NATIONAL ECONOMIC PLAN AND WORLD DEVELOPMENT

HC Deb 11 February 1955 vol 536 cc2195-258

11.5 a.m.

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

I beg to move, That this House, conscious of the need for achieving a substantial increase in the production of food, raw materials and manufactured goods in order to raise the standards of life of the people throughout the world, urges upon the Government—

1. (a) the creation of a National Planning Commission which will, in consultation with those engaged in industry, representative organisations and others directly concerned, prepare national production and economic development plans; and
2. (b) the development of closer economic co-operation with other members of the Commonwealth and through the United Nations and other world organisations.

As I was coming to the House I thought what a beautiful morning it was—blue skies, sun shining. People were happier than I have seen them for some time. Yet, as I was speaking to my hon. Friend the Member for Ince (Mr. T. Brown), I thought, "There is a dark cloud of man's making. Man can move it and man must move it." I hope that that theme will run through our proceedings today.

Man is faced with the greatest challenge of all history. It is the challenge of technology resulting from the development of science. Is this to be used for mankind's benefit, or is it to be used for the destruction and obliteration of mankind over large areas of the world? The supreme issue in life is that relatively nothing—and let me underline the word "relatively"—is worth very much compared with the answer to that question. All the small men can play about with this, that and the other, but that is the big issue with which all real men are faced in these times. Our country has in the past made a great contribution in many ways which will be referred to later, but it can make a still greater contribution if it is determined to be worthy of its past. It is upon that that I want to make some observations in moving this Motion.

I am very pleased that the big Powers—mainly the United States, Britain, Canada, France and the Soviet Union—have, with very little quibbling, now reached complete unanimity on the agenda and procedure to be adopted at the international conference on the peaceful use of atomic energy to be held under the auspices of the United Nations in August next. That is a big step forward.

I do not want to make too much of what I say, but I think that I am entitled to say that if a few of the big Powers had used their influence more in the direction of the peaceful use of atomic energy the international situation would not have reached its present seriousness. However, let us give credit where it is due. The appeal today is for a new start, not only for our country but for all those countries associated together in the United Nations.

Let us therefore be encouraged. Let us show our appreciation of the agreement reached on the agenda and procedure to be adopted when consideration is given to the peaceful use of atomic energy and how individual States can give to each other in this field. A paper on the first atomic power plant erected in the world has already been promised by the Soviet Union, and other papers have been promised on this new power source. I happen to be familiar with those who have been responsible for its development in this country. If they receive the encouragement they should there is no reason why Britain should not be in the forefront in the peaceful use of this energy. Provided that we who meet together here, and those sitting opposite who have real power, are prepared to give that encouragement to those who have worked behind the scenes, our country can make a great contribution in this direction.

My first plea is that the British Government—and I am not allowing our political differences to affect this issue, because there is so much at stake—should use their influence towards the adoption of a constructive policy at Geneva. They should set an example in making a new start in world relations. In preparation for this, there should be a national plan and if that is accepted we must work towards a world plan which is called for in these days.

That is why I put this Motion on the Order Paper. It outlines my main ideas. I congratulate the British Transport Commission, which has at last prepared a plan for the modernisation of British Railways. I regret having to use the word "I," which has been too often used by many people since the end of the war; but one may be forgiven when one deals with a matter in which one has so much interest. It happens that I advocated this plan, not because I am different from anybody else, but because I had the privilege of being trained in one of the word's most modern and efficient workshops for manufacturing plant required for modernisation, and so I was in the forefront.

The advisers of the Transport Commission and the railway managements before nationalisation, until a few weeks ago, had been advising the Commission to use eighteenth century motive power. A great lesson can be drawn from that, because still too many people are living in the ways of the eighteenth and nineteenth centuries. There has been an enormous change in the twentieth century. At last, the country is to modernise its transport. We have a plan for the modernisation of the mining industry and it is already producing results. It has made a great contribution towards saving this country and towards giving us the time to be worthy of the past. If only we will modernise and plan in every industry and plan our national economy in the way that the Commission now proposes for transport and as those managing the coal industry are already doing, there is still a great future for this country. We have modernised electricity supply and distribution and we have a plan for producing more power, although it is not as much as we should have when one examines proposals for other countries. However, since the end of the war we have made great progress with our electricity supply.

We now need a national plan, a world plan and, in addition, the Government should always support policies which would lead to world expansion of trade and world economic co-operation. The condition of the world and of our own country urgently demands the application of the policy contained in the Motion. Those who are against us must say what constructive alternative to the proposals we are making they can suggest. If we are faced with a slump, as we may be, or a recession, or if the world agrees to disarmament, those who are against this proposal must say what alternative they have. What preparations are they making to avoid a million or 2 million of our own people going through what many of us went through for a very long time? We ought to be preparing now. We want to increase output, we want to increase world trade and improve the standard of the whole world. What we propose in this Motion can begin the construction needed to deal with mid-twentieth century economic problems.

At the end of last year, during October and November, it was my privilege, with a few others, to travel 20,000 miles by air, road and rail. Wherever I went I tried to talk to as many ordinary people as I could—but let me emphasise the difficulties of language. I hope that students in all countries will more and more study languages, as an increasing number of people will travel more widely in the future. But, making allowance for the language handicap, I have no hesitation in saying that everywhere I went I found enormous good will for this country and enormous admiration for the contributions we have made to the world, in spite of the black pages in our history, which I would be the first to point out and indict. They respect our culture, our skill and our accumulated experience.

We have a great past and I am convinced that if we place this plan at the disposal of the world in an organised form and set an example, instead of gloating over the difficulties of other countries and other people, and show that it is our desire to work for harmony with men throughout the world, this country has a great future. We need the ideas contained in this Motion to enable us to make such a contribution.

In forty years the British people have fought and worked during 10 years of world war. In the First World War we lost thousands of our young men and in the Second World War we exhausted ourselves. Our losses in damage to property alone were not replaced until 1950, while our net loss and disinvestment due to the war was £4,500 million. Our investment between 1946 and 1950 was only £4,200 million. It is necessary in dealing with a subject like this briefly to put those points and to recall for the consideration of other countries what those countries owe to us, for they soon forget what they owe to us. In one year, in 1952, the United States of America invested in machinery for manufacturing industry alone £4,400 million.

It was necessary to make those points so that these problems could be put in the correct perspective, because our people have worked harder than those in any other country in the world. Our people have strained themselves in two world wars. As calmly as I can I must say that we can no longer afford this exhausting expenditure on armaments and preparations for war. Conservative anarchists were responsible for mismanaging this country in the eighteenth and nineteenth centuries and some people today think that their ideas will still meet twentieth century needs.

It is those people who are demanding the abolition of the Capital Issues Committee. That Committee has never operated satisfactorily, and I have had differences of opinion about it with people for whom I have great respect. It marked a step forward, but it is not real Labour policy. Where real Labour policy was applied during the four years after the war it was a success from the point of view of the national interest.

It is time that these facts were recorded. In the ten years from 1904 to 1913 capital issues in Great Britain were as follows: basic industries, £41 million; breweries, £6 million; hotels and theatres, £7 million. From 1924 to 1933 the figures were: basic industries, £27 million; breweries, £26 million: hotels and theatres, £28 million. From 1929 to 1933 the figures were: basic industries, £6½ million; breweries, £11 million; hotels and theatres, £8 million.

There is reported this morning a statement made by Sir Walter Benton Jones, Chairman of the United Steel Companies Ltd., at its annual meeting. Here may I pause to pay tribute to a friend of mine no longer with us, Captain Hilton, who was responsible for the rationalisation of the steel companies—a scheme which gradually produced one of the best organised steel concerns in the world.

Now we have this statement by Sir Walter Benton Jones and I think that the Economic Secretary to the Treasury should note what he has to say about the seriousness of the replacement position in industry.

I smile when I hear people talking about inducements or the need to make appeals. It is evident that people who talk in that way have either forgotten history or have never read it. In matters of this kind, inducements and appeals have no effect at all. That fact led to differences between myself and many of my friends during the period when a policy of restraint was exercised in this country. The working class lost millions of pounds while other people paid no attention to the profits being made and the dividends being paid. I was in favour of a policy of restraint, provided that it was applied fairly. It is easy now—because we have been proved correct—to say that the policy worked out in such a way that the working class lost millions while other people made millions.

We see from the statement of Sir Walter Benton Jones that this is reflected in the serious position of capital issues. He says that in the period between the two world wars, world production of steel had risen from 76 million tons to a figure of 133 million tons. He continues: In 1953, that is, over a period of 36 years, it was 230½ million tons, or three times as large as it was in 1918. In the same period of 36 years the production of the United Kingdom did not rise above the 1918 figure of 9½ million tons until 1935. That is a reflection of the direction of capital expenditure. A relatively large return was obtained by investing in breweries and in hotels and theatres, but the basic industries were starved.

But that is all in the past and we are concerned with the future. Sir Walter goes on to stress "the startling growth of Russia and her satellites, which is largely Russia." He gives a picture of the growth of world production of steel. In 1918, the United Kingdom figure was approximately 9 million tons. In 1953, it was 17 million tons, whereas in the Soviet Union the figure was 1 million in 1918 and 47 million in 1953.

I wish to stress that, instead of abolishing the Capital Issues Committee, as so many right hon. and hon. Members opposite wish to do, we should be starting a National Investment Board so that the wealth and financial resources of the country may be applied in a manner best suited to the national interest. Then our children will thank us for what we do now in the same way as we thank those who won our democratic rights in years gone by.

Here are more serious figures relating to investment as a percentage of the national income. In 1907, 12.2; 1924, 8.1; 1929, 7.2; 1935, 6.9. One of the greatest indictments against the past industrial policy of this country is contained in a publication issued by the Tory Reform Committee a few years ago entitled, "Tools for the next job." Had I the time, I should like to quote from it statements in support of what I have been saying.

In 1900, an American industrial worker turned out in a day approximately the same amount as a worker in Britain or Germany or France. In 1950, the American worker turned out from three to five times as much as a worker in this country. America has approximately three times our population, but ten times our national income. Unless the constructive proposals contained in the Motion are adopted as a national economic policy, we shall never be able to deal adequately with the situation. Americans do not work as hard as we do, nor do they work as long.

In 1870, Britain's share of world trade was 66 per cent.; in 1913, 33 per cent.; in 1937, 20 per cent.; and in 1953, 10 per cent. Those are very serious figures, and it is only by adopting these constructive proposals that we shall remedy the situation. I charge the Foreign Office and the Board of Trade with subordinating Britain's trading interests to the military decisions of the United States. If anyone challenges that statement, I can produce evidence to prove it, though I do not want to go further into that matter this morning.

When the Chairman of Westminster Bank spoke last week he was appealing for more machinery to be installed in our industries. He wanted more modernisation and a reduction in working hours. Anyone who knows anything about modern production knows that it cannot be increased to any extent worth talking about by working harder. It is increased by scientific methods; by modernisation; by improved organisation, and by putting more horsepower at the disposal of each employee in each industry.

The Home Secretary recently said that in spite of the successes of the past year, exports from Britain as a whole were no more than just sufficient to maintain our share of world trade in manufactures. I am glad that he has blown sky-high the complacency which existed in many quarters about our present economic position. He went on to say that there was a need for an increase in the level of investment in manufacturing industries. Ours was, at the time, below that of Germany and the United States.

What a terrible thing to have to say. I am not blaming the Home Secretary; he had courage to say it. But what a terrible indictment it is, that in spite of all the appeals, in spite of all the influence, in spite of all the wireless talks and all the other efforts, the Home Secretary has to admit that in the manufacturing industries our increased level of investment is below that of Germany and the United States.

This is most unfair to those who have worked so hard and so long. I speak especially for the working class of the country, which is the most highly skilled in the world. It has a great background; it is loyal; it makes a great effort, and it takes an interest in doing its best in every possible way. It is time that the people responsible for our present position had a rude awakening. In my view, we shall never be able to improve that position except by legislation based upon the ideas contained in the Motion. The statement of the Home Secretary is complete confirmation of what some of us have been saying in past economic debates and shall repeat this morning. After all the lessons of the past, and after all that we have done in two world wars, we have arrived at our present unhappy position because of a small minority of well-placed people.

Interested people are asking, "Will our exports remain high? Will our prices remain competitive?" What are the Government's proposals for dealing with these two problems? A large proportion of our exports consists of engineering products. It has been said that we must keep the prices down, but what is really meant—as those of us who understand what goes on know—is, "Keep the wages of the highly-skilled engineers down, in order that exports can be subsidised and other people can go on living as they have always done and others can even improve their position." I have no time to deal with Mr. Philip Redfern's informative paper. I have skimmed through it, but before I refer to it I prefer to make a careful analysis of it. As far as I can see, however, it is a complete confirmation of what I have been saying about the past.

Now we come to our constructive proposals. Almost every country has already introduced planning or State economic machinery. Mexico has its six-year plans, economic co-ordination of planning, specialised credits for industrial development, and several economic commissions. The Argentine has its five-year plans; Bolivia has a development corporation; Brazil, Chile and Peru have their economic plans, and Venezuela has its national economic council. In Sweden, the Government guide the economic affairs of the nation in the national interest. They take an active interest in investment, and have introduced legislation to ensure that profits go towards the modernisation of plant. In all the Eastern States, the Soviet Union, India, China—throughout the world increasing State action is going on, in the people's interests. The only exception is Conservative Britain.

The United States are all against social ownership. I remember, to my cost, Article 7 of their loan agreement. In spite of what they owed to us for our past, they robbed us during the twelve months when we stood alone. They exploit the State machine to assist them, and especially their big business. During the past thirty years there has been a steady increase in State participation in the economic life of the United States. They have commodities regulation machinery; wage stabilisation; farm products prices assistance, and they give economic and statistical advice to business.

There is the President's Economic Council and the United States National Resources Planning Board, and in many other ways they manifest a twentieth century form of imperialism by financial penetration of other countries and control by indirect methods. I have here a statement made by the President to Congress only last month. Running through it are more proposals for State participation in the economic life of the United States.

My view is that, irrespective of what other countries may do behind the scenes, and irrespective of the way in which they may try to blackmail us by introducing their Article 7's, and so on, the British Government should take the initiative, without any compromise, in seeking international economic co-operation in every way. This is the most urgent need in the world, for all the talk is of no avail unless constructive action of this character is taken. This will lay the basis of a system for dealing with the economic needs of man, and upon that foundation we can improve political relations between countries and so remove the dark cloud that everybody knows is hanging over the world.

Britain should make it quite clear that she desires to co-operate with the world at the same time as she develops the Commonwealth. Britain should advocate and support this policy at all international conferences, not only publicly but behind the scenes. Here I am reminded of that great character, the late Arthur Henderson. He was the most respected man of his day. Although differing from him politically, even Mr. Litvinov—who used to sit a few yards away from him at Geneva—had great respect for him because what he said at Geneva on Sunday he said here on Monday. What he said behind closed doors he said later publicly in Geneva. That is the way to build up the respect of the world, and I am confident that if Britain adopts a policy more in harmony with that ideal we shall exert a greater influence in the world.

No real effort has been made since the end of the last war to build up international economic co-operation. Anything that has been done has been a reflection of American foreign policy. I know that the Economic Secretary does not accept that. I know that Britain has made her contribution, and I am prepared to give credit to that extent, but I am appealing that it should be of a more fundamental character and should be carried out not merely in our own interests.

I am speaking about economic cooperation not from our national point of view, but from the point of view of the whole world, because we have reached a stage when we cannot save ourselves unless we help to save the world. The world is now indivisible; what takes place here can affect the other side of the world. That is what I mean when I say that no real, fundamental effort has been made to develop economic cooperation. Too much action has been taken—not by us, but we have followed at the heels of others—to side-track the United Nations and its Agencies.

Consequently, we ask why no attempt has been made to relate world productive capacity to the consumption needs of the people of the whole world. Why does the embargo on trade with Russia and China still continue? Two-thirds of the population of the world live in backward areas. There is an urgent need for capital investment, capital equipment, technical advice, drawings and skill. In the industry in which I used to be employed for years we provided the Soviet Union with technical advice, skilled men and drawings, and built many of the Soviet Union's finest power houses. If it was right to do that in those days, it is equally right to do it now, for it would enable us to remove the political differences which have existed far too long.

We say that it is along those lines that our policy should be developed: first, a national plan at home; secondly, a Commonwealth economic conference; and thirdly, development of world cooperation. I should like the Economic Secretary to give us a definite reply upon this matter. It has been my privilege to meet a number of the Prime Ministers from Commonwealth countries. They have met and got on very well together, and as a result of the efforts of the Prime Ministers of Burma, Ceylon, India, Indonesia and Pakistan, an economic conference is to be called of the kind that we are advocating; but it is to apply only to Asia. Nevertheless, those countries are to approach their problems in a planned, constructive way. What is to be our contribution? Are we to send a message of good will to them? Shall we make constructive proposals for concrete action? The proposals made by these Prime Ministers constitute a method of dealing with twentieth century problems. Are we to encourage them and co-operate with them?

I will conclude by drawing attention, as briefly as possible, to the present economic position as I see it. Behind the scenes warnings have been given by the National Advisory Council which indicate that the red light is again being shown. We must look upon this matter from the point of view of our past experience. I have no hesitation in saying that we shall again be involved in perpetual crises leading to economic catastrophe unless we plan, regulate and control our economy on the lines indicated in the Motion.

We have built up in this country a relatively high standard of living, and we want to maintain it and at the same time make our contribution to developing the world. We cannot do that unless we adopt modern ideas. The margin between stability and chaos is so narrow and so precarious that constructive proposals need to be applied. This can be achieved by world co-operation on the lines that we advocate, but we shall not make progress unless we adopt a new trading policy. There is an urgent need for us to devise a new trading policy basd upon fair trading and exchange leading to real friendship.

From every point of view, including the military and the economic, Britain is more vulnerable than any other country in the world. We cannot risk free convertibility of the type that some people are trying to force upon us. The Luddite anarchists would ruin our country if they were allowed to apply their policy. Therefore, we should take the initiative and implement constructive proposals of the type mentioned in the Motion.

11.46 a.m.

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

I beg to second the Motion.

At the beginning of his speech my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ellis Smith) mentioned the long journey that he recently took. It is no secret to us that that was his journey to China. As he spoke, I thought of the phrase that the Chinese sometimes use when they dislike one. They say "I hope you may live in an interesting age."

In our lifetime we have certainly been living in a most interesting age. There is a good deal of evidence that, despite the fact that we have survived it so far, the times are still troublesome. We had the Second World War, with its unparalleled destruction. We have seen great changes inasmuch as the Soviet Union and China, our former allies, are now looked upon by many as our possible enemies, and our former foes, Germany and Japan, are looked upon as our possible allies.

As my hon. Friend mentioned, the world is divided into East and West, and expenditure on armaments is a grievous burden to both sides. Trade between the two is impoverished, the flow of goods representing an anaemic circulation, and neither of us gains the advantages that we might. Two great generals appear to have divided the world between themselves, one in the East and one in the West. A third general — General MacArthur — who was at one time thought to be even greater than his compatriot, recently declared that one cannot and must not go to war any more in this age, for there will be no victor and there can be no vanquished. Consequently, it is apparent that we are living in a most interesting age.

There are those among us who sincerely believe that, in anything that we in Britain can do in the way of planning our own economy or assisting outside, we must limit the plans in economic and social matters entirely to the Commonwealth and Empire. It is certainly possible to point to some things that we have been doing for a long time, and we can point very proudly indeed to such projects as the Colombo Plan and to the Colonial Development and Welfare Acts which we regularly enact. I sympathise with those who argue that within the limit of our ability we have done a great deal.

Outside the work that we have been doing in Britain—and I think we have set a good pattern for the rest of the world—I wish to limit my observations in the main to the question of planned aid to the under-developed areas of the world—we have the United States Point Four scheme and the Specialised Agencies of the United Nations, of which the Technical Assistance Programme is a very good example. The Communist countries offer evidence that they, too, are giving technical and financial assistance to countries friendly to them.

I heard the other day that the Czechs have built in Bulgaria one of the most modern textile mills in Europe and that it was offered to that country as a free gift. That is an example of technical assistance to an under-developed country. China, at present, is receiving very substantial help from the Soviet Union.

But the most interesting example is that of India where we have lent £5 million to the Indian Iron and Steel Company through the International Bank and from that portion of the money which was ours to dispose of. At the same time, the Soviet Union is assisting India to build a new steel plant. If we and the Soviet Union are able to step into the same territory to do exactly the same sort of work, then that is a very heartening feature.

The question I wish to ask is how far all this assistance, when added up from all possible sources, is matching up to the world's needs. I have no hesitation in saying that it does not match up to even a fraction of what the world as a whole needs today. This subject has been debated in this House on innumerable occasions since 1945. I think it fair to say that in this House a plea for further assistance to the under-developed areas of the world receives more sympathy and better understanding than in any other similar assembly in the world. There is certainly more sympathy and understanding for it in this Chamber than there is even outside in this country.

I remember my first speech in this House in 1945, when I talked about this subject. I said, among other things, that it was obvious that in the future the food exporting countries would be exporting less food than before the war, that inevitably their own peoples would themselves be consuming a greater share of the food which they produced, and that, therefore, there would be less food available in the free market. That has certainly proved to be the case in the Argentine as regards meat.

I also said that importing countries like our own would be compelled, whether we wanted to or not, to grow much more food than we had in the past because food would be dearer as compared with manufactured goods, and that less of it would be available for purchase in the free market. I think that is true.

The third thing which I mentioned was that I felt that if we were to solve the problem of world hunger, we should need to double the amount of food available in the world at that time, and that if we all combined together—and this was 10 years ago—the problem might be solved in 25 years' time. But 10 years have gone by and the world food situation is just about what it was in 1938 and 1939.

Of course, the world population has increased, and there has been some stepping up in world food supplies, but the amount of world hunger today is just about what it was before the last war. When the war ended, we were all heartened by the most notable attempt to solve the type of problem which I have in mind by the work of the International Emergency Food Council, with its 30 member States. That was a wonderful example of co-operation, and I think that in its three years' work it may well have saved our civilisation.

Unfortunately, a more permanent solution which was offered at the instigation of Lord Boyd Orr, by way of the creation of the World Food Board, was rejected. I think that that was a pity, but it cannot be helped. In March, 1953, the United Nations received an interesting suggestion from its Economic and Social Council. It was that a special United Nations fund should be set up for economic development. The Economic Secretary to the Treasury is very conversant with this proposal. The recommendations were unanimous, and we know what has happened.

I think it is fair to say that Britain was responsible for saving the fund from being entirely rejected on principle. We have not supported it in actual fact, but there was a move to reject it entirely, and in this House in March last year the former Minister of State pointed out, quite rightly, that but for Britain's intervention the very principle of the fund would have been rejected. The fund was to have been supported by, roughly, 30 countries, including the United States and ourselves. But the United States spokesman made it quite clear that his country would not participate unless and until savings were available from successful international disarmament.

The Dutch suggested that if each of the 30 participating countries would find one dollar out of each 340 dollars that it spends on armaments, the fund could start with an annual sum of 250 million dollars. That would have meant that our own contribution would have been about £8 million. Of course, 250 million dollars is a small sum. I think that it is much too small, and I shall say why in a moment. It is interesting to see what that sum represents in the light of what we are all spending. It is the cost of one day's defence expenditure of the United States alone.

I said a moment ago that 250 million dollars annually would not be enough. It would be a sort of token figure and the criticism against raising that sum would be, first, that most of it would go on salaries of the secretariat, and, second, that we do not want any overlapping, because there are other Specialised Agencies at work. I think that that is a real criticism.

An American observer has since pointed out that a beginning should be made with a substantial sum, and the figure of 2,000 million dollars was suggested. Such a sum would represent about 5 per cent. of United States' expenditure on armaments, but, obviously, we are not thinking in terms of the United States alone. If we were to think of it in terms of 30 contributing nations, with or without the United States, it might be possible to achieve a sum of about that figure.

If the United States did come in, our own contribution would be about £70 million in order to achieve the figure of 2,000 million dollars a year. Could we afford this? Of course, it is easy to say that we cannot possibly not afford to make this contribution because of the vast rewards which would be obtained from this type of work, not only in the West, but in the world as a whole.

In the debate on 24th March, my right hon. Friend the Member for Derby, South (Mr. Noel-Baker) gave some very interesting figures. He first mentioned the very high death rate of infants and the appallingly low expectation of life in the under-developed areas. I should like to quote one phrase which he used. He said that 1,200 million of our fellow men are hungry, disease ridden, ill-clothed, and ill-housed, from the cradle to the grave. We must remind ourselves that this is going on all the time; that it has gone on in the past, and it is very dubious whether it can continue to go on in the future and our type of civilisation and our security survive.

My right hon. Friend also pointed out that our own contribution in 1954 to the United Nations Technical Assistance Programme was only £650,000. He showed that, despite the smallness of the sum we contributed—and it is not very small in comparison with what many other countries give—it provided evidence of the remarkable assistance which was afforded by technicians to so many countries and in so many projects all over the world.

He also pointed out—and I thought this was very interesting—that quite clearly we were making a very handsome profit out of our contribution, because so many orders came back to our country for plant and machinery, and so many people came from all over the world to train here and then to be sent out under the scheme itself.

He then went on to plead that we should support financially the special fund to which I have referred. He went so far as to say that we should work up to a subscription of 1 per cent. of our national income, and that all the member countries should do the same. One per cent. for us would be over £100 million a year. I do not know how soon we can reach that figure, but my plea this morning is that if we start with one-tenth of the 1 per cent. of our national income we need, and work up until we can find the maximum of 1 per cent., that might transform the situation all over the world.

The then Minister of State, when he was replying to the debate on 24th March, gave very comprehensive details of all the assistance we offered to the Commonwealth and Empire and to other countries outside the Commonwealth and Empire, including the examples which he gave of Libya, Yugoslavia, and Jordan; and there is no doubt that when we look at the figures we have nothing to be ashamed of about what we have done in the past. But it is when we match up what we have done to the needs of the world that we realise that this is an urgent matter, and that we must extend aid as quickly as possible.

World mutual aid should not wait for international agreement on disarmament, for world mutual aid is a measure of disarmament itself, or, at least, the essential prelude to physical disarmament. It is the best possible way in which to get people to work together, as is shown by the illustration which I gave when I said that the Soviet Union and Britain are both assisting steel production in India.

The other day, Mr. Kruschev, in Russia, stated that the Soviet Union would rather compete with us in the provision of electricity from atomic installations than in stockpiling atomic and hydrogen bombs. That, I think, is a serious and real challenge. We should pick up the glove and enter the lists against that sort of competition. If the Soviet Union and the Communist countries claim that they can do better in the way of assisting the under-developed areas in the world, than we in the West, I think that we should take note of what they say, and it is obviously up to us to enter into the lists and see who can really do the better.

If we cannot get, in the age we live in, one world plan for the sake of suffering humanity, I see no objection to having two competing plans, one for the East and one for the West, with unrestricted trade and commerce between the two. I think that the stakes we play for are very high. They include at least the alleviation of mankind's age-long misery, and they include peace.

I think that it is a good game to play at, and I do not think that we should be afraid to play it. It is a strange game because both protagonists can win. We have learned in our time that if we attempt to resolve our problems by warfare they are not really resolved. We get neither food nor shelter nor security, but competition in planned assistance to the hundreds of millions of people who need our help can give us, I think, our heart's desire, and bring peace with it.

I should like to crave the indulgence of the House in saying that many years ago I came across an example of unnecessary suffering associated with poverty, which I have been unable to forget. In those areas of the world where drought is frequent, crops can fail and sometimes almost entirely fail. At such times, particularly in the Central Provinces of India, a particular vegetable, a sort of vetch, named lathyrus sativus, will grow when everything else fails.

Everyone has known for a very long time that this is a poisonous plant when it becomes the staple diet of the people for many weeks. The earliest Hindu medical literature mentions it. Hippocrates described its poisoning effect. Attempts have been made by legislation, without success, to stop it being eaten, for when hunger is real we cannot legislate to stop people from eating anything they can. In 1921, 8 per cent. of the people in the Central Provinces were afflicted with poisoning through eating this vetch, which they ate because they had nothing else to eat. In a bad year, 60,000 people had been known to die of it.

The disease is called lathyrism. It struck me as particularly horrible, because first paralysis of one or both lower limbs begins to take place and the man afflicted shuffles along, holding himself up with one tall stick. Later one sees him with two sticks for support, and finally his legs will carry him no longer and he shuffles along the ground, pushing himself with his hands, which he protects with wooden shoes. He is fortunate when he dies. It is a horrible complaint because it chiefly afflicts males between the age of 15 and 35 years, in the very prime of life.

The knowledge that such things happen should enable the House at least to accept that this is a serious Motion, and should offer it no opposition, but give it full support.

12.10 p.m.

Mr. Tom Brown (Ince)

I wholeheartedly support the Motion which has been so ably moved by my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ellis Smith) and seconded by my hon. Friend the Member for Stoke-on-Trent, Central (Dr. Stross). I do not know whether it will be your duty, Mr. Speaker, at a later stage to refer to the Monopolies Commission the debates which have taken place in this House on the last two Fridays. Last Friday we had a good dose from hon. Members from Stoke, and today we have had another. Hon. Members from Stoke seem to monopolise our Friday debates; but be that as it may, and jocular as it may seem, I strongly support the Motion.

As one surveys society today one is forced to the conclusion that if the peoples of the world are to make real progress, in all its aspects, we must concentrate upon cultivating the art of living together. When we do that there is a chance of permanent progress. There is plenty of room here and overseas for the cultivation of that art. If we do not cultivate it I see in the distant future the destruction of all the liberties for which we stand.

In the process of evolution science has played a very important part. Nobody will criticise the application of science provided that it is used for the improvement of conditions and the future happiness of mankind, but if it is used for the purpose of destruction we criticise it very severely. Science is all right in industry, commerce, and so on. It is a grand thing to furnish the upper storey with science provided that we furnish the ground floor with common sense. We want to see common sense applied to the problems which face humanity today.

My hon. Friend the Member for Stoke-on-Trent, South referred to planning. Is there any evidence that planning is essential in our complex society? Whichever direction we look we can see the advantages which the nations of the world have enjoyed as a result of planning. Without making a party point, I need only mention the mining industry, with which I have been familiar for many years of my working life.

I ask those who criticised the step taken in 1946 what would have been the position in Britain if we had not embarked upon a comprehensive planning of the mining industry. I know that almost every day people criticise the National Coal Board, the miners and their leaders and Members of Parliament from mining areas. All their criticism falls on shallow ground because they fail to analyse what would have been the results if we had not planned as we did.

The opportunity was afforded us by the Coal Industry Nationalisation Act of 1946. As an ex-miner, who worked underground for 35½ years, when I think of the advantages obtained by comprehensive planning, short-term and longterm, there is ample evidence for accepting what we are asking for in this Motion. When I think of the amount of capital expenditure—I know that we complain that it is insufficient and inadequate—and the results accumulated from that planning, I hold up my hands and speak in reverence of those men who in days gone by had this vision for the planning of the industry.

I remember when there were 1,103,000 men and boys employed in the mining industry. Today, about 700,000 are employed. I am not attempting to incriminate the former owners. I am trying to emphasise that there is ample evidence in the three major industries of mining, electricity and gas, that planning has brought untold and precedented success. If it had not been for the comprehensive planning embarked upon in 1946 the country would have been in a sorry plight.

There is a desire in our hearts that there should be an awakening from the apparent complacency which seems to surround us today. Everything in the garden seems to be lovely, but what will be the position if there is a recession? What will be the position if there is a slump? We must awaken ourselves and show a sense of responsibility not only to the people at home but to those of the world.

I was delighted to find in the Motion a reference to the necessity for: … achieving a substantial increase in the production of food.… That is of paramount importance. I understand from figures which have been made available that between the two world wars we imported four-fifths of our food. I am well aware that, not because we are lacking in skill but because our climatic conditions are against it, we cannot grow all the kinds of food which are so palatable to us; but we could considerably improve the production of the ordinary essentials.

We could increase the production of essential foods if we applied the necessary planning. I know that there are strong differences of opinion and that in the application of the terms of the Motion we shall tread on somebody's toes. This is no idle debate. We look upon the matter as very serious from every point of view.

I believe that if the contents of the Motion are applied to the Commonwealth and for the improvement of the standard of life of the people of the Colonies, we shall not have to face an intensification of the situation in which poor Jamaicans come to this country and cause an uproar. I cannot criticise the Government for the amount of money which is being spent on the Colonies, and I should strike a very selfish note if I did. The schoolmaster has been abroad and has taken under his wing many students. The development and enlightenment of the schoolmaster as a result of his going abroad is bringing something which we never expected to see in our day and generation.

Now we have the complaint that the Jamaicans and people from other Commonwealth countries are coming to the United Kingdom. Why are they seeking asylum in this country, a country which is the asylum of all the outcasts—and I do not use that word with any disrespect? They come here because they have learned that there is a higher standard of life in this country than in their own. I am therefore delighted that the sponsors of the Motion have widened it so as to include the Commonwealth countries.

I could continue to speak for a long time, amplifying the importance of the Motion, but I want simply to support with all the emphasis at my command the plea which my two hon. Friends have made to the Government to overcome this apparent complacency. Everything appears to be going well, everything in the garden is lovely, but there may come a time, unless some positive action is taken, when we may find ourselves—I hope we never shall, but we may—returning to the position of the 1920s and 1930s. God forbid that there should descend upon this country anything which would bring the experience through which many of us passed in the days of unemployment in the inter-war years.

I therefore add my words to the plea which has been put forward that the Government should give serious and active consideration to the Motion so ably put before the House this morning.

12.23 p.m.

Mr. William Warbey (Broxtowe)

My hon. Friends the Members for Stoke-on-Trent, South (Mr. Ellis Smith) and Stoke-on-Trent, Central (Dr. Stross) have today raised a matter of the first importance—indeed, one might say, second in importance only to that of the great issue of war and peace. This question of economic planning, not only for this country but for the wider area of which the Commonwealth and Colonial Territories form a part, is one which we shall neglect at our peril and one on which I hope we shall have a considered reply by the Government.

I am sorry that the Economic Secretary has had to leave the Chamber for the time being, but I have no doubt that he will be informed of any questions which are put to him. One of the questions which I want to put at the beginning is to ask whether he can give us some information about the economic discussions which took place al the recent meeting of the Commonwealth Prime Ministers. After that conference we had the usual not very informative communiqué, a small section of which was devoted to economic matters. As far as I could see, it consisted mainly of generalisations and, in so far as it made any specific reference to actions which might be taken by the countries concerned, it appeared to me to refer simply to the kind of action which they would take independently anyhow and without any form of co-operation between them.

The communiqué said that they would develop their resources and expand their production. We hardly need a meeting of Commonwealth Prime Ministers to resolve that each of their countries has to develop its resources and expand its production, and I hope that the Prime Ministers discussed something more serious than that and discussed how they might develop within the Commonwealth a common policy and common action to develop resources, expand production, improve distribution and make a contribution to economic stability within a wide area of the world.

There is a hint that they touched on the question of the convertibility of sterling. We understand that the Chancellor of the Exchequer, who appears to have an enthusiasm for taking a plunge into the chilly and dangerous waters of sterling convertibility, did not find the same degree of enthusiasm among some of his Commonwealth colleagues. Perhaps the Economic Secretary would tell us a little about that, because we should like to know what are the views of the other Commonwealth members on sterling convertibility and what are the Government's views.

In the view of many of my hon. Friends, nothing could be more dangerous for this country and for the Commonwealth than to make sterling a freely convertible currency. It would virtually destroy the sterling area, it would tie sterling to the dollar, it would put this country at the mercy of the most intense form of foreign competition, it would leave us without defences in the event of an American recession and it would inevitably involve the workers of this country in unemployment and lowered standards of living. I hope we shall hear from the Government that, whatever lip-service they may have paid to this doctrine, they have no serious intentions of proceeding in that direction in the near future.

But the Conservative Party seems to be as doctrinairely wedded to this conception of convertibility as it is to a twin conception of multilateral non-discrimination. We on this side of the House believe that we cannot leave foreign economic policy as a matter of chance. We must endeavour to plan our trade and to plan the investment by which development and the expansion of trade must be supported. Planning involves discrimination, and a planned trade, therefore, is the antithesis of non-discriminatory trade.

My hon. Friend made an eloquent plea for moving towards a world system and a world economy, but it is one thing to have an organised world economy and another thing to have a chaotic and disorganised world economy such as we have at present and to throw open this country and other countries to the mercies of all the winds that blow. General free trade in such a world is the antithesis of any conception of the organised direction of the flow of goods and services between this country and others.

We have to consider today in what area we should endeavour to plan. We can think in world terms, and eventually we must do so. Certainly hon. Members on this side of the House will continue to aim at the development of a world economic order. But that is some way ahead and until it arrives we have to consider intermediate conceptions and stages. We realise that we cannot plan with success purely on a national basis. We are not national Socialists. While there are some parts of the world where they talk of Socialism in one country, we certainly cannot claim here that, even with a Labour Government back in power, we can make a complete success of Socialism by planning on the basis of this country alone. We have to plan on a wider basis A country like ours, which has to import more than half its food and the greater part of its raw materials, is largely dependent, under whatever social and economic system we have, on the economic developments in the rest of the world.

Within what area, therefore, can we hope successfully to plan? I think we can begin to plan along with countries with which already we have some embryonic forms of planning, countries which have like-minded forms of government and in which there is a strong movement in the direction of democratically controlled economic planning. Those countries are to be found mainly in the area of the Commonwealth and also in Western Europe.

I should like us to set as a definite aim in our foreign economic policy the building up as one integrated economic unit of the area of Britain, the Western European countries and what might be called their associated countries and territories overseas. Within this area we have vast potential economic resources. We have similar economic problems, and also we have what is, in effect, an intermediate area between, on the one hand, the solid rouble bloc and, on the other hand, the not solid but unstable although at the same time enormously powerful dollar bloc.

Part of this area already has a unified currency, sterling, and that is already an enormous step forward. I think it would be an advantage for other West European countries—and I believe that many of our friends in these countries think it would be an advantage, too—that we might eventually have a uniform currency for the whole of this area. We need not call it sterling because our friends in France, Belgium, Norway and so on might object to the suggestion that they were coming into the sterling area, but an integration of the sterling area with the currency areas of the Western European countries is an aim which we should definitely set for ourselves.

Within this area, if we are going to have planned trade and investment and eventually a common currency, a customs union and with it appropriate safeguards and transitional steps—mobility of labour, reciprocal social services—we must have the appropriate machinery which makes those things possible. Of course, we cannot plan without machinery. So far, we have only the beginnings of economic planning machinery in this field. We have the sterling area pool. We have these meetings of Commonwealth Premiers and Finance Ministers, but we have no permanent economic organisation for the Commonwealth as a whole, and it is time we began to develop one.

We have, in our relations with Europe, the Organisation for European Economic Co-operation. Why should we not develop for the sterling area a similar organisation? Why should we not develop an O.S.A.E.C. alongside O.E.E.C.? This country, as a member of both, would form the beginning of a link between them. Both of those organisations, of course, would have to develop more advanced forms of planning machinery than they have at present.

O.E.E.C., for example, has a number of technical committees. There is a long list of them in the recent survey with which we were supplied—the chemical products committee, the coal committee, and electricity, food and agriculture, maritime, transport, oil, paper, pulp, timber and textile committees. They do valuable work. They survey economic trends, production, distribution, and so on, in their particular fields, and provide valuable statistical material on the basis of which individual Governments are then left to make their own decisions, and private business men, presumably, also make their own decisions.

But that is not good enough. That is the beginning of planning, but what has to follow from that is the development of active planning machinery by which we can take decisions and implement them within the areas concerned. It is no good saying that this is Utopian, that it is too advanced and that we could not get the countries to take part in decisions about trade and investment. It is done already in another field. It is done in the field of preparations for war.

Hon. Members have been supplied in the Library with copies of thick volumes describing the extraordinarily elaborate organisation which has been built up in the North Atlantic Treaty Organisation. It is a fascinating document for those who like to study planning machinery. It shows how, step by step over a very short time, there has been built up by a number of sovereign independent countries a highly organised planning machinery with a permanent organisation, with permanent and continuous planning going into great detail, and, above all, with a political machinery which is able to take effective decisions and see that they are implemented by the countries concerned.

Now we have at the head of N.A.T.O. a Council of Ministers who, when they sit together, sit as a kind of community of Governments. We may have the Service Ministers, Finance Ministers and others sitting together and forming a community of Governments, arriving at a collective decision which, of course, each has to implement in his own country but, nevertheless, which they are able to implement as a result of a collective decision.

If that can be done to prepare for war, why cannot we do it to prepare for the nobler and more inspiring tasks of peace? Of course, it can be done and it should be done. But I must say that I am not enthusiastic about the idea of it being done by Her Majesty's present Government. I do not see any sign that they are moving in this direction. We cannot really plan on an international basis if we cannot even begin to plan on a national basis. We have had here for the last three years a Tory Government which has been steadily scrapping the machinery of planning, dismantling the central economic planning machinery, getting rid of the various controls by which the economy can be kept under control, allowing private businessmen to have their head, and leaving all to the chance decisions of a number of private individuals at the independent level.

As a result, we have the incredible chaos of scarce dollars being spent on buying North American wheat, while Australia had a wheat surplus which was not bought. We were told by the Economic Secretary himself that we had handed it back to private importers, that that was the kind of decision which they made and that we could not do anything about it. It is time we had a Government which can do something about that nonsensical state of affairs.

I will conclude by taking as an illustration the kind of thing that causes the incredible scandal of tea prices today. Here is a vivid illustration of the anti-planning of the Conservative Government in the interest of private profit-making, and the kind of planning that might be undertaken by a number of countries if our ideas were accepted by the Government.

Housewives of Britain are deeply concerned about the constant rises in the price of tea. The Tea Trade Committee send out a tea news service in which it tries to explain what has gone wrong. The Economic Secretary and his right hon. and hon. Friends have tried to tell us that these increases have been the result of the interplay of supply and demand. No doubt that is so, and the tea trade news service says this: At the present time, world supply exceeds world demand by a comparatively small amount. The excess is not enough to prevent very keen competition between buyers. Prices are, therefore, high and may become higher. In other words, although world supply is adequate to cope with the demand, the organisation of the tea trade is such that there are numbers of buyers bidding against one another in order to force up the price. In fact, it is actually stated on the first page of this tea news service that In times of shortage the price is forced up by the competitive bidding of buyer against buyer all struggling to get enough tea for their consumer. What a confession of the total inadequacy of the capitalist organisation in the distribution of a vital commodity, because that is what it comes to. This country imports half of the total world exports of tea, yet we allow the markets to be rigged against the consumers here in that astonishing way. I think it is time we began to adopt a new attitude towards the question. We should begin to organise the distribution of tea on a rational basis. That would involve, of course, not only cutting through these various middlemen like auctioneers, brokers, and so on, who all take their rake-offs at various stages, but it would also mean entering into discussions with other countries of the Commonwealth, such as India, Pakistan and Ceylon, about the organisation of this trade.

We have had today a very interesting statement by Sir John Kotelawala in which he said, "Why do the people who blend and pack the tea not send to Ceylon and buy the commodity there, cutting out a lot of these middlemen?" He told us that tea, including the duty, could be bought in Ceylon for from 3s. to 4s. a lb. Yet the housewives of this country have to pay 7s. 4d. a lb., and may expect to pay more.

I wonder whether opportunity was taken of the presence here recently of the Premiers of Ceylon, India and Pakistan to discuss with them this whole question of tea distribution, so that there could be better organisation for its distribution. Here is an illustration of the kind of thing which could be done by a Government which really wanted to "play the game." But it looks as if we will have to wait for a Labour Government to do that, and when we get a Labour Government they will restore bulk buying, import and export controls, exchange control and the direction of investment, because it is only if these keys to economic planning are in the Government's hands that we can plan effectively in this country and so enable it to play a more effective part in wider economic planning.

12.45 p.m.

Mrs. Harriet Slater (Stoke-on-Trent, North)

I support the Motion and wish to deal with the problem before us from an international point of view. My hon. Friend the Member for Stoke-on-Trent, South (Mr. Ellis Smith) has already pointed out that we have evidence that the nations of the world, through sheer force of necessity and fear, are having to devise some means of co-operating to control atomic warfare. We believe that it is equally necessary for the peoples of the world to plan and co-operate to save the world from the poverty which is being endured in so many places.

The other night I heard Mr. Nehru say, when he was asked how many problems he had in India, that he had 370 million—meaning the population of India. This Motion has been submitted because my hon. Friend is conscious of the fact that in the world today—and we in Britain have a very large responsibility for it—there are 2,500 million problems, the problems of the entire population. Everybody agrees that man lives upon raw materials, that we depend on them not only for our food, our shelter and our clothing, but also for the culture which we enjoy.

We are constantly facing the fact that the resources of the world are not unlimited and are governed by a large number of factors. We have the problem of famine in one part of the world and gluts of raw materials in other parts. There is also the problem that some of our minerals are fast running out. We shall have to replace them and plan for that by other means.

We are also forced to realise that we do not use our scientific and technical knowledge until through dire need and poverty we are forced to do something about it. Perhaps the Government will argue that the kind of planning suggested in the Motion is emotional, sentimental and unnecessary. But I would remind them that in large-scale business, which they represent, there has to be planning if that business is to be successful and if profits are to be reaped. We have examples of large-scale monopolies organised not on a national but on an international basis, generally through careful planning and organisation.

Then, again, we must realise that planning is necessary if we are to conserve what we already have. In some parts of the world we find examples of forests being cut down indiscriminately, of land being taken out of cultivation and because of it the people in that particular area suffering poverty. We have the misuse of valuable minerals and the unscientific cultivation of land, due solely to the fact that there is not at this stage any developed international planning of the kind sought in this Motion.

Further, we have to face a growing world population. Every 24 hours, 8,500 more people are born and, somehow, those people have to be fed if we are to prevent what is happening now, one out of every three babies dying before they are a year old. Only the co-ordinated planning asked for in the Motion can save us from that kind of destruction.

This means that we must have a reassessment of our values of human life, and that, instead of relying on the private profit-making motive, we must take as the basis of our values a humanitarian approach to world problems. We have much evidence of the private profit-making motive being the dominating factor, and somehow we must supplant that by a humanitarian point of view. I believe that only this country, perhaps in conjunction with India, can achieve such a reassessment of values.

If we are to raise the standard of life of the peoples of the world generally, we must mobilise our scientific and technical knowledge and we must extend it to all countries. First, we must plan our own available resources and, subsequently, we must plan on an international level. In pre-war days there were many examples all over the world of attempts to keep down production in order to keep up prices. We heard terrible stories of the burning of wheat and the throwing back of fish into the sea simply because the private profit-making motive was the dominant factor in economic life.

That has not happened yet in the postwar world, but it must not be forgotten that stockpiling by America in the Korean war affected the people of this country and other countries. Then there was the effect of the cold war in the restrictions on the flow of trade between East and West. We must also face the fact that there are large sections of people in the under-developed countries who are now no longer prepared to be a source of cheap labour without reaping any benefits for themselves.

There have been attempts at international planning. The Havana Charter of 1938 tried to lay down principles governing commodity agreements between nations. There was the International Wheat Agreement between the United States and Canada and Australia, which are exporting countries, and 33 other nations which are importing countries. They agreed on a system of votes according to their quotas of wheat imports, and it was decided that if the upper price limit operated, the exporters would guarantee a minimum supply of wheat to the world, whereas if the lower price operated, the importers would purchase a certain amount of wheat.

When that Agreement was due for renewal Britain withdrew because she was not prepared to pay the top price asked by the producers, particularly in America. Yet because that example failed there is no reason why we should not try a similar experiment. That was an example of planning applied to a basic raw material which, if it had been by inter-Governmental agreement, could have ensured for the world the staple food of bread.

We believe that if such inter-Governmental agreements are to be established the machinery of the United Nations organisation should be used. This ought not to be impossible because we have evidence of the work of the United Nations Children's Fund and the work of the World Health Organisation to compare with the international agreements between large world cartels and combines. We cannot forget that just before the last war started an agreement was made between Imperial Chemical Industries and the Farben Industrie by which they would watch each other's interests. That was an example of an international agreement from the wrong motive.

Today, therefore, we appeal to the Government to look again at this problem in order to see how far Great Britain can use her historical background, knowledge and ability to try to understand the needs of people so that we can give a lead to the world, first by establishing national planning here and then by establishing international agreements for trade, for the control of raw materials and the things which people need so much. We believe that if this is done the purchasing power not only of those we represent in this House, but also of those for whom we are responsible in the under-developed countries, can be raised so that no longer will they be condemned to suffer the squalor, ignorance, disease and poverty of which we are all aware.

My hon. Friend the Member for Stoke-on-Trent, South put down this Motion because he believes sincerely and deeply that such evidence of national and international planning would lay firmly the foundations of world peace. No longer would we need to use the phrase which we hear so often in this House, that we must negotiate from a basis of strength—meaning armaments. Instead we should begin to negotiate from the strength of international co-operation a humanitarian basis which would give us economic stability.

We appeal to the Government to receive this Motion not with a shrug of the shoulders and as being emotional, sentimental or impracticable, but as a basis for discussion and organisation so that we in Great Britain can take that lead which we ought to be taking at present, of saving the world from poverty and war.

12.58 p.m.

Mr. Frederick Elwyn Jones (West Ham, South)

The House is under a debt of gratitude to the initiative of what I might describe as "Stoke United" in bringing before us today this all-important question. I was impressed when reading recently a remarkable observation of the American writer Herbert Agar, who said that the present time is the last chance that the white race will have of joining the human race as an equal. That was a challenging observation.

My hon. Friend the Member for Stoke-on-Trent, South (Mr. Ellis Smith), who has recently been on great travels to the East, has given us a picture of what he saw there and I have heard from him some of the things he observed. The outstanding physical fact today about that two-thirds of the human race which is not white, is its appalling misery its hunger, its liability to live most of its life in a state of disease, and its illiteracy. That is the outstanding physical fact. The outstanding spiritual and political fact about that two-thirds of the human race is a determination that that avoidable state of things shall not continue.

Time is short. Desperate men, economically desperate men—put in simple language, men who have not enough food for their children—turn to desperate political measures in the hope of redressing the injustice. That, of course, causes the spread of Communism. Communism in Asia is not the fabrication of the Kremlin; it would be there in spite of the Kremlin and if the Kremlin had never existed.

As a white race, if I might so describe us, how do we deal with the problem? We contain the challenge militarily. We are squandering our wealth, our resources in prodigious military expenditure which, of course, makes it more and more difficult for us to contribute funds to remove the misery which is the cause and the occasion for the spread of Communism. This vicious cycle goes on and on, and there is no indication on the part of this Government or of the American Government of action by which this vicious process can be broken—cut through—with the light of humanity and the grasp of simple human reason. There is no breaking through it at Present.

In the House of Commons, Friday is a day when one is permitted, perhaps, to engage in a certain amount of general discussion of the world scene. When one reflects what can be done to deal with this problem of the human misery which is creating a sense of revolution throughout the world, it is both inspiring to think of what might be done and worrying to our consciences to realise what little we are doing.

There is malaria. We are told by the World Health Organisation that about 300 million people are suffering from malaria at present; that means about one person in eight of all the human beings in the world. There is no doubt whatsoever that malaria could be eliminated. It is being elminated in many areas. I remember that when I was in the Army, in Italy, during the war, one of the remarkable things we did was to eliminate malaria from vast areas. Of course, we had an immediate purpose in doing it there—we did not want our troops to get malaria—but it had the indirect advantage of eliminating it from poor Italian peasants who, through the ages, had known nothing but recurring fever and weakness from this fell disease.

If we and the other contributing nations gave a little more money to the World Health Organisation, we could practically eliminate this disease from the world. It is really as simple as that. Quite apart from any humanitarian motives, that would mean that we should be doing ourselves and the people of the world a good service. At the moment, those 300 million people have hungry mouths and cannot feed those mouths with the work of their own hands. How much better that they should be added to the world's productive labour force to create the wealth they need and, in creating it, improve our lot, too.

In a very real sense world prosperity is indivisible. In this field of technical assistance and contribution on our part as a nation to increasing the wealth of the world, we derive benefit which some of our critics in other countries always accuse us of deliberately seeking to attain—the feeling of doing a moral good and, at the same time, getting a material advantage. Compared with that of many others, I do not think that our own national effort is anything for which we need apologise—I ought to hasten to say that—but can it be said that what we are doing is the most we can do?

We are, it is true, doing a great deal for colonial development. I do not seek to deny that we have quite a good record in that respect, but our contributions to some other of the Agencies of the United Nations—really, it is much less than we can now afford, with the enormous increase there has been in recent years in our national wealth. For instance, in 1954 our contribution to the Technical Assistance Programme was only £650,000—a miserable contribution, really, is it not, in terms of what that United Nations organisation can do?

Let me give one small illustration of what that organisation can do. Up to recent years there was grave anxiety about the decline in the output of rice, which is the basic food of hundreds of millions of people. The Technical Assistance people got working on it. They produced a new, larger, stronger and better seed. They devised new methods of cultivation. The result is that the world output of rice is now 10 per cent. greater than it was before the war. That kind of development improves the wealth of everyone.

My constituents in West Ham may think this a very remote subject for their Member to be talking about on a Friday morning, but they, too, will benefit from that improved output. The ships that go from the great docks in my constituency, the trade upon which this nation depends—all will benefit and wealth will flow to us. There comes to mind the old Biblical phrase: Cast thy bread upon the waters: for thou shalt find it after many days. We will indeed—and it will return with all the blessings of the hungry being bestowed upon us in the process.

I should like to mention one specific matter with which I hope the Economic Secretary will deal when he replies to the debate. I wish to refer to the Special United Nations Fund for Economic Development—I think that is its full name. What an attractive new word the initials of that organisation provide—S.U.N.F.E.D. What a picture it gives of what we are trying to work for and press for in this debate. Sun fed—the sun of the effort of all peoples benefiting all the peoples of the world. The very mention of the name drives one to eloquence.

What is to happen to S.U.N.F.E.D.? Let me remind the House of the terms in which the then Minister of State—Minister of Supply, I think, is his present elevation—described this admirable project in his speech in the House on 24th March, 1954. He said: The broad purpose of"— S.U.N.F.E.D.— is to provide grants in aid to underdeveloped countries … on an international scale to do exactly what we are doing under the Colonial Development and Welfare ACt."—[OFFICIAL REPORT, 24th March, 1954; Vol. 525, c. 1254–5.] An admirable idea—to do for the world what we, through the Colonial Development Corporation are doing for our own Colonies. It received the verbal enthusiastic support of the then Minister of State. What have the Government done about it since? It is not enough that there should be speeches from the Front Bench opposite on Friday afternoons. How is it being followed up? Last March, we were assured by the Minister of State that a report was to be made to the Assembly of the United Nations in 1954. I should like to ask the Economic Secretary whether it came up for discussion by the United Nations. What did the spokesman of the Government say about it? Did we give a lead to the world in this matter, we who depend so much as a people, as the fountainhead of a great Commonwealth, we who depend so much on all nations joining in this effort? What did we do to give a lead to the world?

The American answer, which is not to support the international fund until we have some money to spare as a result of disarmament, does not bear a moment's analysis. Contributions by the 30 nations whom it is contemplated shall join this organisation would, in themselves, constitute a measure of money taken from armaments. Is there really a more effective instrument of security today than expenditure of this kind?

Do not let it be thought that I am recommending that our approach to this problem of world hunger should be a military security approach. That would be wrong. Indeed, it is regrettable that so much of the great and generous American effort in this field—which I am most glad to proclaim—has, in recent years, become merely a tributary of the military security programme. That has put American aid under suspicion in many parts of the world where otherwise, if it were given through the agency of the United Nations, if it were offered, if I may use a legal expression, if not with clean hands, with hands without any ulterior purpose of military advantage, how much more welcome it would be.

It is astonishing to me that the generous American people—as individuals their generosity has no equal anywhere in my experience—should have their generosity curdled by Governmental policy and have it turned sour in the face of the hundreds of millions of Indians and other Asians who could benefit so greatly from it. They would gladly receive it, if it were given in a different spirit with a less questionable motive. "Questionable motive" is not a fair, nor perhaps a true expression to use. If only it were given without the approach that it is given purely for security reasons. The manner of the giving is very often as important as the gift itself.

What have we done about this international fund? What do we propose to do about it? Are we proposing to take the initiative in this matter? Its idea still remains and the Government have committed the House at any rate to an examination of it and to its moral support. Have the Government gone further? I ask that with a real sense of urgency of the situation in which we are.

I believe that unless something is done soon the great crisis through which the world is going may very well deepen. When that moment of crisis comes, the moment when allies among the millions and millions of the world may be needed, there will be a very ready testing question. I repeat what I said at the beginning of my speech. We have reached the point in human civilisation when this will be about the last chance for the white race to join the human race as an equal.

1.15 p.m.

The Economic Secretary to the Treasury (Mr. R. Maudling)

I hope that it will be for the general convenience of the House if I now take the opportunity of saying something on behalf of the Government and of the Government's attitude to the Motion which has been moved in such serious and thoughtful terms by the Stoke combination, aided by one or two other hon. Members opposite.

The debate has certainly ranged pretty wide, as of course it could well do, because the Motion is very comprehensive in character, bearing on major problems, both external and internal. In general, the debate has been of an extremely serious order, although there were one or two remarks from the hon. Member for Broxtowe (Mr. Warbey) which I hope to have the chance of controverting in a minute.

I should like to assure the hon. Lady for Stoke-on-Trent, North (Mrs. Slater) that I have no intention of criticising this Motion as being sentimental. I think that the word sentimental has been too much deplored. I do not see why, if a thing is sentimental, there must be something wrong with it. I would not say that this Motion is sentimental, and I would not differ from her about the great human importance of the problems which are raised by the Motion.

I want to indicate as I go along how much I agree, to a large extent, with the Motion and many of the things that have been said by hon. Members supporting it, although hon. Members will appreciate that the Government do not agree with the creation of a national planning commission. Our differences are more of method than of objective.

When I listened to the hon. Member for Stoke-on-Trent, South (Mr. Ellis Smith) opening the debate, I felt strongly that many of the things he was saying about the objectives were things which I could wholeheartedly echo. He started by saying that in this generation we are now facing the greatest challenge of all history because of the development of scientific skill and technological knowledge. The hon. Member for Ince (Mr. T. Brown) rather echoed that, and I am sure that it is absolutely true.

I am sure that this generation faces both possibilities of advancement and dangers of destruction different in scope and indeed in kind from any that the world has ever known before. It is, as the hon. Member for Stoke-on-Trent, Central (Dr. Stross) said, an exciting age in which to live, because of these fantastic possibilities and fantastic dangers.

As the hon. Member for Stoke-on-Trent, South went on to develop his thesis he was controversial in some respects and in others he was not. In the course of the remarks I intend to make on the Motion, I should like to pick up some of the remarks which he made and those which were made by other hon. Members. I must say that I was rather surprised to hear the hon. Member talking about his experience in other countries and saying that most other countries seem to be developing national planning commissions or national planning authorities.

I could not help remembering that the two countries most opposed, under their present Governments, to State planning, are the United States and Germany. Yet it was competition from the efficient industries of the United States and Germany to which he was particularly alluding in the earlier part of his speech. There was some inconsistency in his argument and no doubt he will, in a subsequent speech, try to prove that there was no inconsistency.

He was rather off-beam when he said that since the war, or at any rate in recent years, there had been no real effort to build up international economic co-operation. In fact, since the war there has been a most remarkable effort to build up international economic co-operation. The hon. Member did say that this country had done a great deal, and I am sure that we should all agree with that.

We should not under-estimate the very remarkable contribution of the United States to solving international economic problems. In this country we have particular reason to appreciate it, because it is unchallengeable that, without the aid of the United States through the Marshall Plan, nothing like the present degree of recovery in Europe could possibly have been achieved.

I think also that it is a mistake to try to throw doubt upon the motives of the United States—although I do not think that the hon. and learned Member for West Ham, South (Mr. Elwyn Jones) was doing that—or to exaggerate the degree of doubt which may have arisen for other reasons. I think it wrong to underestimate the vast amount done by the American people, although they are separated from Europe both by 3,000 miles of water and by a tradition of isola- tionism bred over a considerable number of generations.

The hon. Member for Stoke-on-Trent, Central, like the hon. and learned Member for West Ham, South, referred to the delectable organisation known as S.U.N.F.E.D., which always reminds me of some kind of vegetarian nut cake—the special United Nations Fund for Economic Development. I hope that I shall be excused for being rather flippant about its title because its substance is extremely important. I think that I should make clear where the Government stand on this matter. The hon. and learned Member for West Ham, South referred to expressions of general approval and support, but I think he will find that we have gone further.

In 1953, we subscribed to a declaration by the General Assembly of the United Nations which was a definite commitment, and I should like to read the actual words. When sufficient progress has been made in internationally supervised world-wide disarmament, to devote a portion of the savings achieved through such disarmament to an international fund within the framework of the United Nations to assist development and reconstruction in under-developed countries. That is a definite commitment. As I understand it, the whole idea of S.U.N.F.E.D. has developed alongside the idea of developing something which will take place as world rearmament expenditure declines.

Though I speak from memory, I think I am right in saying that that idea had a lot to do, in the first stages, with some of the remarks made by the President of the United States a year or two back. Certainly from its inception S.U.N.F.E.D. has been tied up with the idea of a reduction of expenditure on rearmament.

Sir Richard Acland (Gravesend)

Is it not correct to say that all the leaders of the under-developed countries, and, I think, the Dutch, pressed that S.U.N.F.E.D. should be started forthwith; the Dutch pointing out that this could be done if all the nations subscribed one dollar for every 340 dollars spent on armaments? Was it not well known at the time that the formula which the Economic Secretary has just read was the formula by which the wealthy nations—outstandingly the Americans and ourselves—shunted this proposal off into the dim and distant future until—I am paraphrasing but I think I have the sense correctly—the Russians had agreed to have international snoopers looking round their arms factories, which meant putting it off indefinitely?

Mr. Maudling

I do not think that that is precisely what I was saying. But ideas on the timing of disarmament may differ.

As I understand it, this idea of S.U.N.F.E.D. has from the start been tied up with the reduction of expenditure on armaments—certainly by the people providing the finances—

Sir R. Acland

By America and ourselves.

Mr. Maudling

—which is a rather important matter. The position about the setting up of S.U.N.F.E.D. within the United Nations and the possibility of setting it up and obtaining world-wide contributions are still being discussed under the direction of the Economic and Social Council; so that the answer to the hon. Member is that the Economic and Social Council is still working on the possibility of getting contributions and on the details of setting it up.

I think our attitude would be that we are committed to contribute to a body, but that we are not committed to making any contribution until we see that some effective body can be set up, with contributions from all sources. Until it appears likely that everyone will come in, it is difficult for this country to do so—

Mr. Warbey

rose—

Mr. Maudling

—let me complete my sentence, which I admit is a rather long one—and it is important from our point of view not to contribute to a new organisation if, by doing so, we should be forced simultaneously to reduce the contributions we are already making to under-developed territories through other channels.

Mr. Warbey

Yes, but as I understood it, what the Economic Secretary said just before was that if other countries will come in, we should be prepared to go on without waiting for general disarmament. I do not know if the hon. Gentleman has grasped the point?

Mr. Maudling

Not quite.

Mr. Warbey

As I understood him he said—and it is rather important that we should know the position of the Government—that the British Government are now prepared to come into S.U.N.F.E.D., to help to get S.U.N.F.E.D. started, if other countries will come in, without waiting for general disarmament.

Mr. Maudling

No, I think that I have made the position of the Government quite clear, and the hon. Gentleman will see that in the OFFICIAL REPORT tomorrow.

We have a definite commitment in the terms that I have described, beyond which we have not yet gone. We are working within the Economic and Social Council and examining the practical possibilities of setting up S.U.N.F.E.D. with world contributions—

Mr. Warbey

Without disarmament.

Mr. Maudling

—and that is the position at the moment. The provision of money is tied up with the reduction of armament expenditure.

I thought that the hon. Member for Stoke-on-Trent, Central was on a good point when he referred to the waste of money on these projects when an organisation is set up without adequate financial resources, because the overhead costs are so heavy. I would say that in our attitude to S.U.N.F.E.D. we have been co-operative and practical in that we accept the principle, with the reservation which I have described, and we are working out definite details of the possibilities. So much for the point raised about S.U.N.F.E.D.

Other points were raised with which I shall try to deal, but I think that, in passing, I may be permitted to make one or two remarks on the subject of the price of tea which, for some strange reason—although not altogether inexplicably—has arisen in this debate. I would say to the hon. Member for Broxtowe that if he wishes to know the facts about the price of tea, and the reasons for the increase, he might well consult his friends in the Co-operative movement, who could give him some good information.

The real reason for the increase in the price is the increase in the prices realised by the sellers at the free auctions. I was a little surprised by the description given by the hon. Member for Broxtowe of what goes on at these free auctions. I have never heard of buyers bidding against one another in order to force up the price against themselves for the benefit of the seller—

Mr. Warbey

I do not like interrupting the hon. Gentleman again—

Mr. Maudling

—May I just finish the sentence?—and I would add that he should remember that it was under a Labour Government that these free auctions of tea were restored, in my view quite rightly.

Mr. Warbey

I was merely quoting from what the Tea Trade Committee itself said in its news bulletin. I am sorry that I have not the document with me now. But it will be seen from HANSARD that I was quoting from the document issued by the committee, in which it was said that the bidding of buyers had forced up the price. It is not what I say; it is what was said in the bulletin.

Mr. Maudling

I agree that it is usually the bidding of buyers which forces up prices, just as the absence of buyers brings down prices.

Mr. Elwyn Jones

Would the Economic Secretary express a view about the correctness of the figures given yesterday by Sir John Kotelawala, or would that be asking too much?

Mr. Maudling

I think that it would be wrong for me to comment on the remarks of the distinguished Prime Minister of Ceylon. In any case, I have not the full information at my disposal. But a reference to the Co-operative movement would provide hon. Members opposite with a full and accurate description of why the prices of all brands of tea are so high at the present moment.

Mr. John Edwards (Brighouse and Spenborough)

It is not really the price of tea which is important in this debate. The important consideration is what attitude are the Government taking towards circumstances of this kind. Does the Economic Secretary think that the Government ought to intervene because of all that is happening? That is the kind of thing we should like to hear about. Are the Government proposing to do anything?

Mr. Maudling

if the right hon. Gentleman wishes to know what the Government propose to do about the price of tea, it would be better for him to put a Question to the Minister of Food. I have not yet heard whether hon. Members opposite intend—

Mr. Deputy-Speaker (Sir Rhys Hopkin Morris)

Order. This Motion is certainly in very wide terms, but I do not think that it covers a discussion on the price of tea.

Mr. Edwards

May I submit to you, Mr. Deputy-Speaker, that in this debate we are concerned with planning, and we are discussing the extent to which the State should seek to influence economic affairs. The point of my question was not the price of tea but the fact that this is the kind of situation in which the State ought to intervene. I submit that that is very relevant to the discussion which we are having.

Mr. Deputy-Speaker

Questions of planning might be relevant. The Motion is drawn in very wide terms, but, as I understood it, the price of tea was now becoming involved in the argument.

Mr. Maudling

I was only trying to point out that the removal of planning from the sphere of the distribution of tea was done under the previous Administration, when free auctions were restored. Perhaps I had better leave the matter there and come to the Motion itself.

There are three main elements in the Motion. First, there is the reference to the need for achieving a substantial increase in the production of food, raw materials and manufactured goods … No one would deny that for a moment. I am sure that it is right to lay special emphasis upon the production of food and raw materials. A great deal has been said this morning about food shortages throughout the world.

I am quite certain that it is right to concentrate one's attention upon the development of food not only in bulk but in quality, because in many underdeveloped areas the people are undernourished not so much because of the shortage of bulk as of quality. The greater the degree to which crops can be diversified and people taught new methods of cultivation and new things to cultivate, the better.

The capacity of the modern world to chew up raw material is quite astonishing, and unless we continue to devote our scientific ingenuity and energy to the development of new sources of raw materials we shall be faced with serious problems. The great possibilities of developing energy from atomic sources, if realised, would help us considerably over the next generation in making easier, cheaper, and more efficient, the production of food and raw materials. I do not think that there is any difference between us upon that point.

I shall take the two positive parts of the Motion in the order opposite from that in which they appear, and deal first with the development of closer economic co-operation with other members of the Commonwealth and through the United Nations and other world organisations. I wholeheartedly agree with hon. Members opposite upon the importance of developing this closer economic co-operation, but I cannot help feeling that they under-estimate the amount of development which has already taken place. I want to review what has been happening and what is going on.

Taking the Commonwealth first, I think it is fair to claim that relations between the countries of the Commonwealth upon economic problems have never been closer than they are at present. A process of consultation and working together has been developing steadily and naturally for many years, and it has now reached a very high peak. A number of meetings of Finance Ministers have been held in recent years, in London and Sydney—and there was also a meeting in Washington—and meetings of Commonwealth Prime Ministers have also discussed economic matters. I shall have a word to say about the question raised by the hon. Member for Broxtowe upon this matter in a moment.

No one should under-estimate the amount of steady liaison that goes on in London between the various Commonwealth countries upon these financial and economic problems. I can assure the House that we keep the Governments of overseas territories constantly and fully informed—without reservation—of everything that we are doing and thinking of doing in the economic sphere.

The hon. Member for Broxtowe asked for more information about what happened at the Prime Ministers' Conference, but if he requires more information than appears in the public communiqué he should ask my right hon. Friend, who was there, rather than I, who was not. He should not be led astray, however, by rumours about differences of opinion existing in the Commonwealth upon economic policies. One of the most impressive things in recent years has been the extraordinary unanimity of Commonwealth thinking upon the subject of our major economic policy.

The hon. Member also made some reference to convertibility, to which I shall refer later. He knows that our policy is one of trying steadily to advance towards a freer system of international trade and payments. That is not United Kingdom policy alone; that is the policy which has developed as a united Commonwealth policy since early in 1952, before my right hon. Friends went to the conference in Washington.

That policy has been re-examined and reaffirmed at every meeting of Commonwealth Prime Ministers and Finance Ministers which has taken place since then. I had the good fortune to attend one of the Finance Ministers' conferences—the one which took place in Washington—and I was most impressed by the extraordinary degree of unanimity which exists upon this subject between countries so diverse as India and Canada. I would ask the hon. Member not to under-estimate or try to write down the extraordinary agreement which exists upon this matter among Commonwealth countries.

The hon. Member suggested that we might have, for the sterling area or the Commonwealth, something equivalent to O.E.E.C. My view is that that suggestion fails properly to appreciate the circumstances of O.E.E.C. and the difference between it and the Commonwealth. O.E.E.C. started largely as an organisation for distributing American aid within the European countries.

It later became, in addition, the vehicle of the European Payments Union, which was a machine for encouraging the free flow of payments within Europe, without bringing into it settlements in gold. That is not necessary within the sterling area, because although we have not a unified currency—each territory having its own local currency—we have the same international money, namely, sterling, and nothing similar to the E.P.U. would be necessary for the sterling area.

The other main function of O.E.E.C. is the liberalisation of trade, which has been developed recently. This function was viewed sympathetically by the hon. Member for Stoke-on-Trent, South, who talked about closer economic co-operation, but I think that the hon. Member for Broxtowe was against it altogether. He seemed to believe in discrimination and not liberalisation. The main work of O.E.E.C. recently has been to extend liberalisation, and in the sterling area there is practically complete liberalisation. Certainly this country is an open door to Commonwealth products. I do not see the analogy betwen O.E.E.C. and the sterling area in that field of O.E.E.C. activities.

More than one speaker has raised the question of Commonwealth investment. The Government attach very great importance to encouraging the development of this country's investment in the sterling area. We have always been a traditional source of development capital for the sterling area, and we are glad to see how this is developing. In particular, we are glad that we have also been able to find more and more money for investment in Canada. It was especially galling to see, in recent years, how Canada was developing while we found it impossible to provide, out of the dollars available to us, sufficient finance to participate in that development.

I now turn to the Colombo Plan. I was rather surprised that the hon. Member for Stoke-on-Trent, South made very little, if any, reference to that Plan, but the hon. Member for Stoke-on-Trent. Central went into the matter at considerable length. The Colombo Plan is a remarkable achievement in international economic co-operation. This country and the Commonwealth provided the initiative, and many countries have contributed towards it.

I think that the original idea sprang from a speech made by Sir Percy Spender in 1950, but the late Ernest Bevin had a tremendous amount to do with the development of the project, which was initially a Commonwealth one but which now has associated with it the United States, and also embraces—I believe that I am right in this—all the countries of the vitally important South-East Asia area.

The point made by the hon. Member for Stoke-on-Trent, South about an economic conference of Prime Ministers of countries in that area was an interesting one. The best evidence of our attitude to problems of economic development in that part of the world is displayed by the co-operation we give, in the Colombo Plan, to all countries which are already members of it.

Mr. Ellis Smith

The reason why 1 did not mention the Plan is that the hon. Members representing Stoke-on-Trent set an example of co-operation.

Mr. Maudling

I quite understand.

It is important not to under-estimate the contribution which this country and the other donor Powers, as they are called, are making through the Colombo Plan. What we have contributed to the development of the countries in that area has really been very considerable. There is, of course, the Colonial Development and Welfare Fund, to which several speakers, including the hon. Member for Ince, have referred. We have been glad to contribute towards expenditure on development in Colonial Dependencies in the Colombo Plan area. Very large sums have gladly and properly been spent by the United Kingdom upon development in those areas.

We have also been able to provide loan finance by one means or another. We provided a loan of 10 million for Pakistan when she was in serious difficulties. By capital subscription to the International Bank we offered to make available to countries in that area loan finance on a substantial scale.

The hon. Member for Stoke-on-Trent, Central referred to a steelworks project. An offer has also been made in respect of the Damodar Valley scheme in Bengal. These are substantial contributions, although initially we confined our offer of loan capital through the World Bank to Commonwealth countries, but at Delhi, in 1953, we said that we were prepared to do the same, under the same conditions, for other countries in the area.

Over and above these contributions, there are the substantial releases of sterling balances which provide a very large part of the development finance required in India, Pakistan, and Ceylon. The annual releases from the sterling balances of the three countries amount to about £42 million. I know that it is true to say that we are releasing their own money, but in considering what we are doing to help generally it is important to remember that the fact that the releases are being made and that the money is being used to purchase goods means that there is a strain of a substantial character upon this country's economy.

Thus, we have been making a big contribution through the Colombo Plan. The United States has also done a tremendous amount to assist development in that part of the world. Hon. Members who have travelled in that part of the world will have seen evidence of the work that the United States has done. The United States has done immensely important work by the provision of technical assistance, wheat, and other commodities and also by large sums by way of aid, particularly to India and Pakistan.

One must not forget the great contribution that Canada has provided. The Canadian Government have supported development in India, Pakistan, and Ceylon in a very generous way. The contributions by Australia and New Zealand to the Colombo Plan, although smaller, have, in relation to their national income, been very generous indeed. I went to a meeting of the Colombo Plan, and I thought it was a remarkable example of really practical international co-operation of which we can all be proud, and which we should like to see proceed further.

Finally, on the question of Commonwealth co-operation, we get very valuable evidence of how the Commonwealth countries can co-operate with benefit to all in international conferences, certainly in such meetings as those at Geneva on G.A.T.T., which some of us manage to follow, although others find them rather complicated to follow. The co-operation of the Commonwealth countries has been extraordinarily good.

I turn now outside the Commonwealth, to the United Nations and other world organisations. Here again, a great deal has been done since the war that we should never have thought possible in pre-war years. I agree that in some ways the development of the United Nations has, on economic side, been disappointing. We all know that much of that is due to the very conflicting political, and perhaps social, views which are held by different members of the organisation. However, we should not underestimate—hon. Members opposite have rightly stressed this—the value of the work done by a number of the Specialised Agencies, and the Technical Assistance Programme.

The hon. and learned Member for West Ham, South (Mr. Elwyn Jones) referred to O.E.E.C. I have said a fair amount about that, and all I will say now is that if one wants a really good example of international co-operation one should study what was done when we had to cut down fairly stiffly our imports from Europe in the winter of 1951–52. The other countries of Europe allowed us to rebuild our position without our suffering any retaliation from them. That was of very great benefit to this country and to European trade generally. I am sure that hon. Members opposite who had some part to play in the development of O.E.E.C. must have felt considerable satisfaction when that happened.

There are also the International Bank and the International Monetary Fund. The International Bank has done a tremendous amount in the way of development, particularly of transport, power, and communications, all over the world, and particularly in South America, the sterling area, the Near East, Europe, and the Middle East. I consider that the International Bank, under Mr. Black's presidency, has been one of the most successful and enlightened international agencies that we have seen for a long time.

A project is now being considered for an International Finance Corporation. It will work under the World Bank and will be financed by subscriptions from Governments, I imagine roughly in the proportion in which the Bank itself has been financed. It will have wider lending powers than the Bank has, and is designed to assist in the provision of further finance for the development of under-developed countries. It is in no sense a substitute for present development plans; it is a new development for the financing of under-developed countries by better-developed countries on lines which hon. Members opposite approve.

We have heard a good deal about convertibility. I do not wish to remain any longer in contest with the hon. Member for Broxtowe about convertibility, but there are two things I wish to say. First, the Government believe that if we want political unity in the free world we must aim at economic unity. A world which is divided into mutually discriminating an! jarring economic groups is not the best foundation for really sound political unity.

Secondly, as I understand it, the Labour Government, just as much as the present Government are, were committed to the principle of removing barriers to the flow of trade and international payments through the medium of international organisations which this country has joined. I refer here to the Articles of the International Monetary Fund and to G.A.T.T. itself. All these international bodies which we joined, and of which we are still members, commit us to the principle of progressing towards the removal of barriers to the flow of trade and the exchange and payment of money between the different countries of the world.

I turn now to the other positive proposal in the Motion, the one which I am afraid I find it difficult, and, indeed, impossible, to accept: the creation of a national planning commission. Paragraph (a) also refers to consultation with those engaged in industry, representative organisations and others directly concerned. … This country is very fortunate in already having close contact and consultation between the Government in power and representatives of organised industry and organised employees.

The Planning Board, which contains very distinguished gentlemen with experience of both labour problems and industrial problems, regularly meets and regularly gives the Government most valuable advice on very important economic issues. There is also the National Production Advisory Councils for industry which, all would agree, I am sure, help to maintain contact between the Government and those actively engaged in industry.

However, I do not believe that the creation of a national planning commission would assist the objectives which hon. Members opposite have in mind. When one begins to talk about planning it is very easy to get rather theological. We ought to try to exercise as much common sense as possible. After all, all Governments do some planning; government consists largely of planning. The hon. Lady the Member for Stoke-on-Trent, North said that industry itself does a good deal of planning. We also heard a good deal from the hon. Member for Stoke-on-Trent, South and the hon. Member for Ince about the great planning in the fuel and power industries.

We might also have some regard to the great plans which have been developed in the chemical and motor car industries. It is impossible to be for or against planning; that would be nonsensical. What one believes in is a certain form or a certain degree of planning. We can, of course, have the completely planned economy, with everything planned to the last detail under Government authority, which, I suppose, is roughly the Soviet system. That, I believe everyone agrees, is something to which the temper of this country and of our people is hostile.

What degree of planning short of that can we have? I think it was the late Sir Stafford Cripps who developed the phrase "democratic planning" to describe the type of planning which was undertaken in this country in the late 1940s. It is, I think, a rather more detailed planning of the activities and development of industry than we on this side of the House consider to be proper for the Government to try to undertake.

I think that the difference between us is this. While hon. Members on both sides of the House believe that the Government should plan for the objective of increased prosperity, what we on this side disagree about is the degree to which the Government should try to plan the individual details of industrial development. I should have thought that the experience of the late 1940s showed that the theory of "democratic planning" was, in practice, subject to great difficulties.

If we look at the economic surveys between 1947 and 1951, we see the gentle decline which took place in democratic planning. In 1947, there were detailed targets for what was going to happen in 1948: in 1948, there was an explanation of why they had not been reached; in 1949, there was no such explanation; and, by 1951, the detailed targets had practically disappeared altogether. That, I think, was really a very sensible recognition by the previous Government that too much detail in planning does not work.

Mr. Ellis Smith

We have not the time, and it would not be fair at the moment to get involved in this, but I know a certain amount of the inside story about that, and I have no hesitation in saying that there was a man in office at that time, Sir Edward Plowden, who was there to prevent us from applying Labour's real interpretation of planning.

Mr. Maudling

I think that it is always wrong to discuss individual civil servants who really cannot defend themselves. The responsibility rests with the Government of the day in the same way as the credit rests with them when they earn it, even if it is their servants who deserve it.

I would suggest three main reasons why detailed planning cannot work in a democratic society. First, we cannot plan the movements of labour. We can only do that if we have a wages policy or direction of labour. Neither of these things are acceptable to this country. Next, we cannot really plan consumption unless the Government determine prices, which I do not think is practicable, or unless we have rationing. If we cannot determine consumption, how can we determine production?

Here I would join issue with the hon. Member for Stoke-on-Trent, South about the control of investment. Surely, the purpose of investment is to meet the demand put forward by consumers. It is no use investing in things which people will not buy. It is on consumption that the pattern of investment depends.

Then there is the question of exports. I do not think that one can plan exports. It is only by having the most flexible system of exports ready to meet the changes and requirements of the overseas customers that we can hope to retain our export position in a competitive world. Nor can one control imports unless there is discrimination and rationing.

I do not believe that one can have an import programme unless one con- trols all imports into the country, and when the world tendency is away from discrimination and towards freedom, any attempt by us to go back to more controls would be disastrous. I am sure that the more controls there are over trade, the less the total volume of world trade will be. There is no country in the world which depends so much as we do on having a maximum volume of world trade.

I think that the hon. Member for Stoke-on-Trent, South was particularly interested in the level of investment, about which he quoted a number of figures. I want to mention some figures which I think will interest him because they show that our policy of inducement is not doing badly. It must not be forgotten that the last Budget introduced by the party opposite did, for reasons which I do not at this moment challenge, deliberately aim at reducing investment in 1952–53, by abolishing the initial allowance. Since then, we have progressively restored initial allowances and added the investment allowance, and we are now beginning to see the fruits of this policy.

For example, in 1954, the number of new factory buildings approved rose very markedly. I will give the figures, in square feet, of factory space. In 1953, there were 9.8 million square feet and in 1954 16.8 million square feet, a very remarkable increase. Machine tool investment, I suppose, tends to fall behind. In the third quarter of 1954, expenditure on machine tools was £13.2 million as compared with £1.5 million in the previous year, and we can see a definite revival in investment activity. Much of that depends on the policy of investment pursued and on giving freedom to consumers to spend and freedom to investors to meet the demands of those consumers in the way in which they think that their investments will most efficiently be used.

I would not argue that detailed planning of the type suggested by the hon. Member is wrong in principle, but in practice it is not practicable in this country, for the reasons I have suggested, and will not produce the results which the hon. Member had in mind, and which I think we share in common.

It is accepted by all Governments that it is the duty of the Government of the day to maintain a high and stable level of employment. It is also the obvious duty of the Government of the day to keep a close watch on the balance of payments and the international strength of our currency, and also the position of our reserves. Planning, in the broad sense of the word, is constantly needed by Governments to follow up those two objectives. If we are to maintain the strength of our currency and the position of our international reserves, and if we are to maintain a full level of employment without inflation, then constant planning and watchfulness are required.

That is what we have been trying to do since we came to office. When we took over, we were faced with a position in which reserves were seriously running down, and we had, first, to adopt a policy of restriction by cutting down imports and by tightening up on credit. That produced a change in the overseas balance of payments, and there was, of course, a slackening in the increase of production which had been tasking place since 1945.

Since 1952, we have been proceeding on a policy of cautious re-expansion, the object of which is to encourage the re-expansion of production as fast as possible without endangering our international position or permitting a return to inflation. I would say that, so far, our methods have not done too badly. We have reached a record level of production, we have full employment, and we are now seeing an encouraging recrudescence in the level of investment.

I would say that our policy is just the sort that is really needed to give the best planning for freedom, planning for opportunity for people to use their ideas, their capital and their energies as freely as possible within the general framework of the national need for full employment, for a stable and satisfactory balance of payments, and for getting an adequate surplus for overseas investment and debt redemption. I believe that if we tried to do that by a method of more detailed planning, we should restrict trade abroad and cramp development at home.

I very much welcome the spirit in which the Motion was moved, and I accept wholeheartedly a great part of it. I also believe that our objectives are one and the same, and that our only difference is that we on this side of the House believe in planning for the maximum amount of freedom whereas hon. Members opposite believe in planning for the maximum amount of detail.

2.0 p.m.

Mr. John Edwards (Brighouse and Spenborough)

I would begin by saying that I share in the appreciation which has already been expressed to my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ellis Smith) for introducing this subject to us today in words that conveyed, I think we all agree, the most serious sentiments. I would, too, like to say how much I appreciated the moving speech of my hon. Friend the Member for Stoke-on-Trent, Central (Dr. Stross), who illuminated his remarks by medical analogy and example which, I thought, most effective. I think my hon. Friends would agree that the Economic Secretary has replied to this debate in the same serious fashion, and with the courtesy which we always expect from him.

Planning is, of course, sometimes used as a term of abuse. The noble Lord, Viscount Chandos, who used to sit for Aldershot in this House, once made a speech in which he used it the whole time as though it were a term of abuse. We have today been using the word in many different senses, ranging from the planning of a particular industry or service, like mines and transport, to the planning of our own economic life in Britain, and even to trying to plan in the world, or in very large-scale terms.

Perhaps I may be permitted to look back to the 'thirties. I fought my first Parliamentary election in 1931, when I was very much influenced by the opinions of Mr. J. M. Keynes. The views that I then propounded were treated with complete contempt by my opponent and almost with indifference by some of my friends. The things said by people like me in 1931 are now so commonplace that the Economic Secretary would, I think, be startled if anybody were to get up and say anything against the kind of Budget planning with which we are now familiar.

The truth is that in a certain sense we are now all planners Our differences are about the extent to which we think the State should use its influence to effect or control economic events and developments, and the extent to which the Government of the day maintain the necessary legislation and the necessary machinery for making such plans as it has effective.

I was interested when I was in India recently—in Delhi, at Christmas—to find that those who had been to China with Mr. Nehru—and presumably he himself—had been tremendously impressed by the pace of Chinese economic development. But they had also been equally impressed by the price the Chinese were paying in loss of personal freedom. Mr. Nehru and all his planning people are doing their best, as I understand it, to step up the pace of their development, but without having to forgo the kind of freedoms which the Indian Government think essential.

Let us consider for a moment what planning means in terms of our economic life in Britain. It is commonplace to say that the standard of living of the people is determined by the number of people at work, the resources that they can command, and the capital resources which they have, including in the world capital their own personal skills.

When we look at our present position, it is clear that if we are to make progress we must expect to make it in this third element of capital, including personal skills and abilities. I therefore ask: are we satisfied when we take, first of all, the qualities of our people that everything is being done that should be done through education, through technical training and so on to improve the qualities of our people, both their mental qualities and their technical qualities?

It would seem to me that this is a field in which the State is quite entitled to intervene; that the Government of the day ought to have a view about what is happening in the universities, for example, on the admission of students to various faculties. I am not suggesting that we should say to a boy or girl, "You ought to do this" but rather that, in placing the resources at the disposal of the universities we should have in mind the effect of that on our economy.

When we take this same point more narrowly, in respect of our technical equipment, are we sure that we are doing enough in research and development? Again, I would suggest that this is a field proper for the Government. It is for the Government to encourage and help—not necessarily to do, but to see that it gets done. My guess is that most of the research associations could do with more money at the present time; that we would lag less behind America if we had more resources.

Let us take the more crucial point of the direction of investment. My hon. Friend, who introduced the Motion, gave interesting figures about what happened to capital investment over the years. Are the Government really keeping their hand on the direction of the capital programme? When I was last a member of a Government, I was concerned with what we then called the investment programme. I wonder what is now happening to that. Is any attempt being made to look, not at the details, but at the broad distribution of our capital resources over the years ahead? If not, I would say that the Government are not doing anything like enough planning.

I make that point because I want to assert that it is a necessary condition for British economic progress that the Government should formulate broad economic objectives, and maintain the necessary legislation and controls in order that those broad objectives may be fulfilled. My criticism of the Government would be that over the last few years, they have, in fact dismantled the machines and surrendered the powers which are necessary, even if their broad objectives are to be obtained.

Perhaps I might interpolate one word about the reference which my hon. Friend the Member for Stoke-on-Trent, South made to the former Chief Government Planner, Sir Edwin Plowden, to say this: I am sure that my right hon. Friend the Member for Leeds, South (Mr. Gaitskell), if he were here, would say, first, that those of us who, over the years, were at the Treasury must "take the can back" if there is any criticism, and, secondly, that in the person to whom my hon. Friend referred we could not have had a more loyal or helpful colleague.

Mr. Ellis Smith

Does my hon. Friend accept what was stated in the "Financial Times" of 22nd June, 1951: Several times in the last 18 months it has been rumoured that Sir Edwin Plowden was to retire from his post as Chief Government Planner. One each occasion Sir Edwin has been persuaded to stay, and a very good thing for Whitehall his presence there has been. Now, however, Sir Edwin really is laying down his official burdens; and he will be returning very shortly to private enterprise. It goes on to say: Sir Edwin Plowden is better entitled to claim that he is not a planner in the Socialist sense of the word. He could fairly be described as a useful fireman in the lunatic planning asylum set up by the Socialist Party. It fell to him to pour cold water on some of the more ridiculous plans hatched in the years of madness that followed 1945.

Mr. Edwards

I beg my hon. Friend not to make such a statement on such slender evidence and from such a source. In any event, I think that the real point at issue here is that His Majesty's Government, as it was at the time, must take any responsibility for what was done. I merely wanted to say that, at any rate, I am quite sure that those who were then concerned would not wish to confirm that statement.

Mr. Smith

I have ample documentary evidence to prove that it is not talk that matters. We have an opportunity to translate talk into concrete reality when we are given a position of responsibility. It was well known that controversy went on, and that Sir Edwin Plowden was the central figure in that controversy who prevented us from adopting Labour's programme of planning, as decided by the Labour Party Conference and the Trades Union Congress.

Mr. Edwards

I am content to leave it there, but I do not accept the view that has been put forward.

I was saying, before I diverted my attention to this personal matter, that we on this side would feel that the Government were to blame, because they had, over the last few years, surrendered powers which, in an emergency, they may need. The Economic Secretary rather prided himself, perhaps very properly, on the fact that the methods the Government were using had not done badly. I would say to the Government, and I think that my hon. Friends would agree, "Please do not be deceived by your good fortune; please do not assume that the happy conjunction of circumstances which you have had in the last year or so will necessarily always prevail."

I do not propose to go fully into all the circumstances, but it is clear to anybody who looks at the facts that there have been a number of fortuitous elements which have helped the Government. I daresay that the Economic Secretary would agree with me. Therefore, I ask him to pause a little and to consider whether, if those happy circumstances had not been there, the Government would have found themselves able easily to dismantle controls and to get by without maintaining the administrative machine that they found when they went into office. Although we will never ask for controls for their own sake, we on this side feel that the Government, in the circumstances of our age, must form broad economic objectives, or plans, and must see that they have both the powers and the machinery in order that those plans may be executed.

I turn to those parts of the debate on the subject of the underdeveloped areas. I agree with the Economic Secretary about the progress that there has been in the amount of co-operation that we get in the Commonwealth. I agree that one can add up what has been done for the underdeveloped areas and the total looks quite impressive, but I do not think that any of us, searching our consciences, could agree that everything is being done that ought to be done.

I will not go into the question of the new organisation, S.U.N.F.E.D. I should like to get beyond the money aspect. Several of my hon. Friends, including my hon. Friend the Member for Stoke-on-Trent, Central, talked about how much money we wanted. Of course, that is the only way in which we can find a common measure. We have to talk about financial resources, but we have to get behind these money terms to real terms if we are to appreciate what is needed.

During my recent visit to Asia I came across examples where the financial resources were there, but where they could not do what had to be done. The reason, in almost every case, was lack of the right people. Development almost always means the creation of new skills, the improvement of old ones and educational training. Development also means that we change established routines. We disturb established communities, and, therefore, we raise a host of new social and community problems which, again, call for the development of new social skills and outside help. We must appreciate that.

I spent a good deal of time, when I was in Siam, India and Pakistan, looking at the problems of development and talking to technical assistance and other people. I would say that the biggest single problem in the under-developed areas is how to get enough people trained for all the jobs that need to be done. I am not now talking just about the top level of administration; I am talking about the work at every level.

One of the things that pleased me in Calcutta was to find there some members of the union with which I am connected, the Post Office Engineering Union, helping the Indian telephone service under the Colombo Plan. They were paid for out of Colombo Plan money and they were helping to develop the system of automatic telephone exchanges. There will be difficulty later about training the people to maintain those automatic telephone exchanges. It may well be that we shall have to send out some other people to establish a small training school for that purpose.

Wherever I went I was conscious of this difficulty of not having the right personnel. This means that if we say that we should give more money, we should face the fact that at the same time we should lend more help. There was a time when many young men and women thought that it was their business to go to various underdeveloped areas in the Colonies, and so on. Some went as medical missionaries and others went as teachers. Today, there is as great a need for people in ordinary occupations to go out and to do a turn of duty overseas.

It does not matter how much money we raise. Unless from Britain we can send a steady stream of first-class young men and women to do these jobs, it will not avail. There is an element of personal sacrifice involved in this. If I could I would issue a call to young men and women, "Consider whether you cannot devote two or three years of your life to work in these areas, whatever your occupation." There is scarcely anything on which these areas do not want help.

I am sure that my hon. Friends would agree that, when we say that we want to see more work done, we are really asking that there should be more people willing to go to do it. When I was in one of these centres I was appalled. I had a long talk with a man who was doing tuberculosis control work. He said, "I make the diagnosis but, quite frankly, I can see no hope for this generation. We cannot get this dreadful scourge eradicated in this city until the environmental conditions have changed, and that means development plans of all kinds, for housing and a hundred and one other things."

One thing leads to another. If we are enabled to improve the health services then we are immediately confronted with further problems because we have improved them. In some parts of the world the mere fact of improvement in health—what is sometimes called death control—raises the most serious population problems. I know that I speak for my hon. Friends on this side of the House when I say that we would, in our individual ways and collectively, do anything we could to co-operate with anybody who would really try to get a move on in this work.

I wonder whether we are doing everything that we ought to do. A lot of this work overseas does not pay a return. One cannot declare a dividend on it. Is it, for example, a good thing, by and large, that the Colonial Development Corporation should now be running right away from doing the foundation work and the kind of jobs which will not yield a return? Perhaps I am misjudging the C.D.C. Those who control it now seem to be saying, "Let us find a project; let us go in fifty-fifty with some business interest, and it will be all right." Lots of essential projects cannot pay their way and, because of that, we must make our contribution. Do not let us "kid" ourselves. We cannot, at one and the same time, expect to be doing everything that we ought to do in the underdeveloped areas and have rapidly rising standards of living at home. For my part, I regard it as the right contribution to make to the peace of the world that we should say we will earmark a certain part of our resources for this work.

Perhaps I have spoken a little more heatedly on this matter than I should have done, but I am not being sentimental. This is the reaction of any one, who has recently been in contact with the problem at first hand. The sight of the refugees in Karachi or Calcutta is the kind of thing which, even if I cannot immediately do much about it, I should at least like to communicate some sense of urgency, not to the House, because I know the House appreciates it, but through the House to our own people.

We have been talking a good deal about world development largely in terms of the underdeveloped areas. There are, of course, very great problems for some areas of the world which are developed. I spent a fortnight in Japan, a country of about 88 million people, with an agriculture as well developed, I suppose, as it can be developed, and without very much prospect of expanding its food production. Last year, the population of Japan increased by a little over 1 million in spite of the fact that there were nearly 1½ million induced abortions.

Here is a country with enormous problems—problems which, I venture to say, cannot be settled apart from the development of the underdeveloped areas. The real hope for that kind of community is if we can develop areas like South-East Asia with some kind of complementary trade, with food flowing from the area and certain consumption goods and other things flowing from a country like Japan. I would, therefore, add to what has been said a reference to the extra needs of other parts of the world which, I believe, can help in development and can be helped by the development of the so-called underdeveloped areas.

I would conclude with a word on convertibility. I take the view that the ideal method of trading is what we call the method of multilateral trade. My maiden speech in the House was on this theme, and I hold to that view. There is no doubt that multilateral trade, properly conceived, means freely convertible currencies. Our difficulty is not on a point of principle, as I understand it, but rather that we feel absolutely certain that at this point in time we should be asking for the greatest economic trouble if we rushed prematurely into convertibility. It is no use saying, "This is the ideal." There are so many obstacles between us and the ideal of which we ought to take account that I urge the Government not to be precipitate in this matter unless they want the most dreadful repercussions in British industry and on British trade.

I have embroidered the Motion a little but I hope that, broadly, it commends itself to the House and that my hon. Friends will be given their Motion without anybody voting against it. I have had too much to do with these matters to underestimate the difficulties. Many of these things, I know, are not easy. But we have a duty to give all the practical help we can in this business of planning, and even when we cannot give help we may sometimes contribute ideas which are pregnant with hopeful possibilities and sometimes provide a good-neighbourly leadership which the world at present so desperately needs.

Notice taken that 40 Members were not present;

House counted, and 40 Members not being present, the House was adjourned at twenty-six minutes past Two o'clock till Monday next.