either directly by the Government or by some public institution? We were told in a debate yesterday that there is an aircraft repair and maintenance base owned by British European Airways Corporation the future of which is threatened because the work is insufficient or is being diverted from it. I should like to know whether anything has been done to investigate whether some of these repairs to aircraft by contract can be diverted to that base.

We were also told yesterday of an engine and propeller repair centre tucked away in a comparatively safe strategic position, in which redundancy is being declared. Clearly that station would, on all sorts of grounds, welcome doing work for the Fleet Air Arm, and I should like to know whether any investigation has been made of the possibilities of putting into that repair factory any of the work of repairs to aircraft by contract covered by Subhead A of Section III of Vote 8. I am sorry to ask all these questions in such a long string, but it is quite clear that this is the only opportunity for us to do so, and I hope I may be forgiven.

I was interested to read in the explanatory note to Subhead B of Part I of Vote 10, on page 43, that money is appropriated by the right hon. Gentleman for, amongst other things, a contribution towards the cost of a new joint Services headquarters. This is under a classification headed "Workshops and Technical Buildings," and it would appear from this that the three Services together are proposing to operate a joint establishment for technical work which can be done usefully in common between the three Services.

I must confess that this is the first time I had heard of this intention to operate this new joint Services headquarters for technical purposes. I speak subject to correction, but I rather fancy that this is the first time the House has been informed of this intention. Primq facie I think it is a sensible suggestion. I have always felt, as a layman, that there were many things for joint activity be- tween the three Services instead of each keeping itself strictly to itself for no better reason than that of prestige and for reasons of "empire building."

I am quite sure there is a good deal more room than is being exploited at the moment for joint requisitioning, joint purchasing and joint storekeeping of certain types of common stores between the three Services. If this new joint Services headquarters under "Workshops and Technical Buildings" is a first break in the sacred brick wall built up by each of the Service Departments around itself, then I am sure the whole House will welcome it. But we should like to know more about it, including the scope of work which it is proposed to carry out at these headquarters, and who is to administer it. Is it to be administered by the Joint Chiefs-of-Staff? Is it to be administered, as one would expect it to be in logic, by the Ministry of Defence?

I recall that when the Ministry of Defence was established, one of the main justifications for setting it up was there were many executive functions common to all three Services which the Ministry could in some cases co-ordinate and in some cases carry out for them. I have more than a shrinking suspicion that that function has not been carried out in any significant degree at all. If the Ministry of Defence is not operating this joint service, I shall ask—although I know it is not the hon. and gallant Gentleman who will be able to answer it—why it has not been carrying out this duty.

On page 155 of the Navy Estimates there are explanatory notes on a number of subheads commencing with "Allowances to ministers of religion," and going on to Fees and gratuities for special services, etc.,"Loss by exchange, etc.," "Lighthouses, etc.," and "Instruction of Nava‡ personnel at outside establishments. There are four purposes for which the money is asked under Fees and gratuities for special services, etc., and the second of these reads as follows: Rewards to (a) officers and men of the fleet, and (b) civilian staff, for original proposals of value. This is similar to suggestion schemes in civilian industry, and I am wondering to what extent the Admiralty has endeavoured to benefit from the experience of the operation of these schemes.

These schemes, when first introduced, were found to be of small and diminishing value until people got around to considering why it was that they did not produce in theory what they ought to produce, and then they found that there were substantial limitations in two directions, first, in the direction of relating the reward to the financial benefit produced by the idea; and, second, in the direction of the democratising of the decision-making body, who decided whether a suggestion was valuable or not.

One of the surest ways of securing that people will stop bringing forward ideas is to give them the impression that when they bring an idea forward it is dealt with arbitrarily by one man, or at the most by two or three, without proper consideration being given to the matter. During the course of our debate one hon. and gallant Gentleman who served in the Royal Navy quoted an instance of a substantial change being made in the equipment of a ship in which he served, and which he said resulted in a considerable sum of money being saved. The person principally concerned was given an award of £5.

I do not know what a substantial sum of money means in that connotation, but I judged from the description which the hon. and gallant Gentleman gave that he was thinking of something of the order of £30,000, £40,000, £50,000 or even £100,000. If it was of that order, then the person who got an award of £5 would feel sour. Giving an award of £5 is worse than giving no reward at all, because if no award is given then the man can say that he did it out of love for the Service, and he gets a word of praise from his commanding officer. But once the reward is placed on a financial basis, a man is going to be soured if he is given a derisory award like £5.

So, I should like to know how many of these ideas come forward in the course of a year, and by what sort of criterion people judge what these rewards shall be in relation to the financial or other saving accruing to the Service. Third, on what sort of validity is the award to be judged? If it is the case, as seems to be apparent from the observations of the hon. Member for St. Ives (Mr. G. R. Howard) that the technicians are so much out of touch with conditions that a ship has to call in at the first harbour to get rid of equipment, then it is no com- pliment to those who are supposed to judge fairly the ideas of the chaps who are doing the job. The next subhead is one which I was surprised and, indeed, horrified to discover. It is called, "Loss by exchange, etc.", and I find that there was provided last year for this contingency £5,000; this year, it is again £5,000, and the explanation is that this subhead bears a net loss in exchange due to dealing in foreign currencies. I cannot, however much I try, think why the Admiralty should deal in foreign currencies at all. But, suppose that it does. Why does it always budget for a loss?

The First Lord has sitting behind him a most powerful array of hon. Members who have had day-to-day experience in the City, and who know all about these wonderful mysteries of dealing in commodities and foreign exchange. Why should he not get some advice from his hon. Friends so that he can arrange to reach a position whereby, if he sometimes makes a loss, he may also sometimes make a profit? It seems to me arrant defeatism to say that because one swops one currency for another one must always lose a hundred pounds a week in so doing.

I must pass on and if hon. Members opposite are murmuring, I would point out that we are dealing with £400 million. I will pass over the temptation to ask whether the provision made for the cost of removal of certain wrecks obstructing navigation refers to physical things or to human things, and come instead to asking a question about Vote 12. This concerns the expenditure of the Admiralty Office, and on Subhead A. "Salaries, wages, etc.", I find that I am delighted in being able to congratulate the First Lord and ask him only to convey to his opposite numbers in the other two Services the expertness which, in this particular matter, he has managed to develop.

For, in the shorthand and typing staff at the Admiralty, there are two controllers and nine superintendents dealing with more than 800 shorthand typists and typists. Superintendents seem deliberately to be put with other people so that one will not know how many of each there are, but allowing for this piece of security work, it look as though the ratio of supervisory to staff grades is much better in the Admiralty than in some other Departments. If that is so, I ask the First Lord to pass on to his colleagues whatever it is that he has discovered which makes him more efficient in this respect than they are.

Under Vote 12, Subhead A, I should be glad if the First Lord would tell me what are chief paper keepers, senior paper keepers and paper keepers, of which there are several hundreds employed by the Admiralty. I managed either to recognise or to find some understandable explanation for every other vocational description in the whole of the 319 pages. Why do not these people appear in other Service Departments or other Departments of the Government? What sort of papers do they keep? How do they keep them? Are they just chief filing clerks, senior filing clerks and filing clerks, because, if they are, why are they not so called? Doubtless they were called chief paper keepers in the days of Lord Nelson, but one or two things ought to have changed since then. If they are not filing clerks but keepers of cigarette papers or of other papers, perhaps we may be told precisely what it is that they keep.

I desire to raise one or two points of detail which come out of the Programmes and Appendices, where there are some of the most interesting figures in the whole Report, if one only takes the trouble to look them up. I refer, first of all, to the statement showing the probable cost in 1953–54 and the estimated cost in 1954–55 of new construction in the table which is given on pages 224–5. I am particularly interested to compare, between the two years, the relation between direct charges, on the one hand, and oncosts and services on the other hand; or, in other words, the percentage of the total cost represented by oncosts and services.

During the day, not unnaturally, we have heard about efficiency in the operation of the Navy, and one of the ways, outside these Services, in which in recent years we have sought to improve efficiency is by reducing the percentage of oncosts. Here the percentage of oncosts is estimated to be larger during the coming year than during the past year. What is especially interesting is that this slight increase in the overall figure comes about notwithstanding a significant fall in the figure for dockyard-built ships.

It is in respect of contract-built ships that the percentage of total costs represented by oncosts and services has risen by one-ninth, and I wonder whether this does not indicate some relaxation in the controls which the Admiralty costing department normally exercises over contractors, not only about costs in general but about oncosts in particular. I want an assurance on the matter, because in the recent past we have had only too many bitter experiences to confirm the fact that if these controls are relaxed in the least, we find contractors' costs and especially, in some cases, their oncosts, running away with them.

The House will be glad to learn that I have only three further points to make, and I shall try to dispose of them very quickly. The first of these concerns marriage allowance. I observe on page 258 in Appendix I that marriage allowances are provided for officers. I will not say, because I am not competent to do so, whether these allowances are adequate, or fair, or what. But what strikes me as strange is that they vary according to the age of each officer, and that officers aged 25 years and over rank for rank get much more generous allowances than married officers under the age of 25.

I cannot see why this distinction should be drawn at all. There are vast differentiations in the rates of pay and allowances which can always be justified in respect of rank. They are differentiations because of greater ability in the handling of the job, and greater responsibility exercised in the handling of the job. But if one takes rank for rank, station for station and circumstance for circumstance how can one justify paying a different allowance for a lieutenant-commander or a commander below a certain age and above a certain age?

Mr. Beverley Baxter (Southgate)

That is an important point which the hon. Gentleman has finally reached. Does he not think that the authorities in the Admiralty have possibly, in their wisdom, thought it wise not to encourage men to marry at too young an age? That seems to me a sensible idea that they should wait until they are 25, and not marry at too early an age.

Mr. Mikardo

That is precisely the conclusion I had reached and which I was about to announce when the hon. Gentleman, with the prescience for which he is famous, foresaw what I was about to say, and added to the time I was taking by interrupting to say it for me.

If the Admiralty thinks that it ought to encourage people not to marry at too young an age it ought to mind its own business. This is a hangover of the days when not only did the Admiralty discourage young officers from marrying, but forbade them, and thereby encouraged, and indeed created, if records are to be believed, a great many unofficial and improper liaisons. It is no business of an employer, Service of civilian, whether an employee gets married at 23 years of age or waits for another two or three years. I was married before I was 25, and I should not have allowed any employer to tell me I had to wait. The Admiralty is carrying out the functions of an employer and paying marriage allowance, and should not have the right to say at what age a man should get married. I am sorry I have been so long, but the hon. Gentleman the Member for Southgate (Mr. Baxter) will pop in at the end of a debate or speech. I know he is trying to be helpful, but one day he will learn which way it is that is paved with good intentions.

The next matter I wish to refer to is a parallel to one which I raised on the Air Estimates. It is on the pay of apprentices, which is dealt with at the bottom of page 260. I shall not repeat in detail what I said about the same point on the Air Estimates, because although the hon. Gentleman was doubtless tucked up warmly in bed when I made those observations he may have had them drawn to his attention since, but I want to say briefly that if the First Lord is having any difficulty in the recruitment of apprentices he had better have a look at the pay scales, which may have borne a relation in the past to those of employers competing for the services of apprentices but will not do so in the very near future.

I know because I went to a school from which a great many of those apprentices come. I know that in the past there was a good supply of boys from there, and perhaps it is continuing in the present. If the hon. Gentleman wants to attract people from civilian industry he must consider the pay rates of the apprentices, and also the pay rates as they are related to age groups.

I observe on page 263 that among the allowances for men there is an allowance for the nursing of tuberculous patients at a daily rate of sixpence. I cannot find, after the most careful scrutiny of the Estimates, any such allowance for officers, including officers of the Nursing Reserve. Do not officers get the same allowance, too? If not, why not? I know there is a considerable difference of opinion about whether there is additional danger incurred in nursing tuberculous patients. When I once raised with another Service Minister the fact that officers were paid six times as much additional allowance for nursing tuberculous patients as ratings I was told that there was no extra danger anyway.

However, the hon. Gentleman and his Service colleagues cannot have it both ways. If there is no extra danger, there is nothing to pay for, and if there is pay, there should be fair payment all round. Therefore, I ask, whether there is an allowance for officers under this head, and for the Nursing Reserve? If so, how much is it, and if it is different from the sixpence a day rate for the men, what is the difference?

I apologise once more for having taken so long and having covered so many points, a procedure into which I was forced by the new practice under which Vote A cannot be discussed at all, and by which one is compelled somewhat unsatisfactorily to crowd into a speech in the general debate all sorts of points of detail which, for reasons that the House well knows, I had better not call Committee points, even if they are.

1.29 a.m.

Mr. F. A. Burden (Gillingham)

I am quite sure that the hon. Gentleman the Member for Reading, South (Mr. Mikardo) will not expect me to go into the subjects which he has raised in a rather prolonged way. I feel that my constituents are much happier with what my right hon. Friend has accomplished during the last year than the hon. Gentleman appears to be. There is considerable satisfaction in the Chatham Dockyard area, most of which is in my con- stituency, and among the naval personnel as well.

We have all been very seriously concerned at the deterioration in the manpower position in the Navy, and there is general acclamation for the steps announced in an effort to restore the situation. I, too, was very pleased to hear that measures are to be put in hand to improve the efficiency of the dockyards, but I was concerned at that part of the debate which took place on the Amendment of my hon. Friend the Member for Farnham (Mr. Nicholson), when the suggestion was made that more of the naval shipping requirements should be fulfilled by private yards. I urge upon my right hon. Friend the need for ensuring that the Royal naval dockyards are fully occupied.

All those who follow these debates, and especially those who represent dockyard constituencies, realise that there has been considerable apprehension for quite a time about the future of the dockyards. Indeed, suggestions were recently made in my constituency that it was the intention of the Government to close down Chatham Dockyard. My right hon. Friend has given the best possible reply to those rumours by announcing, first, that the Chatham naval barracks are to be modernised, and, second, that there is a scheme for the modernisation and improvement of the dockyards. This is not before time. Those who represent dockyard constituencies know that much of the machinery, plant and workshop accommodation is in a shocking state.

I share the view expressed from both sides of the House about the announcement by the Admiralty that holidays are to be taken in one period of two weeks this year. I understand that this is to be an experiment, but hon. Members, and certainly dockyard personnel and business interests in the towns concerned, are entitled to know what influenced the Admiralty in arriving at this decision, which seems to cut across the avowed intention of the Government to press generally for staggered holidays. That was the proposal of the Labour Government, as well as the present Government. There must have been strong reasons for this action. I hope that we shall be given more information, and an assurance that if the economies aimed at are not achieved there will be a return to staggered holidays next year.

I wish to deal with two other questions. At this time of the year one is always approached by men in the Navy with grievances. The first, I believe, is rather an old chestnut. It is the question of warrant officer ranks in the Navy. I have been informed that there is a good deal of dissatisfaction at the fact that the Navy has no rank comparable to warrant officer 1 and warrant officer 2 in the Army and Air Force. I am told that this has been a bone of serious contention for some time and that representations have been made, but no announcement has been made in response to the repeated representations made by senior ratings in the Navy. Perhaps this will afford an opportunity to my hon. Friend to say whether any proposal can be made about this matter for the future.

Then I have had another matter raised with me, which is a fairly narrow point, but it is a question of what appears to be an injustice. In the Admiralty's message of 2nd March, 1954, R.N.V.R. instructors were shown as being ineligible for the increases in pay announced recently by my hon. Friend. The number of men affected comprise only about 200. Although it was stated that at the moment these men were not eligible for an increase, it was also stated that the matter of an increase in pay for them was under consideration.

I shall be glad if my hon. and gallant Friend will advise me why it was stated that they were ineligible for increases at the time, why their pay position was under consideration and whether that consideration has now been given and they are to receive an increase in their pay, with other members of the Forces, because according to R.N.V.R. Regulations of 14th July, 1953, dealing with the conditions of Service pay, while serving N.C.S. engagement instructors will receive full active service rates of pay and allowances and will not draw pensions, on completion of their engagements their pensions would be subject to increase in respect of additional service beyond the normal period of 22 years' pensionable service.

Where active ratings are drafted as instructors, on being pensioned they will, if retained for further duty as instructors execute N.C.S. engagement and be paid the full active service rates of pay and allowances. It does seem to me that this was fairly clear. Those men were to re- ceive the full active service rates of pay. That was part of their engagement, and it is hardly to be wondered at that they are seriously concerned if they are now to be informed that they are ineligible for the present increases, and then, later in the Admiralty signal, that their position is under consideration. Though this may affect only about 200 men, I do hope that my hon. and gallant Friend will tonight remove the concern that they are undergoing at the moment as they do feel that exclusion from benefits promulgated in the White Paper would constitute a breach of their agreements.

I have been rather concerned over the question of the medical services in the Royal Navy, though not with regard to the present hospital and medical services in the Fleet, because I understand that they are excellent. Indeed I can assure the House that the medical facilities and treatment at the Royal Naval Hospital, Chatham, compare very favourably with those at any other Service hospital or any civilian hospital.

I am concerned about the question of money being made available for medical research. I understand that no sum of money is allocated to the Navy for medical research. I do not know whether the same applies to the Army and to the Royal Air Force, but it seems to me that, at a time when new weapons are being developed and when there is an enormous increase in the speed of aircraft; when rapid development is taking place concerning submarines that can stay submerged for many days, and because secrecy must be maintained about these and other modern weapons and their effect upon the human frame, medical research must very largely be carried out in secrecy. It seems to me, therefore, that the best manner in which investigations can be carried out by medical teams is by recruiting to the Forces men capable of undertaking the research, and by providing the necessary money for the employment of such men. Research could be carried out under terms of secrecy such as can be imposed only upon members of Her Majesty's Forces.

There is also the question of the facilities for carrying on the research. Many of the weapons from which the need for research would spring would be in the hands of the other Services and would be used by them. Therefore, I ask my right hon. Friend not only to look into the question of allocating money to the Navy for medical research, but also to look into the matter in association with the chiefs-of-staff of the other Services. I do feel that this is a subject that requires investigation.

1.43 a.m.

Mr. W. Nally (Bilston)

This House is rightly regarded by democratic assemblies throughout the world as the Mother of Parliaments, but that does not necessarily prevent her from behaving like a silly old fool. We are having at the moment, and we have had before on Service Estimates, this ridiculous procedure. We begin our work on the debate on the Estimates at four o'clock in the afternoon, and at a quarter to two in the morning we listen to a long speech by an hon. Member opposite who quite properly presents to the House a whole variety of technical questions and issues to which he is entitled to have an answer from the Government.

The Government Front Bench looks slightly bored throughout the whole procedure, and takes no notes that matter. I am a reporter of some experience and I should be very happy to go outside and have a competition with right hon. and hon. Members on the Government Front Bench concerning the number of important points raised by the hon. Member in the last 10 minutes. I am perfectly certain that whoever else may be aware of them, the Government Front Bench is not. The reason for that is that we are discussing these quite vital matters at a quarter to two in the morning.

The point at issue is the Navy, and the Navy is vitally important—a matter of life and death to this country. No matter how eloquent the speech, no matter how important the points raised by the hon. Member for Gillingham (Mr. Burden), no matter how precise and legitimate the points raised by my hon. Friend the Member for Reading, South (Mr. Mikardo), what we have to face is that these points are being presented at half-past one and a quarter to two in the morning, as a consequence of which 95 per cent, of the intelligent men and women of these islands, whose regard and respect for the Navy is as great as anybody's in the House, will not be impressed a few hours from now by what points were made by the hon. Member for Gillingham or what points were made by my hon. Friend.

The only thing that people will be impressed by is that Her Majesty's House of Commons, discussing serious Service Estimates on matters vital to the future of the country, was discussing them at half-past one and a quarter to two in the morning, when the majority of us are not at our best. [HON. MEMBERS: "Hear, hear."] Certainly—and when, moreover, a large number of Members on both sides of the House with speeches to make, with knowledge to impart and experience to deploy in a Parliamentary discussion, have decided that once 11 o'clock is reached, neither the House nor anyone else is particularly interested in what they have to say.

Mr. Swingler

Oh, no. Is my hon. Friend aware that there are some Service Departments which take sufficient note of speeches made by hon. Members in the House that if the Minister who replies to the debate is unable to deal with the points, the Members concerned will receive replies by correspondence afterwards, as I can vouch for on many occasions in previous years?

Mr. Nally

It ought to be an elementary principle of good Parliamentary practice, as with courts of justice, that not only should justice be done, but that it should be made perfectly plain to the public that it is being done. If speeches have to be made at a quarter to two in the morning in order to get a letter from the Minister four days later saying that the point in a Member's speech has been dealt with, without the public or anybody else being fully aware of what was said and what was meant, I do not find in that an adequate defence for sitting here at this time.

Mr. Fernyhough

Is my hon. Friend suggesting that all the speeches that were made before 11 o'clock will receive such adequate publicity that the public will be able to form their own conclusions about what was said here?

Mr. Nally

It is not the publicity in which I am interested: it is the dignity. I am saying that if we are discussing Service Estimates, matters that affect vitally the future and welfare not only of the country but of people serving in the Services, the time to discuss them is not a quarter to two in the morning but is 10.30 in the morning, when people are at their best and when the subject can be handled properly.

This is the third or fourth time in the House that I have protested about important and vital matters being discussed at this hour. I did so under the previous Government and I do so now. It is no excuse for alternate Governments to argue that the Opposition has always wasted the time. The trouble, from which the Service Estimates are the biggest sufferers, is that the elasticity always starts at the wrong end. We are all, one hopes, comparatively sane Members of Parliament. Is there anything to prevent our meeting to-morrow, by arrangement between the two sides, and having two days for the Service Estimates, beginning our discussions at 10.30 in the morning instead of at four o'clock in the afternoon, when many hon. Members have already done a considerable part of a hard day's work?

Are we to assume that the Navy is a proper subject to discuss at quarter to two in the morning, when there is not a company director on the benches opposite or a journalist on these benches who would dream of running an important conference at this hour of the morning? I have heard the greater part of the speech made by my hon. Friend the Member for Reading, South and that of the hon. Member for Gillingham, who brought to the attention of the House a variety of points worthy of serious consideration. Although this ought to be the place, it is certainly not the time to discuss those important points, or even to ask the Minister, who presumably has got a hard day's work to do a few hours from now, to reply to them. But whose fault is that?

The fault is ours. If the Mother of Parliaments persists in this attitude that it is right and proper for us to discuss these important matters at this time of the morning, then all I can say is that the Mother of Parliaments will deserve what the British public now says about our late Sittings, that they are not only ridiculous, but childish.

1.52 a.m.

Brigadier Terence Clarke (Portsmouth, West)

I offer no apology for making a speech at this hour of the night. I represent the premier naval port, and in my constituency is the premier naval dockyard. I am sorry that we have to discuss this matter at this hour of the morning, but I believe that we might have been finished a lot earlier if everybody who wanted to contribute to the debate had done so in the way we on this side of the House have done.

First, I should like to draw the attention of the First Lord to the fact that he has done a very good thing in raising the pay of certain skilled and senior ratings to try and persuade them to stay in the Service for a longer time. I have been pressing that on the Government for a long time, but they have failed to understand the importance of competing with industry. These skilled men, who have knowledge of radar and other technical and electrical matters, have an enormous call on them from outside the Service, and the Navy has to compete with industry.

The second point I wish to make is that for too long men have had to go on long tours of overseas service.

Mr. Nally

Would the hon. and gallant Gentleman forgive me a moment?

Brigadier Clarke

No. I think you will agree, Mr. Speaker, that I have sat here waiting for too long to agree now to be interrupted.

Members of Her Majesty's Forces have to go on long tours of duty overseas, and I should like to read a letter I received the other day from a senior petty officer: Don't think I am a grouser. I have an excellent record and have recently been recommended for service in the Royal Yacht. I am leaving the Service at the first possible chance because my son will be two years old before I see him, and I spent many years away from home during the last war. A man can be kept on an overseas station for two years and nine months, which is too long to be separated from one's family. I think everybody on both sides of the House will agree with that statement. The First Lord has now said that he will do his best to see that foreign service is reduced to one year. That will make a great difference to recruiting for the Navy and to keeping those already in the Navy in the Service.

I wish next to draw attention to posting. I get an enormous postbag every week on this subject, and repeatedly I am told that men have been posted overseas out of their turn. This may not prove to be the fact, and in a number of cases that I have investigated with the Admiralty, it has always given good reason why a man has to be posted overseas. In general, the Admiralty managed to convince me that men go overseas in their correct order. I think the Admiralty has not only got to see that postings are fair, but that they appear to be fair to these men posted overseas. I think it ought to be carefully explained to these men how their posting has been brought about, especially when they have only been posted Home for a few months and then find themselves once more going overseas and leaving their families.

The next point I want to make—and I have made it several times before— concerns the retirement of officers and the discharge by purchase of ratings. I think the Admiralty is foolish in withholding the privilege from officers of retiring and from ratings of buying their discharge. The Admiralty has the idea that if this were allowed there would be widespread departure from the Navy, but that would not be the case at all.

I know that until the First Lord spoke today there was no way of getting out of the Navy unless an officer said that he was going to stand for Parliament. But nowadays a naval officer cannot be a candidate until he has left the Navy, and if there is no way of leaving the Navy then an officer cannot be a candidate for Parliament. That has been rectified today. I know at least one officer who wanted to get out and stand for Parliament but he was not able to do so, and I am sure the First Lord would agree that that is not democratic.

I am sure there will not be any mass exodus because of the promise which my right hon. Friend gave today. I heard him give the promise in the House, and I took the trouble to go and read it on the tape machine. It sounded better in the House than it read on the tape machine. On the tape machine it said: The scheme will necessarily be on a limited basis, as with the other Services. I do not understand how it is to be limited "as with the other Services." As far as I know a soldier or airman can get out, and I have not known discharge or retirement to be withheld in either of the other two Services. If the Admiralty limits the men leaving, I doubt whether what the First Lord has promised us today is going to be very good.

Then the tape message goes on to say: Officers may retire at Admiralty discretion. Personally, I would not be at all happy to leave the Admiralty to decide on that subject. I think that these men should be allowed to go out of the Navy as a right. After all, an officer makes up his mind to enter the Navy when he is extremely young, and he often does not know his mind at the time he is pushed into the Service by his father, who is probably a Service man.

After being in the Service for a few years, he discovers that it is not the life which he expected, and he would like to get out. It may be that he has developed some new interest, or he may even find that he is not fitted for the Service. Also, that man may have been barred from further promotion and up to now. even although the Admiralty will not promote him, they will not let him go and start a new life.

Mr. Fernyhough

I am very interested in what the hon. and gallant Member is saying, but does he mean that a man should be able to "ask for his cards." so to speak, or to give a week's notice?

Brigadier Clarke

I am sorry, but I did not hear the hon. Member.

Mr. Fernyhough

Is the hon. and gallant Gentleman suggesting that a man in the Navy should be put more on a par with men in civilian employment; that a man should be able to give a week's notice?

Brigadier Clarke

I do not think that we can bring trade union principles into the Royal Navy, the Army or the R.A.F. I think we can run this privilege very well, as we have done for a very long time. Of course, all sorts of terrible things happened under six years of Socialism, but now we have a Conservative Government back again, we shall soon get the thing on a proper footing and everything will be all right.

There is another matter to which I would like to refer. There are men who.

at about the time of the crisis at the start of the Korean war, were entitled to their gratuities, but who were called upon for further service for two years. I have raised this question before, and I know of one man in particular who had committed himself to buying a house and furniture because he was looking forward to collecting his gratuity. Eventually, the gratuity was allowed, but he was entitled, after a further two years' service which he had done, to a further £25 for each year; but because he drew the gratuity when it first became due, the Treasury says that he cannot have the other £25 a year.

I do not see why the Treasury should make a profit of £50 out of this man, and others like him, because he drew his gratuity on the day that he was entitled to draw it, and I hope the First Lord will deliver some sort of corrective in the right place at the Treasury. I think this man has been robbed of £50—[Interruption.] I am not going to apologise for keeping the House, because if I sit down, somebody on the other side will get up and keep the House for another couple of hours; and I have a lot to say.

Mr. Nally

On a point of order, Mr. Speaker. You have previously ruled that an hon. Member may be tedious without necessarily incurring your displeasure, or he may repeat himself. But, if he combines the two, then surely, because of that you might be disposed to take what one might term a "a dim view." The hon. and gallant Member has not raised one single point which has not already been raised in the House or by letter to the First Lord.

Mr. Speaker

There is no point of order in that. The hon. and gallant Member was not, in my view, guilty of tedious repetition.

Brigadier Clarke

Thank you, Mr. Speaker. As far as I know, the hon. Member for Bilston (Mr. Nally) has not been in the House most of the evening. He has probably been reading a book, like his hon. Friend the Member for Reading, South (Mr. Mikardo).

I want to raise a question on non attributable diseases. If the hon. Member for Bilston has heard that before he is very clever, because it has not been mentioned at all this evening. There is a great deal of discontent among men who contract diseases which the Admiralty consider not to be attributable to their service. I know this problem is difficult and may cost a little money, but we must remember that a man is given an Al certificate when he enters the Service and yet, after two or three years; he may come out completely disabled because of one of these diseases which are regarded as not attributable to his service.

The Minister of Pensions does his best to regard them as attributable if he can, but certain diseases are not regarded as attributable, for example, tuberculosis. I know of many men in my constituency who cannot get work because during their service they contracted a disease, but they get no pension for their disease if it is non-attributable. There was a service wife in my constituency who nursed her husband, who had a 100 per cent, disability, for nearly 30 years; but when he died his pension died with him. This is a small point but one which the Admiralty must consider. It must see that such women are not thrown on to National Assistance at the end of an extremely useful life, spent in looking after ex-sailors or ex-soldiers, who die of their disability.

I wish, now, to turn to the Civil Lord, and to ask why, without consultation with all those concerned, he decided to close Portsmouth dockyard during two weeks in August. It is the height of the holiday season. Half the dockyard workers have wives and daughters who work in hotels, restaurants, laundries and elsewhere, and who naturally want their holidays at the same time as their husbands and fathers. This decision is very inconvenient to the city. None of the dockyard workers wants to be forced to take his holidays on a date announced by the Minister. The Minister has said that these men had a choice, but in fact it was a very narrow choice; they were asked whether they would prefer the first two weeks in August or the last two weeks. It may well be more convenient for a man to have his holiday in May or June. The Government have always urged staggered holidays.

Mr. J. P. L. Thomas

They had a choice of six weeks.

Brigadier Clarke

I understood that they were offered simply an alternative fortnight, but I accept what my right hon. Friend says. I hope that next year my right hon. Friend will arrange for a return to staggered holidays.

Finally, I should like to raise a point about merit award, which is given to men who are efficient in their work at the dockyards. The award is on a percentage basis, and if the whole dockyard is efficient not all can get the award. It seems to me wrong that the dockyard can refuse to give the award to men who are efficient because only a percentage is allowed by the Treasury. I think that this award should be given to everybody who is efficient, and I hope that the First Lord or the Civil Lord will see that every man who is efficient draws it in future.

In 1949, the Treasury decided that men who retire should count only half their pre-1949 service for pension. People who have entered since 1949 count all their service for pension. I think that these older men who have served their country and the dockyards well, should be allowed to count the whole of their service for pension, and not only half the time before 1949.

I wish to finish on a note of thanks to the First Lord for the extra money granted to the dockyards for machinery: £7 million is a sum not to be coughed at, and it was a pity that the hon. Member for Devonport (Mr. Foot) should so misread his Estimates that he thought that all they were getting was £39,000. If the First Lord continues next year at that standard which he has now set we shall all be very pleased indeed.

2.12 a.m.

Mr. Emrys Hughes (South Ayrshire)

I am not a mariner, nor can I claim to speak for any of the important dockyard constituencies. For many years now I have taken part in these debates, and listened with interest to what hon. and gallant Gentlemen have said. I have learned a great deal, and I believe that those who represent constituencies which are vitally affected are entitled to have their say, even if the debate goes into the early hours of the morning. My interest in this subject is that of the ordinary Member of the House looking at it from the point of view of the civilian. I believe that the taxpayer should vigilantly and carefully scrutinise the Estimates, especially when they have become so astronomical as in recent years.

It will not be much use when we have passed this money and go to collect taxation, spending night after night discussing whether such things as linoleum should be subject to Purchase Tax. It is far more important that we should deal with the expenditure when it comes up on the various Estimates. I make no apology for taking part in the debate, because I believe that these questions which we are discussing are fundamental. They overshadow everything else, and we must face them in a spirit of realism and imagination. It is agreed by influential sections of the Press that the Defence Services are taking enormous amounts of the taxpayer's money. The "Glasgow Herald," which is the most prominent Conservative newspaper in the west of Scotland, recently expressed these sentiments in an editorial.

It said, referring to the general Services' expenditure: It now seems clear that the £1,600 million to £1,640 million level of defence expenditure will operate for at least three years to come. It will interest taxpayers to know that this represents 7s. 6d. in the £ of all Government expenditure. It swallows up the entire yield of the taxes on tobacco and cigarettes, on wines and spirits, beer, entertainment, betting, motor vehicles and petrol, and the Purchase Tax. Such is the price of security. So I say that we are entitled to examine these questions in great detail, and we do not do our duty to our constituents if we do not consider these Estimates in all their implications.

I think it was three years ago that I suggested that what was needed was an impartial examination of the Navy Estimates by a committee of businessmen. Judging from what I have heard hon. Members on both sides of the House saying in this debate, that idea is gaining ground—that we should have a body of reliable, intelligent, independently-minded citizens who will examine all these issues, not merely from the point of view of the vested interests but from the point of view of the nation as a whole.

This is especially necessary in the case of the Service Estimates because in the Service Departments we have these great vested interests which the Prime Minister himself spoke so strongly about on the Navy Estimates six years ago, when he talked of the enormous number of people who had come into the Admiralty and who … make work for themselves and their descendants."—[OFFICIAL REPORT, 8th March. 1948; Vol. 448, c. 835.] This procedure is going on. One can hardly blame the persons who are in those posts. Everybody gets into a life routine. People with good salaries and comfortable jobs do not like to be disturbed.

One of the most difficult things to do is to get democratic control of the Services, and the Admiralty is one of the most strongly entrenched. It lives on tradition. The impact of modern scientific thought has made practically no impression on the Admiralty at all. It has made some impression on the Air Ministry, but I find extremely disappointing the First Lord's Statement accompanying the Estimates because there is no sign in it of the thought, conjecture and speculation disturbing us all. The right hon. Gentleman does not seem to have understood the points made so cogently by my hon. Friend the Member for Cardiff, South-East (Mr. Callaghan) in opening the debate for the Opposition.

The first page of the Statement is devoted to the Coronation, the Coronation Naval Review, the Royal Commonwealth tour, and items of that kind. We have to remember that the Coronation is past, that these items, while interesting enough and having a place in the national life, are not related to the problems with which we are concerned. The problem which the First Lord has is to justify the spending of this £400 million on the Navy at the present time.

The explosion at Monte Bello need never have occurred so far as the Estimates are concerned. There is a reference to it in this document, and there were three lines about it in last year's. After the explosion of the atom bomb, which must have made everybody who takes an interest in naval matters realise that a turning point had come in the history of warfare at sea, we thought that there would be some sign that the policy of the Admiralty had changed and that there would be some sense of realism.

I should like to call attention to what the Prime Minister said about the explosion at Monte Bello. He said: The object of the test was to investigate the effects of an atomic explosion in a harbour. This was essentially a naval operation, The weapon was accordingly placed in H.M.S. ' Plym,' a frigate of 1,450 tons, which was anchored in the Monte Bello Islands…The weapon was exploded in the morning of 3rd October. Thousands of tons of water and of mud and rock from the sea bottom were thrown many thousands of feet into the air and a high tidal wave was caused. The effects of blast and radio-active contamination extended over a wide area and H.M.S. 'Plym' was vaporised except for some red hot fragments which were scattered over one of the islands and started fires in the dry vegetation. … To give some idea of the character of the explosion perhaps I might say this: normal blood temperature is 98 2/5 degrees. When the flash first burst through the hull of 'Plym' the temperature was nearly 1 million degrees. It was, of course, far higher at the point of explosion." —[OFFICIAL REPORT, 23rd October, 1952; Vol. 505. c. 1268–9.] This is reality. This country has several big harbours which are vital to our national existence. Recently, when I was in Berlin, I discussed atom warfare with a Russian. He said, "Of course, you realise that the atom bomb, when it explodes in a harbour or in water, is far more dangerous and far more deadly than when it explodes on land." It is with that reality in mind that we should be asking what will happen in the event of another war, and how that affects naval strategy.

We have several harbours on which an atom bomb might be dropped. There is the Thames estuary. Those who take an interest in the problem of Civil De-fence will have realised that if a bomb is dropped on the Thames estuary that will be most serious for London. There might be 30,000 people killed and another 50,000 seriously injured, and half of London might go up in flames. That might occur not only in the Thames estuary but in Southampton Water, on the Tyne, in the Bristol Channel or on the Clyde.

I want to examine the position of the area in which I am directly interested. The Clyde is most important in time of war. The various harbours in the Clyde have for long been naval bases in time of war. When we realise that an atom bomb dropped on the Clyde might vaporise vessels in the neighbourhood, we begin to ask ourselves, "What sort of a situation shall we be faced with?" That situation has been in the mind of the authorities responsible for Civil Defence in the City of Glasgow.

There have recently been carried out in Glasgow certain Civil Defence exercises based on the theory that an atom bomb might explode over Princess Dock. The gentleman in charge of this investigation, the assistant chief constable of Glasgow, has made an interesting and detailed study, in which he imagines what might happen to the vessels in the Clyde, and says, "Twenty-four vessels in the Princess Dock area are all seriously damaged and sunk, and many are on fire, the docks are quite unserviceable, and it will be a long-term project to get them in service again." So if this is going to happen in our docks and ports, one naturally wonders where the Navy is to find a safe anchorage in the event of an atom bomb war.

There is absolutely no attempt to face up to these realities in the documents we have in front of us. We have had the same old lists of officers, the same old platitudes, but nothing to show that the Government realise that this new kind of atom war has completely altered the naval possibilities, and that we are being faced with an entirely new situation. Once that bomb had shown what could happen to a vessel, then I submit to the House that it should have dawned on the Admiralty that it could not go on in the same old way and must be prepared to think in terms of new ideas.

That point has been made by a very eminent military student and historian, Mr. Chester Wilmot, who in his last work Pointed out that we must revise our whole ideas of strategy, and that the role of the Navy especially should receive attention. He pointed out that the rocket might be directed to our naval bases and dockyards, and said that the invention of rocket weapons had greatly accentuated the problem of defending the British Isles, but that the extent of the transformation in Britain's strategic situation had not yet been reflected in either the problems of defence spending or the composition of our military forces.

What I suggest, if we do get set up the sort of committee I suggested earlier, as a sort of super-committee to look at the position of the Navy and Air Force, is that it will meet every possible obstruction from every kind of vested interest inside the Services. The Opposition spokesman pointed out that we might merge the Army and the Navy. We have a precedent in merging Ministries. We have merged the Ministry of Civil Aviation and the Ministry of Transport, so we might go a little further and perhaps put the Navy in the Ministry of Transport as well, for all the good it is likely to be in protecting the people of this country.

How can one possibly protect the people of Glasgow from the impact of an atom bomb that comes by air? The Navy is an anachronism. It has played its part, and whether the romanticists on any side of the House are prepared to realise that I do not know, but if we do not realise it in theory we shall certainly be forced to realise it if we ever experience the impact of a modern war.

Everyone hopes we are to be spared a war of that kind, but what sort of expenditure are we to be faced with so far as the Navy is concerned if the cold war continues? We have aircraft carriers which cost enormous sums of money, as much as small towns. They are repeatedly altered in the process of their construction and as science progresses, so that they take years to build, and when built they are declared to be obsolete.

The right hon. Member for West Bromwich (Mr. Dugdale) developed the theory that we need these huge aircraft carriers because it would be easier to bomb Magnetogorsk in the Urals from such a carrier in the Arctic than from a base on land. What effect is that going to have upon the Russians? If they think that an aircraft carrier is likely to be sent to the northern latitude so that atom bombs can be dropped on Magnetogorsk that will provide them with an impetus to build submarines with which to sink the carrier.

The Russians are building more submarines. Of course, that is a waste of money from the Russian point of view, because they should be building things other than submarines. But while we build immense and expensive aircraft carriers they will continue to build immense submarines, with the result that both nations will be impoverished, even if actual war does not come. The time will come when the statesmen of the world will have to realise that if they are not to waste the substance of their peoples and lower their standards of life they will have to get together to try to make disarmament a reality.

I do not know whether hon. Members have read the description in "The Times" of the new atomic submarine that has been invented by somebody in America. It has taken a long time to build, and we are told by the Washington correspondent of "The Times," in two columns of descriptive writing about all the latest gadgets and mechanical contrivances in the submarine, and that it is to be driven by atomic power. It will submerge at New York and arrive at Liverpool in a matter of three or four days.

I am not a technician, and I do not know a great deal about the technicalities of submarines, but when I saw that this submarine cost £18 million to build I wondered what sort of economy we should have in this country if we tried to build similar submarines. I presume that if we build submarines, we shall not want to build the cheap obsolescent ones. But what nation in the world can afford to use its manpower, its technical experience, its resources and its money on that kind of thing?

There is one other rather smaller and more trivial point which I wish to raise, but one which has caused a good deal of criticism in our part of the world. The hon. and gallant Member for Portsmouth, West (Brigadier Clarke) referred to the Royal Yacht. In the debate on the last Estimates, I referred to the cost of that vessel. I see that recently an article was written by the Editor of the "Sunday Express," Mr. John Gordon. He said that this new yacht is the most magnificent yacht ever built and certainly by far the most fantastically expensive. The original sum was £1,800,000. "A whopping sum" is the comment. But on Clydeside they say the final sum will be up to not far short of £2 million. Mr. Gordon asks why, and he says: It is not easy to get the answer to that, for the curtain of silence round John Brown's shipyard is just about as impenetrable as the walls of the Kremlin. But the local whisper is that even John Brown's have never known anything like the chopping and changing of plans that has gone in the past few months. Who is responsible for that? Nobody will say. But hordes of Admiralty officials have made endless trips to the ship in recent months. And after each visit more costly alterations were ordered. The staggering cost of building this yacht is by no means the limit of the burden of the taxpayers. She will cost £150,000 a year to run—apart from the fuel. This is the conclusion: Of course, the Admiralty's excuse for all this extravagance is that the yacht is really a naval hospital ship. When the fairy tale season is over, I doubt whether that theory will be widely acceptable. It would cost at least another £250,000 to convert her into hospital ship work. And if war ever came, there would be much more urgent work to do. If this yacht is to be kept in commission at a cost of £150,000 a year, what is the justification for that to the impoverished taxpayer?

I might make some constructive suggestions. Surely the yacht will not be used all the year round. Why not send it to the Clyde on Glasgow Fair holiday and charge admission for the citizens of the Clyde area to see it, and send it along to Blackpool for August Bank Holiday and to all the other seaside resorts at other periods of the year? Perhaps we shall then be able to pay for it and to send it for a period to America, where it can earn dollars. These are the sort of extravagancies that need to be exposed. If we could get a more penetrating examination of these Estimates, a good many of these items might be avoided.

I served in local government on a Scottish town council and a Scottish county council, where we carefully scrutinised every item of expenditure. Far too many big sums are slipping through this House, and Members on all sides, and of all parties, should unite to exert a greater vigilance than is possible in the very cursory examination of the finances of the Service Departments. It is said that liberty is the price of eternal vigilance. It is the price of economy to.

The argument that was used to justify this immense expenditure in the last Navy Estimates debate was that it was necessary to have this huge array of cruisers, frigates, and so on, in order to meet the Russian menace. My hon. and gallant Friend the Member for Hull, East (Commander Pursey), who sometimes speaks with authority on naval matters, has frequently ridiculed the idea of Russia having a huge force. It is interesting that in the figures he gave in last year's debate on the Navy Estimates, the Minister acted on the assumption that we alone would have to face Russia in a possible naval war. When comparing our Fleet with that of the Russians, he forgot what seemed to me the obvious fact that if we ever get into a war with Russia, America will be on our side, and so will many of the countries in Europe which have large fleets.

I have with me what, I believe, is the most authoritative book dealing with the naval strength of the countries of the world, "Janes Fighting Ships." In that book I have found certain figures, which are not likely to be under-estimates, showing that Russia has 520,000 officers and men in its Navy. But how many have the others? The United States has 800,000 men in the Navy and 250,000 marines; Spain has 39,000 in the Navy. Turkey 19,500, Britain 150,000, France 70,000, Greece 11,000, Italy 25,000, the Netherlands 28,000, Norway 4,000 and so on. So we find that if the navies of all the N.A.T.O. countries were united the Russians would be hopelessly outnumbered in both vessels and men.

Last year we were persuaded to agree to the huge Navy Estimates without having the whole picture clearly in perspective. The Russians are a land power. They have the Baltic Sea and the Black Sea, both of which have bottlenecks. Then they have the White Sea in the North, which is blocked by ice for many months of the year. They also have a long coastline on the other side of the world. I submit that there is no reason for this House to get over-terrified of the prospect of Russia as a great naval power. That is largely a bogey.

The Admiralty will always have these bogeys until some superior authority tells it to stop doing so. If, in two or three years' time, the Germans have been given a navy—and I do not see how that can be avoided if they are rearmed on land and in the air—they may have the latest types of submarines, or even battleships, and then along will come the Admiralty and say, "Now we have to arm against the possibility of having to fight the Russians and the Germans at the same time." And it would not be beyond the wit of the Admiralty to say "We must be prepared to meet the United States if necessary."

There will always be an excuse for keeping up expenditure, because that is the point of view of the vested interest at the top. The duty of democratic Government is to remember that the national interest is superior to any sectional interest. Through tradition the Admiralty has become one of these dangerous vested interests, threatening our national economy by its existence, and the time has come when the House should assert itself in this matter.

2.43 a.m.

Commander C. E. M. Donaldson (Roxburgh and Selkirk)

There having been about 12 hours of debate, I shall not speak at the length I had originally intended. I am sure that the hon. Member for South Ayrshire (Mr. Emrys Hughes) will not expect me to follow too closely the arguments he has put forward, although hon. Members on both sides of the House found them very interesting. I also trust that the First Lord and the Civil Lord will not feel that my intervention in this debate is ill-placed by virtue of the fact that, although I served the White Ensign for many years and am still proud to hold a commission in the Reserve, it was in the Royal Canadian Navy and its reserve that I served originally. During that service I spent a considerable time in this country and had the opportunity to observe the systems of training and the organisation and operation of dockyards, briefly in peace-time but at some considerable length during the period of the last war.

In considering this vast sum of £353 million, I am immediately attracted to the introduction to the White Paper, and I am glad that the First Lord has done something towards offsetting the fears which those of us who are interested have had in relation to the diminishing figures referred to in the fourth paragraph of that Introduction. We are relieved and glad that he has been able to give an assurance relating to discharge by purchase and also about length of service on foreign stations. There has been also some reference to the provision of married quarters, and I should like to direct my remarks to those topics in particular.

I am convinced that the difficulties of recruitment, as set forth on page 10 of the White Paper, are in large measure due to the two things which my right hon. Friend most stressed in his opening speech today, and that is that the ratings who serve in the Navy have seen for too long too little chance of reasonable married quarters. That is the basis of a great deal of the seven-year engagement rather than the 12-year engagement. I congratulate my right hon. Friend on taking bold steps to set that right.

The hon. Member for Devonport (Mr. Foot), in his speech, referred to Vote 10, and he devoted some considerable time to the dockyard position, particularly in relation to Devonport, but in the explanatory note on page 141 we see that the application of moneys to be spent refers to married quarters, and on page 143, which refers to the expenditure abroad, we see that the first reference again is to married quarters. I hope that, that, as a consequence of the policy to be adopted by my right hon. Friend and by the Admiralty, married quarters will come first, because I am convinced that if we are to build a strong force, which is so necessary for the Navy, married quarters, both in the home ports and abroad, at places like Bermuda, Malta, Gibraltar, Hong Kong and Singapore, are among the necessities without which we shall not get the long-term recruit.

I am glad that reference has been made to reduction of service on foreign stations. I put to my right hon. Friend approximately a year ago a series of Questions relating to recruitment and to married quarters, particularly on foreign stations. They related to the availability of a task force which would bring about a condition where the ratings could serve 18 to 20 months and go with their ships for leave. We have not had an assurance about the task force, but I think that was implicit in what my right hon. Friend said today, otherwise we shall be left with a great deal of useless troop transport to far-distant places. I shall be corrected if I am wrong, but I imagine that something of the nature of an American task force has been envisaged.

Another thing which has caused concern to a number of us is the fact that for the first time this year there is going to be a very large proportion of National Service men entering the naval service to offset the lack of long-service ratings. One does not wish to cast any reflection on these young men, far from it, but it is a fact that an efficient Navy—and I have had some experience of this in the service to which I have already referred, in which I had a considerable number of years as training officer—cannot be built up with National Service men.

I feel that far too much has been said about technical matters and far too little about the aspect which is most vital to the Navy. Strategic dispositions, the type of ships to be built and so on are no good unless there are available the men who count most in the Navy. The men who count most are the three-badge able seamen, but they are scarcely to be found in the ships or dockyards of the Royal Navy today. Something must be done to make the Service sufficiently attractive to get the 12-year engagement men; the three-badge able seamen, the leading seamen, and petty officers. If we can do that, then we shall have done something towards offsetting the difficulties encountered in relation to the permanent force.

I want to refer briefly to one of the auxiliary services of the Royal Navy which has been mentioned only once before in this debate, and that is the mine-watching service. That is a small, but vital branch. The hon. Member for South Ayrshire has described the possible horrors and difficulties of atomic warfare on our ports. But the ordinary bombs of the last war are something which must be very carefuly guarded against if we are to bring convoys to this country and into our harbours for unloading. The minewatching service is recruited from men who are volunteers; men who give their service freely, and are in training now.

Not far from this House, down the Thames, and in other places of which I have knowledge, I have found these men; and it is rather a neglected service. There is insufficient equipment, particularly among those who have charge of the direction of the service. Allowances for those who have to travel considerable distances each week, such as 2d. a mile for one's private car, are quite inadequate. It is discouraging, to say the least, and I hope that that point will be looked into. Further supplies of equipment are needed. These men are keen; so keen that I think they would rather do without the uniforms, provided at a cost of £12 or £15 each, than go without equipment which is essential to their training.

There has been considerable reference to the various naval dockyards. This is a sore point in Scotland, as the hon. Member for South Ayrshire will agree. For many years past there has been the feeling in Scotland that we supply sufficient ratings to the Royal Navy for consideration to be given to the establishment of a depot there. Of course, Rosyth would appear to be the logical place, and I ask the First Lord to reconsider this matter. The whole art of preparing for another catastrophe, should it ever occur, is the disposal of troops at distances rather than in concentrations; rather than in one or two dockyards in the south. It has always been that our harbours in the north were required in time of war while in time of peace they are neglected. It happened after the last war, and I do most sincerely hope, when we come to the next discussion on the Navy Estimates, that there will be reference to that aspect of our defence.

2.55 a.m.

Mr. Cyril Bence (Dunbartonshire, East)

I do not want to detain the House for long, but there are one or two points I wish to mention.

I have been inquiring all day what are flag officers and I have now been informed that they are admirals. There are 65 admirals with a Navy which has 150 ships on active service—two and a half ships per admiral. Someone must be making a mistake if we have 65 admirals with so small an Active Fleet. Will the Minister tell us whether that is a fact? As an engineer, I worked in the motor industry and other industries, and I must say that I am astonished to see such a large number of directors with such a small active force. It is an amazing situation. In addition to the admirals, there are 28 officers of relative flag rank and many other officers—about 40,000 officers and 80,000 men.

Commander Donaldson

I should like to clear up what appears to be confusion in the hon. Member's mind. These admirals relate to various branches— executive, the pay branch—now called the supply branch—the engineering branch, and so on. They are not necessarily admirals who go to sea flying their flags.

Mr. Bence

Do they all get admiral's pay?

Commander Donaldson

A great deal of this is administrative.

Mr. Bence

If they all get admiral's pay it is a very expensive way of administering the Navy.

I want, next, to refer to one launching which took place in 1944 and two which took place in 1945. of the cruisers "Defence," "Tiger" and "Blake." Earlier today, the First Lord said much trouble was due to bad accommodation in our ships because there had been improvements in machinery and equipment since the hulls were launched and this had crowded out the men's quarters. He led us to believe that something would be done to rectify this situation.

Work on these three ships has been suspended presumably because of the new equipment which has been designed, and because of research, since the hulls were launched. Bearing in mind that when these ships were designed the design was for the equipment of that time, surely the accommodation in them will be shocking. How often does this sort of thing occur? We launch a ship in 1944 or 1945 and yet in 1954 the hulls are laid up, presumably because they were designed for equipment which is now out-of-date. Surely the whole thing is out-of-date. It is a sheer waste of money to spend it on laying down ships which are out-of-date in nine years. As I said earlier, it is a pity that the Admiralty does not spend its resources on improving our techniques of production and the machinery and equipment in the dockyards rather than waste them in constructing and launching hulls which afterwards it cannot complete because they are out-of-date.

Mr. Digby

Surely the hon. Gentleman realises that these were built in war-time and are war-time hulls.

Mr. Bence

Yes, but they ought to be scrapped.

The point I am making is that here are three hulls which are being kept afloat somewhere and are being equipped with the latest machinery, and the First Lord was telling the House that because of the new machinery being installed the crew's quarters were being squeezed up. Why keep them? I do not know anything about the Navy, but they ought to go. I worked in an industry where, if we manufactured anything that was out of date, it was scrapped.

The other matter I want to raise is rather serious. I come from Clydebank, and the stories that are going around Clydebank about the "Britannia" are shocking. I have nothing official, but it is my duty to tell the House of the tales that are being told of the things which went on over the construction of that yacht. The stories are a disgrace to the Admiralty. I have no evidence to support them, but I am putting them to the House as I heard them. I want the First Lord to hold an inquiry into what occurred.

High-ranking officers the seaid to have been coming from Portsmouth, while things were running along comfortably with the ship. They gave orders for this to be ripped out, and that to be taken out. Formica panels were removed from the bulkheads and squads of me a were put on the ship, and were nearly falling over one another. Thousands of man-hours were wasted because of modifications and alterations. These are the tales that are being told, and that is why I ask the First Lord to inquire how it came about that these changes were made by these high-ranking officers from Portsmouth.

The estimated cost of this vessel was originally £1,800,000, but the ultimate cost, according to this Vote, is £2,098,000, more than £250,000 in excess of the estimate for a vessel of 4,000 or 5,000 tons. It is common talk that the hull was bulging with men working overtime on these useless modifications. I am not a shipwright, and I do not know anything about shipbuilding, but I must take cognisance of the tales I am told when I walk up the Dumbarton Road in Clydebank. I have asked for evidence, but I cannot get it. It is not good enough. If these tales are false and lavish exaggerations of what went on in the ship, they should be settled by inquiry.

All I am saying is hearsay, but it has gone so far that one Sunday newspaper actually had two columns on this subject. That newspaper could not have got it from me, the House can be assured of that. This is the first time I have ever mentioned it in public. It is a serious matter, and I am asking, in the interests of the public, that the Government, which talks about expenditure and waste, should investigate the stories about the frightful things that occurred on this yacht, and which this town of 40,000 people are discussing. I ask the right hon. Gentleman to institute an inquiry— not by people in the Admiralty: it is no use selecting officers in the Admiralty to make it—to investigate the expenditure on that yacht in order to quell the scandal that is growing about the frightful expense on its building, and especially on its modifications.

3.5 a.m.

Mr. Tom Driberg (Maldon)

I must apologise to the House for making a relatively brief speech, but I have not a great many matters I want to raise.

Mr. Callaghan

My hon. Friend has plenty of time.

Mr. Driberg

I may say, in passing, that I do not share the indignation that has been expressed tonight, or this morning, by my hon. Friend the Member for Bilston (Mr. Nally) at our discussing these matters at what seems to him an untimely hour. My hon. Friend speaks for himself, of course, as we all do. He says he is not at what he calls his best at 2.30 in the morning. Personally, I am never at my best, but I am even less at my best at what for him is the ideal hour of 10.30 in the morning than I am at two or three in the morning.

Mr. Nally

My hon. Friend got most of his early training, before he became a Member of Parliament, on the "Express" group of newspapers. I got mine on Socialist newspapers, and I have been accustomed to working at civilised hours.

Mr. Driberg

Quite. I have always been accustomed to working for what I would call real newspapers that go to press late at night to print the latest news. As a journalist I must say that I wish my hon. Friend, as a journalist, and so, by definition, a man who verifies his references, had refrained from digging up that old misquotation from Disraeli. It is not this House that is the Mother of Parliaments, but England that is the Mother of Parliaments.

Mr. Nally

I said so myself, not from Disraeli.

Mr. Driberg

No. Unconsciously, perhaps, my hon. Friend was misquoting Disraeli.

I was very glad that the hon. and gallant Gentleman the Member for Portsmouth, West (Brigadier Clarke) raised some of the grievances of the men who were retained over their time because of the Korean war, because I have always felt that they, of all people in the Navy, have had a most legitimate grievance. Unless I misunderstood him, I think the hon. and gallant Gentleman was mistaken in saying they were retained for two years. They were retained for 18 months. In any case, I think their grievance was a legitimate one.

I always felt it was an extremely difficult decision for the Admiralty to have to strike a balance between their interests and the interests of the Royal Fleet reservists who also had to be recalled at the same time. It was very difficult to decide which of them had the better claim to be released or to not to be made use of in that emergency. I suppose it is rather academic at this late date, but I still wonder whether something could not be done for those men who were retained, many of them 12-year men who were just about completing their service, who had suddenly to stay on an extra 18 months, without, as the hon. and gallant Gentleman said, any special bonus or reward, any special recognition of any kind, unless, indeed, they happened to serve in Korean waters, in which case they were entitled to the Korean gratuity. I wish that something special could be done for them, such as allowing all those retained for the extra 18 months to have the Korean gratuity, because it was the Korean War that was the cause of their retention. However, that may be a little difficult to arrange at this late date.

I should like to congratulate the First Lord on what he himself would call his good fortune in being able to make two very agreeable announcements in his speech today. The first was about discharge by purchase. It may be, of course, that he noticed on the Air Estimates last week that some of us indicated that we intended to raise this question tonight. If he did notice that and suddenly thought of it then, he must have worked jolly quickly. It may, of course, have crossed his mind at a little earlier date.

The second was about his intention to reduce the term overseas to one year or as near as possible to one year. We shall have to see how that works in practice. I imagine that there will be considerable difficulties in organising it. If he could also have announced that he would make it possible for more people serving fairly long terms to have the option of breaking their service, then, indeed, his would have been an almost model Estimates speech.

Mr. Callaghan

On the personnel side only.

Mr. Driberg

There is one point of detail that I want to raise. I have already given the right hon. Gentleman notice that I intend to do so. It arises from an unfortunate accident which took place a few weeks ago in a Sea Cadet Corps in Essex.

I have already raised this matter in other contexts in this House, but this is the first time I have had the opportunity of addressing the First Lord directly upon it. Although it may seem to be in one sense a minor matter in comparison with the great issues that have been debated earlier today, I am sure that it is one which the First Lord himself would wish to take very seriously, because it is of great concern to all parents of sea cadets throughout the country, and I know how much store the right hon. Gentleman sets by that admirable pre-service Corps.

I should say that the accident actually occurred in the constituency of the hon. Member for Harwich (Mr. Ridsdale), but, as he and I think the whole House would agree, it is of considerably more than mere local interest. I think that he himself has already taken it up with the Admiralty, but I raise it because of the much wider issue involved. Perhaps I could quote from the report of the inquest on the cadet who was tragically killed as a result of an accident during rifle practice.

The cadets who were being trained were using weapons which are apparently completely obsolete. They were weapons which came to this country under Lend-Lease during war-time, and, therefore, they are a good many years old. An expert who gave evidence at the inquest told the jury—I quote from the report: … every rifle of American and German make had to be reproofed before being offered for sale in this country, and this particular weapon had not been proved within the meaning of the Act. The expert also showed how very easy it was for this rifle to be fired accidentally merely by banging it on the ground, and the jury and the coroner made some rather severe comments on the whole business.

There was also evidence from the commanding officer of the unit, a lieutenant of the Sea Cadet Corps, who said that the rifle in question had been in the unit for five years. He agreed, in answer to questions put by the coroner, that it would be better, in the light of what they now knew, to have a better make of rifle and that there was really no one in that unit capable of giving the rifle a thorough technical inspection. There are other disquieting details in this report with which I need not trouble the House.

I think I have quoted enough to show it is a rather unfortunate position if this kind of thing is at all widespread, and I hope very much that the right hon. Gentleman or the Parliamentary Secretary can give us some reassurance on this matter, both regarding this particular Cadet Corps in Essex and the Corps in general. I have a question on this matter down for answer in a few weeks' time by the Parliamentary Secretary to the Ministry of Defence, on pre-service units in general.

I also raised this matter last Thursday night on the Air Estimates to find out what is the situation in the Air Training Corps, because obviously, on the face of it, if obsolete and dangerous weapons of this kind are issued to the Sea Cadet Corps they may be issued, or may have been issued at some previous date, to pre-service units of any kind. We do want to safeguard boys who go into these units against unnecessary risks.

I am bound to say that the hon. and learned gentleman who answered for the Air Ministry did give a clear and satisfactory answer last Friday morning, at 3.23 a.m. He said he could assure me that all the firearms in the A.T.C. are tested periodically. That did not seem to have been the case in the Sea Cadet Corps, at any rate in this particular unit, and he added that after this accident happened they were all specially tested. That is to say, I take it that every rifle used anywhere, in the Air Training Corps anywhere in this country had a special test as a result of this single tragic accident in a Sea Cadet Corps in Essex.

I take it that the Parliamentary Secretary or the First Lord will be anxious to give us at least as clear and as full an assurance as that on the safety of the boys in the Sea Cadet Corps throughout the country.

3.19 a.m.

Sir Jocelyn Lucas (Portsmouth, South)

At this time of night it is rather difficult to speak without repetition, for someone is sure to have raised most of the points one wished to raise. I was naturally delighted to hear that so many grievances of which I have written on behalf of constituents are to be remedied. The right of the sailor to buy himself out on the same terms as his comrades in the other Services was a reform long overdue, and which, through force of circumstance, could not be made before.

I am very glad to hear that the provision of married quarters is to be put right in the forefront, for this I know has made a great difference to people staying on in the Service. The long periods of separation for the married men have been the cause of great complaint and the cause, I fear, of many broken marriages. One is often getting complaints that petty officers and others with high qualifications were doing long terms of overseas service, far longer than their fair share. This is probably unavoidable in many circumstances, but the fact remains.

The statement made by the First Lord will certainly be an inducement to men to sign on, particularly as the pay is being increased; a little more makes it much more attractive. How glad I was to see the announcement made the other day that the cuts in the officers' pensions in all the Services would at last be restored. Officers, in particular, look to the future if they make the Services their career. Nothing could be more vital to the idea of keeping the best officers in the Services than the certainty that their pensions will be sufficient and safe. The removal of this injustice has been pressed for by the Portsmouth Members and others in Parliament for a long time. I hope that the powers that be, of whatever party, will bear this in mind.

One point that still rankles is that while the married soldier or airman in the Far East receives an overseas allowance, as does the sailor who is based ashore, the sailor on the ship does not qualify for such an allowance. Consequently the sailor on the ship in the Far East is worse off than his counterpart in the other two Services. I know that the answer is that a man living on board ship is supposed not to be affected by the high cost of living ashore, and, therefore, does not need the allowance. But this is a real grievance, whatever the explanation. I am not suggesting that the sailor should be helped to keep up the naval tradition of having a wife in every port, but he should have the same privileges as the land lubber.

The First Lord is anxious to keep trained men in the Navy, and I am sure that this concession logical or otherwise would help a great deal in that direction. It is far better and cheaper to try to keep good men happy in the Service than to be perpetually worried about replacements. May I thank the First Lord for what he has done, and ask him to have another look at this suggestion?

3.22 a.m.

Mr. E. Fernyhough (Jarrow)

The issue I wish to raise is one at which, I think, the First Lord might have a look. In the first place, I am sorry that the Royal Navy has found it necessary to man part of its forces by the method of conscription. It seems tragic that the Navy should have followed the bad example of the Army and the Air Force in that respect. I wonder whether it is the hard conditions in the Navy which have made conscription necessary.

What distresses me is the fact that while the Navy is taking steps to compel men to join it, difficulties are being placed in the way of boys to want to make that Service their career. I have a nephew who from the age of 12 had set his heart on joining the Navy. He was so anxious to get in that he did additional homework every night. He eventually went for an examination, and for some reason or other he was rejected not on physical grounds, but on academic grounds. I do not believe that the academic test at the age of 15 is so very important for anybody entering the Navy.

I want the First Lord to bear in mind that this lad has already got a grudge against the Services, and that when he becomes 18 and is forced to go into the Army he will hate and detest it because he will be joining a Service with which he does not want to be associated. Had he been allowed to join the Navy at the age of 15 he would not only have been enthusiastic about the work, but would have made good progress in the Service because his heart was in it.

I ask the First Lord, therefore, whether he will not look at the examination which the ordinary boy, coming from the modern secondary school, has to undertake at the age of 15 to get into the Royal Navy; and in view of the fact that the right hon. Gentleman now has to conscript men for the Navy, whether it would be worth while looking at that test to see whether, if it were made easier, it would be possible for the Royal Navy to get its full complement of manpower by the method of volunteers rather than by resorting to the method which so many of us reject.

3.26 a.m.

Mr. Stephen Swingler (Newcastle-under-Lyme)

I suppose I ought to assure the House that I shall not be speaking for more than an hour. I cannot share the indignation which has been expressed by some about the long Sittings of the debates on the Service Estimates, because I have had a good deal of experience of long Sittings on these Estimates and I think that those who come in and out occasionally and protest about these things ought to make their representations to the proper quarter, which is the Leader of the House, and ask for a few more Parliamentary days on the Service Estimates.

Mr. Nally

My hon. Friend is obviously referring to me. Will he bear in mind that in four speeches since 1946, when I first put down a Motion on this subject, I have repeatedly protested, not about the length of time for which the Service Estimates were discussed, but that they did not begin until 4 o'clock? Will my hon. Friend further do me the honour of realising that since 1946, with one exception, I have never missed an all-night Sitting of any kind in the House? I think that that record is slightly better than that of my hon. Friend.

Mr. Swingler

I made no inference against my hon. Friend except on the protest against those who are interested in carrying on the debates on the Service Estimates. The trouble lies with the Leader of the House—I do not particularise the present Leader of the House, but all Leaders of the House— in that he is not willing to give extra Parliamentary days, which is what is required for the discussion of these increasingly long Votes, with their increasingly complicated questions. It is unfair to put the responsibility on Members who happen to be interested in raising valid points.

From past experience I know that the Admiralty, at any rate, has always paid attention to questions that Members have raised in the debates on the Service Estimates. If the Minister has been unable to reply on the particular and sometimes detailed points which have been raised, the Admiralty has been very careful about sending letters to Members in reply to their questions and in following up the problems they have raised. Members have appreciated very much that the points they have raised in Service Estimates debates have been worth while.

I am sure that the Minister who replies to this debate will devote the greater part of what he has to say to replying to the excellent speech made 11 hours ago by my hon. Friend the Member for Cardiff, South-East (Mr. Callaghan), who made the burden of the case that we have tried to make on this side of the House. He made it in crystal clear terms yesterday afternoon when considering the fundamental role of the Navy and the prospects of considerable economies in that regard. My hon. Friend referred, in the course of his speech, to the reform of the Naval Discipline Act, and I propose to refer to that question also. I can best summarise my introduction to this by referring to a speech made by the present Solicitor-General on 29th January, 1951, when there was produced to the House a Bill that introduced the establishment of an appeals court for courtsmartial.

It will be remembered that immediately after the Second World War there was considerable agitation in the House about the question of military courts-martial in all three Services and that in 1946 a committee was set up, under Mr. Justice Lewis, to inquire into the judicial system in the Army and the Air Force. That reported three years later, in 1949, when the Lords of the Admiralty successfully resisted during those three years any enquiry into the Naval Discipline Act. But when the Lewis Committee's recommendations were made in 1949 their bearing was so obvious on some questions of naval discipline that it was found necessary to set up a new committee, under Mr. Justice Pilcher, on courts-martial procedure and disciplinary questions in the Navy. That committee sat in 1950 and 1951 and produced two reports, one at the end of 1950 and one at the beginning of 1951. One of the things which emerged from those reports on judicial procedure in the Army, Air Force and the Navy was the Courts-Martial (Appeals) Bill which had its Second Reading in the House on 29th January, 1951, when the present Solicitor-General said this: The House will remember that it was as a result of pressure from this House that the Lewis Committee was appointed on 4th November, 1946. That Committee reported in April, 1948. It was not until January, 1949, that the Members of this House were able to read what that Committee had reported, and then we were told that the position in the Navy must be considered. So it was not until 17th February, 1949, that the Pilcher Committee was set up. That Committee reported on 20th February, 1950. Then we had this Bill on 15th December last year and last Friday"— he was speaking on 29th January, 1951— the White Paper to which the right hon. Gentleman has made a passing reference. It appears from that White paper that, although the Government have had the Lewis Report since April, 1948, and the Pilcher Report since February, 1950, they have not made up their minds as yet on no fewer than 14 of the recommendations in the Lewis Report and on six recommendations in the Pilcher Report." —[OFFICIAL REPORT 29th January, 1951; Vol. 483, c. 605.] That is the present Solicitor-General on the subject of these reports from the Pilcher Committee, of which he happened to be a distinguished member.

I have checked up on all references to naval discipline since 29th January, 1951, three years ago, and I find that there are no references whatever in the OFFICIAL REPORT to anything concerning the Pilcher Report or the introduction of the reforms in the Navy to implement the recommendations that were made by this Committee. In the speech which he then made the present Solicitor-General referred to an Interim Report of the Pilcher Committee on Naval Courts-Martial in 1950. The first main Report of the Pilcher Committee was issued in November, 1950, and included 61 recommendations for reforms under the Naval Discipline Act; and in January, 1951, the Pilcher Committee issued another Report concerned particularly with summary jurisdiction in the Navy, and this had 14 main recommendations about reforms. We have no record of any action whatever taken on these recommendations, apart from the action covered by the previous Government to produce an appeal court for men subject to courts-martial.

There were, at any rate, three very important questions raised in those years which led to the establishment of these enquiries into the administration of justice in the Navy. One was the very important question of unanimity of the findings of courts-martial. I am sorry to say that the Pilcher Committee came down against the recommendation that had been made by the Lewis Committee on the Army and Air Force, and against establishing the principle that the findings in a naval courts-martial must be unanimous. It is interesting to note that in the first report of the Pilcher Committee, in 1950, the present Solicitor-General and my hon. and learned Friend the Member for Leicester, North-East (Sir L. Ungoed-Thomas), the former Solicitor-General, issued a Minority Report, which said this: We regret that we are unable to agree with the majority of our colleagues that the finding of guilty or not guilty by a naval-court-martial should be determined by the votes of the majority. Nor can we accept the summary of arguments in favour of unanimity given in paragraph 118 of the Report as an adequate statement of our views… In our opinion where a person subject to the Naval Discipline Act is charged before a naval court-martial with an indictable offence, a finding of guilty based on the views of a bare majority and ignoring those of the minority of the senior and responsible naval officers who sit on courts-martial is not consistent with the requirement of English law that the guilt of the accused shall be established beyond all reasonable doubt. I think that that is of great importance. This matter has not been rectified in the other two Services, and the Navy may be said to be the only sphere in the Services in which the rule of unanimity does not apply in the presumption of innocence unless there is unanimous opinion that the person is guilty and subject to court-martial. I think it is regrettable that this question has not been debated in the House and that nothing has been done by the Admiralty since the present First Lord came to office.

The same applies to a second very important recommendation, which relates to the right of a man accused to opt for a court-martial. The Navy is away behind the other two Services in granting the right to offenders or defaulters to opt for a court-martial. As my hon. and learned Friend the Member for Leicester, North-East said in his reservation to the 1950 Pilcher Committee Report: … the powers of summary punishment of Commanding Officers in the Royal Navy far exceed those found necessary in the other Services. This may very severely restrict the right of a man to opt for trial by court-martial.

It seems to me that this lengthy Report and its recommendations have lain for three years in a pigeon-hole in the Admiralty with the dust gathering upon them, and there has been no statement to the House whatsoever about any of these recommendations being carried out, nor any attempt to bring forward these matters to the House for debate.

There is a third recommendation, which is very important, and about which again there was disagreement on the Pilcher Committee. That was the question of the appointment of civil judges to naval courts-martial. Once again, differentiating the Pilcher Committee from the Lewis Committee, there was disagreement about the question of whether it was advisable in naval practice to have civil judges to preside in certain cases over courts-martial.

These are very important matters, and they are not, of course, the only matters in respect of which the Naval Discipline Act is very archaic. Indeed, Ministers at the Admiralty know, because my hon. Friend the Member for Cardiff, South-East, through the medium of the Press, has been drawing attention to many respects in which the Naval Discipline Act is completely old-fashioned and ought to be revised. When it came, nine years ago, to consideration of this question of judicial procedure in the Armed Forces, the Navy was several years behind the Army and the Royal Air Force in establishing the necessary committee of inquiry and getting recommendations for reform.

We now have the situation where there is a Select Committee hard at work every week going through the Army and Air Force Act, and the time has come, to put it at its least, for a Select Committee, or committee of inquiry, to go through the Naval Discipline Act, in the same way as the Army and Air Force Act is being gone through, and comb out the archaic provisions.

If it is impossible for the Admiralty— and I do not believe it is—to weigh in on the Government's legislative programme and bring forward proposals immediately for the amendment of the Naval Discipline Act, then we should at least have some assurance that a committee will be established to go through it as thoroughly as the Army Act is being gone through so that it may be brought thoroughly up to date.

There is one other matter to which I would refer. On page 8 of the First Lord's Explanatory Statement, there is a cryptic reference, under the heading of administration, to certain recommendations of a committee which investigated the relationship between the Admiralty and the Ministry of Supply with a view to improving the production of naval aircraft. I presume that this is a reference to the Rogers Committee. It is stated to be a committee established as a result of the Report of the Select Committee on Estimates in 1951–52 on the subject of the inspectorate of naval ordnance, and if I am not right in this respect, then, apparently, there is no reference in the First Lord's Explanatory Statement at all to this committee.

Could we be told why the First Lord has agreed with the Minister of Supply not to publish the Report of the Rogers Committee? After all, very strong allegations were made by a Select Committee of the House, and they were given wide publicity in the Press, about wastage of manpower in the Royal ordnance factories by the Admiralty.

I do not wish to weary the House with a large extract, but in paragraph 87 of the Twelfth Report from the Select Committee on Estimates, published on 28th October, 1952, it is stated: In the course of their visits to the filling factories, members of Your Committee could hardly have failed to observe the large number of inspectors whose principal duty was merely to watch a small section of production. In the filling factory group there was one C.I.A. inspector for every 6.2 industrial workers and one I.N.O. inspector for every 13.3. There is no significance in the difference between these figures as the volume of work for the Ministry of Supply was greater than that for the Admiralty; but the combined ratio is one inspector to every 4.3 workers, which is. alarmingly high. The committee then went on to deal with the technical demands of the Admiralty, and the demand for a separate inspectorate, and the various grounds for this demand in the Royal Ordnance Factories. The First Lord and the Minister of Supply set up a committee to consider various matters, including wastage of manpower. When the Minister of Supply was questioned, on 1st February, he said that there was nothing secret about the Report but, for a reason which he would not disclose, he refused to publish it. He said: I do not think that this is the kind of report that should be published, although there is nothing very secret about it."—[OFFICIAL REPORT, 1st February, 1954; Vol. 523, c. 17.] He gave promises to a number of hon. Members to send them summaries of the Report.

I cannot understand why it should be hushed up and why the House should not be told what action the Admiralty is taking in relation to the allegations of the Select Committee and how far the duplication of inspectors has been reduced. Could we know what is now the ratio of naval inspectors to workers in the R.O. Fs. and how much the inspectorate has been reduced, or did the Rogers Committee show that there was no duplication? As all these facts were published by the Select Committee, it is. only fair to the Service Departments, since they set up a committee to investigate the matter independently, that the findings of the Committee should be reported and the House permitted to know to what extent there has been a saving in manpower and an administrative economy achieved as a result of the very careful investigations of the Select Committee.

I do not expect a final answer now, but I hope that further investigation may be made into both these points and that we may later have statements from the First Lord about them.

3.47 a.m.

Mr. Walter Edwards (Stepney)

We have had a very good innings on the Navy Estimates. Hon. Members on both sides have had some complaints to make about the administration of the Admiralty and the presentation of the Estimates and in some cases there has been a little praise for one or two things which the First Lord said.

I was extremely dissatisfied with the complacent tone of the First Lord's speech. It seemed a case of the Navy just jogging along and saying, "Leave it to us. Everything will be all right." It was not until my hon. Friend the Member for Cardiff, South-East (Mr. Callaghan) spoke that the House became interested in what was the exact rôle of the Navy. That is borne out on both sides of the House. What my hon. Friend said is a matter for serious consideration by those in charge of the defence of this country, and I am sure he said it only with that purpose in mind. Whether we like it or not, careful note will be taken of what happens between now and the presentation of the next Navy Estimates either by this or by another Government.

I will not express an opinion about whether it is easy to join the Air Force with the Navy or the Navy with the Air Force. The only point of importance on this which my hon. Friend made was that if they are to be joined together it is a matter which should be carefully considered, and I am sure that no one who is concerned with military matters in this country would object to questions of that description being carefully considered. He has not said that they will have to be joined together, but that will obviously have to be borne in mind by those in charge at the Admiralty and the Air Ministry.

Almost every aspect of Admiralty activity has been covered during this debate. The questions of recruitment, dissatisfaction, re-engagements, and last, but not least, the Naval Discipline Act have been mentioned. There were a number of other questions which are not as important as those, and I do not intend to take up too much of the time of the House in repeating what hon. Gentlemen have said about those particular matters. Both sides of the House are concerned about recruitment and re-engagement. There was one sentence in the speech by the First Lord which did worry me to some extent. It was when he said that the Admiralty could not pretend to the House that the future of the Navy was promising from the point of view of manpower. That was a serious statement.

Mr. J. P. L. Thomas

But the hon. Gentleman has just accused me of complacency.

Mr. Edwards

It is complacency because I can see no evidence of trying to do anything to stop that unpromising future. We shall have to wait to see what the extra 2s. a day will do. It may make all the difference to re-engagement and recruiting, which are matters for the naval authorities. One of the reasons why Governments were able to get recruits for the Navy, the Army and the Royal Air Force before the war, or to get people to re-engage them, was that the men had no jobs to go to when they came out, and they had none when they entered the Service.

That is not the situation now, and compared with 30 years ago those serving in the Navy never had so much civilian respect for marriage association as we have now. When I first joined the Navy, a man, even if he was married, knew that he was in the Service for a specified period, and if he had to go away on a two year commission he knew that he had to be away from his wife for those two years. That is not the idea of men serving in the Navy now, who want to be able to be with their wives and families as much as possible, whether in home ports or abroad. That is one of the difficulties in getting men to re-engage, even if we increase their pay. It will also be a difficulty in recruitment.

It is not my intention to follow up what everybody else has said, because I think we have spent a fair amount of time on these matters, and I do not want to be accused of repetition, but there are several points of interest to the House, the Navy and the country that I would put to the Parliamentary and Financial Secretary, and of which I have given him notice.

It will be noted that the total number of men in Vote A is to come down from 151,000 to 139,000, a reduction of 12,000. Of the 12,000, flag officers, commissioned and branch officers number 250. The number of other ranks to come out of the Navy is 10,900. According to my calculation, only one officer out of every 58 at present serving, and only one out of 66 flag officers, will be coming out, but one out of every 11 ratings is to come out. I want to know whether the Navy will become top-heavy with officers when Vote A is reduced in that way. If there is another reduction in Vote A next year, will it be on that basis? There arc 1,200 chief petty officers due to come out of Vote A in 1954 to 1955. Are the officers to do the work of the chief petty officers but to be paid as officers? To a limited degree the same is true of the Royal Marines. The number of Royal Marines next year is to come down.

I turn to Vote 2 and clothing and victualling. It appears from the First Lord's statement that we are to have a larger number of men added to the Navy through National Service, the highest for a long time. There is a reduction in the estimate for clothing of £2,868.000. The number in the Navy has decreased because of the release of the reservists and the time-expired men, but is it appreciated that if we have an increase in the number of National Service men they will have to be supplied with new uniforms? This Vote was reduced by £3 million last year, and I cannot understand how it is possible to reduce it again this year. Is it because the Government are using stocks built up by the Labour Government and are not purchasing any more, or are they taking chances with regard to the new entry?

On the next Vote, I may have to repeat something said by hon. Members on both sides of the House about the closed holiday fortnight. When I was Civil Lord of the Admiralty I always maintained that questions of this kind should be discussed with the trade unions and not on the Floor of the House. I endeavoured to do everything by agreement with the trade unions. I still adhere to that policy. Such matters as holidays, pay and allowances should be dealt with in the first place by the trade unions through the Admiralty Joint Industrial Council.

However, the matter has been raised today. The First Lord will remember that, in reply to a supplementary question which I put three or four weeks ago, he stated that the decision on the closed holiday fortnight, did not have concurrence of the trade unions through the A.J.I.C. but was simply forced upon them by the Admiralty. Employers sometimes have the right to force conditions upon people employed by them, but I cannot understand why that has been done in this case. Before the war there was a closed week which was used mainly for the purpose of Navy Weeks so that the Navy benevolent funds could obtain some money to help past and present members of the Service.

The staggered holiday was introduced because of war conditions. The system worked very well indeed until this year. The men in the industrial side of the Admiralty now get two weeks instead of one week. If staggered holidays of one week per year proved satisfactory during the war and for about eight years afterwards, I cannot see why staggered holidays of two weeks should not prove equally satisfactory. I maintain that what the Admiralty has done by taking this decision is to make more difficult the opportunity for its employees to go holiday-making and at the same time to make the employees discontented. How many people at present have to have two weeks' holiday spread over a period of six weeks? I am sure that the civil servants in the Admiralty do not; I am sure Members of Parliament do not, and I am sure that the vast majority in industry do not, and I cannot see what economy this can make to the Admiralty in any way.

I understand, however, the matter is now settled so far as the A.J.I.C. is concerned and so far as this year's holidays are concerned. But when Government after Government—and this was done by the Coalition Government, the Labour Government and the present Government —say that it is in the interests of the nation that holidays should be staggered, and the Admiralty change staggered holidays to closed fortnights, it does appear strange that such a policy should apply.

I am mentioning this only because it has been mentioned before by hon. Members from each of the dockyard towns, where, obviously, apart from the trade union movement, there seems to be some concern. I do hope that, if nothing can be done this year, due note will be taken when this matter receives consideration for next year.

The question of contract work for the Navy, as concerned on page 104 of the Estimates, has also been referred to, and there was the competition between some of those in the shipbuilding districts and the hon. Member for Gillingham (Mr. Burden) as to where it should go. All I should like to be certain about is that, with this tremendous amount of contract work going on now, we are satisfied that the full resources of the Royal dockyards are being used. I really think we are, but when one sees the staggering figures of contract work one is entitled to know that the Royal Dockyards are not being sacrificed in any way.

I should like to be assured whether an extra effort is being made to give the dockyard employees the opportunity of building ships instead of repairing ships the whole time. There is a huge labour force employed by the Admiralty, and we are incurring tremendous expense in training young workers, who, it appears, are spending much more of their time on repairing rather than on building. A man who is a craftsman wants to build something rather than mend something.

I believe that last year I called Vote 10 my baby, but I suppose that I have to call it my granddaughter now, as it is a year old. I am extremely unhappy about Vote 10. I am sure that the Civil Lord would have liked to have got the money, but I do not think that the Board of Admiralty has done all that it should have done to the Civil Lord. In the First Lord's speech, and in many other speeches today, we have heard about recruitment, contentment, re-engagement, and everything else, and it has been said at least during every debate on the Navy Estimates since 1945, if not during the war, that the finest way to keep a man in the Navy is to give him married quarters.

In 1946, the married quarters policy was started, and by the time this Government came into power almost every air station in this country had its quota of married quarters. One can see all that has been spent in 1953 and 1954, and the provision which has been made by the previous Government, mainly because of their consideration of married quarters. I am dealing with Vote 10 now, which, I ought to explain, has nothing to do with the home ports or married quarters at home, except those for key personnel in Northern Ireland and those abroad.

Even if we discount Vote 15 for the time being, all that is being voted this year is £19,000, and another £143,000 is being spent as a result of schemes which, I submit, were in being before the present Government came to office. All that the future holds—unless there is something which has not yet been spent out of previous schemes—is £91,000 for Vote 10 in this country.

How many houses do we get for £91,000? Is that really a very great incentive when people who know these figures are able to say that that is all the Admiralty is to do with regard to that phase of married quarters? But something which is even more important is the question of the accommodation of personnel. For 1953–54 the sum of £63,000 was voted, and £742,000 was spent in excess of that figure as a result of previous schemes on accommodation for personnel.

We see in these Estimates that for the year 1954–55 over £1 million is to be spent on such accommodation under schemes which I think the Civil Lord will agree have been in operation for some time

Mr. Digby

Not all.

Mr. Edwards

The best part of them have. However, what is the provision to be made now? We have the figure of £22,000 for new works this year. Obviously, we are not going to get much in the way of barracks for £22,000. The total Estimate for new works to be started this year is only £470.000.

To come back to dockyards and factories—there was some confusion about the matter when my hon. Friend the Member for Devonport (Mr. Foot) was speaking—we see that £749,000 was spent last year on previous proposals and that only £37,000 was proposed by the present Administration for new works. It is true that the £37.000 is increased to £76,000, but, even so, £974,000 has to be spent this year out of the money allocated for previous schemes. I admit that so far as the £76,000 new works this year is concerned, it will in due course involve the Admiralty in an expenditure of £1½ million. There, again, are we really attacking this problem of Vote 10 in the way we should attack it so far as barrack accommodation for personnel is concerned?

That is a very heavy item of expenditure. The same applies to the dockyards. If we are going to say every year that this is all the money that we are going to spend on the improvement of barracks for personnel, can we wonder at the lack of recruitment and re-engagement? We must do something more.

There is no reason why this Vote should not have been higher this year. If priority is to be given to the conditions under which the men in the Services are to live, there is no reason why, from the point of view of the efficiency of the Navy, the dockyard reconstruction scheme should not be speeded up as quickly as possible. At the present rate, goodness knows how many years it will take before the barrack and dockyard reconstruction schemes are completed.

So far as accommodation for personnel is concerned, compared to what it was when I first entered the Navy nearly 36 years ago, there is a wonderful improvement. Had the people who complain today known it 36 years ago, they would appreciate what they have. That wonderful improvement, however, is only in certain sections, and we must increase the improvement in barrack accommodation as quickly as possible.

One stark feature about Vote 10 at home is that I think it would be found that the total estimate for new works this year is £1 million or more less than last year, which means that the future is less promising than a year ago. There is years and years of work to be done. If it is to be the policy of the Board of Admiralty to bring down the total estimate on the Works Vote year by year, obviously nothing, or very little, can be done for naval personnel, and only very little can be done in dockyard improvements. I suggest that when the Estimates come before us next time, as I think I said last year, more consideration ought to be given to the improvement of the men's living accommodation in the Service and the working conditions in the dockyards.

There is one brief point that I should like to make about married quarters abroad. The amount that is to be spent is not very great. As most people know, the cost of building abroad is higher even than in this country. Only £25,500 is being voted for 1954–55, and the total estimate for new works to be started in the year is £258,000. The First Lord, the Parliamentary Secretary and the Civil Lord will all agree that the prospects of accommodation for personnel abroad do not seem bright. These are matters which ought to be looked at.

Vote 12 has always been one of the Votes which the Opposition have criticised. I well remember that from 1945 to 1951 the spokesmen for the party opposite, when in opposition, never left Vote 12 alone. They always told us how shocking it was for the Labour Administration to carry such an enormous load under Vote 12 as we were carrying at that time. They complained about the terrific number of naval staff, apart from the extraordinary number of civil servants who came under Whitehall.

It is rather strange that not only last year was Vote 12 increased, but that despite the numbers coming down from something like 151,000 to 139,000, the Vote is again increased.

Commander Noble

The numbers are down.

Mr. Edwards

Yes, but only very slightly—nobody has said by how many —and yet the cost has gone up. In one or two departments the numbers are going up. I do not know whether there is any switching from one department to another. In any case, the cost is going up, and the cost is higher now than it has ever been since 1945.

The reason given in the last three years for the high cost of Vote 12 has been the fact that we have to get on with the job of rearmament. Well, we have more or less come somewhere near that; we hope to do so at any rate by the end of 1955. I am not saying for a moment that this has not been fully inquired into by the Financial Committee of the Board of Admiralty, but it is strange that when the party now in office were in Opposition they always complained about this Vote, yet, when in office, increase it. I hope that will be a lesson to them when they are in Opposition again.

Last, but not least, is Vote 15. It will be remembered that during the past financial year the Armed Forces (Housing Loans) Act has been altered to make provision for more money to be bor- rowed under that Act. The First Lord has said it has been decided by the Admiralty that married quarters shall be provided in home ports, and I assume that the married quarters to be provided in the home ports will come out of Vote 15.

I am sure that almost everybody connected with the home ports is extremely happy about that decision. I would only ask whether the right hon. Gentleman is satisfied that he cannot go more quickly on this issue. If the men and materials are not there, well and good, he cannot do more than is being done. As we have got the money under the Armed Forces (Housing Loans) Act, let us get on with the job as soon as we possibly can, because I am sure that will help the Navy in contentment and perhaps in recruitment.

Those are the questions I have taken the trouble to dig out. I have tried not to detain the House for too long. I would only repeat what I said last year in the conclusion of my speech, that to be associated with the Navy is a great honour. It is a great force in this country which has very, very important and beneficial repercussions throughout the world. Those of us who may have any connection with it or who are in charge of it must ensure that everything done for the Service is for the benefit of the nation, and for the benefit of mankind as well.

4.23 a.m.

The Parliamentary and Financial Secretary to the Admiralty (Commander Allan Noble)

This is the third time I have had the privilege of winding-up the main debate on the Navy Estimates. The times of doing so have varied from year to year, but this one is so much of a record that I begin to think it is rather a doubtful privilege.

First, may I say how very glad we are to see the hon. Member for Cardiff, South-East (Mr. Callaghan) back again. He was away last year. If I may say so, I thought he made a very helpful and thoughtful speech. I was very glad to hear what he said about the new cadet entry, and we must all now try to make it work. In that connection, my right hon. Friend was very grateful for what the hon. Member for Southampton, Test (Dr. King) said, because he also gave the new scheme his blessing. The hon. and gallant Member for Hull, East (Commander Pursey) still remembered his many inhibitions, but I hope that when he studies the scheme he will see that there is equal opportunity for, as he said, the son of the Duke and the son of the cook.

I should like at once to add my congratulations to those that have already been given to my two constituents, my hon. and gallant Friend the Member for Haltemprice (Major Wall) and my hon. Friend the Member for Ilford, North (Mr. Iremonger). I think the House will agree that they made most useful and distinguished contributions and we shall look forward to hearing them again. I will come to the speech of my hon. Friend the Member for Ilford, North a little later, but perhaps I might say here that I shall look forward to seeing him slinging his hammock in the corridors of the House.

Perhaps I might deal straight away with the point raised by my hon. and gallant Friend the Member for Hull, Haltemprice about the Royal Marines and amphibious warfare. We do attach great importance to this; we are retaining the amphibious warfare squadron and the Commandos because we feel they had a most important role to play in keeping alive the technique and in testing new craft and weapons.

The hon. Member for Cardiff, South-East, the hon. Member for Huddersfield, East (Mr. J. P. W. Mallalieu), the hon. Member for Preston, South (Mr. Shackleton) and others asked various questions about the weapons and ships of today and the future. It is such a very long time ago that they may have forgotten what the questions were, but I will try to give some of the details. I was asked for figures about new construction, and particularly about frigates. I can tell him that five of our new frigates are expected to undergo their trials this year, and another 20 are building. Ten more conversions are expected to be completed during the coming year and nine have already been done. There are 13 to do and seven old Loch frigates will complete their modernisation.

We are continuing to modernise our six-inch cruisers, and when that is done they will be first-class ships and certainly able to take on any "Sverdlov" cruisers on not too unfavourable terms. I should like to remind the House of the action in the last war when the "Graf Spee," with superior armament, was dealt with by three small cruisers. Also in connection with cruisers and other heavy ships, I would remind the House that in rough weather, when aircraft are unable to fly from the carriers, they are able to give anti-aircraft protection to our fleet.

I should like to tell the House of two developments in the gunnery world. We have now got a first-class new six-inch gun which is of a really revolutionary rate of fire. Four of these guns will deliver five tons of metal per minute, which is something very high compared with what was known in the past. At the same time, we find similar progress with the new three-inch gun, which will have a rate of fire formerly associated with heavy machine guns. All this will be of great value to the Fleet.

I think the House would expect me to deal in some detail with the question of carriers. We attach great importance to our carriers, both today and in the future. They provide, with their aircraft, what we might call the main armament of the Fleet today. If we had no carriers the Navy's rôle would be probably one of local defence of our forces at sea. But it has always been the duty of the Navy to seek out and destroy the enemy wherever possible and so deny him the sea.

Naval aircraft, of course, consist of strike aircraft for bombing land and sea targets and they are useful in the destruction of a surface raider; the fighters to destroy the shadowers and the bombers operating outside the range of the shore-based fighters and anti-submarine aircraft to seek out and destroy the enemy submarines in co-operation with our sea surface forces and with Coastal Command. The fleet carrier is heavily armoured and is faster and with greater range than the light fleet carrier. It is designed to do all this work, by which I mean, it is designed to carry all the aircraft necessary for these tasks.

The light fleet carrier is limited by size. One hon. Member asked my right hon. Friend what exactly he meant by escort carriers. He meant that to cover the light fleet carrier, the "Mac" ships, the converted ships and what may be the helicopter ship of the future. It was a comprehensive term. May I now say that it is all very well for hon. Members to suggest that we must rely on shore-based aircraft, but I would ask them, "Where would the next war lead us?" Let them remember that carriers were required in Korean waters, and, in the last war, from north Russia to the Pacific.

I wonder, too, whether any hon. Members, during the last war, found themselves protected at some stage by aircraft of the Fleet Air Arm, and whether any found themselves at sea in the unfortunate position of there being no allied aircraft; with the enemy shadowing the convoy or ship for hour after hour, when one had the almost certain knowledge that all the U-boats in the area were being called up.

I would refer to what the Prime Minister said in the defence debate —that we must not scrap our conventional weapons until we have the weapons which we see coming along in the future. I have been asked about the weapons which the carriers' aircraft will carry; I would say that I should think they would be able to sink a fair sized cruiser.

Then, I was asked about the Navy of the future. I do not think I could give a full answer at this hour of the night, but my hon. Friend the Member for Ilford, North made a contribution to that answer in his excellent speech when he said that our anti-submarine and mine sweeping efforts should continue, not only in the initial phase, but also in what the Prime Minister has called the "broken back" war. This country, and Europe, will have still to be supplied with food and raw materials, and the Navy would not be able to "let up" in any way.

We attach the greatest importance to the Navy in offence. As I said earlier, it has to seek out and destroy the enemy, and we visualise that carriers and their aircraft may be necessary even after the R.A.F. fighter and bomber have become what I understand are known by the current and official term of "unmanned fighting vehicles." One cannot throw an atomic guided missile at a raider or a submarine. One has to find it first, and we think that the carrier will have this duty in the future.

Reference has been made to a new submarine and a new fuel, and, like the Americans, we are thinking in terms of nuclear propulsion for submarines and other ships.

The hon. Member for Cardiff, South East suggested that perhaps the R.A.F. and the Royal Navy should merge; should become one Service. I am sure that, having been at the Admiralty, he would suggest that the Navy should take over the R.A.F. But this is not a suggestion to which we have given a great deal of thought so far.

The hon. Member for Preston, South, I think it was, questioned the need for a Navy on the grounds that the Russians were not a sea Power; that they showed no great interest in their Navy. But I would tell the House that there has been a great change in Russia in this matter, and great importance is now attached by the Russians to their Navy. Many of us saw the "Sverdlov" at the Coronation Naval Review, and the Russian Commander-in-Chief has written in "Pravda" that she is in no way an exception. On her way back she did "showing the flag" cruises in various satellite ports behind the Iron Curtain. As far as I know, nine of these ships are in existence and others are building.

At the same time, much of the Russian effort is going to building long-distance ocean-going submarines. There has not been a break-down of Russian defence estimates for the last four years but it is known that in 1950 they allocated 15,000 million roubles to the Navy, which is about £1,340 million, compared with our Navy Estimates that year of £193 million.

Mr. Emrys Hughes

What is the value of the rouble?

Commander Noble

The value of the rouble is always a little uncertain, but that is at the rate at which, I am given to understand, it should be converted.

That is, about one-fifth of the total defence effort is being given to the Navy. A new note has entered Soviet publicity. Russia is referred to publicly as a great sea power. Two films have been released on the life of the 18th century Russian Admiral, Ushakov, who is being built up as the Russian counterpart of Nelson and even as Nelson's superior and teacher in operational tactics.

Finally, the Commander-in-Chief of the Russian naval forces, who is known to be a personal friend of Molotov, was this year asked to take the salute with the Minister of Defence at the Soviet Air Force Day. I think that is taken as an indication of the growing association of Russian naval and air power in global and arctic strategy. In that connection, I was interested in the speech of my hon. Friend the Member for Cambridge (Mr. Hamilton Kerr). We take very seriously the point which he raised.

Mr. Shackleton

Before the Minister leaves the point, may I point out that he has not given the House a satisfactory account of what the Navy' role should be in its deterrent capacity. Nothing in either his speech or that of the First Lord has given that information. I hope he is not advocating building up a Navy simply because the Russians indulge in a lot of propaganda.

Commander Noble

The answer is that the naval forces in N.A.T.O. provide a deterrent similar to that of the air forces and military forces, and I do not think we can dissociate one from another.

Much has been said about manpower problems and several hon. Members have given personal experiences of naval discipline. Perhaps I may be allowed to give mine. On naval discipline, as distinct from the Naval Discipline Act, to which I will refer in a moment, I would say that naval discipline has always been based on mutual esteem between officers and men. The officers have to like and respect their men and the men to like and respect their officers. That has been done in the past in a Service in which there were long-service volunteers and where the captain, officers and men stayed together in a ship for some time. By his announcement of the general service commission and the limitation of foreign service to 18 months, my right hon. Friend has done something to bring that back. Foreign service in the general service commission will be a maximum of a year, but in the Far East and certain other places it will be 18 months.

In the past, a minority have had their wives with them in places such as Malta, but my right hon. Friend has pointed out that this was a very small minority in the Navy. I am certain that if any family is faced with separation the fact that the husband is to be away for less than a year would keep them at home in their own house, with the children at the same school, instead of packing up and travelling half across the world. When I visited the Fleet in the Far East and Korean waters last summer the first thing that the men always said was that foreign service was too long. Captains, officers and ratings said that in a ship away for a long time welfare cases began to arise after about a year. There was news from home that families were breaking tip, and it was most disconcerting and worrying for men who were so far away from home. I am, therefore, glad my right hon. Friend's proposals about this matter have been well received by the House.

Much has been said about malicious damage. The hon. Gentleman the Member for Cardiff, South-East quoted figures given to him recently by my right hon. Friend. They are all young men on Regular engagement, but there was no clear motive. It may have been a grudge against life or the service, but there was no evidence to show that it was an organised campaign. In several cases men had been transferred from ship to ship in a way which is bad for officer-men relationship. We hope that now that the Service is getting back to normal after the war and the hostilities in Korea these incidents will disappear as quickly as they have arisen.

Many questions were asked about living conditions, but I need not go into it fully except to give some idea of the new arrangements. A new type of messing is being tried in some small ships with the meals being prepared centrally. I saw some of this when I was in the Far East, and it is popular. A new type of hammock which can be converted into a camp bed is being fitted, and bunks are being fitted in new and modernised carriers. There is also improved furniture and kit lockers of increased capacity and security are being provided. Laundries, drinking water coolers, ice cream makers and refrigerators are now being fitted. The increased laundry and bath-room fittings which will interest the hon. Member for Hudders-field, East mean that more water will fee required, and distilling is always a problem at sea. It will be appreciated that these improvements I have mentioned are not all in force in the same ship, but these are the lines on which new construction is going.

I think the hon. Gentleman the Member for St. Ives (Mr. G. R. Howard) talked about Sea Cadets doing their National Service with the Navy. We have had to restrict our National Service to those who have joined the R.N.V.R.. but we have taken some qualified Sea Cadets and Scouts, and it may be that now we are taking more National Service men we can fling our net wider.

I am glad that my hon. Friend the Member for Harborough (Mr. Baldock) and other hon. Gentlemen mentioned minewatching. We attach great importance to it, and there is room for volunteers. Those who have volunteered are doing well. We appreciate the need for more equipment, training facilities and exercises. Incidentally, my right hon. Friend is opening an exhibition in London on this subject at the end of the month and an exercise of mine dropping by helicopter will take place off Greenwich.

I should now like to refer to the unfortunate case of the sea cadet with a rifle, mentioned by the hon. Member for Maldon (Mr. Driberg). That training was not part of the training run by the Admiralty, and in view of the recommendations he has quoted instructions have been issued that these rifles are not to be used until further orders, and pending the consideration of satisfactory and adequate arrangements for maintaining such rifles they will not be used by sea cadets.

One word about the Naval Discipline Act, which has been referred to by the hon. Member for Cardiff, South-East and the hon. Member for Newcastle-under-Lyme (Mr. Swingler). The latter described the Pilcher Committees' work in a certain amount of detail, and the House will not want me to do so now. The first Pilcher Committee made 61 recommendations, 54 of which have been accepted either fully or in some modified form. The second made 13, of which all have been accepted either completely or in modified form. Many of those acceptances, which were announced by the late Government in January, 1951, in a White Paper, which the hon. Gentleman quoted, have not required legislation and have been put into force by administrative means.

We have been asked tonight why we have not produced legislation to amend the Naval Discipline Act. I am certain no new Government could have been expected to have done that in its first Parliamentary Session. Since then, as the hon. Gentleman will agree, events were overtaken by the Select Committee on the Army and Air Force Annual Bill. We are in close consultation with that Select Committee, and are represented on the official committee that works below it. That Select Committee has not yet reported. When it does, the Army and the Air Force will want to consider how to implement its proposals. It seems common sense that we should wait to see what the implications may be for the Naval Discipline Act.

I have been asked whether we could have a Select Committee to consider this matter. That would be considered at the appropriate time by my right hon. Friend and by the House. I am not at all sure that, with Parliamentary life as it is today, with all the Committees there are, hon. Members would want another Select Committee on Service discipline at the same time. I quite agree that there are many things in the Act that are out of date, but the hon. Member for Cardiff, South-East knows as well as I do that many of them are amended by regulations, and that they are being interpreted today in the spirit of the times.

I do not want to detain the House, but I must say something about works. It has been pointed out by the hon. Member for Devonport (Mr. Foot) and the hon. Member for Stepney (Mr. W. J. Edwards) that the amount devoted to works today is about £1½ million less than last year. The main element in the decrease is the fall of £1¼ million in airfield expenditure, because the large programme of extensions and lengthening of runways is now nearly at an end. At the same time. I admit, as I know my hon. Friend will, that we have not made the progress with works that we would have wished. My hon. Friend is quite certain that the figure in Subhead B of £8¼ million is now a thoroughly realistic figure. It will be seen in Vote 10 that we have increased the sum for modernisation of shore establishments. We are starting this year on a programme costing nearly £500,000. It will be seen that although the sum is modest, as the hon. Member for Devonport pointed out, we are making greater provision this year for reconstruction in the dockyards.

The right hon. Member for Rochester and Chatham (Mr. Bottomley), and my hon. Friend the Member for Gillingham (Mr. Burden) and, I think, the hon. Member for Stepney asked whether the Royal dockyards were fully employed. We are doing everything in our power to use the Royal dockyards to capacity. The right hon. Member for Rochester and Chatham said that outside painters were being employed in the dockyard. Although I will inquire into that matter, it would seem that it would be because the dockyard painters were already fully employed.

Mr. W. J. Edwards

Can the hon. and gallant Gentleman say anything about new buildings in the dockyards?

Commander Noble

No, but we try to strike a happy balance between new building and repair work. I think it is true to say that there is some new building going on in each dockyard.

Mr. Foot

The hon. and gallant Gentleman chided me for not having taken into account the provision for new machinery which was allocated in Vote 8. He mentioned a figure of £7 million which was to be spent on the programme over a number of years. I should be grateful if he would tell me exactly where, in Vote 8, I can see reference to that £7 million.

Commander Noble

I do not think that the hon. Gentleman understood what I said. I think that he will give me the point that we are making an increased contribution, though a small one, on Vote 10. What I said about Vote 8 was that we were starting a programme of £7 million to be spread over a period of four years, and we aimed to spend £1 million of that in 1954–55. Perhaps I could show the hon. Gentleman afterwards exactly where it is mentioned.

We have always regretted, as I know have the previous Government, that we have had to delay this dockyard work. I am sure that hon. Members will agree that rapid rearmament had to come first. I do not think that we have ever been accused of wasting our dockyard machines. There is a story of a firm who visited one of our dockyards and there they found one of their machines which they thought was the first one they had ever made. They asked whether they could have it for their museum. Their Lordships replied, as only they could, by saying that the request had been noted and would be reconsidered when the useful life of the machine had been completed.

I must mention the closed period, about which many hon. Members feel very deeply. My right hon. Friend announced the reasons for the change in a Parliamentary answer. It came about through the one week holiday becoming a two weeks' holiday, with greater dislocation of work. Another reason is that it has been done to enable maintenance to be carried out. The saving should be about one week's output. My right hon. Friend has said that everybody has agreed to do it for this year, and he will listen to anything anybody has to say next year. He will most certainly consider the matter again then.

Married quarters abroad come under Vote 10. The hon. Member for Stepney will agree that not so much is being spent on those abroad because the large schemes are coming to an end. I have seen married quarters in Singapore and Hong Kong. They are first-class. The wife of one young rating told me that they were "delicious." Under Vote 15, under the new Act, £9,250,000 will be spent mainly on married quarters in the home ports, but, obviously, the new programme will take some time to get started.

This has been a very wide debate, as, of course, these debates should be. Some important contributions have been made. My right hon. Friend has announced some important changes and right hon. and hon. Gentlemen have raised many issues, from the future of the Navy to details of day-to-day life afloat. I have tried to answer some of them. The hon. Member for Dunbartonshire, East (Mr. Bence) talked about the Royal Yacht. He made allegations which he said were based on hearsay—[HON. MEMBERS: "The hon. Gentleman is asleep."]—He can read what I say in the OFFICIAL REPORT. That is not my information. I suggest that he should try to find out details and send them to me.

I would say once again that we do mean it in the Admiralty when we say that any point I have not answered will certainly be studied. I think this debate has thrown into relief that the Navy has been going through a difficult transitional stage both in men and materials, and I am quite sure that the result will be a Navy of which this country and this House can be proud.

Question, "That Mr. Speaker do now leave the Chair," put, and agreed to.

Supply accordingly considered in Committee.

[Sir RHYS HOPKIN MORRIS in the Chair]