HC Deb 10 November 1955 vol 545 cc2019-99

Order for Second Reading read.

4.0 p.m.

The Minister of Agriculture, Fisheries and Food (Mr. D. Heathcoat Amory)

I beg to move, That the Bill be now read a Second time.

The purpose of this Bill, which I hope the House will feel is a sensible one, is to end State trading in sugar and to give importers and traders as big a measure of freedom as we can compatible with the responsibilities of the Government under the Commonwealth Sugar Agreement and the Agriculture Act, 1947. The proposed arrangements were outlined in the White Paper which the Government issued towards the end of July. The Bill looks at first sight to be a complicated one, but I hope that hon. and right hon. Members will find, when they look more closely at it, that it is fairly simple in its main provisions. I will, therefore, try to deal with the matter as shortly as I can.

Sugar, in the past, has often been a controversial subject. Mr. Disraeli, with his highly developed sense of political realities, once observed: Strange that a manufacture which charms infancy and soothes old age should so frequently occasion political disaster. He was then discussing the Sugar Duties, in 1846, which heralded the abolition of the sugar preferences which, since Cromwell's days, we had used to support our sugar Colonies, and the eventual abolition of which heralded disaster for them. I doubt whether sugar is quite so controversial today. Anyhow, I am sure that it no longer divides the House on party lines and I believe that there is no difference between the opinion of the Government and the Opposition on the importance of supporting the sugar beet industry at home or of supporting the sugar cane industries in the Commonwealth.

The sugar beet industry has been supported by all Governments during the past thirty years, and the Commonwealth Sugar Agreement was a joint enterprise begun by the Opposition and completed by the present Government. Of the Com monwealth Sugar Agreement, the Special Correspondent of The Times wrote: Undoubtedly the most successful experiment in colonial development that Great Britain has ever made. Its psychological effects on the West Indies, both on the management and on the workpeople, have, he said, been "incalculable."

So it is a real satisfaction that all parties can claim to have contributed to the developments of the past thirty or forty years which have so revolutionised affairs that, whereas in the first decade of this century over 90 per cent. of the sugar we consumed in this country came from foreign sources, today more than 90 per cent. of the sugar we consume comes either from our own farmers or from the Commonwealth. I therefore hope that there will be sufficient support from all sides of the House for the present Bill, which enables the Government to fulfil their obligations to producers in this country under the Agriculture Act and to Commonwealth exporters under the Commonwealth Sugar Agreement of 1951.

From what I have said the House will have gathered that we have no intention, in this Bill, to undo any of the work of the past. The purpose is to provide a legislative framework within which our home-grown sugar industry and the Commonwealth Sugar Agreement, on which we rely for almost the entire sugar we consume here, should be integrated with normal commerce in the United Kingdom.

The objectives are, first, to end State trading and to facilitate the opening of the London Terminal Sugar Market and the recovery by London of its old preeminence as a centre of the international trade in sugar. That objective is an important one. Secondly, it is to bring up to date certain legislation dealing with the sugar industry at home. The Bill seeks to do these two things in such a way that the Government will continue to remain solely and directly responsible for fulfilling our obligations under the Commonwealth Sugar Agreement and to farmers under the Agriculture Act. I would like to emphasise strongly that this Bill makes no change in our obligations as a Government in both those directions.

Today, in the United Kingdom, we consume about 2½ million tons of raw sugar a year, of which 1,568,000 tons comes in under the Commonwealth Sugar Agreement at a price which is negotiated each year with the producers. Between 600,000 and 700,000 tons, depending upon the yields of the crop, comes through the British Sugar Corporation from our own sugar beet production for which, as the House knows, growers are paid the price guaranteed at the time of the Annual Review.

Any balance of our requirements comes, in practice, from Commonwealth supplies outside the negotiated quantity or from foreign sources in the open market. At present, the Commonwealth negotiated price, and the cost of producing sugar at home from our own sugar beet, are both substantially higher than the so-called world price. I say "so-called" because the world price, though it is the vehicle of a considerable part of the international trade in sugar, is not the price at which the greater part of world sugar producers are remunerated. Indeed, the world price applies to rather less than one-third of the sugar entering international trade, or one-tenth of the world's sugar production. For instance, Cuba, the largest exporter of all, exports to the United States a larger quantity than the whole of the quantity provided for under the Commonwealth Sugar Agreement at prices which are in excess of the Commonwealth negotiated price.

I want to say a word about what I will call the averaging of prices.

Mr. Arthur Holt (Bolton, West)

Before the right hon. Gentleman leaves that point, would he tell us what are the differences between the Commonwealth price, the Cuban price, and the world price?

Mr. Amory

I would prefer to ask my hon. Friend the Parliamentary Secretary to give those figures at the end of the debate, but the difference is substantial. If the hon. Gentleman would like me to give them from memory, the difference is about £10 a ton between the world market price and the present Commonwealth negotiated price, excluding Empire preference. If, however, that figure is badly out, I will ask my hon. Friend to correct it at the end of the debate.

As the House knows, my own Department still imports all sugar for internal consumption and all this imported sugar, irrespective of its origin and price, is resold to the trade at a common price sufficient to cover the average cost to the Ministry. The result is that the internal price of sugar in the United Kingdom is at present above the world price. This average cost price determines also the price which the British Sugar Corporation gets for the sugar it sells.

Now I want to say something about foreign manufacturers exporting into this country goods containing sugar. If foreign manufacturers had access to sugar at world price they would have an advantage over our manufacturers in this country but for the fact that we have at present certain import licensing restrictions. Similarly, if the British exporter of goods containing sugar is not to be at a disadvantage with his competitors in other countries, he must be allowed to purchase sugar at world price like his competitors. The point I want to make is that the arrangements that we have at present for meeting these two difficulties are extremely complicated indeed. One advantage of the Bill is that we shall be able to simplify them considerably.

Under the arrangements provided in the Bill, averaging of prices will still be necessary. If the over-riding difficulties which I have mentioned in the way of freeing trade in sugar and manufactured sugar goods are to be removed, we have to find a new device to average the cost of imported and home-produced sugar, as the Ministry does today, and, at the same time, enable all the internal and external trade in sugar to be conducted on the basis of the world price; that is to say, the price at which ordinary international trade is conducted. We have, therefore, to marry the concept of guaranteed prices and markets to our own producers and Commonwealth exporters with the concept of freedom to traders to buy and sell at competitive prices while ensuring that an average internal price continues.

We propose that the agent for making those arrangements shall be a small Sugar Board composed of a chairman and not more than four members. We propose that the Board shall have the statutory obligation, first, of buying Commonwealth sugar which the United Kingdom has contracted to take at a negotiated price under the Commonwealth Sugar Agreement. Secondly, it will have the duty of ensuring that the British Sugar Corporation will be able to pay a guaranteed price to producers of sugar from sugar beet in this country.

The Bill provides that the Board should normally sell the sugar which it buys from the Commonwealth exporters in the country of origin before shipment at current world prices. In this way the sugar trade will resume its responsibility for the physical handling of sugar and also for making arrangements for freight, insurance and the like. The Board will not have any responsibility for trading in, taking delivery of, or buying any other Commonwealth sugar outside the Commonwealth Sugar Agreement unless it is specifically directed by the Minister to do so.

Commonwealth sugar enjoys a tariff protection in the United Kingdom and Canada, and after Commonwealth producers have met the important requirements of the Canadian refiners, they will, I think, have no difficulty in selling the balance of their production here when freedom returns. I have discussed this important aspect with the refiners, and they assure me that, as before the war, they will make it their practice to prefer Commonwealth sugar for the home trade requirements provided that it is offered competitively. In the past, refiners have adhered to this practice scrupulously, and I have no doubt of either their intention or their ability to do so in the future.

The effect of these arrangements will be that importers in this country will once again buy the supplies they need competitively at current commercial value, and Commonwealth sugar will once again play a full part in the operations of the London Sugar Market.

We have still to consider how to bring about the averaging of prices. If the world price of sugar is below the Commonwealth Agreement negotiated price, then the Sugar Board will make a deficit. If the world price is higher than the Commonwealth negotiated price, then it will have a surplus. At present, as I have mentioned, the world price is lower, and I think that is the pattern that we can normally expect to prevail.

Assuming for the moment that the Board makes a deficit, our proposal is that the Board shall recover the deficit from the proceeds of a surcharge—it is really a levy—levied on all sugar and molasses on which sugar duty has been paid, including the sugar content of manufactured goods coming into this country. It will also be paid on the sugar emanating from the British Sugar Corporation. If, on the other hand, the world price is above the Commonwealth Sugar Agreement price, then the procedure will work exactly the other way round, and the surplus earned by the Board will be redistributed.

This averaging arrangement—that is what is really is—will not mean any higher charge for sugar. In effect, it is just carrying out in a different way the present price averaging system operated by my Department. If it were possible, for instance, to imagine introducing this charge tomorrow, the internal price of sugar would not be affected at all. I should like to repeat—because this is important—that this is only another way of doing the averaging and it will not mean any addition to the cost of internal sugar.

For the traders concerned, I think, and hope, that the method that we have chosen will be simple. The surcharge will be collected by the Commissioners of Customs and Excise as agents for the Sugar Board. It will be collected at the time when the Customs or Excise Duty is itself collected. Therefore, the traders will be paying their surcharge at the same time when the Customs or Excise Duty is enable the existing Customs and Excise law and machinery to be employed, so ensuring economical collection and, I think, from the point of view of the traders, the continuation of procedures to which they are well accustomed.

I now want to say a word about what I might call the reserve powers of the Board. I have described what the normal function of the Board will be, but, apart from the Board's primary responsibility for the purchase of Commonwealth sugar which the Government have contracted to take, we propose to give the Board certain other powers. We propose to give it power to buy other sugar and also to transport and store sugar, if necessary, but to do those things only at the direction of a Minister. Since the Board will, in the ordinary course of events, sell the sugar in the country of origin, we believe that it will rarely, if ever, be necessary for the Board itself to transport and store it.

We cannot be absolutely certain that in every case and in all circumstances the Board will be able to do that, so we thought we must provide that sugar could be transported and stored by the Board, if it became necessary to do so in the view of the Minister whose responsibility it is to give directions. We need reserve powers to buy sugar, apart from the Commonwealth-negotiated sugar, for other reasons. It might just be desirable that the Minister should be able to instruct the Board in certain circumstances to buy other Commonwealth sugar apart from the sugar which he has a statutory duty to buy at present.

We feel that this has not been made quite clear in the Bill as drafted. We think it is highly unlikely that the Minister would require to give such directions to buy such Commonwealth sugar, because, for the reasons I have given, the present tariff preferences, backed by the undertakings given by the refiners to give preference to Commonwealth sugar, should assure to Commonwealth exporters the market that they require in this country. We all know what a key position sugar occupies in the economy of some of the Colonies. However confident we may be that our arrangements will be sufficient and all right, it is proper that we should provide for circumstances which we cannot fully envisage, and so we make provision for this residual power.

In the Bill, the powers we give to buy sugar extend to sugar from any source and can be applied by general directions of the Minister as well as by a specific direction. That is a wider power than is necessary, so we propose to introduce an Amendment in the Committee to limit this power to buying Commonwealth sugar and to require the Minister to give a separate direction for each transaction, cargo by cargo; and also to consult the principal importers of sugar before giving any direction of this kind. That should put beyond any doubt whatever the position which the Board is intended to occupy in the sugar trade.

Mr. Frederick Willey (Sunderland, North)

I thank the right hon. Gentleman for giving way. He is now dealing with the intention of the Government to change the Bill. Are these changes being made after representations by the sugar trade?

Mr. Amory

We have had representations of one kind or another on almost all aspects of the Bill. We have thought over the whole position, in the light of representations we have had from time to time, and we have concluded that this power in the Bill is unnecessarily wide and that we ought not to make it any wider than is actually necessary.

Now I would like to turn to the British Sugar Corporation. Clauses 7 to 16 are necessarily rather complicated, and deal with the law relating to the duty which it is proposed should be applied also to the payment of surcharge. It is unnecessary for me at this stage to go far on to that ground, but I look forward to hearing in the Committee a lucid exposition from my right hon. Friend the Financial Secretary to the Treasury on this subject. I will therefore turn to the part of the Bill which deals with the British Sugar Corporation.

We do not propose to interfere in any way with the existing structure of the Sugar Corporation. After eighteen years, it has shown itself to be an extremely efficient organisation and, under the leadership of the present chairman, on the appointment of whom I would like to congratulate the right hon. Member for Dundee, West (Mr. Strachey), its standards, already high, continue steadily to rise. It is a public company with private shareholders and articles of association, and with the chairman and two directors nominated by the Government. Its policies are regulated by the Government.

That may not seem a very logical affair, but it works, and works very well. By this practical test I cannot see any grounds for interfering with this well-established and efficient enterprise, or for jeopardising the good will which it has succeeded in establishing, both with the farming community, and with its own employees; but the Bill must bring up to date the legislative framework within which the Corporation operates.

Therefore, we define the Corporation's responsibilities to contract for the sugar beet coming from the acreage of sugar beet authorised by the Government at the Annual Review, on the terms defined at that review. We are also making provision to enable Ministers to continue certain incentive payments—they may not necessarily be the same as at present, but the principle will be the same—the purpose of which is to promote and encourage economy and efficiency in the undertaking. It is made clear in the Bill that payments of this kind will be related to the achievement of steadily rising standards of efficiency and economy.

I have used the word "Ministers" since, in such matters as price, acreage, research, education, the appointment of Government directors and the efficiency of the British Sugar Corporation, I share responsibility with the Secretary of State for Scotland. Briefly, responsibility for the purchase and treatment of beet sugar by the Corporation is shared by us jointly, while responsibility for its disposal and for the financial aspects lie with me.

I would say a word about market-sharing arrangements. Provision is made to continue the present market-sharing arrangements, which are necessary if the Government are to carry out the obligations to sugar beet producers, and if the Corporation is to be assured of a market for its refined sugar. These arrangements have been in force for a considerable time and seem to have worked well. The Bill empowers the Minister to modify the arrangements that have been come to if—I quote from the Bill at any time, after consulting the parties to the agreement, he considers it necessary to do so in the interests of users and consumers of sugar in the United Kingdom. Market-sharing arrangements, however carefully devised, may, in time, operate against the public interest. It is essential that consumers should be able to come to the Minister if they feel that the consumers' interest is jeopardised, knowing that he has powers to put the matter right.

Let me say something about prices. When the statutory price control of sugar ended with derationing, the Minister of Food and the refiners entered into an agreement by which the latter bound themselves to regulate their margins according to a formula based on up-to-date investigations. The refiners have now offered to give my right hon. Friend the Chancellor of the Exchequer an undertaking that they will continue to regulate their margins under free market conditions. The formula that they have suggested has been very carefully scrutinised and examined by the Treasury, who say that it is likely to throw up results which are virtually identical with the existing agreement. I understand that the Chancellor of the Exchequer, with the agreement of the refiners, is willing, in due course, to place a copy of this agreement in the Library should the House wish it.

For my part, I am grateful to the refiners for their helpful initiative in this matter, because I think that the solutions proposed for regulating prices under free market conditions will overcome what is technically a difficult problem. I am satisfied that this arrangement will safeguard fully the interest both of consumers and of other users of sugar in this country.

Mr. Sidney Dye (Norfolk, South-West)

The right hon. Gentleman said that this would regulate prices under free market conditions. Does he really mean that?

Mr. Amory

I am sorry. I was perhaps going a little too quickly. I am grateful to the hon. Member for calling my attention to this. What it does is to regulate the margin to cover the refining costs. It is the refiners' margin.

Mr. Dye

But there is practically a monopoly, is there not?

Mr. Amory

My hon. Friend will be glad to go into that at a later stage. I will do so now if the hon. Gentleman wishes it. I do not think that it alters the position. This agreement regulates the margin that all the refiners take on the refining processes that they carry out. [HON. MEMBERS: "Where is private enterprise?"] If I get the meaning of that question aright, I reply that when we have found something that works we do not take too doctrinaire a view of it.

I should like to say, finally, as I said at the beginning of my speech, that the history of legislation on sugar in this House shows that it has been largely a history of agreed legislation to which each party has contributed in turn. The proposals which I am now submitting to the House are proposals which have been devised in that spirit, and in an attempt to devise sensible and permanent arrangements for the sugar industry on lines which are broadly acceptable to everyone.

Taken as a whole, these arrangements meet, I believe, the desire of the House for a framework within which the Government can implement their undertakings to the Commonwealth and to our own growers while getting rid of these special difficulties in the way of restoring to importers and manufacturers the freedom to trade competitively without irksome restrictions, thus assisting the reopening of the London Sugar Market and assisting London in recovering its preeminent position in the international sugar trade.

If, as I confidently hope, these proposals become law, they will, I am satisfied, fully protect the interests of users and consumers of sugar. It is certainly my desire that we should proceed with the task of the examination and, if possible, the further improvement of this Bill with the firm intention of producing a statute of which the whole House will approve.

4.35 p.m.

Mr. Frederick Willey (Sunderland, North)

The right hon. Gentleman the tripartite Minister of Agriculture, Fisheries and Food, through his variegated experience in the present Administration, has, I am sure, earned the respect of many Members of both sides of the House. That is why that I am sure I am speaking for them all when I say that we earnestly hoped to have seen him elevated to a position less onerous and less vulnerable.

We are all very sorry that the Chancellor of the Exchequer's understandable desire to bolt has upset the applecart of the Government's shuffle, but it places me in a difficulty, because I am not anxious to say anything to prejudice the right hon. Gentleman. The seat which he occupies at present is a very hot one. In the Cabinet game of musical chairs his is the chair which is often whipped from under him. His predecessor, the Minister of Food, with an almost audible sigh of relief, slipped into the Home Office just in time. His predecessor the Minister of Agriculture was not quite so lucky. The chair was whipped from under him and down he went with an awful bump, and we are all very sorry for him.

In fact, the history of the Tory Party is littered—

Mr. J. K. Vaughan-Morgan (Reigate)

Get on with the Bill.

Mr. Willey

That remark is, of course, understandable from the hon. Gentleman, who knows the contemptible way in which his party treats its Ministers of Agriculture. The Tory Party is littered with the corpses of Ministers of Agriculture. If we are hardy enough to look into their faces, we see that they are not only shadowed by doubt but lit by revelation. They have always been discarded and cut down in their prime just as they realised that Tory dogma of unrestrained, free profit by middlemen is incompatible with a sound agricultural policy. This has happened time after time. I do not want it to happen to the right hon Gentleman.

This incompatibility, this fundamental contradiction, is the background to the matter we are discussing today—sugar marketing. Let me say at once that the right hon. Gentleman's proposals could, of course, have been far worse. In so far as he makes substantial concessions to those of us who are Socialists, I welcome them. He knows that it is absolute nonsense to talk about free enterprise in sugar marketing. He knows that he and many of his hon. Friends talked a lot of mischievous nonsense during the General Election about rationing and controls. He and his hon. Friends need to be thick-skinned not to be embarrassed when the Government and the right hon. Gentleman come to the House and, under Clause 27, ask for full powers of price control, and, under other Clauses, ask for full powers of allocation, and import and export controls.

In so far as this is a confession of Tory failure, and in so far as this is open acknowledgment of Tory deceit of the electorate, we are magnanimous. We are not going to discourage the right hon. Gentleman from repenting. What disturbs me is that he appears in sackcloth and ashes, and yet uses all his ingenuity to devise what he regards as moderate scope for sin. It is as though a man, on economic grounds, discarded three of his four mistresses, and then appeared before us as a self-virtuous moralist.

Before the war, the sugar beet industry was a protected subsidised monopoly, and the Conservative Party in 1936, for all practical purposes, nationalised the industry. That is why we have not had any very great tribute paid to the industry today. It nationalised the industry except for one not unimportant aberration. This nationalised industry was obliged to retain private capital, and a very complex, comprehensive piece of machinery was established solely to guarantee profits in perpetuity to the shareholders.

Major H. Legge-Bourke (Isle of Ely)

If the hon. Gentleman said that this industry was nationalised in 1936, why did the Labour Party agree, in its programme of 1950, that it would nationalise it?

Mr. James Griffiths (Llanelly)

To complete the job.

Mr. Willey

All we propose to do, and I am sure that we have the sympathy of the hon. Gentleman, is to complete the job. As my right hon. Friend the Member for Don Valley (Mr. T. Williams) said during the debate in 1936, the Government created a refined mixture of subsidised, nationalised, monopolised, sugar and Treasury finance."—[OFFICIAL REPORT. 10th February, 1936; Vol. 308, c. 608.] This "refined mixture" provided a comfortable feather bed for a specially protected, special privileged group of shareholders—rentiers par excellence.

In particular, it safeguarded the position of Messrs. Tate and Lyle. When the State decided to protect and to support the sugar beet industry, Mr. Charles Lyle said that he intended—and I quote him: … to go into sugar beet also for my own purposes and to take my share of the plunder. He carried out his intention. In fact, today Messrs. Tate and Lyle have a very substantial shareholding in the British Sugar Corporation. However, since the Sugar Industry Act, 1942, this industry has been virtually under full public control. The farmer receives a guaranteed price, and the British Sugar Corporation has processed and produced the sugar as a national corporation. This has been especially so since Sir Alan Saunders has been the chairman. Of course, he is a Government appointee. He is put there by the Government to see that the public interest governs the action of the Corporation.

As this is a nationalised industry, I want to say a few words about its remarkable record of efficiency and success. I can understand the embarrassment of the Minister. I am sure that he is obliged to me for doing it. I can do what he finds it difficult to do.

Mr. Amory

I hope that I shall be able to join with the hon. Gentleman in his tribute. I do not know; I shall wait and see.

Mr. Willey

The Corporation has carried out its £9 million scheme for reconstruction and modernisation, substantially financed from reserves, a year before it was planned to complete it. The last annual report says that in spite of the difficulties of the 1954–55 campaign, the yield was one-third of a ton above average. Whatever efficiency tests one cares to apply—whether it is manpower, absenteeism, labour turnover, coal consumption or output—the Corporation acting as a national Corporation has a remarkable record.

I am very glad to add this, because it was not always so. In the field of research and experimentation, in many respects, we can claim to lead the world Meanwhile, the shareholders, who, as everyone knows, have had nothing at all to do with this—indeed, the complicated provisions of the Bill are partly designed to prevent them having anything to do with it—have slumbered contentedly, receiving a modest 5 per cent. in place of the 4 per cent. guaranteed by the Government.

Why cannot the Government recognise reality and acknowledge the achievements of the Corporation and transform it into a proper public utility, performing, as it does, a national service? The right hon. Gentleman mentioned the incentive provisions of Clause 19, but surely he recognises that the farce of the Treasury agreement of 1952, of sharing economies between the Treasury and the shareholders, should be ended. Why cannot we recognise the splendid record of the Corporation and provide that all the money should go back into the industry, that it should go back to those who are actually working in the industry who should have the benefit of the substantial improvements which they have carried out in the past few years?

There is another very important reason why the Corporation should be brought under full public ownership. The Minister mentioned sugar refining. Sugar refining is an absolute monopoly governed by the Sugar Refining Agreement of 1937. Not only are prices fixed, not only is the amount of sugar that the Corporation can refine determined, but the refiners and the Corporation carve up the country and each has its own distribution areas within which it has exclusive marketing rights. My right hon. Friend the Member for Llanelly (Mr. J. Griffiths) says something about Tory freedom. This, of course, is an absolute monopoly, but I concede at once that when the Agreement was modified in 1953 it became substantially better from the point of view of the Corporation.

I have no reason to doubt that the Corporation is now satisfied with the Agreement though, with all deference to "Mr. Cube," I should have thought that the Corporation ought to be allowed to produce specialities, like other refiners. But this is the point: the Corporation ought to be like Caesar's wife. When agreement is negotiated between the refiners and the Corporation, the refiners should not have a substantial shareholding within the Corporation. They themselves should not have a substantial shareholding in the Corporation with which they agree to divide the trade and the country. That is quite unjustifiable. It is done only to appease a few clamorous back-benchers and to ensure that a very limited number of people, a very limited interest, should continue to get a rake-off from a nationalised industry without contributing anything. It unfortunately arouses suspicion where there is probably no ground for it, but while they are there the shareholders are, as it were, a Trojan horse.

It would be far better to say that here we have the British sugar beet industry built up and reliant upon financial assisttance, State protected, and playing an important part in our national economy; its production necessarily determined by the national need; let us rid it of all these complicated provisions and bureaucracy and allow it to be what it ought to be—simply a public utility under private ownership.

What is obvious about home-produced sugar is equally obvious about imported sugar. I can readily understand what has happened. I have stigmatised the Minister, and I stigmatised his predecessor before he went to the Home Office. The House will remember the barges on the estuaries and rivers on the Continent which were chock-full of sugar and which, presumably, are still full. The House will remember the dumping of sugar abroad at the expense of the taxpayer, the novelty of slashing the food subsidies which aided the British housewife and subsidising the foreign housewife instead—even the Russian housewife. The House will remember the inexplicable conversion of assumed profits into substantial losses.

I remember the Joint Parliamentary Secretary, when we last discussed this matter, saying: I should, first, like to clear up the £l1 million deficit on sugar. That was for sugar sold abroad."—[OFFICIAL REPORT, 12th July, 1955; Vol. 543, c. 1835.] That is so staggering that I cannot believe it; but I am sure that the Prime Minister, reading the OFFICIAL REPORT, appreciating the meticulous accuracy of the hon. Member for Sunderland, North, if not that of the Joint Parliamentary Secretary, called for the right hon. Gentleman and said, "You have got to get out of the sugar business"; and so we have the Government announcing that they intend to bring to an end State trading in sugar.

They are not doing anything of the sort. They are transforming the form and limiting the field of State purchase. They are not doing what they set out to do, because they are bound to acknowledge the Commonwealth Sugar Agreement. Nevertheless, it is very disturbing for everyone in the Commonwealth that the Government should take this action and go so far—go to the very limits to which they can go—before they have made it quite clear that they intend to renew the Commonwealth Sugar Agreement.

Let us look at the position. We are to have a nationalised board, appointees of Whitehall with the approval of the Treasury. This is the machinery which the right hon. Gentleman is creating. He knows that basically and essentially there is little place at all for private enterprise in the sugar trade; that for whatever businessmen may be sent "combing"—to use the classical word of "Britain Strong and Free"—they cannot be allowed to go combing for sugar. Not only have we the Commonwealth Sugar Agreement, which obliges us to buy 1,600,000 tons at an agreed price each year at a fixed formula, but we have also the wider obligations of the Commonwealth Sugar Agreement. We have the International Sugar Agreement with its floor and ceiling prices, and rigid system of quotas varied by the International Sugar Council to maintain a stable price for sugar.

All this is very desirable and in accord with the Labour Party's policy to guarantee to the producer that security on which full production will depend. But in this sort of world there is little scope for "Operation combing." Why not recognise the realities? If we do recognise the realities, the simplest and most economical way of trading in sugar is the way in which we are now trading. The right hon. Gentleman has mentioned the trade. In fact the trade operates now. The sugar brokers obtain the sugar, they are the procurement agents, but their profits are controlled, and they do not like that.

All this was discussed by the Estimates Committee. The official spokesmen of the Ministry of Food made it clear that in their opinion the proposals which the right hon. Gentleman is now bringing to the House would be much more complicated than the present arrangements, and that is the fact. And may I say in parenthesis that this excuse about goods containing sugar is a flimsy excuse? These imports are practically negligible, and there is no difficulty in keeping them negligible either.

Let us examine what the hight hon. Gentleman proposes to do. As he has explained, the Sugar Board buys at a fixed price. The price is determined by the Commonwealth Agreement. As he has explained, it is prohibited from handling the sugar unless the right hon. Gentleman so directs. It has to sell forthwith, in the words of the Bill, at prices conforming as nearly as may be to those which, in the opinion of the Board, the sugar would command if sold, at the same place and (apart from price) on the same terms, by any other person in the normal course of trade"— whatever that means. That is what happens. As the right hon. Gentleman explained, it makes no difference to the internal market. As the White Paper says: The internal market for sugar in the United Kingdom forms a unified price system … and so it will remain if this Bill becomes an Act. That is why the right hon. Gentleman has had to seek price control powers under Clause 27. But, to avoid a subsidy, we have to have very complex and complicated administrative arrangements to make sure that we take back from the traders and refiners the difference of price between the price at which they sold the sugar, the world price determined under the Clause to which I have referred, and the Commonwealth price.

To make this even more complex, they have to recover the deficiency payment to the British Sugar Corporation. To make it even more complex still, a surcharge has to be paid on all sugar, whether it be from the Commonwealth, or foreign countries or home produced. So we shall have a battery of accountants and calculating machines to calculate the sums and—in spite of the cover that it is done by Customs and Excise—a hoard of officials to levy the surcharge. In addition to all this, we have to have the necessary import licensing control, because of the position obtaining under the Commonwealth Sugar Agreement and the International Sugar Agreement, and because of the problem of balance of payments. The Chancellor has learned his lesson about feedingstuffs. Marginal sugar supplies are dollar supplies, so that above the complicated administrative arrangements we have to have this additional import licensing control.

All this has been done because, being obliged to accept—and may I say very properly accept—the Commonwealth Sugar Agreement, the right hon. Gentleman then has to provide an opportunity for as unrestrained as possible private profit so as, according to the White Paper, to allow the trade to "carry out its normal functions." The one thing the trade cannot do is carry out its normal functions, not with the industry bound by these agreements. But under the false myth of competitive buying, the right hon. Gentleman has used all his initiative to contrive as wide a field as possible for private profit. The fact that he has given way to the merchants means that there will probably be increasing pressure; in fact, the right hon. Gentleman has already announced today that he has given way to such pressure.

This is bound to weaken confidence. It is bound—and this is a disturbing thing to affect confidence in the Commonwealth. It would be far better to retain the present Government responsibility and to make it clear—the right hon. Gentleman said nothing about it—that this country intends to renew the Commonwealth Sugar Agreement.

Mr. Amory

I should like to repeat what I did say. There is nothing in this Bill which affects in any way the fulfilment of obligations under the Commonwealth Sugar Agreement. We have had consultations with the producers representing the Commonwealth exporters, and we have made it perfectly clear to them that the position remains in the future as at present. The Government are responsible for fulfilling those obligations, and the Commonwealth exporters have said that they are entirely satisfied with the position.

Mr. Willey

I am obliged to the right hon. Gentleman. That is some solace. But he has not said, in view of the disturbance this Bill has caused, that it is the intention of Her Majesty's Government to renew the Commonwealth Sugar Agreement.

Mr. Holt

The Agreement is not due to be renewed until 1959. How does the hon. Member know that the housewives will be prepared to go on paying an excessive price for sugar?

Mr. Willey

The hon. Gentleman, in his solitary isolation, can speak for the Liberal benches. I am speaking for what I regard as the broad interests of this country and the Commonwealth.

I have a further very grave objection to this Bill. It is a matter about which I have repeatedly warned the House. It is the policy of the present Government, as it was in the nineteen-thirties, to provide aid to the farmer wherever he may be, at home and abroad, at the direct expense of the housewife. Under their food subsidy policy the Coalition Government and the Labour Government paid people equally by way of food subsidies, and raised the money differentially by taxation. The present Government deliberately set out to destroy that pattern, and unfortunately they are following the same course today.

Through the consumer price, the subsidy element in sugar is now to be borne by rich and poor alike across the grocer's counter. There are two elements of subsidy in sugar. The first is the protection of the British sugar beet industry. That is something which is done on national and strategic grounds. It ought to be raised by taxation. It is quite wrong to raise it by a poll tax on everybody who buys sugar. That, I remind the hon. Gentleman, was the view of the Select Committee on Estimates, who suggested that this element ought to be borne on the Votes of the Agricultural Departments. If on national grounds we decide to support agriculture, the sum used for that support should be clearly recognisable and known and it should come out of general taxation.

Equally important, in the Commonwealth Sugar Agreement there is an element for colonial welfare and improvement. Again, it is quite wrong that the rich and poor housewives should contribute the same amount over the grocer's counter towards colonial welfare and improvement. This is a subsidy element. It accounts substantially for the difference in price between the Commonwealth sugar and world sugar on the free market. This element ought not to be raised by a poll tax on rich and poor alike whereby those with larger families pay much more than those without families. It ought to come out of general taxation. This is another example of the retrogressive fiscal policy of the Government.

For those reasons, we are very properly disturbed at many of the things that the right hon. Gentleman is doing within the terms of the Bill. We recognise, of course, that some of the things he is doing, whilst objectionable to those who sit behind him, are not unwelcome. We do not mind him discarding ancient Tory shibboleths. We do not mind him acknowledging the achievements of the British Sugar Corporation. We support his acknowledgment of the obligations of the present Commonwealth Agreement. Nevertheless, we regret that, in so doing, the right hon. Gentleman should in the first place use his ingenuity to preserve the element of private capital in what is essentially a nationalised industry. We regret very much that he should disturb greatly the confidence of the Commonwealth Sugar producing countries in the Government by setting up this machinery, ingeniously devised, to allow as great scope as possible for private profit.

Mr. Amory

It would be unfortunate if I allowed the statement to go out that there was any interference by the Bill, because there is not. It is not interfering in the smallest way with the fulfilment of the Government's obligation under the Commonwealth Sugar Agreement.

Mr. J. Griffiths

The right hon. Gentleman said that the Bill does not interfere in any way with the fulfilment of the existing Agreement. Is he equally sure that it will not in any way interfere with, or influence, the renewal of the Agreement when it comes to an end?

Mr. Amory

The two things are entirely distinct. The Bill provides purely an alternative method of fulfilling the obligations under the Sugar Agreement, otherwise it has no reference at all to the terms of that agreement.

Mr. Willey

We have conceded for the purposes of this argument that the Government are accepting the obligations of the Commonwealth Sugar Agreement—that is not being brought into question. What we are saying—we are surely entitled to say it in view of the steps being taken under the Bill—is that this is disturbing confidence in the Government's intention to renew that Agreement.

Mr. Amory

I wish the hon. Member could develop that point. I cannot see even the smallest grounds for that view, nor do I believe that Commonwealth exporters see the smallest grounds for it.

Mr. Willey

It would have been quite easy to continue the present arrangements and to have accepted the direct Government responsibility for the importation of sugar. That would have been the best way of continuing to safeguard the Comomnwealth Sugar Agreement. That has not been done.

Mr. Amory

That is an expression of the hon. Gentleman's view. So far, he has produced no ground whatever for saying that the Bill should in any way shake the confidence of the Commonwealth exporter.

Mr. Willey

Then I will proceed to the grounds. What the right hon. Gentleman is doing, by complicated administrative arrangements, is to allow the merchants the fullest possible opportunity to make profit whilst accepting the Commonwealth Agreement. That is disturbing if one's primary object is, by the formula devised, to maintain the stability of the price of sugar. There is no other conclusion. That is why I say the right hon. Gentleman's action is disturbing.

In short, what the Minister has done is to appease a very limited number of vested interests. He has created the impression that he is not very enthusiastic about the fundamental principle behind the developments which have taken place in sugar marketing, which is the devising of machinery to maintain a stable price. The right hon. Gentleman has taken another opportunity unfairly to penalise the housewife.

The sugar price contains these two elements: it contains protection and support for our domestic sugar beet industry, which is done on national and strategic grounds, and it contains an element of support for Colonial welfare and improvement.

The Under-Secretary of State for Commonwealth Relations (Mr. Douglas Dodds-Parker)indicated dissent.

Mr. Willey

It is no good the hon. Gentleman nodding his head. He ought to know that that is an element. It is quite wrong that the burden of protection for an industry on national grounds and the burden of colonial improvement should be passed on to the housewife as an indirect tax.

Mr. Amory

That, again, is not something that arises under the Bill. Under the present arrangements, the Government recover their costs through the average price for sugar in this country.

Mr. Wiley

How it arises is this. Up to the time of the right hon. Gentleman's predecessor sugar bore a subsidy. The right hon. Gentleman has abolished that subsidy. He now suffers a trading loss on selling sugar to consumers abroad, but he does not suffer any loss on his sales in the domestic market. What he is doing under the Bill is to make those provisions permanent so that the retail price of sugar bears both those elements. The Minister is entitled to his own views, but I regard that as unfair to the housewife. For these overriding reasons, whilst we accept a good deal of what the right hon. Gentleman—I do not think he claims any great virtue for it—has found unavoidable in the Bill, nevertheless we must oppose it.

5.10 p.m.

Major H. Legge-Bourke (Isle of Ely)

One of the duties of the Opposition in this House, I understand, is to oppose, and I should have said that the hon. Member for Sunderland, North (Mr. F. Willey) had that duty mainly in his mind today, because he was determined to oppose at all costs a Bill with which he has very little sympathy.

I should like to take up the hon. Gentleman on one of the remarks he made earlier in his speech. That was his reference to my right hon. Friend the Member for Richmond, Yorks (Sir T. Dugdale), the previous holder of the office of Minister of Agriculture. The hon. Gentleman referred to "his chair being whipped from under him," which seemed to me to be just about as cheap a remark as some of those made by the right hon. Member for Leeds, South (Mr. Gaitskell) to the Chancellor of the Exchequer in his speech on the Budget. It seems to me that if hon. and right hon. Gentlemen opposite have nothing better to say than that, they might just as well leave it out because it does not increase the respect for this place outside, and, heaven knows, it has sunk low from time to time. [Interruption.] If the right hon. Member for Easington (Mr. Shinwell) wishes to interrupt me, perhaps he will stand up.

Mr. E. Shinwell (Easington)

I am not asking the hon. Gentleman; I am telling him. Do not be so mealy-mouthed; it is not a tea party, with the dear vicar in the chair.

Major Legge-Bourke

No, but the right hon. Gentleman the Member for Easing-ton is certainly a master in this particular art, which I was condemning, and I certainly would not have expected him to make any other comment than the one he has just made.

If I may now come back to the speech of the hon. Member for Sunderland, North, in his remarks about my right hon. Friend the Member for Richmond, he referred to "his chair being whipped from under him," when the hon. Gentleman knows perfectly well that it was an extremely honourable course which my right hon. Friend took on that occasion. No question of having his chair pulled from under him arose, but simply the question of being let down and my right hon. Friend decided to take the responsibility. It was very cheap of the hon. Member to make that remark.

Mr. Shinwell

You forced him to resign.

Major Legge-Bourke

The hon. Gentleman also accused my right hon. Friend of not having given any credit to the British Sugar Corporation, but, in the course of his speech, he did give credit to it, and it is certainly not the wish of anybody on this side of the House to do anything other than express admiration for the way in which the Corporation has worked. I know that from my own constituency, which is very considerably interested in it, and I am sure that my hon. Friend the Parliamentary Secretary would say the same thing. We both have sugar beet factories in our constituencies, and the services which the Corporation has rendered to the area have been very considerable. Although now and again there may be disputes about how the sugar content is arrived at, I think that on the whole the Corporation has rendered valuable service.

Hon. Members opposite try to pull our legs about having introduced a semi-nationalised industry, but let them not forget that their own policy was to do nothing at all for agriculture unless and until they had first nationalised the land. [Interruption.] Yes, it is true, and the right hon. Member for Don Valley (Mr. T. Williams) would not support any sensible marketing organisation unless and until nationalisation of the land had taken place. The policy of hon. and right hon. Gentlemen opposite is all or nothing; they have to have complete nationalisation of the land or leave things free. To have something like the British Sugar Corporation, even in the form it is today, when perhaps it is neither one thing nor the other, absolutely appals them. They do not like the idea. They like to go the whole hog and put it in the straitjacket of nationalisation.

What would happen if they did? If my right hon. Friend adopted that policy, would the price of sugar go up with the same rapidity as the price of coal has gone up since the nationalisation of the coal industry? Has there been any greater contribution to the overheads of the British Sugar Corporation than the increased price of fuel from the nationalised industries? We had much better leave the Corporation in conditions in which it has been able to do a very good job. Do not let us upset the machinery of that industry simply for the sake of following some political theory.

It was perfectly obvious from the closing remarks of the hon. Member for Sunderland, North that what they really want to do is to try to make out that they object to any reduction in the consumer food subsidies, but let them not forget that it was a Labour Chancellor of the Exchequer who first started reducing the food subsidies and who put ceilings on the prices of consumer food subsidies. It is a fair point to make that we are ruthlessly opposed as to whether we believe in a free economy or a Socialist economy, but let not the hon. Gentleman try to be sanctimonious or self-righteous about consumer food subsidies and what the housewife has to pay, because the first brake that was put upon them was by means of a Socialist reduction in the amount of the subsidy. I am sure that my right hon. Friend the Chancellor was quite right to do what he did, although personally I feel that the hangover from the policy of the late Sir Stafford Cripps is rather too lasting for my liking.

I certainly welcome this Bill in so far as it means the end of State trading in sugar. I certainly believe that if we can eliminate the State trading losses, it will be all to the good and will help our own people. To come back to the point about consumer food subsidies, is it really worth while for the people to have high consumer subsidies while the State is losing a lot of money, the bill for which has to be met by high taxation? If we want to get back to realities, and I suppose everybody does, surely it is wise to try to eliminate State trading, especially when that State trading results in losses?

I do not want to deal at great length with the Commonwealth side of this matter, beyond saying that I accept the assurance of my right hon. Friend that this Bill does not interfere or upset in any way the Commonwealth Sugar Agreement, nor does it upset in any way the obligation of the Minister, as far as the home sugar industry is concerned but there are a few points arising out of Clause 17 and the later Clauses about which I should like to have some reassurance.

In particular, when we compare Clause 17 with the provisions contained in the Act of 1936, and particularly in Section (5) of that Act, we see that there is a very considerable difference in the new arrangements. I am prepared to accept from my right hon. Friend, if he can give it, an assurance that this change will not make the slightest difference to growers. I hope it will not, but I would emphasise that, as I read the Bill, there has been a change in the method by which my right hon. Friend decides, under Clause 17 (4), the measure of guarantee to growers. Whereas the 1936 Act talked about determining the acreage to be grown, this Bill refers to the quantity. Of course, the Bill goes on to provide—and I think that perhaps this may be the saving clause in subsection (6)—that the Ministers are bound to— exercise their powers under this section in the light of the conclusions of the reviewing Ministers from reviews held by them under section two of the Agriculture Act, 1947. That is a reference to the famous occasion each year, which is of such great interest to the hon. Member for Wednesbury (Mr. S. N. Evans)—the Price Review. I take it that it means that, although on the wording of subsection (4) the Minister may quite easily be able to vary the arrangements, as compared with the 1936 Act, in fact subsection (6) brings him back to the obligation not to get away from the guarantee. I am sure that it would have been of very great concern to me and other hon. Members if that assurance had not been given.

There is one other point which arises from this part of the Bill, and that is that under Section 15 (1) of the Sugar Industry (Reorganisation) Act, 1936, the Commissioners were entitled to make supplementary payments to the Corporation out of money provided by Parliament in the case where paucity of the crop, due to adverse farming conditions, led to a shortfall on the standard quantity. At that time the standard quantity was 560,000 tons a year. I am not quite sure whether Clause 19 of the present Bill is meant to replace Section 15 of the 1936 Act. It refers to agreements for incentive payments to the Corporation. That was not so much an incentive payment, as I understood it, but rather a sort of payment that the Minister himself agreed to make at the end of last year's harvest in cases where the crops were unharvestable. As long as the Minister has the right, through the existing review machinery under the Agriculture Act, 1947, to deal with this, there is no need to worry, but I shall be sorry to see a provision, such as was covered by Section 15 (1) of the old Act, being altogether removed from the present Bill, unless there is some other means of covering that sort of contingency.

The part of the Bill which the hon. Member for Sunderland, North seemed to like most was the more Socialistic part. That is the part which I dislike most, and what I dislike most is that today the Minister is in rather a different position from that which he occupied when the Sugar Industry (Reorganisation) Act, 1936, became law. Today we have the Annual Price Review and the guarantees of the Agriculture Act, 1947, so that every year the Minister is in the position of having to act as one of the negotiators of an agreement as to price and yet at the same time his representatives are negotiators of the price agreement with the National Farmers' Union at the Annual Price Review.

Mr. Amory

The Annual Price Review is not really an annual negotiation. It is a review of the prices. We consult with the industry, but the responsibility for fixing prices lies with the Government.

Major Legge-Bourke

I appreciate that, and perhaps my careless wording gave a wrong impression, but I think that the Minister would at least agree that in 1936 his predecessors were not in that position and there is a slight danger of the Minister having the right to make a final decision and at the same time being the arbiter of whether that decision is right. None of us likes that. It tends to give too much power and to centralise power too much, and I hope that some safeguards can there be introduced.

The abolition of the Commissioners under the old Act has not made it easier to eliminate that risk. For that reason, in some ways it is a pity that the Commissioners have gone. That has tended to give the Minister's Department a great deal more power than they already possess, and I am never in favour of giving Ministries more power. If legislation has to be introduced, I would sooner it divested Ministries of power rather than gave it to them. I think that my right hon. Friend agrees with that, but occasionally we have to make exceptions to the rule, and this is one of those cases.

I accept the reassurance that this will not upset the Commonwealth Agreement, nor make any difference to the ordinary grower of sugar beet. I hope that my right hon. Friend will put my mind at rest on the points which I have raised, and I wish the Bill well.

5.25 p.m.

Mr. Gordon Walker (Smethwick)

The hon. and gallant Member for the Isle of Ely (Major Legge-Bourke) made a rather stuffy beginning to his speech and gave a pompous and unnecessary rebuke to my hon. Friend the Member for Sunderland, North (Mr. F. Willey). I ask him whether he thinks that throwing pennies across the table is a dignified way of behaving in the House of Commons.

Major Legge-Bourke

No more than when the right hon. Gentleman the Member for Lewisham, South (Mr. H. Morrison), as Foreign Secretary, suggested that the Tory Party wanted war.

Mr. Gordon Walker

That is a most unjustified and monstrous assertion. Whatever my hon. Friend the Member for Sunderland, North may have said pales into insignificance beside such an outrageous statement; and of course when we were in office the hon. and gallant Gentleman used to say the most unpleasant, appalling, sharp and bitter things about us; but we did not mind, because they had no effect at all.

The hon. and gallant Gentleman made his main speech around the question of the abolition of State trading, and that is why he particularly welcomed the Bill. But that is only half of the question. The question is what is put in the place of State trading when it is abolished, and the hon. and gallant Gentleman began to tumble to the realisation that a great deal of bureaucracy, unnecessary control and complexity has been put into the Bill, because the Government have decided to put this particular substitute in place of State trading.

We are, of course, not discussing the Commonwealth Sugar Agreement today. The merits of that are quite distinct from the merits or demerits of the Bill. We all want the Commonwealth Sugar Agreement. I was recently in the British West Indies, and it is clear that the whole economy there depends on the maintenance of sugar production. The Commonwealth Sugar Agreement is in being and would continue in being if the Bill were defeated.

The Bill is therefore only one way of implementing the Commonwealth Sugar Agreement, and it is a very bad way. It involves unnecessary complexities, rigidities, unnecessary Government interference with that economy, unnecessary aid to private enterprise and, as I hope to prove, is against the true interests in the long run of the Commonwealth and developing Commonwealth production. I will try to substantiate those points. The defects in the Bill seemed inherent in its very purpose from the beginning. It would not be possible to take them out by amending the Bill. The Bill has inherent defects, because its whole purpose is to combine Commonwealth bulk purchase agreements with a free market and private profit, and those two things cannot be combined.

Bulk purchase agreements on any scale, like this, destroy the very conditions which are necessary to the proper functioning of private enterprise. Private enterprise presupposes a free, competitive market, and, as the Bill shows, if a Commonwealth bulk purchase agreement is made, that free competitive market disappears and there is no way of saving it. One can pretend to resuscitate it and resuscitate a substitute, but the free competitive market disappears.

The world market is quite artificial. The right hon. Gentleman referred to it as a "so-called world market." The Commonwealth Sugar Agreement, the International Sugar Agreement and American Sugar preferences mean an end of the world market. The world price is determined by marginal quantities of sugar coming on to the market often at dumping prices. The home market is equally artificial because the Sugar Board and the British Sugar Corporation have the entire monopoly for determining supplies coming on to the market, and this is apparent in the Bill.

There is an extraordinary Clause in the Bill, Clause 1 (5), which is the sole reference in the whole Bill to the idea of a free market. It gives a most extraordinary definition of market or market price. It says: The Sugar Board shall sell sugar … at prices conforming as nearly as may be to those which, in the opinion of the Board, the sugar would command if sold, at the same place and (apart from price) on the same terms, by any other person in the normal course of trade. In other words, the price is determined by someone who imagines what it would be if everything were different. It is a con- tradiction in terms. It says that there is no other way of reaching prices except by deciding what the price would be if everything else were different. If that is a free market, then I have never heard of such a chaotic and illogical description. But it is inherent in the whole of the Bill—the whole Bill starts with that idiotic concept.

The Joint Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Harmar Nicholls)

I only intervene to say that there are enough complexities in the Bill without the right hon. Gentleman introducing others. The Bill says that, having all the facts in front of it, the Board would use its judgment, just as would any business house.

Mr. Gordon Walker

I was always told that a free market was the impersonal play of the forces of supply and demand, but we are now told that it is something in which the biggest interest concerned judges things as if everything were different from what it is, and comes to a decision which is the free price. All the troubles in this Bill really come from this attempted, artificial respiration of a defunct market. It is this doctrinal idea that we must have a market even where the market is impossible which has led to all the complexities to which my hon. Friend has referred.

The right hon. Gentleman said that the new system was simpler. It may possibly be simpler than things are at present, but it is not as simple as it could be. If it were done simply and straightforwardly, we would get away from all these complexities, Government controls and the rest. A lot of the Bill is in contradiction to the most cherished beliefs of the Conservatives—or their pretended beliefs. The Bill is full of physical controls—absurd, detailed, unnecessary physical controls—Ministerial directions to allocate quantities, to fix surcharges and drawbacks, and actually to fix the price to the consumer. These are very extreme physical controls—the sort of thing Conservatives have always denounced.

The Measure is peppered with penalties. New offences are created right and left, quite unnecessarily. Clauses 16, 26, 27 and others are full of new penalties, for which there is no need but which have to be created because the Government are trying to effect this doctrinal salvation of the free market in impossible circumstances. The Bill is certainly based on the idea that the gentlemen of Whitehall know best. They have all sorts of reserve powers, direct and indirect powers. If Conservatives have read the Bill properly, it really amazes me that they have not risen in revolt against these physical controls.

However, from the point of view of the interests involved, they have a considerable quid pro quo. Their profits become uncontrolled, which is a very considerable gain. They continue to have their subsidy and a monopoly in the home market, because the Bill specifically carries on this monstrous and indefensible carving up of the home market. It is extraordinary that the Minister can so calmly say that that carving up of markets is to continue with the authority of the State.

It is in restraint of trade—and it is intended to be in restraint of trade. It is amazing that such things can be put into a Bill. For instance, Clause 25 (1) says: Any sugar refining agreement made after the passing of this Act, if it is approved by order of he Minister, shall have effect notwithstanding any rule of law relating to agreements in restraint of trade. The very purpose of this Measure is to enable these things to be done in restraint of trade. It says so in so many words. The Minister can actually impose these carve-up agreements even if the people do not come to them themselves; another physical control of an extraordinary kind—although I do not think the party opposite will object, because the purpose is to set up a private monopoly backed by the power of the State.

It is said that this has gone on ever since the Sugar Industry Act, 1936, but to say that something wrong has gone on for a long time is no argument against getting rid of it. Indeed, it is an argument for righting the wrong as quickly as possible.

Mr. Amory

The right hon. Gentleman's party, when in office, did not get rid of it. I wonder that they object now.

Mr. Gordon Walker

We had rather a lot of things to do in the field of public enterprise in our time, but I have no doubt that we should have got rid of this by now. If the right hon. Gentleman will read our Election programmes he will realise that. We had much to do then, and I would not put this in the same high priority as iron and steel and coal. It has a priority now, but if the Minister thinks that it is good that markets should be carved up for private enterprise, I hope that he will say so.

On this side, we say that in certain circumstances physical controls and the penalties which must go with them are necessary. Here they are not necessary. They come into the Bill only because of this attempt to preserve private profit and artificially to re-create the private market. The right hon. Gentleman tried to imply that this was the only way to carry out the Commonwealth Sugar Agreement, but of the many ways there are of doing that, this is one of the worst. It would be perfectly possible to sweep away all of these complexities, physical controls, carving up of markets and the rest if the Government would accept that if we have a bulk purchase agreement it involves public enterprise in the home market. That is what they will not accept. That is why we have this extremely long, detailed and dangerous Bill.

It would be simple to set up one or perhaps two sugar boards or corporations which could buy up all the sugar from the Commonwealth and at home, operate the refineries and sell at the price necessary to cover costs. We would not then have all the drawbacks, rebates, surcharges, distribution payments, distribution repayments and three long, almost unintelligible Clauses. None would be in the least necessary.

All this fills me with alarm from the point of view of the policy of encouraging Commonwealth production and distribution. If it had been done in a simple way, with a single, or possibly two, sugar board, the Commonwealth Sugar Agreement would have fitted in with the greatest of ease. The Government, in choosing this method, are making it extremely difficult to fit in any Commonwealth agreements. If all this elaborate, complex, detailed Bill is needed to fit in one simple Commonwealth Sugar Agreement, it must fill with despondency all who have Commonwealth production at heart. If the Government make such a fuss of fitting this one agreement into the system, it is no wonder that they have torn up all the others.

It must be remembered that this is the sole survivor from the slaughter of the innocents. The Government have been tearing up Commonwealth agreements all over the place. What is so disturbing is that something which could have been done easily is done in a most complex way, and that must throw doubt on the willingness and readiness of the Government to fit such agreements into our economy. The Bill will weaken our whole policy of the general encouragement of Commonwealth trade by longterm bulk agreements. The Government has put the doctrine of a free market before the policy of encouraging production in the Commonwealth.

5.40 p.m.

Mr. Arthur Holt (Bolton, West)

I have found two extraordinary inconsistencies in the debate. I am at a loss to understand how hon. Members can sit here and accept, on the one hand, the great desirability of Commonwealth Sugar Agreements and encouraging Commonwealth growers while accepting, on the other hand, the encouragement of the uneconomical growing of sugar beet in this country. Either we want to help the Commonwealth, and in particular the West Indies, or we do not. If we do, then I can appreciate the view of some hon. Members that the Commonwealth Sugar Agreement—which in any case was signed in December, 1951, and is to continue until 1959, so we can do nothing about it—is a good thing.

On the other hand, bearing in mind the difficulties which these international agreements constantly meet, I am surprised at the continued great confidence in them. I am just as concerned as any other hon. Member to support any system which will try to keep prices as stable as possible, for I am certainly no advocate of a system in which prices, particularly those of raw materials, rush up and down in a higgledy-piggledy way, causing a great deal of trouble and inconvenience. Nevertheless, we are seeing the kind of problems which occur when we have these agreements. For instance, we see them in the International Wheat Agreement, which is putting a very great strain on relationships between America and Canada. There is, too, the trouble which is arising from the special American arrangements for cotton. I do not know how that problem will be solved, but when it is solved it will cause a great deal of trouble to somebody. These international agreements were started with the best intentions but they have by no means proved that they are successful instruments for carrying out those intentions. It may be that they can be improved, but I have my doubts.

In opening the debate, the Minister described as something wonderful the change which has taken place in the United Kingdom's purchases of sugar. We now buy 90 per cent. of our sugar from the Commonwealth, which is a complete reversal of the situation 30 years ago. When he describes it as wonderful he entirely ignores the disadvantages to consumers in Great Britain, who are now paying £40 a ton and more instead of about £26 a ton which they would pay at world prices. We cannot brush this lightly aside in the name of the Commonwealth and say it is marvellous.

I will not go further on this point because there is another aspect of the Bill to which I want to draw attention. I entirely agree with one point made by the hon. Member for Sunderland, North (Mr. F. Willey)—if only one—who spoke for the official Opposition. That was his comment on the manner of dealing with deficits. I am opposed to these hole-in-the-corner methods of dealing with things which do not pay. For heaven's sake let us have them out in the open as a straight subsidy. If the Sugar Board and the Sugar Corporation are not to pay, let us have a straight subsidy which we can see in the Budget, so that we may know every year what it is costing us to carry out this policy of supporting the beet industry for agriculturists, on the one hand, or supporting the Commonwealth countries, particularly the West Indies, on the other hand. Let us know what it is costing us instead of trying to hide the whole thing through a surcharge so that nobody knows.

Mr. Amory

There will be no hiding. The accounts of the British Sugar Corporation and of the Sugar Board will be available, the latter being laid before the House, and will show quite clearly whether there has been a surplus or a deficit and how much.

Mr. Holt

I am very glad to hear that and I hope we shall study those accounts each year and decide whether it is worth the £30 million which it will probably cost us.

I have great respect for the Minister and I feel that this Bill is another indication that the Minister who is in charge of agriculture, fisheries and food, whoever he may be, is hopelessly overworked and has so much routine work to do that he can never sit back and examine carefully what his policy ought to be. I feel that if the Minister had had two or three months' holiday in the West Country—

Mr. J. Griffiths

The West Indies.

Mr. Holt

—by the end of that time—

Mr. Amory

I must tell the hon. Gentleman that up to that point I find myself in entire agreement with him.

Mr. Holt

I hope he will find himself in entire agreement with the remainder of what I say. I am sure he would have agreed with me if he had taken the holiday.

If, after such a holiday, he had been presented by the officers of his Department with this Bill and a brief upon it, he would have been shocked that anyone had had the nerve to present it to him. I entirely agree with the right hon. Member for Smethwick (Mr. Gordon Walker) that this Bill is a complete denial of the beliefs of those Tory Members who from time to time say they believe in a free economy. I know that some of them do not believe in it; the hon. and gallant Member for the Isle of Ely (Major Legge-Bourke) does not believe in it. Some of them, however, genuinely do believe in it and I can only conclude that they have not read the Bill.

Major Legge-Bourke

I certainly do not believe in the kind of free economy in which the hon. Member believes, which is throwing British agriculture to the wolves.

Mr. Holt

I cannot expect the hon. and gallant Member to agree with everything in which I believe. There are many Members of his party who go a great deal further than the tiny way he goes in the direction of a free economy and I cannot think that they have read the Bill. It is Socialism throughout, and I should have thought that hon. Members of the Labour Party would raise their voices with glee that a Conservative Government has introduced it. I cannot believe that it is a Bill of which any Conservative Minister should be proud.

Let us consider the sugar beet industry of this country. I am not an agriculturalist and do not pretend to know the wisdom or otherwise of growing sugar beet. All I know is that it is uneconomic compared with growing cane sugar. There is no dispute about that. As the Minister said earlier, sugar has always been in politics, even back to the 18th century, in the days when the Quakers first tried to grow sugar beet because they disagreed with the growing of sugar by slaves in the West Indies. It is still in politics, perhaps more now than ever, and the Bill will certainly have repercussions.

One of the problems of considerable social concern over the last 12 months has been the influx of immigrants from the West Indies, particularly from Jamaica. Will this Bill help that? Is there anything in the Bill which will encourage the buying of more sugar by this country from the West Indies? Nothing at all, as far as I can see. The quotas have been fixed under the Commonwealth Sugar Agreement of 1951 and, as I see it, there is no likelihood of their being increased. The production of sugar beet in this country has risen, as can be seen by anyone who looks at the White Paper, "Annual Review and Determination of Guarantees, 1955," Cmd. 9406. According to Appendix I, the acreage under sugar beet has gone up about 30 per cent.; the tonnage has gone up 70 per cent. I gather there has been some increased efficiency. Whether there has been increased cost, I do not know, but there has been increased efficiency on an acreage basis. Also, on the previous page of that White Paper, the statement is made that the Government wish to see the present sugar beet acreage maintained, and then they give us the price figure for the year.

I should have thought, quite apart from any question of a doctrine of economics, that if we really want to help the West Indies, if we are really concerned with the fact that so many West Indians are coming to this country, and with all the problems which go with that, in view of the fact that we require to grow more feedingstuffs in this country and that sugar beet are merely taking up land which presumably could be used for other things—

Mr. Dye

The hon. Member is completely wrong there.

Mr. Walter Elliot (Glasgow, Kelvin-grove)rose

Mr. Holt

Will the right hon. Member allow me to continue, because I have a very interesting document here called "Change is our Ally." Possibly the right hon. Member has not read it. It says: Nowadays many of the most efficient farmers find it quite unnecessary to introduce a root crop into the rotation, and there is good evidence that the cereal acreage can be kept up otherwise than by a high production of sugar beet.

Mr. Elliot

What the hon. Member has said, like "the flowers that bloom in the spring," has got "nothing to do with the case" at all. The hon. Member says that we do not get stock-feeding from sugar beet, but anyone who knows anything about the question knows that you take the top and bottom off the beet and feed it to stock and that it is one of the most valuable foods there is.

Mr. Holt

I am aware that that happens to sugar beet, but I am also aware that people want other kinds of feedingstuffs as well. We managed to feed our various animals and birds before we grew sugar beet, and we could do it again. About 12 months ago we had a Budget in which there was an increase in the duty on root chicory. The Economic Secretary to the Treasury, if I remember rightly, got it muddled up and suggested that it was a very good duty because he was growing the article at home. He had it wrong, because he was growing vegetable chicory and not root chicory. The argument for increasing the duty on root chicory at that time was to encourage its growth to deal with eel worm, which, apparently, comes as a result of growing too much sugar beet.

Major Legge-Bourkeindicated assent.

Mr. Holt

I am glad that I am right in one agricultural matter.

When the Minister said that there is no controversy in this matter, I thought I should send him a copy of a very interesting document written by a number of hon. Members called, "Change is our Ally," because it says: One aspect of the existing pattern of farming subsidies which seems to us to merit review is the continuing impetus it gives to the growing of sugar-beet. Apparently the party of the right hon. Gentleman is not united on this matter. I hope that later in the debate we may have some views from these people.

Mr. J. Griffiths

Who wrote the document?

Mr. Holt

Perhaps I might send a copy to the right hon. Member. It was edited by the hon. Member for Wolverhampton, South-West (Mr. Powell) and the hon. Member for Reigate (Mr. Vaughan-Morgan), who was in the Chamber earlier. The group call themselves, the "One Nation" group.

Mr. S. N. Evans (Wednesbury)

Is it buckshee?

Mr. Griffiths

No, it is subsidised.

Mr. Holt

We do not need to go further into that aspect of the matter.

I feel that the Government are completely abdicating their responsibility if they really believe that Commonwealth agreements are a good thing for encouraging the growth of Commonwealth trade and helping to maintain or even to reach a rising standard of living for many people in the West Indies, as it seems completely anomalous that at the same time they should go on encouraging the growth of sugar beet in this country when it is both uneconomic and an expense to the taxpayer.

5.56 p.m.

Mr. Ronald Russell (Wembley, South)

The hon. Member for Bolton, West (Mr. Holt) and the right hon. Member for Smethwick (Mr. Gordon Walker) both wondered why we on this side of the House could support a Bill which contains a large number of restrictions. I have a certain amount of sympathy with their querulousness on this point. I do not like those restrictions and I do not like Bills which can be called by anyone Socialist Bills. But there are times when we have to submit to restrictions of this kind rather than have complete chaos under full freedom. I prefer this method of dealing with the problem than that of State trading, which has been in existence for so long. This is a compromise and shows that we on this side of the House are not a wholly dogmatic party, rigid in our outlook, like the party opposite. That is the difference between us.

However, it is from the Commonwealth point of view of this matter that I want to deal with the Bill. The hon. Member for Bolton, West, if I may say so with respect, ought to read the Commonwealth Sugar Agreement and the International Sugar Agreement because he would then find he need not be alarmed about production or the fact that there is any rigid quota of Commonwealth sugar. I think he will find that the total quota for the exporting countries of the Commonwealth for next year is to be 75,000 tons higher than in 1954 and 1955. That has been permitted by the International Sugar Agreement, which fixes the total quota for the Commonwealth Sugar Agreement.

If I thought that this Bill would in any way diminish the production of Commonwealth sugar, or be a discouragement to the production of Commonwealth sugar, I would not be in favour of supporting it, but I do not think it will have that effect at all. This change from State trading to another method more akin to private enterprise was foreshadowed when the Commonwealth Agreement was signed in 1951, and the machinery for doing so is contained in the Sugar Agreement. I think I am right in saying that it was done in agreement with the exporting countries of the Commonwealth at that time.

I was with the right hon. Member for Smethwick in the West Indies in July. I am very keenly conscious of the need for stimulating all possible production of sugar, particularly in that part of the world where at least one Colony, Barbados, depends entirely on the production of sugar, and in most of the other British territories it is the chief agricultural crop. When visiting one of the largest sugar estates in Jamaica I learned that it would have to cut back sugar production by 25 per cent. next year compared with this year because it had exceeded its quota.

I regret any such cutting down in Commonwealth sugar production. But it is needed because if we did not have the Commonwealth Agreement plus the International Agreement we would have chaos and the cost of Commonwealth production would be undercut by Cuba, causing more distress and unemployment than there is there at the moment. I do not like this cutting down and realise that we have to do everything possible to increase production.

Mr. James Johnson (Rugby)

It might be better to buy less Cuban sugar for dollars and more Jamaica sugar inside the sterling bloc.

Mr. Russell

I should be glad if that could be done. I was sorry about one recommendation in the Bill, which my right hon. Friend touched on in his opening speech, namely, that the Board shall not buy Commonwealth sugar outside the Agreement unless directed by the Minister.

I am sorry to see that, because I do not see why the Board should not be allowed to buy Commonwealth sugar outside the Agreement if it thinks fit to do so. My right hon. Friend said that he would propose an Amendment during the Committee stage to restrict this direction to a separate recommendation for each cargo. I wonder why, because that would appear to make it all the more difficult for the Board to buy Commonwealth sugar outside the Agreement. I hope that this step is not being taken for any international reasons. I should like to see the Board free to do what it likes to help any part of the Commonwealth—especially the West Indies—to produce as much sugar as it possibly can.

I welcome the Bill, because it means that London will once again become the centre of international trade in sugar. I have no figures with me, but I am quite certain that before the war a very great deal of benefit in the way of foreign exchange was derived because the international market for sugar was in London. I am glad to see that this market will be restored, and that London will once again become the centre of the world's trade in sugar.

6.1 p.m.

Mr. Will Owen (Morpeth)

I listened with interest to the Minister's explanation of the Bill, and especially to his comment that he regards the Bill, as at present drafted, as being complex, and anticipates that further elucidation will be forthcoming when it reaches the Committee stage. There are certain features of the Bill which I regard as meriting the consideration of the House.

The endeavour by the Government to reconcile private trading with Socialist practice will not succeed. The Bill assures us that the general practice of the maintenance on the one hand of the Commonwealth Sugar Agreement and, on the other, of the agreement with the British beet sugar growers, will not be changed. If the basic features of past practice are to be accepted, what will this complex new sugar Bill achieve? It seems to me that its principal purpose is to ensure the fulfilment of a doctrinaire policy. The Government are bringing forward a complex Bill for no other purpose than to demonstrate their sheer prejudice against State trading.

The hon. Member for Wembley, South (Mr. Russell) thought that one effect of the Measure would be the reopening of the London futures sugar market, and the re-establishment of London in preference to New York as the centre of that field of international trade. The Bill reflects the Government's desire to promote private interests by legislation, and that probably serves some useful purpose in the commercial progress of Britain, but it seeks principally to curtail what has become an established practice at a time when I should have thought it desirable for the Government to review in its entirety the whole question of sugar production and distribution in the interests of the producer and the consumer.

The very nature of the proposal, as indicated by my hon. Friend the Member for Sunderland, North (Mr. Willey) is that the personnel who will benefit from the measure are the producers in the Commonwealth, the producer in Britain, and the British Sugar Corporation. The people who will not benefit are the consumers. For many months—ever since the Tory Party took office—the British housewife has been subject to constantly increasing burdens, and this new Measure is not likely to alleviate them. The Minister said that he wanted to assure the House that there would be no increase in the price of sugar to the consumer. Commenting upon the Bill, the Economist uttered the warning that there is no guarantee that the price of sugar to the consumer will not be increased. The Minister indicated that the Bill allows the Minister to protect the consumer. I hope he will tell us just what machinery for consumer protection exists in the Bill, because such protection is essential if the British taxpayer is to continue to meet additional liabilities.

There is considerable substance in the observation of my right hon. Friend the Member for Smethwick (Mr. Gordon Walker) that the Commonwealth is disturbed at the tendencies inherent in this piece of legislation, and that it would necessarily be anxious to secure some assurance that the Commonwealth Sugar Agreement, which has now been operating for some years, is a basic feature of Government policy in the interests of the Colonies concerned and the industry in which they are engaged.

I make a plea to the Minister to consider once again the proposal for the levy upon sugar being passed on to the consumer, as that, in itself, is increasing the consumer's liability.

Mr. Harmar Nicholls

It is rather important not to have a wrong impression upon this point. Nothing in the Bill or in the surcharge will increase the cost to the consumer, if there is any alteration in the price of sugar, it is an alteration which could take place whether we had the Bill or not. We should not get the idea that this surcharge will increase the price of sugar to the consumer.

Mr. Owen

That may be the idea of the Government, but it is not explicitly embodied in the Bill. Those who are now commenting upon the implications of the Bill—both inside and outside the trade—are expressing considerable fears that this is what will happen.

Mr. Nicholls

At present, the Ministry of Agriculture, Fisheries and Food does the buying and arranges the averaging which settles the price in the shops. Under the Bill the same averaging will be done, but it will be done by the Board, under the surcharge, instead of by the Ministry, and the effect to the consumer will be the same.

Mr. Owen

That assurance will be vindicated only in practice and in the administration of the Measure. Our experience in other matters means that the organisations concerned would be justified if they did not accept it.

I wanted to press the point, and I hope the Minister will recognise it, that there is considerable concern throughout the country at the prospect that this scheme will put an additional burden on the domestic budget and another liability which will fall—not equitably—upon rich and poor. What the Bill means, as my hon. Friend the Member for Sunderland, North said, is that the liability which will fall on the rich and poor is not equitable, is unjust, and is, therefore, a feature of the Measure that should have further consideration.

6.11 p.m.

Mr. Graham Page (Crosby)

I understand that the object of the Bill is to end the present system of State trading. It is not to end the Commonwealth Sugar Agreement, as many hon. Members on the other side have endeavoured to imply. I think that the main trading results of the scheme proposed in the Bill will be a revival of the international sugar trade in London, with the great benefits which that will bring to this country. I do not think it will have any domestic results. From the assurances we have received from the Minister and the Joint Parliamentary Secretary about how the new scheme and the surcharge will work, understand that the Bill and the scheme in it will not have any effect on the price of sugar to the housewife.

The right hon. Member for Smethwick (Mr. Gordon Walker) made rather heavy weather about the proposed scheme as it is set out in Clause 1 (5). I think that that subsection is probably the root of the scheme. This country has its obligations under the Commonwealth Sugar Agreement. The Government have to see, in bringing in this new scheme, that those obligations are observed. They are to be observed by the simple scheme of the Sugar Board's purchasing the 1,568,000 tons under the Agreement at the negotiated price and selling it in the country of origin at the commercial price. I cannot see in that any of the terrible complications which hon. Members opposite say they see. It seems to me a very simple, right and proper type of trading that the Sugar Board should purchase at the price at which the Government are under an obligation to purchase and then sell at the marketable or commercial price in the country of origin and that the refiners should arrange for the sugar to be brought from the country of origin to this country.

I would, however, agree with the hon. Member for Bolton, West (Mr. Holt) to a certain extent when he describes this as a Socialist Bill. I would not say that this is a Socialist Bill, but I would say that it has Socialist trimmings about which some of us on this side of the House are not too happy. One of those trimmings occurs in that subsection (5) to which I have referred, in the proviso by which the Minister retains to himself the right to swing from this scheme, which is being introduced by the Bill, right back to the present scheme.

I was glad to hear my right hon. Friend, in his speech, say that he would move some Amendments later, as I understood, to the Clauses by which the Minister retains the power to restore the old scheme. I thought that the Minister had some difficulty to justify these restrictions to the scheme, particularly the directions he is retaining by Clause 1. If we are satisfied that the scheme in the Bill is operative, that it can operate efficiently—and I understand the trade is quite satisfied that it can operate it and keep the obligations under the Commonwealth Agreement—we ought not to hold a sword of Damocles over the head of the industry, the threat that we may at any time return to the old scheme. I hope that the Joint Parliamentary Secretary, in replying to the debate, may give us a little more information about the Amendments which the Minister has in mind to Clause 1.

In my view, all that is necessary in this scheme is that the Sugar Board's purchasing power should be restricted to buying the Commonwealth sugar which we are obliged to buy under the Commonwealth Sugar Agreement, 1,568,000 tons, and that the Sugar Board's selling power should be restricted to selling that sugar at a commercial price in the country of origin. With these two powers the scheme is easy to operate—with the purchasing restricted to the Commonwealth sugar which this country is obliged to purchase under the Commonwealth Sugar Agreement, the selling by the Board restricted to selling that sugar at a commercial price in the country of origin. If private enterprise, buying the sugar from the Sugar Board, is incapable of enabling the Government to carry out the obligations of the Commonwealth Sugar Agreement, let the Minister come back to the House and say so.

I ask my right hon. Friend, when launching the scheme as set out in the Bill, not to look at it as a sort of toy boat on a pond, and not to hang on to the string. Let the industry operate the scheme. There are plenty of safeguards in the Bill for the Commonwealth Sugar Agreement and for the obligations under it, and for the obligations to the home growers of sugar beet. If we can dispose of what I would call the Socialist trimmings, particularly in Clause 1, I shall welcome the Bill.

6.20 p.m.

Mr. James Johnson (Rugby)

I thought that my right hon. Friend the Member for Smethwick (Mr. Gordon Walker) absolutely massacred the Minister and the Bill earlier in the debate and, therefore, not being a sugar beet farmer, I do not intend to embark upon the subject of the British Sugar Corporation. The Minister has since said, following an exchange with my hon. Friend the Member for Sunderland, North (Mr. Willey), that the colonial producers are quite satisfied. I want, as it were, to try to forget myself and where I belong and try to speak as if I were a Member for Mauritius or Barbados and to consider what they would see in the Bill. I have, therefore, torn up my notes for the speech which I intended to deliver and will try to express myself on the Bill from the point of view of producers in the Colonies.

If I were a colonial entering the United Kingdom, I should be driven to the conclusion that it was one of the ancient myths of these islands that the Tory Party is the party of Empire. When I look at their performance since 1951, I believe they are the party of anti-Empire. It will be recalled that on Wednesday of last week my hon. Friend the Member for Wednesbury (Mr. S. N. Evans) gave capital investment figures to show what the Tory Government are doing or, rather, not doing for the Colonies, compared with what the Labour Party did when it was in office. If anyone who has read that speech and has seen the Bill is yet not disillusioned, he can consult Lord Beaverbrook and the Daily Express, because the noble Lord has been disillusioned for many years with the party opposite in the matter of colonial affairs.

I think that we are all agreed tonight that no longer can we obtain cheap food out of the Colonies. Those days are gone. Not only shall we have dearer food in the West End hotels, but we have seen the end of cheap food in the poorer, working class homes of the East End. There-fore, whatever assurance the Minister gives about the future price of sugar not being dearer as a result of the wonderfully intricate system which he has devised and embodied in the Bill, I am prepared at least to see dearer sugar if it means better working conditions in Mauritius, Jamaica, and other parts of the Empire.

When one talks to delegations who come to this country from the West Indies and elsewhere to meet the Government and Ministers, one finds that the Government have shown less sympathy with their hopes and aspirations than did the Labour Government, and I believe that in the Bill the Colonies get less change from the Government than they did when the Labour Party was in office. Why is there any need at all for the Bill? The old system was working quite well and these provisions will make no difference to the output of the sugar plantations overseas. I share the desire of the hon. Member for Wembley, South (Mr. Russell) to see larger output and more expansion in this industry. Islands like Mauritius, Jamaica and Barbados are islands of mono-culture, and sugar is the best example of mono-culture.

It can be said of Mauritius that the population keeps pace with the output of sugar. It is said there that if 500,000 tons of sugar is produced annually, the population is 500,000. It is said that production of sugar in the island can be increased to 750,000 tons annually, which means that the population can increase too, though not very much further. Whatever the Bill does or does not do, the Minister, in winding up the debate, must give the House and the Colonies a solemn assurance that it will in no way attack present agreements and in no way vitiate or debilitate any future agreements with the Colonies to take their sugar. The party opposite has consistently attacked the Labour Party as the party of bulk purchase and guaranteed markets in the Colonies.

Mr. Harmar Nicholls

My right hon. Friend has given that assurance in the clearest possible terms and it should have been recognised by the hon. Member as having been given.

Mr. Johnson

I thank the hon. Gentleman. Sugar has ever been a shuttlecock of politics and it is good that we should have guarantees for years ahead. The Government must live up to their Agreement, but I see no need for this helter-skelter of mechanism in the Bill if our object is to guarantee the Colonies their future and to take the sugar that they produce.

Mr. Russell

Is not the hon. Member confusing two issues? The things that Colonies are so keen to have are long-term contracts, which are not quite the same as bulk purchase. In this case, we on this side of the House are as much in favour of long-term contracts as is the hon. Member.

Mr. Johnson

That may be so, but the Bill is twenty years late in implementing what Lord Olivier said in 1930, when he was pleading for a genuine marketing board to implement a genuine bulk purchase system which would give the Colonies a guaranteed future. What he had in mind is not the kind of thing which this Bill provides.

If I were a colonial producer, and I saw from the Bill that the Sugar Board was to consist of a chairman and not more than four other members, I would ask, "Why cannot we have written into the appropriate Clause in the Bill that of the four members two shall be Commonwealth or colonial producers?" I should like the Minister to answer the question, or in some way endeavour to meet a perfectly legitimate claim on the part of the overseas producers to have their interests safeguarded in that way and to have on the board perhaps one member to represent the Queensland plantations and those of South Africa, and another who would be the watch-dog for producers in Mauritius, Barbados, Jamaica and other islands.

I hope that the Minister will consider that point. In that way we should help to reassure people in the Colonies and to dissipate some of the suspicions in the minds of some of the overseas producers that the Bill is not necessary and in no way helps them in their task. The Government will find it difficult to lull those suspicions, but a provision of this kind might help to ensure that producers overseas did not feel that they were being thrown to the wolves. We have had an assurance that the Commonwealth Sugar Agreement will be maintained. Let us also say to the overseas producers that they can have representatives on the Board who will stand up for them, safeguard their interests, and speak on their behalf when there is need to do so.

6.29 p.m.

Mr. J. E. B. Hill (Norfolk, South)

It might be thought from some of the remarks made in the debate that the price of sugar to the housewife was unduly high as a result of our arrangements with the home industry and the Commonwealth, but it is worth remembering that the price of sugar in the shops in this country is rather lower than it is in many other countries, including the United States, France and Switzerland. We are, of course, the biggest sweet-eating nation in the world. These facts rather belie the impression that has been given that sugar is unnecessarily expensive.

I welcome the Bill because it seems to me to hold the balance that has been more or less agreed and has been working between the Commonwealth producer and the home industry, in the ratio roughly of two to the Commonwealth and one to the home industry.

I am speaking for the home industry because much sugar beet is grown in my constituency. I have to declare my interest in this subject because I grow sugar beet, though not wittingly any chicory. The production of sugar beet rescued arable farming, particularly in East Anglia, from a serious depression. It did not come in as a freak crop which, perhaps, should have been grown in the tropics, but as a necessary cash root crop.

I do not want to get involved in technicalities, especially as the hon. Member for Bolton, West (Mr. Holt) has left the Chamber, but I must point out that in addition to the sugar we not only get tops for the feeding of livestock, but the pulp in both dry and wet forms is a further source of food. Finally, even the factory residue is carted out and spread on the land as a valuable fertiliser.

Mr. Cyril Bence (Dunbartonshire, East)

Some of it.

Mr. Hill

Yes, it depends on transport, but for those who are lucky enough to be near a factory, it is extremely valuable.

Mr. Bence

I wish that the factories near the rivers would not push the residue into them and spoil some of our best trout or salmon fishing.

Mr. Hill

We can await with pleasure a later debate on river pollution.

The development of the sugar beet industry has been one of the success stories of agricultural scientific invention and research, both as regards machinery and plant breeding. I think the hon. Member for Bolton, West somewhat unwillingly paid tribute to the advance made, which can be summarised as an overall increase in yield of some 50 per cent. over the 1939 yield per acre. Indeed, what was a spectacular yield pre-war is now only respectable, and unless we grow a good crop sugar beet is not worth growing, because it is troublesome to grow.

Now a word on costs. The cost of British sugar beet per ton last year was slightly less than the agreed price under the Commonwealth Sugar Agreement. This year, instead of the estimates providing for a large subsidy, they record an expected credit moving from the Corporation to the Government of about £2 million. This shows that our sugar beet industry has progressed steadily to a stage when it is largely economic, thanks to subsidies given in the past.

Our expansion has come mainly from a limited acreage and I am a litle anxious, as my hon. and gallant Friend the Member for the Isle of Ely (Major Legge-Bourke) pointed out, that Clause 17 rather suggests that any limitations the Minister may make in future will be on quantity, which I take it refers to tonnage rather than to acreage. It will be appreciated that in growing a root crop which varies in yield so much from year to year, the only feasible unit of production to take is acreage, especially when the acreage has to be fitted into the general rotational policy of the farm. It may be that a tonnage limitation of quantity might in future become more satisfactory when dealing with the total funds available for a guarantee, but I hope that any modifications in production will be expressed in acreage.

I doubt whether the home industry is likely to expand a great deal further. In some parts of the South, farmers wanting to have a factory in their own area have been refused by the Minister, in my judgment rightly from the national point of view, but perhaps unluckily from the point of view of Southern farmers. The big drawback, however, about the sugar beet crop is that it is greedy in labour and is an arduous and exacting task. It is cheerfully carried out, but the fact remains that the labour costs make it expensive. The cost of homegrown sugar beet, therefore, will depend in future very much on the advances made in labour-saving devices, and it may well be that some striking changes towards cheapness may be made, particularly in devising a method of singling the plants in spring by something other than the human eye and hand.

The right way to judge the future course of the balance between the home industry and the Commonwealth producer is to watch it over the years, because if the costs of growing sugar beet in this country in relation to those of the Commonwealth show a steady upward trend, farmers should be induced to turn slowly to more remunerative crops. On the other hand, if costs come down and we can produce sugar beet here inside the Commonwealth Sugar Agreement price, as we have done in this last year, the home grower, having accepted a limitation in his acreage, should in equity have the right to maintain his authorised acreage as a sound, and, indeed, a proved economic proposition.

6.38 p.m.

Mr. Jack Jones (Rotherham)

The House may well ask what a steel worker knows about sugar. I know this, that the Government have accepted a pill, not a Bill, which has been well and truly coated with sugar. Its net effect will put State trading under a different name, but instead of the State benefiting from the trading the resulting benefit, once again, will go to the private enterprise merchants.

The first thing I ask the Minister to be certain about is that the people concerned with the trading will insert into their contracts in the future, if it is not there at the moment, the fair wages clause for the people who work where the sugar is grown. British trade unionists do not mind paying a fair price for an article provided they know that the price is based upon fair conditions and upon fair wages being paid to our coloured brothers in other parts of the world and to our white brothers in other parts of the Empire. We want to be sure that the people who are creating what we cannot do without shall have the benefit of a fair wages clause just as they do in engineering and other industrial contracts in our country.

My second point concerns the distribution of sugar in time of shortage. My constituency has a big interest in sugar because it contains one or two confectionery factories, including one large one, at which some of my constituents—good-looking lassies—work, and, judging by General Election results, most of whom support their present Member of Parliament. They and the proprietors are concerned about who will get sugar in time of shortage, strikes and shipping difficulties, or when supplies become contaminated and even destroyed because of bad storage.

The little men are wondering what their position will be under the Bill. They want to be absolutely certain that the big boys, such as Cadburys and others who buy sugar in colossal amounts, will not get preferential treatment compared with them. This is a very important point. It may be covered in the Bill, but I can find no provision relating to consumer interests. We have had other Bills, such as the Measure relating to steel, in which there has been so much legal jargon that it has been difficult to find what we have been after, and it is the same with this Bill. Consumers are gravely concerned, and I hope the Minister will give us an assurance about the position.

On the question of home production, I know a little bit about singling. Why farmers sow 1,000 seeds and then take 992 of them out I have never been able to discover. Is it beyond the wit of British engineers to find a means of sowing seeds more thinly so that farmers can do what I do with my prize carrots and onions—sow them thinly and do less singling? I know that singling is a difficult task. Sugar beet takes a lot of forking, slicing, heading and tailing and putting into carts for the purpose of taking it to the station or the factory.

However, that is not the point about which I am concerned. The important point is what is done with the stuff which is not wanted. The beetroot goes to the factory, and the pulp is dried and stored and used for feeding cattle, and so on. The Board must take great care about what is done with the unwanted residue by the persons who are running the sugar beet industry. In and around Wisbech they have ruined some of the finest fishing in the country with the residue. When one ruins fishing, one ruins the minds of men. When the minds of men are ruined, those men do not go to work on Monday as happily as they ought to. If the men do not work as happily as they ought to, they cannot earn the wages that they might. If they do not earn the wages that they might, they cannot buy the produce of the farmers. Let the farmers get it into their heads that we take serious objection to their spoiling fishing by tipping effluent into the rivers during the hours of darkness. I would say to them, "Stop it! It is bad practice. We have had too much of it."

That is all I want to say about the Bill. It is the same as good Socialism with a lot of sugar round it. Hon. Gentlemen opposite must swallow it just as they will have to swallow a lot more Socialism in like manner in due course.

6.42 p.m.

Lady Tweedsmuir (Aberdeen, South)

I should like to follow the hon. Member for Rotherham (Mr. Jack Jones) on the subject of the pollution of rivers and have a long discourse with him on the subject of salmon and trout fishing, for I hear a great deal about it at home, but I fear that Mr. Speaker might call me to order. Consequently, I shall return to the subject of the Bill.

The House will be grateful for the fact that we have had an absolutely clear indication of policy from the Opposition benches. We know what the Labour Party would like to do with the sugar refining industry. The hon. Member for Sunderland, North (Mr. Willey), stating Opposition policy, said that the Labour Party would still like to nationalise the sugar refining industry. Now we know where we are.

Mr. Wiley

I apologise for interrupting the hon. Lady, but I did not mention the nationalisation of the sugar refining industry. I regarded that as a matter outside the subject that we are discussing today.

Lady Tweedsmuir

So did I. That is why I was rather surprised when the hon. Gentleman said that he based his argument on the fact that, to a large extent, part of the sugar interests in the country constituted a monopoly. He clearly said, "We should like to complete the job." It seems to me that that indicates that the Labour Party would like to complete the job by bringing the sugar refining industry under State control.

I have the impression that one of the main reasons behind all the criticism of the Bill from the Opposition is that hon. Members opposite realise that, because of the way the Bill is framed, it would be impossible for a future Government to nationalise the sugar refining industry. It is very important that the country should know that. Nor is it possible under the Bill, as it stands, for any future Government to stop or govern the importation of sugar.

Mr. Jack Jones

Is the hon. Lady suggesting that a future Government could not repeal this Measure?

Lady Tweedsmuir

Any Government could, of course, repeal any Measure, but under the Bill the Minister, despite all the criticisms of his powers, could not bring about State control of the sugar industry as a whole.

I felt that it was very mischievous of several right hon. and hon. Gentlemen opposite, including the right hon. Member for Smethwick (Mr. Gordon Walker), who has had the honour of being Secretary of State for Commonwealth Relations, to suggest that there is anything in the Bill which could in any way alter the Commonwealth Sugar Agreement, or weaken confidence overseas, particularly as the Minister rose at least four times during the speech of the hon. Member for Sunderland, North to say categorically that that was not so.

One of the main reasons why I support the Bill is that it makes provision for Britain to continue to buy up to 1½ million tons of sugar under the Commonwealth Sugar Agreement. I should like to put one fact before the House. The total sugar consumption in the United Kingdom at present is about 2½ million tons annually. The home sugar beet industry contributes about I million tons. Therefore, surely the House must be driven to the conclusion that there is very little margin in the British consuming market for more home-grown sugar beet.

We have heard the plea of my hon. Friend the Member for Norfolk, South (Mr. J. E. B. Hill). I sit for a constituency which is half a Scottish city; we do not grow sugar beet there and so I am in a very different position from that of my hon. Friend. On the other hand, if we face the situation realistically, I do not see how we can go on encouraging, or making possible, a larger acreage or tonnage of sugar beet to be grown at home. Just as we say to the Commonwealth that it is very important that certain areas should not be entirely dependent on one commodity crop, so should we say that to our farmers.

Like the right hon. Member for Smethwick, I was a member of the delegation to the West Indies. I took a particular interest in Jamaica because the biggest sugar estate there, Monymusk, was founded many years ago by one of my forebears, one of the Grants of Monymusk, in Scotland, the estate in Jamaica being named after the Scottish estate, although I regret to say that it is now the property of Tate and Lyle. I was extraordinarily interested to discover that, despite the fact that a new refinery has been built on the Monymusk sugar estate and that production is very efficient, those concerned realise that they cannot continue indefinitely increasing the total acreage of sugar in the island.

Jamaica is trying to diversify its crops. More bananas are being grown. Experiments in rearing cattle are being undertaken, and there are also experiments aimed at improving grassland. A great many more secondary industries have been established in Jamaica since I was last there five years ago. Throughout the British Caribbean there is every realisation that it is dangerous to be dependent upon one commodity crop. Trinidad is fortunate enough to have oil and other crops. British Guiana has tried rice and is increasing its experiments with jute. I hope that they will develop their minerals in the interior, although it is very difficult.

When we discuss what we want to do in supporting Commonwealth sugar and our home industry, we should realise that sugar is a peculiarly suitable crop for the West Indies. I speak particularly of the West Indies because they are the largest contributors to the Commonwealth Sugar Agreement. We may have noticed that in the devastating hurricanes that recently hit the West Indies the crop which stood up best in Granada and Barbados was the sugar crop. It is, therefore, not only because of geographical considerations but also from other points of view, a peculiarly suitable crop for that part of the Commonwealth.

A point which I wish to bring before the House will, I trust, be replied to by the Joint Under-Secretary of State for Scotland, because it is particularly related to the distribution of sugar in Scotland. I very much welcome the fact, which should be widely known, that there will be no change in the price of sugar to the consumer in the United Kingdom under this Bill, but there will be, as I read the Bill, an effect on distribution. It will limit the housewives' choice in Scotland. I therefore particularly welcomed the statement the Minister's opening speech that he would like to hear representations from consumers.

Clause 25 imposes a restraint of trade between refiners. This very important point was put to me by the Wholesale Grocers' Association of Scotland, which covers the whole of Scotland. That country is zoned or divided into areas for distribution. After derationing, traders on the west coast could draw their supplies from Greenock, and on the east coast from the British Sugar Corporation in Cupar. Sugar could be drawn from either area by wholesalers outside that area.

In practice, the Greenock sugar is, on the whole, rather more popular than the east coast sugar. The reason is that the general public seems to know that at certain times of the year the sugar of the British Sugar Corporation is made from home beet. The hon. Member for Norfolk, South may say that sugar made from beet is better than other sugar, but it is not the housewife's choice. The British public likes to buy sugar of its own choice, whether we think that is reasonable or not.

Under Clause 25 of the Bill, sugar refiners will be liable to the heavy fines laid out in Clause 28 if they are found supplying sugar outwith their own areas. That also applies to beet sugar, because there may be consumers who prefer beet sugar and want to be able to get it. That fact is deeply resented, so far as I can ascertain, by all the members of the Wholesale Grocers' Association of Scotland. In the Aberdeen area, in which I represent part of the city of Aberdeen, we are in a fortunate position because we are part of the area which can draw sugar from Greenock, although we are on the east coast.

Therefore, the Clause does not apply to our traders, except that it is a restraint of trade between the two areas. For example, Aberdeen and eighteen other counties can draw their sugar from the Greenock sugar refineries. Those counties confined to Cupar sugar are: Fife, Angus, Clackmannan, Orkney and Shetlands, Ross and Cromarty, Sutherland, Caithness, Inverness, Nairn, Moray, Banff and Kincardine.

The result is that some retailers will lose severely on their business, while others stand to gain a great deal. The fact that Aberdeen wholesalers are in a favourable position but are utterly opposed to the principle of the Bill, which is that of denial of choice under the present arrangement, is real proof of the anxiety that exists throughout the wholesale grocers in Scotland. I trust that the Joint Under-Secretary will be able to give us an assurance that an Amendment will be prepared, between the Second Reading and the Committee stage, to make this useful Bill even better.

6.56 p.m.

Mr. Sidney Dye (Norfolk, South-West)

The hon. Lady the Member for Aberdeen, South (Lady Tweedsmuir) made it quite clear that she was not in favour of the extension of the growing of sugar beet in this country.

Lady Tweedsmuirindicated assent.

Mr. Dye

I am not sure that anybody was advocating it. The hon. Lady was not clear whether she intended to reduce the amount of sugar beet. It was clear that the hon. Member for Bolton, West (Mr. Holt) attacked the growing of sugar beet, and he called in his support hon. Members who support the Government. That indicates that there is a live force in the Conservative Party against the growing of sugar beet in this country. That was the whole purpose of the hon. Member's speech. He nods, and so indicates that that is so.

This is a matter for Government policy. If we want a certain proportion of sugar to be grown in this country, we must ask the farmers to do it. They produced sufficient beet sugar throughout the four years of war to equal the domestic ration and, while there is still the threat of world war, we only undermine the farming industry if we indicate that we want to replace home-produced sugar with imported sugar; we also undermine one of the war defences of the country.

There is something to be said for beet sugar. Our production of sugar is small compared with that of other countries, yet the fact that we have produced it here has influenced the world price to remain at a lower level than would otherwise have been the case. The country gets some advantage from the world price of sugar by growing a proportion of its crop.

I do not think that the hon. Member for Bolton has the slightest idea of the value of the sugar crop to our home agriculture. This is not just one crop; the value is in the rotation. Since the sugar beet crop has been grown in this country, and since the later improvements in cultivation, manuring and the rest, the standard of the crop has improved and so has the standard of all the crops which follow it. We are not growing less corn and other foodstuffs than we were when the sugar beet crop was introduced, but actually growing more and better crops both of corn and of roots.

The hon. Gentleman completely fails to realise that a good crop of sugar beet produces two tons of refined sugar to the acre. On top of that there will be three quarters of a ton of beet pulp, which is good food, equivalent in feeding value, weight for weight, to a crop of oats. In addition to that, the crowns of the beet are equivalent to a crop of turnips. We therefore get three crops in one. During the war, that was food production far in excess of the production of the years before the war.

Mr. Holt

What my hon. Friend says confirms me in my view that the support price of this sugar beet is a lot too high. Would he address himself to the argument which I was trying to put to the House, and which was not an agricultural one, with regard to the West Indians coming to this country? If we bought more sugar from the West Indies and did not buy our own beet sugar, because we did not produce it, would not that stop the West Indians from coming here?

Mr. Dye

I should have thought that the hon. Gentleman would have turned his attention elsewhere and asked Her Majesty's Government why, instead of buying less sugar from the West Indies, they bought such a lot from Cuba, some of which is still stored on airfields in my constituency. If within this country and the Commonwealth we can produce all the sugar that we need, there is no need to go beyond. I should have thought that would have been apparent to anyone.

Here we have an essential food and I should have thought that if men, with all their ingenuity and energy, can make the best use of the earth, they can produce more than can be consumed by the purchasing power in the hands of the people. Because of that, a surplus can arise and can undermine the price that covers the cost of production. Hence there is need for sonic kind of organisation both within this country and within the Commonwealth, and, I should have thought, internationally as well.

If we want to assure the people of the West Indies a decent standard of life, far better than they have enjoyed before, we ought to encourage the growth of sugar cane and of other crops. That is what we should give our attention to. I have read with horror of the very low standard of living of the people who are producing sugar in the West Indies. I should have thought that long ago we ought to have been in favour of a price for sugar which would have ensured to those people a decent standard of living for the work they do. Why go on year after year exploiting them on the basis of a so-called world market for sugar, which covers only one-tenth of the total production? Apart from the West Indies, all the other countries have a higher price for their sugar than the world price for sugar. That, of course, is a ridiculous situation which we ought to guard against. It seems to me that there is need for some form of control, such as is indicated in the Bill, but whether this is the best form is another matter.

The hon. and gallant Member for the Isle of Ely (Major Legge-Bourke) seemed to be in a somewhat confused state of mind when starting his speech. He referred to the price of coal as if that had something to do with this Bill. Indeed, it has, if we compare the increased price of coal with the increased price of sugar, or, for that matter, with the pulp that conies from the factories. The point which the hon. and gallant Gentleman was making was that since coal has been nationalised its price has gone up, but the price of sugar beet pulp has gone up far exceeding any increase in the price of sugar.

The price that the grower of sugar beet is now charged for his pulp is £20 5s. a ton. That is the lowest price at which he can get it. A few years ago he could get it for £3 a ton. If we take the price of sugar, it is not so many years ago that it was 2d. per lb. Now packed sugar is 8½ per lb. That represents a percentage increase far exceeding the increase in the price of coal, so if we are to compare a nationalised industry with one that is not nationalised and the price of its products, then coal seems to be far better off than beet pulp or sugar.

Major Legge-Bourke

I think that the hon. Gentleman has forgotten the context in which I was referring to this matter. In 1945, nationalisation, particularly of coal, was solely on the argument that it would result in cheaper prices.

Mr. Dye

Whatever may have been the context of the right hon. and gallant Gentleman's argument, the figures are heavily against him. If we are going to say that the argument against the nationalisation of sugar is that the price has been kept down better than the price of coal, then the hon. and gallant Gentleman has solved his argument altogether, because he has nothing to base it upon.

There is, however, this question exercising the minds of the farming community that, although they grow the sugar beet and send it to the factories, they pay for it going to the factories and then they have to fetch the pulp from the factories. As the hon. and gallant Gentleman knows, all the farmers are greatly concerned at the power the British Sugar Corporation has of charging a higher price for pulp which goes back to the people who have produced it, a price which is not written into the contract at all.

Let us take the position with regard to the grower of sugar today. He makes a contract. On the basis of that contract he is paid. If, as occurred this year, the price of labour goes up and other things as well, then there has been, for this year, an increase of 2s. a ton in the beet delivered to the factories; but, as I have pointed out, when the pulp is brought hack, the increase is £3 a ton—a very big increase indeed.

What happens with regard to the price of sugar? The price of sugar since September, 1954, to the present time has gone up. It has gone up by.½d. per lb. We cannot say whether this Bill will put it up higher or bring it down, but as things are working at present there is a steady rise in the price of sugar. The wholesale price of sugar has gone up by about £6 a ton over the past 12 or 14 months, and it has continued to rise. So with the increased price of sugar and the increased price of pulp, the British Sugar Corporation will have a far greater income this year than it had last year, although the cost of beet delivered to the factory represents only 2s. a ton and on the tonnage of sugar which is produced represents only about 15s. or 16s. a ton. The raw material as delivered to the factory goes up by 15s. or 16s. a ton, yet the sales price has gone up by over £6 a ton inside 12 months.

If that can happen under the present situation, what can happen under this Bill, whereby the Board will be there to manipulate prices? It does not seem as if they will manipulate them in a downward trend. I think that this question of the price of sugar, whether under this Bill or in the present circumstances, is one in which the general public should be interested. On those prices it is possible that the total income of the Corporation for the current year will be £47 million, but it will pay to the beet growers not more, and probably less, than £30 million for all the beet delivered.

Major Legge-Bourke

What will it pay in Excise Duty?

Mr. Dye

I do not know anything about that. It seems to me to be a completely crazy system whereby we have an industry which is subsidised and which at the same time has to pay Excise Duty. That is beyond my comprehension, and therefore I cannot answer the hon. and gallant Gentleman's question.

Major Legge-Bourke

Nevertheless it is an important factor. It is one of the biggest expenses which the Corporation has to face each year.

Mr. Dye

That may well be so. I am merely pointing out that the difference between what the Corporation pays for its raw material, delivered to its factory, and the wholesale price is about £17 million. If it works as a highly mechanised industry, it seems to me that there is sufficient room for manipulation. It is for the Treasury to deal with the question of Excise Duty and subsidies.

It was said by the Minister that there would be a formula on which prices would be based and that that had been agreed with the Chancellor of the Exchequer. I am concerned to know whether not merely the formula but how it works out year by year will equally be made known to the public. The question whether in future the subsidies should be related to acreage or to tonnage is one in which the producers must be vitally interested. If it is to work as a former system worked—namely, that when a certain tonnage had been reached then the price paid beyond that would go down very considerably—there may be something to be said for that on the basis of forcing efficiency; but I think that the growers who play a vital part in this production should know what is the intention in changing to the tonnage system, and how it will work.

If the growing of sugar beet is done on the basis of national policy from a strategic point of view, then we naturally expect that those who carry out that work will have security in doing it and will improve their efficiency. Here we are discussing a branch of agriculture which in recent years has improved to a very great extent. I should not like to see anything done that would harm the keenness of those who are growing the sugar beet and delivering it to the factory, or anything that would harm the men who work at the factory.

I would ask that there might be some changes. Instead of our refining taking place mainly in four large ports, the factories, which are well scattered over the country, should be used not only for refining home-produced raw sugar but, more economically throughout the year, for refining Commonwealth sugar. I should have thought that that would be a great advantage strategically and economically.

7.15 p.m.

Mr. A. G. Bottomley (Rochester and Chatham)

We have had an interesting debate on what the Minister himself has said is a complicated Bill. Indeed, before we really had a chance to consider it he indicated that there have been second thoughts and that he will submit Amendments in Committee. The right hon. Gentleman said that the sugar policy followed by the Government had been the continuous policy for the past thirty years. He also appeared to indicate that those concerned in the Commonwealth Sugar Agreement and the sugar beet industry had the same guarantees and had no fear for the future.

We on this side of the House have some doubts about that and I hope to show in my speech that those doubts are fully justified. We are not very confident about the appointments which, in due course, will have to be made to the Sugar Board. I make this comment, because we are not inspired by past action. We know the Government have appointed either people who deliberately are not in sympathy with the object or people who can be moulded into a given way, so that we do not always get the best result from a public board. I make no reflection on the Minister himself. I would be guided by his judgment, but he would agree that it is not left to him alone to make the final decision.

What the Government really intend to do is to end State trading in sugar. That is quite deliberate. This is the last State trading, bulk-purchase arrangement, if we exclude the Danish Bacon Board contract, and the Government have shown clearly from the beginning that they intend to end it as soon as possible. It has not been done before because the Government have had contractual obligations under the Commonwealth Sugar Agreement and statutory obligations under the Agriculture Act, 1947, to the home producers.

The House is aware that both those provisions were introduced by the Labour Government, and we firmly believe in them. We can claim a good deal of credit for the extent to which they have been successful. We think both should remain and that, whatever the intention of the Minister, he is on the slippery slope and we shall find that we are moving away completely from this kind of trading as time goes on. The Sugar Board may be an ingenious solution to meet the Government's obligations under these provisions—the Commonwealth Sugar Agreement and the Agriculture Act—but I repeat that, in my judgment and that of my hon. Friends, the Government are on the road to so-called complete free competition.

Let us examine the Government's commitments in respect of the Commonwealth Sugar Agreement. We all acknowledge that for a long time we were buying sugar at well below the world price. I was most disappointed to hear the representative of the Liberal Party, the hon. Member for Bolton, West (Mr. Holt), say that we want sugar for home consumption at the cheapest possible price.

I went to the West Indies in 1951, and the people I met there said, "We provide sugar now below the world price. We are doing it because we know that Britain is an honourable country, and when the world price rises she will not try to cut down, but will bring it up." What was even more revealing was when they said, "The wealth of your country, the Welfare State and the provision which your people enjoy, to some extent have been the result of the development of our own country. Do not you think it is time that you considered us?" At least, we can say that the majority of us accept it. I was intensely disappointed to hear the representative of the Liberal Party express his adverse view upon that subject.

My visit to the West Indies was for the purpose of convincing the West Indian sugar producers that the sugar we were buying from Cuba would in no way harm their interests. We bought sugar from Cuba for two reasons: first, because Cuba had an economic stranglehold upon us, and if we had not bought sugar we should have found conditions economically difficult. Secondly, we bought sugar to enable us to deration that commodity in this country. The succeeding Government got the credit for that Agreement which I helped to initial and to conclude, and I was heavily criticised by the then Opposition and by the Daily Express, which referred to the "Black Pact"; but it was by that means that we were able to end the rationing of sugar.

When I was in the West Indies I gave this assurance to the members of the British West Indies Sugar Association: The Government's undertaking to review the operation of the Commonwealth Sugar Agreement in 1953 in consultation with the producers stands. This undertaking provides that if sugar is unrationed in the United Kingdom in 1953 and if consumption proves higher than has been estimated at least a proportionate increase will be made in the quantities to be purchased at a guaranteed price. I went on, finally, to say that this arrangement would do nothing whatever to vitiate its effectiveness or to prejudice the interest of the Commonwealth producer. I assume that the Government of the day still stand by that obligation given by the previous Government. If that be so, let us have a look at the Commonwealth Sugar Agreement and see what it says. It states: Agreement is formalised from a general understanding that has been reached between the parties; that it is desirable in the terms and conditions arrived at to have a long-term agreement for supplying sugar to the United Kingdom and for developing the orderly marketing of that sugar. I imagine that the Minister means what he said earlier, that the Government respect that. But we have recollections of past assurances from the Government—perhaps I should say from the party opposite before it was the Government. We remember the food subsidies. I do not wish to quote the Chancellor of the Exchequer, or the Prime Minister, but perhaps I may quote a leading spokesman for the party opposite—Lord Woolton—who said: There is a story that the Conservatives would cut the food subsidies. That is not true. Well, the public knows differently today, so when the Government give an assurance of this kind, if we are a little sceptical it is readily understandable.

The Government, however, could not be so blatant in the case of the Commonwealth. They have to deal with that somewhat differently. Article 7 of the Sugar Agreement says: This Agreement shall remain in force from 1st January, 1950, until 31st December, 1959, but may in the year 1952 or any subsequent years be successively extended by agreement for a further year. So there was an obligation to look at it in 1952. What happened then? The then Minister of Food made this statement in the House: The agreement is designed to provide within the next few years"— and I underline "the next few years"— sufficient sugar from Commonwealth sources to meet the greater part of the requirements of the Commonwealth."—[OFFICIAL REPORT, 17th March, 1952; Vol. 497, c. 1904.] I think that the use of the words, "the next few years" was quite deliberate. We were prepared to say five years. Are the Government prepared to say the same? That is the sort of assurance to satisfy the Commonwealth producers and to let them know that we mean what we say.

It has been said that the Commonwealth sugar producers will be able to play a full part in the London Sugar Market. I am a bit sceptical about that. I think that it is merely to get them used to a free market so that when the Agreement does end they will have some idea of how to play their part in the market. We have a right to be suspicious, because the Government have shown by their actions and behaviour that we are justified in being worried about these things.

Let me give some idea of how the Government are thinking these days. I recently questioned the President of the Board of Trade because we found that steel imports from dollar areas which were 14.2 million dollars in 1954 had risen to 49.4 million dollars in the first nine months of this year. That is one of the reasons why we have an adverse balance of trade and a drain upon our gold and dollar reserves. I asked the President whether we could get steel from elsewhere. He replied that it was obtained in the market where it could be most economically obtained.

That would happen in the case of sugar, too. That is the basis of the Government's policy—never mind about the well-being of the country or the Commonwealth; get it where it can be obtained most cheaply so long as there is a profit. That seems to be Government policy on these matters of economy. It appears to me that the saving of dollars will have no consideration, and that we shall buy sugar in the cheapest market.

The Government may say, "Yes, but even sugar cannot fall to a low price because of the International Sugar Agreement." But that is cold comfort for the Commonwealth or colonial sugar producers. So far as the Commonwealth Sugar Agreement is concerned, we can understand why we have not much hope for the future.

Let us consider the sugar beet industry. In 1935, the Greene Committee reported that it was unable to find positive justification for the expenditure of several millions a year on an industry which had no reasonable prospect of ever becoming self-supporting. The Government of the day, represented by the party opposite, quite rightly said they would not accept that report. Remembering that war clouds were looming up, there is no doubt that questions of strategy influenced their considerations. But let us recall that it was a Labour Government who, in 1924, introduced the sugar beet industry subsidy for the purposes of strategy and also as a means of helping the agricultural industry. It was a twofold purpose, to help the industry and to provide for the strategic requirements necessary in time of war to avoid having to ship from overseas many of the things which could be grown in this country.

At present all seems to be well, but will it continue? The British Sugar Corporation, it is said, is to continue to contract for home-produced sugar beet and the prices to be paid are to be fixed by the Government as a result of the Annual Review, or Special Review, of agricultural prices. The Board itself is to meet the deficiency which is lower than it might be because the Government now give subsidies to agriculture. Are those subsidies to continue? We heard the kind of economies that were to be made at the time of the Budget. Some were petty, but there were some savage economies affecting housing subsidies. What about agriculture? The Chancellor said: This same criterion of economy and efficiency will have to be applied at the right time to the range of subsidies which fall within the field of my right hon. Friend the Minister of Agriculture, Fisheries and Food."—[OFFICIAL REPORT. 26th October, 1955; Vol. 545, c. 212.]. When we recall that in the case of agriculture food subsidies in 1953 were running at the rate of £262 million a year, and in 1954 had risen to £312 million a year, I think it is clear that the Minister himself has to do some adjustment.

I would remind the House that the British Sugar Association, to which everyone has given a blessing this afternoon, and with justification, was brought into being by the Labour Government, in 1946, as a result of a policy of planned economy. In this case it was a combination of public and private enterprise. This investment programme, started in 1950, has been brought to a successful development and an amount approximating to £9 million or £10 million has been spent on the re-equipping of factories and the provision of factories of the most modern and up-to-date kind.

We talk of fuel efficiency in these days as being of great importance. In the sugar beet factories there is a standard of fuel efficiency which is very high and which industry generally should emulate. That would be helping the economy of the country. May I say, in this connection, that if it is to be said that there is to be no change, then the publication "Change is our Ally" is something which must be read carefully? What the Conservatives are thinking today may well be the policy which the Government will follow in due course. If this industry is destroyed, it can only be because the Government think that a policy of peaceful co-existence is permanent. If they are right. I should have thought there could have been economies in defence expenditure without making economies in this direction. The Bill says that there is to be a quantitative limitation in sugar beet. Perhaps the Parliamentary Secretary can say whether this quantitative limitation is to be by acreage, tonnage, volume or factory capacity.

I have shown that it is bad for the Commonwealth producers and for the home producers. It is equally bad for the consumers. The Joint Parliamentary Secretary earlier interjected—and other hon. Members opposite have said—that this means no increase in price for the consumer. I think that it does. The Bill makes provision for any deficit incurred by the Sugar Board to be financed by a surcharge on all sugar and molasses coming into the country. When we had subsidies that deficiency was met out of taxation. The deficiencies will not now be met from taxation, but will be passed on to the consumer. As the working classes are by far the largest in number, and probably consume more sugar than most because of the needs of their children, their cost of living will rise, and there will be further pressure for increases in wages, contributing, in turn, to the present inflationary tendency.

We believe that the Bill strengthens the position of the merchant without any advantage to the consumer. Indeed, the consumer will be worse off. This is a further step by the Government towards restoring liberty of action to the merchants. Earlier, as we know, the Government granted sugar importers open general licences to purchase more sugar for re-export, whether or not it was refined in this country. As the Bill itself shows, we know that import and export controls will still be required—but how many times have we been told that it is the Government's intention to get rid of controls? If that is their intention it nullifies a good deal both of what has been said this afternoon and what appears in this Measure.

During the past year it has been obvious that the Government were determined to abandon State trading in sugar. They followed their usual line of preconceived ideas and doctrinaire policy. The Bill is produced at a time when the Government has been compelled to withdraw the selling of publicly-owned lorries. In fact, it was introduced on the very day on which the Minister of Transport and Civil Aviation made that statement. Why, when that has failed, do they come here with another proposition which will also be a failure? In my opinion, the Government are playing up to the vested interests. We have to remember that 1 per cent. of the community still own 50 per cent. of the country's wealth.

This Bill is a further illustration of the Government's determination to hand over the country's well-being to private speculators. In his first Budget speech, the Chancellor of the Exchequer said that the country's economy had been deteriorating for the last fifty years. The Government are now giving back all our industry and enterprise to the very people who led us into this sorry mess. This Bill is a step in that direction, and because of that we, on this side, standing for public responsibility and ownership as opposed to vested interest and private speculation, will oppose it.

7.34 p.m.

The Joint Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Harmar Nicholls)

I agree with the right hon. Gentleman the Member for Rochester and Chatham (Mr. Bottomley) that this has been a good debate. Considering the complexities of the Bill, the House has shown a very good grasp of it. I have envied the speedy way in which hon. Members have grasped this subject, because I found it pretty hard going even with all the help of my Department. We never expected unanimity—it is not right that there should be unanimity when new legislation is concerned—but the debate has been conducted without acrimony. There was an odd minute—a brief exchange by the right hon. Gentleman the Member for Smethwick (Mr. Gordon Walker)—when hon. Members might have thought that it was a Vinegar Bill and not a Sugar Bill which was the subject of debate. The general tone, however, has been one of which hon. Members on both sides can be proud.

As always, the hon. Gentleman the Member for Sunderland, North (Mr. F. Willey) breathed fire on the Bill. He did it rather more gently than usual, but he did breathe fire. His right hon. Friend the Member for Chatham and Rochester threw cold water on the Bill. In my experience, when cold water is thrown on a fire the result is steam, which is hot air, which just about sums up the right hon. Gentleman's argument.

I wish, at the very beginning, to refer to the right hon. Gentleman's opening words, because they were really not in character with him—he is held in highest esteem in all parts of the House. His first words, which cast doubt on the impartiality of those who serve on the various boards, were well below his usual level. Generally speaking, we are all proud of the type of man who undertakes this public service—often at very great expense and great trouble. I am certain that the right hon. Gentleman, on consideration, would not like to repeat the charge implicit in his words.

I should also like to take up with him his suggestion that the interests of the Commonwealth are nowadays the monopoly of his right hon. Friends and himself. Neither the Government nor their supporters have anything to fear on that score. They have a record which brings them right up to date; they have no need to bow to anyone in looking after the Commonwealth producer. I would take him up on his challenge. He said that the party opposite would give a clear indication that they would enter into new agreements. Those are just words.

On behalf of the Government, I can produce actions—which always speak louder than words. When this Commonwealth Sugar Agreement was entered into, the termination date was to be 1959, and there was a Clause by which, annually after 1952, the Agreement could be extended by a year. Every year since we have been in power we have extended the period. It now stands, not at 1959, but at 1962. That is evidence to support my general claim that we have the Commonwealth interests at heart. We have nothing to apologise for in that regard.

The hon. Member for Sunderland, North objected to the suggestion that he had advocated the nationalising of the British Sugar Corporation. I shall, therefore, not go so far as that. He objected to it, and I accept it.

Mr. Willey

Perhaps I could make the position clear. I was advocating the bringing into full public ownership of the Corporation. I told the hon. Lady the Member for Aberdeen, South (Lady Tweedsmuir) that I did not say—because I did not think it came within the scope of our discussion—that the refineries should be brought into public ownership. That matter was not raised in my argument.

Mr. Nicholls

It was because of what the hon. Gentleman said that I was going to use other words. He said that the Bill was a retreat rather than an advance. I think that that sums up his message. The suggestion that we should have more control at the centre is out of date. I can well imagine the hon. Member being able to produce a theoretical argument in support of it twenty years ago, because then we had no practical experience to set against theoretical arguments. We now have twenty years of actual experience. It has been shown that the British Sugar Corporation has worked well and produced the results.

Those results are the answer to the theoretical arguments advanced by the other side that it would have been better if there had been more control at the centre. Although we expect them to be used in debate, those arguments really lose their force when set against the experience of the last 20 years. It is, I think, common ground between Government and Opposition that the Government of the day must have sufficient powers to ensure that the Corporation performs its functions of buying sugar beet in a way that carries out the Government's obligations under the Agriculture Act. Clause 17 of the Bill makes that very clear. Where we part company with the hon. Member and his views is at the point when they suggest that the best means of ensuring that the Corporation's duties are carried out efficiently is to hand them over to the Government and to give the Government more extensive powers to enable them to intervene directly on all occasions.

Mr. Bence

The Bill does that.

Mr. Nicholls

In our view, statutory powers such as the hon. Member suggests—which are not included in the Bill; it takes a bit of reading, but if they read it carefully hon. Members will find that it includes no such powers—would be a very blunt instrument indeed. From personal experience in business in a small way, I believe that an organisation cannot be made efficient merely by introducing legislation. We have to depend on the abilities and the enterprise of those who run it. Hon. Members opposite recognise that when they appointed the present Chairman of the British Sugar Corporation, Sir Alan Saunders, who has the qualifications which I have suggested must be possessed by anybody running an organisation like this.

Can we believe that the Corporation would be in better shape today if the Government had had power to tell it what to do and what not to do at every turn? Once we have men of the right calibre, it is better to rely not upon statutory powers but upon the normal operation of economic forces. That is happening now and we want it to continue.

Mr. Willey: The Government are repealing the Sugar Industry Act, 1942, and the hon. Member has not directed himself to that at all. Because the British Sugar Corporation is not a full public utility, we have these complex, compli- cated administrative arrangements to prevent it from doing what otherwise it might do. I am suggesting that we should sweep away those complicated arrangements, make it a full public utility and let the chairman, Sir Alan Saunders, get on with the job.

Mr. Nicholls

The hon. Member said that before, and I understood him perfectly. What I am saying is that, whatever the Corporation is or is not, it is working well and producing the results—and that is the sort of test which we want to apply.

We go further than that and say that if we want it to do better, we should arrange some incentive; let the free working, which exists today, have the added impetus of some incentive schemes behind it. I was surprised to hear the hon. Member belittle the effect of the incentives because later in his speech he described the results which have flowed from them. He outlined the saving of coal, and I agree with him; if every industry had saved as much coal through similar efficiency, one of the national problems of today would be very much smaller. We have seen that man-hours per ton of beet worked have been halved. We are getting the same work in half the time. The daily average of sliced beet has risen in ten years from 31,000 to 41,000 tons. Those are the results about which I am talking. The hon. Member can object to the title and offer all sorts of complex descriptions, but he cannot get behind the fact that the Corporation has produced these results.

Another point which he made and which should be answered concerned the return which the shareholders get. He made a big point of this and tried to leave the impression that the shareholders were getting rich at the expense of the taxpayer. That does not bear examination at all when we remember that over 19 years the average rate of interest has been 4½ per cent. and that this year for the first time it has risen to 5 per cent. When we compare those figures with the present day value of money and all that has happened in those years, I do not think the hon. Member's charge will bear examination.

Many comments have been made about sugar beet growers, and the leader of the band was the hon. Member for Bolton, West (Mr. Holt). It is true that the sugar beet growers and the Sugar Corporation are left exactly as they were before the Bill was introduced. I confirm that the price for sugar beet is settled at the Annual Price Review. The Minister also settles the national acreage. At present the national acreage is about 412 acres. [HON. MEMBERS: "412,000."] That is very important to me personally, because one of the leading sugar beet factories is in my constituency and many of the people who keep it supplied are my constituents. If I omit three noughts it may well be that my constituents' supplies will be cut. I am happy to put that right. It should be 412,000.

I can give a satisfactory reply to my hon. and gallant Friend the Member for the Isle of Ely (Major Legge-Bourke) on the question of supplementary payments in years of adverse farming conditions. There was no need for this provision in the Bill because the Sugar Board pays to the British Sugar Corporation a deficiency on revenue account which will always take into account the element of loss due to poor crops. I hope that will satisfy my hon. and gallant Friend, who raised a very important point.

We cannot support the hon. Member for Bolton, West in his antipathy to sugar beet, which does not deserve all the scathing comments which he made about it. My hon. Friends were quite right to produce a very able defence on that score. I suggest to him, as my hon. Friend the Member for Norfolk, South (Mr. J. E. B. Hill) did, that sugar beet is not as uneconomic as all that. The hon. Member for Bolton, West said that it was completely uneconomic and ought not to be considered, on grounds of cost. In fact, it compares very favourably with the negotiated price of Commonwealth sugar under the Agreement and does not possess all those dark factors which he suggested.

There is nothing to prevent a farmer from growing more sugar beet for animal feedingstuffs or other purposes, but this extra quantity would not attract the guaranteed price nor would it be accepted for making sugar. That is a point which should be borne in mind when explaining to our farmer colleagues the importance of sugar beet in the rotation; there is nothing to stop them from growing extra sugar beet if they wish as long as it is clearly understood that it is not for sugar and does not attract the guaranteed price.

I repeat that the Bill does nothing but dot the i's and cross the t's for the growers and, in substance, the growers' position and the powers of the Minister are pretty much as they were. The main reason for the Bill is that it will take the buying and selling of sugar out of the hands of the Government machine. I support this personally with great joy, because I do not think that the Government machine is suitable for the purpose. A Government agency may be satisfactory during a period of fixed quantities and fixed prices, where conditions must be rigid, as in war or special times of stringency, but when world supply is more than adequate and the buying and selling occurs in fluctuating markets, which is the position today, then the rigid Government organisation is not flexible enough to meet all the circumstances and there is a grave and expensive risk of being left with uneconomic stocks.

On the positive side, these new arrangements should assist us in our endeavour to recapture the invisible exports of prewar days. The reopening of the London Terminal Sugar Market which flourished before the war would be a very useful step and there is no reason it should not come back again. The question of the Board and of obtuse language led me to be proud of my commercial training tonight, because when the right hon. Member for Smethwick found the words he read so difficult to understand and made great play of the fact that nobody could understand them, I was proud—

Mr. Gordon Walker

I could understand them.

Mr. Nicholls

The hon. Gentleman did not make his understanding clear to us. The right hon. Member did not make himself clear, but those words were very clear to me. The Board uses its judgment of the position and is in a position to form a judgment because it is watching the market and sells when the price is the best it can get. That is what everyone in commerce does.

Mr. Gordon Walker

The words were perfectly clear to me but their meaning was not. To identify that with a free market is just nonsense.

Mr. Nicholls

The meaning of the words is what they say, that the Board will sell when the market best suits it.

Mr. Willey

Surely the hon. Gentleman is mistaken in saying that the Board can sell when it will. The Board has no power to store or handle sugar, so it has to sell forthwith.

Mr. Nicholls

The Board buys in the country of origin and naturally will sell at the best price, and it has good judgment in being able to do that to the benefit of its accounts. There is no reason to suppose that it would sell at a lower price than it could get. I do not think the House need have any fear of that.

The Bill makes it possible for the London Terminal Sugar Market to reopen whilst at the same time honouring to the full the Commonwealth Agreement on sugar and maintaining the average price, as is the position now. I want to emphasise again, because it has been referred to by so many hon. Members, this Bill will in no way interfere with the price the consumer pays in the shop. At the moment the Ministry of Agriculture, Fisheries and Food sells according to costs, and that is the price the housewife has to pay. Under this Bill the Board will do precisely the same, and the result as far as the consumer is concerned will be exactly the same. The Commonwealth Sugar Agreement, both as regards price and amount, will remain unaffected.

I think the right hon. Member for Smethwick answered the hon. Member for Sunderland, North in making clear that this Bill was quite distinct from the Commonwealth Agreement, which he pretended to think was in jeopardy because of the Bill. It merely means that the quantity we have contracted to buy under the Agreement will be bought by the Board instead of by the Government.

The other charge made by the hon. Member for Sunderland, North which I think ought to be answered was a charge against the Tate and Lyle organisation. Some very hard words were said about monopolies, and the name of Tate and Lyle has been bandied about as though Mr. Cube were responsible for all the troubles of the Opposition. I think that is a bit of exaggeration. I think the Opposition has it troubles quite apart from Mr. Cube. No one would deny the pre-eminent part Messrs. Tate and Lyle play in sugar refining in this country, but we ought to have this quite clear. If the hon. Member will take this point, because the criticism was rather scathing, while Tate and Lyle is an important and pre-eminent name, it is not the only name in the industry. We have names such as Martineau, Sankey and Westburn. In addition, the British Sugar Corporation itself does part of the refining.

I should like to deal with the rather worrying suggestion the hon. Member made that Tate and Lyle had got considerable shareholdings in the Sugar Corporation and would, as a consequence, influence the policy that would come from that Corporation. We ought to have this clear. According to my information, the British Sugar Corporation has five million shares and Messrs. Tate and Lyle has not one of them.

Mr. Willey

Will the hon. Gentleman now answer what I said? I did not mention Tate and Lyle in this connection. The point I was making was that a refining agreement is negotiated between the Corporation and the refiners and it is wrong, in those circumstances, that the refiners should have any holding in the Corporation. If the hon. Gentleman could show me that the refiners have no holding whatever in the British Sugar Corporation, either through the firms or individually, I shall be very much relieved.

Mr. Nicholls

Because the words followed on his criticism of Tate and Lyle, perhaps I got a wrong impression from the hon. Member. I was rather disturbed and found out the position, and, as far as the information I have been able to obtain goes, it is that Tate and Lyle has not one share. It may well be that represents the position of the refiners generally.

I think those are the general points which have been made in this debate. There have been many other points which I think will lend themselves for further discussion in Committee. The hon. Member for Rugby (Mr. J. Johnson) made a point about membership of the Board. That is a question which I have no doubt he will raise again in Committee. In passing, I should have thought it would have been a bad thing to have as members of the Board, whether in this country or in the Commonwealth, people who have a special interest in the work the Board is to carry out. I should have thought that it would have been better—but of course the decision will be the decision of the Government—to have had as members of the Board people who are impartial and who would view their decisions objectively in a way in which people who were interested in its work could not view them. I have no doubt that the hon. Member, who is very tenacious on these matters—I always admire him for his tenacity—will raise that matter in Committee and we shall be able to give a more detailed explanation than I can give now.

The last point with which I wish to deal is that which was raised by my hon. Friend the Member for Aberdeen, South. I may say at once that it is quite possible for any area to get supplies from another area if it is prepared to pay the extra transport charge. There is not likely to be any alteration of that under the Bill. The development to which my hon. Friend referred and the problem which is being faced do not arise out of anything

in the Bill or in the existing sugar refining agreement. I think I can give my hon. Friend some satisfaction when I tell her that the Committee concerned has promised us that it will give very full attention to this matter, and I have no doubt it will be able to find a solution to the area problem which she raised.

I am quite certain that when hon. Members have had a chance of reading the Bill and the White Paper, as well as having had the advantage of this debate, they will come to the conclusion to which I have come, which I commend to the House, that by this Bill we are safeguarding our Commonwealth Agreement, safeguarding our sugar beet producers and consumers and in this way getting more life into the actual dealing in sugar.

Question put, That the Bill be now read a Second time:—

The House divided Ayes 193, Noes 132.

Division No. 38.] AYES [7.58 p.m.
Agnew, Cmdr. P. G. Crouch, R. F. Howard, Hon. Greville (St. Ives)
Aitken, W. T. Cunningham, Knox Howard, John (Test)
Allan, R. A. (Paddington, S.) Dance, J. C. G. Hudson, Sir Austin (Lewisham, N.)
Alport, C. J. M. Davidson, Viscountess Hughes Hallett, Vice-Admiral J.
Amery, Julian (Preston, N.) D'Avigdor-Goldsmid, Sir Henry Hughes-Young, M. H. C.
Amory, Rt. Hn. Heathcoat (Tiverton) Deedes, W. F. Hulbert, Sir Norman
Anstruther-Gray, Major W. J. Dodds-Parker, A. D. Hutchison, Sir Ian Clark (E'b'gh, W.)
Arbuthnot, John Drayson, G. B. Irvine. Bryant Godman (Rye)
Armstrong, C. W. Eccles, Rt. Hon. Sir D. M. Jenkins, Robert (Dulwich)
Ashton, H. Eden, J. B. (Bournemouth, West) Jennings, J. C. (Burton)
Atkins, H. E. Elliot, Rt. Hon. W. E. Johnson, Dr. Donald (Carlisle)
Baldock, Lt. Cmdr. J. M. Errington, Sir Eric Johnson, Erie (Blackley)
Baldwin, A. E. Farey-Jones, F. W. Johnson-Hicks, Hon. L. W.
Balniel, Lord Fell, A. Keegan, D.
Barber, Anthony Finlay, Graeme Kerby, Capt. H. B.
Barter, John Fisher, Nigel Kershaw, J. A.
Baxter, Sir Beverley Fleetwood-Hesketh, R. F. Kirk, P. M.
Beamish, Maj. Tufton Fletcher-Cooke, C. Lagden, G. W.
Bell, Philip (Bolton, E.) Fraser, Sir Ian (M'cmbe & Lonsdale) Leburn, W. G.
Bell, Ronald (Bucks, S.) Galbraith, Hon. T. G. D. Legge-Bourke, Maj. E. A. H.
Bidgood, a. C. Garner-Evans, E. H. Legh, Hon. Peter (Petersfield)
Birch, Rt. Hon. Nigel Gomme-Duncan, Col. A. Lennox-Boyd, Rt. Hon. A. T.
Bishop, F. P. Gower, H. R. Lindsay, Hon. James (Devon, N.)
Black, C. W. Graham, Sir Fergus Linstead, Sir H. N.
Body, R. F. Grant, w. (Woodside) Lloyd, Maj. Sir Guy (Renfrew, E.)
Bossom, Sir A. C. Grant-Ferris, Wg Cdr. R. (Nantwich) Lloyd, Rt. Hon. Selwyn (Wirral)
Boyle, Sir Edward Green, A. Longden, Gilbert
Braithwaite, Sir Albert (Harrow, W.) Gresham Cooke, R. Lucas-Tooth, Sir Hugh
Brooke, Rt. Hon. Henry Grimston, Hon. John (St. Albans) McAdden, S. J.
Browne, J. Nixon (Craigton) Grimston, Sir Robert (Westbury) Macdonald, Sir Peter
Bryan, p. Gurden, Harold Mackie, J. H. (Calloway)
Buchan-Hepburn, Rt. Hon. P. G. T. Harris, Frederic (Croydon, N.W.) Maclay, Rt. Hon. John
McLean, Neil (Inverness)
Burden, F. F. A. Harris, Reader (Heston) Macmillan, Maurice (Halifax)
Butcher, Sir Herbert Harrison, Col. J. H. (Eye) Macpherson, Niall (Dumfries)
Campbell, Sir David Harvey, Air Cdre. A. V. (Macclesfd) Maddan, Martin
Carr, Robert Harvey, John (Walthamstow, E.) Marlowe, A. A. H.
Cary, Sir Robert Hay, John Marples, A. E.
Channon, H. Heath, Edward Mathew, R.
Chichester-Clark, R. Hicks-Beach, Maj. W. W. Mawby, R. L.
Clarke, Brig. Terence (Portsmth, w.) Hill, John (S. Norfolk) Maydon, Lt.-Comdr. S. L. C.
Cooper, Sqn. Ldr. Albert Hinchingbrooke, Viscount Moore, Sir Thomas
Cordeaux, Lt.-Col. J. K. Hirst, Geoffrey Morrison, John (Salisbury)
Corfield, Capt. F. V. Holland-Martin, C. J. Nairn, D. L. S.
Craddock, Beresford (Spelthorne) Hope, Lord John Neave, Airey
Crookshank, Capt. Rt. Hn. H. F. C. Hornsby-Smith, Mist M. P. Nicholls, Harmar
Crosthwaite-Eyre, Col. O. E. Horsbrugh, Rt. Hon. Dame Florence Nugent, G. R. H.
Oakshott, H. D. Robinson, Sir Roland (Blackpool, S.) Thomas, Rt. Hon. J. P. L. (Hereford)
O'Neill, Hon. Phelim (Co. Antrim, N.) Roper, Sir Harold Thomas, P. J. M. (Conway)
Orr-Ewing, Charles Ian (Hendon, N.) Ropner, Col. Sir Leonard Thompson, Lt.-Cdr. R. (Croydon, S.)
Page, R. G. Sharples, Maj. R. C. Thornton-Kemsley, C. N.
Pannell, N. A. (Kirkdale) Shepherd, William Tiley, A. (Bradford, W.)
Partridge, E. Smithers, Peter (Winchester) Touche, Sir Gordon
Pickthorn, K. W. M. Smyth, Brig. J. G. (Norwood) Turner, H. F. L.
Pilkington, Capt. R. A. Speir, R. M. Tweedsmuir, Lady
Pitt, Miss E. M. Spens, Rt. Hn. Sir P. (Kens'gt'n. S.) Vosper, D. F.
Pott, H. P. Stanley, Capt. Hon. Richard Wall, Major Patrick
Powell, J. Enoch Stevens, Geoffrey Waterhouse, Capt. Rt. Hon. C.
Price, David (Eastleigh) Steward, Harold (Stockport, S.) Willliams, Paul (Sunderland, S.)
Raikes, Sir Victor Steward, Sir William (Woolwich, W.) Williams, R. Dudley (Exeter)
Ramsden, J. E. Stewart, Henderson (Fife, E.) Wood, Hon. R.
Rees-Davies, W. R. Storey, S. Woollam, John Victor
Remnant, Hon. P. Summers, G. S. (Aylesbury) Yates, William (The Wrekin)
Renton, D. L. M. Sumner, W. D. M. (Orpington)
Ridsdale, J. E. Taylor, Sir Charles (Eastbourne) TELLERS FOR THE AYES:
Rippon, A. G. F. Teeling, W. Mr. Wills and Mr. E. Wakefield.
Ainsley, J. W. Hannan, W. Palmer, A. M. F.
Albu, A. H. Hastings, S. Parker, J.
Allen, Arthur (Bosworth) Hayman, F. H. Paton, J.
Allen, Scholefield (Crewe) Healey, Denis Pearson, A.
Bacon, Miss Alice Herbison, Miss M. Peart, T. F.
Bence, C. R. (Dunbartonshire, E.) Holt, A. F. Popplewell, E.
Benson, G. Howell, Denis (All Saints) Proctor, W. T.
Beswick, F. Hubbard, T. F. Pryde, D. J.
Bevan, Rt. Hon. A. (Ebbw vale) Hughes, Emrys (S. Ayrshire) Rankin, John
Blackburn, F. Hunter, A. E. Reeves, J.
Blenkinsop, A. Hynd, H. (Accrington) Roberts, Rt. Hon. A.
Blyton, W. R. Hynd, J. B. (Attercliffe) Roberts, Goronwy (Caernarvon)
Bottomley, Rt. Hon. A. G. Irvine, A. J. (Edge Hill) Rogers, George (Kensington, N.)
Bowden, H. W. (Leicester, S. W.) Irving, S. (Dartford) Ross, William
Bowen, E. R. (Cardigan) Janner, B. Shinwell, Rt. Hon. E.
Bowles, F. G. Jeger, George (Goole) Short, E. W.
Boyd, T. C. Johnson, James (Rugby) Silverman, Sydney (Nelson)
Brockway, A. F. Jones, Rt. Hon. A. Creech(Wakefield) Skeffington, A. M.
Broughton, Dr. A. D. D. Jones, David (The Hartlepools) Slater, Mrs. H. (Stoke, N.)
Brown, Thomas (Ince) Jones, Elwyn (W. Ham, S.) Smith, Ellis (Stoke, S.)
Butler, Mrs. Joyce (Wood Green) Jones, Jack (Rotherham) Sorensen, R. W.
Callaghan, L. J. Key, Rt. Hon. C. W. Sparks, J. A.
Champion, A. J. King, Dr. H. M. Steele, T.
Chapman, W. D. Lawson, G. M. Stones, W. (Consett)
Chetwynd, G. R. Ledger, R. J. Summerskill, Rt. Hon. E.
Clunie, J. Lee, Miss Jennie (Cannock) Taylor, John (West Lothian)
Collick, P. H. (Birkenhead) Lever, Leslie (Ardwick) Thomson, George (Dundee, E.)
Corbet, Mrs. Freda Lindgren, G. S. Tomney, F.
Cove, W. C. Lipton, Lt.-Col, M. Viant, S. P.
Craddock, George (Bradford, S.) McInnes, J. Warbey, W. N.
Cronin, J. D. McKay, John (Wallsend) Weitzman, D.
Daines, P. McLeavy, Frank Wells, Percy (Faversham)
Deer, G. Mann, Mrs. Jean Wheeldon, W. E.
Dye, S. Marquand, Rt. Hon. H. A.
Mikardo, Ian White, Mrs. Eirene (E. Flint)
Edwards, Rt. Hon. Ness (Caerphilly) Mitchison, G. R. Wilcock, Group Capt. C. A. B.
Edwards, Robert (Bilston) Moody, A. S. Wilkins, W. A.
Evans, Albert (Islington, S. W.) Morris, Percy (Swansea, W.) Willey, Frederick
Evans, Edward (Lowestoft) Morrison, Rt. Hn. Herbert (Lewis' m, S.) Williams, W. R. (Openshaw)
Forman, J. C. Moyle, A. Williams, W. T. (Barons Court)
Fraser, Thomas (Hamilton) Mulley, F. W. Willis, E. G. (Edinburgh, E.)
Gaitskell, Rt. Hon. H. T. N. O'Brien, T. Wilson, Rt. Hon. Harold (Huyton)
Gordon Walker, Rt. Hon. P. C. Oliver, G. H.
Griffiths, Rt. Hon. James (Llanelly) Oswald, T. Mr. Holmes and Mr. J. T. Price.
Hamilton, W. W. Owen, W. J.

Question put and agreed to.

Bill accordingly read a Second time.

Bill committed to a Select Committee of Seven Members, Four to be nominated by the House and Three by the Committee of Selection:

Any Petitions against the Bill presented by being deposited in the Private Bill Office at any time not later than the fifth day after this day in which the Petitioners pray to be heard by themselves, their

Counsel or Agents, to stand referred to the Committee, but that if no such Petition is presented, or if all such Petitions are withdrawn before the meeting of the Committee, the Order for the committal of the Bill to a Select Committee to be discharged and the Bill to be committed to a Standing Committee:

Any Petitioner whose Petition stands referred to the Committee, subject to the Rules and Orders of the House and to the prayer of his Petition, to be entitled to be heard by himself, his Counsel or Agents, upon his Petition provided that such Petition is prepared and signed in conformity with the Rules and Orders of the House, and the Member in charge of the Bill to be entitled to be heard by his Counsel or Agents in favour of the Bill against such Petition:

Power to report from day to day Minutes of Evidence:

Three to be the Quorum of the Committee.—[Mr. Amory.]

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