§ Motion made, and Question proposed, That this House do now adjourn.—[Mr. E. Wakefield]
§ 10.1 p.m.
§ Mr. George Jeger (Goole)
I rise to voice my protest against the Government's decision to close the flax processing mills at present operating in this country. These mills were established early in the war because it was necessary to have a home flax industry, otherwise we should have been deprived of all the flax we needed. This provided home-produced flax in place of the imported flax on which we had previously relied.
Flax is valuable for all sorts of purposes. It was useful to us during the war for all the Armed Forces and Civil Defence. It is the basis of canvas, sail cloth, tarpaulins, tents, fire hose, sacking and scores of purposes that have been outlined in the technical journals. It is the source of a valuable industry. In 1954, £9 million worth was produced in cloth, yarn and twine, of which over £2 million worth was exported, apart from the export of made-up goods, which makes a valuable contribution to our export trade and earns foreign currency.
These mills were set up to meet an emergency. Is it to be contended that the emergency is now over? If so, it will be difficult to justify the closing of these mills, set up for that emergency purpose, at a time when we are building up emergency strategic stocks of all kinds of materials, particularly food, some of which involve us in heavy losses from time to time. I contend that we need these flax mills as an insurance against any emergency that might arise again and which might prevent us from importing the flax that we need.
We have built up skill, machinery, mills and technical research in a special department. All these things are making a valuable contribution to British industry. If we close the mills, as the Government have started doing and propose to continue to do, we shall dissipate a team of skilled workers, we shall lose the accumulated benefits of the research work they have already done and we shall leave the market in Britain clear for foreign flax to be imported, which will cost foreign 882 currency and might even, in the absence of competition from home-produced flax, cause prices to rise. We shall lose a valuable export trade in flax seed. I understand that Ireland depends almost entirely upon English seed for its own flax industry. It has been said that Ireland can get similar flax seed from Canada, but that involves the spending of dollars and nobody within the sterling area today looks forward to any proposal for spending more dollars.
The one point which has been advanced by the President of the Board of Trade in defence of his policy is that it would save money which is being spent because of the loss on home-produced flax. I understand that the loss is at present running at the rate of about £250,000 a year. If that amount is correct—it may well be more or less—it is a considerable sum of money, but the saving on it might well be offset if farmers no longer grew flax but in its place turned to another crop, such as wheat, which has a guaranteed price, which would carry with it a payment from the Government and which might well mean that the estimated £250,000 which would be saved would be cut by at least two-thirds if farmers were to turn to a wheat crop rather than a flax crop.
I have yet to learn who supports the Board of Trade and which organisation or body of people connected with this industry supports the Board in its proposal. I have learned of a great deal of opposition to it. I understand that the organised workers in the factories are against the proposal. They would be, of course, because it means that the skill which they have put into the industry, in many cases for 20 years, will be lost. They will have to seek alternative employment elsewhere, sometimes in rather remote rural areas, and if they are getting on in years the prospect of alternative work is not very rosy.
The research technicians who are organised through an association have intimated that they are against the proposal. The spinners who use the flax have intimated in no uncertain terms, in a very well-produced booklet circulated to hon. Members, that they are against it. The farmers who grow the flax are definitely against the suggestion. One of the mills in question is situated at 883 Howden, about 100 yards outside my constituency. About 120 workers are employed there, of whom about 100 come into the mill to work from my constituency. I understand that the mill is provided with flax grown by about 120 small farmers, with an average acreage of 12 per farm.
The farmers like this flax. It is a cash crop. It is good as an eliminator of eel worm and it helps to create a healthy soil. It is a very good rotation crop and the farmers like to get the chaff from the mill afterwards. The chaff is valuable feeding stuff and saves the import of feeding stuff from abroad. That is the picture locally, and I understand that there is exactly the same picture in other parts of the country. I understand on good authority from the National Farmers' Union that farmers generally who are concerned with flax crops share the views of the 120 in my locality in Yorkshire. Furthermore, the N.F.U. states, perhaps with a certain amount of embarrassment, that it has not been consulted by the Board of Trade on this move which affects its members.
The N.F.U. states that some time ago it offered consultations on a technical level with representatives of the Board of Trade, but the offer was not taken up. It says that it has experts who could put forward to the Board of Trade various ways of continuing this industry at lower cost and cutting the losses to which the Board of Trade objects. I would put forward some practical suggestions for the consideration of the Parliamentary Secretary to the Board of Trade who is to reply to the debate.
First, it is necessary on strategic grounds and moral grounds and from the point of view of agriculture to keep this industry alive. I concede that it is perhaps not necessary to keep all the mills which are at present open running in the way in which they are running today. It may be necessary to concentrate on a few mills only, equipping them with more up-to-date machinery and cutting the total loss on the industry to the Treasury. As a result of the activities of the research team which has been working for the last two years on flax production, there is confidence in the industry that with some up-to-date machinery the loss can be cut by a great deal, because the present yield of fibre from flax can be doubled if the 884 wartime machinery now used were scrapped and more up-to-date machinery were obtained.
When I first raised this matter in response to requests from my constituents, 10 mills were open and working. There are now only nine. Therefore, the matter is becoming very urgent. There is still time to reconsider the whole question. The technical knowledge of experts is available. The National Farmers' Union has specialists and research workers who are prepared to discuss with the nominees of the Board of Trade the question of the reorganisation of the industry on sound lines and perhaps with fewer mills. I hope that the Board of Trade will reconsider its decision. I hope that it will take a new look at the industry and decide to keep open the existing nine mills—a decision which would be both popular and right.
§ 10.10 p.m.
§ Commander R. Scott-Miller (Kings Lynn)
I should like to refer to what the hon. Member for Goole (Mr. G. Jeger) has said and ask my hon. and learned Friend whether he would look at this matter again. I know that this flax scheme costs the taxpayer about £500,000 a year, and I am the last person to ask for the spending of public money if it can be avoided. Nevertheless I understand from the National Farmers' Union that it is firmly of the opinion that the flax industry could be run on a limited scale and on a sound economic basis, with small cost to the taxpayer.
This scheme was started by private enterprise in 1931. I should like to underline the farmers' point of view in this matter. About 16,000 acres of our farm land is down to flax and 2,000 acres of that is in the County of Norfolk. It is quite right to say that it is a good rotation crop, and one which is very helpful and popular among our farmers.
I have a particular interest in this matter, because I have one of these mills in my constituency on the Royal Estate, at Sandringham. This mill is agreed by everyone to be the most efficient in the country. Over the last six years it has produced the best fibre extraction rate throughout the whole scheme. It would be a bad thing to close that mill if it could be kept going, because not only would about 200 industrial workers in that factory be deprived of their jobs, but 885 it would mean that the splendid work done by the small research team at that factory would be thrown to the winds.
It takes ten years to grow the right type of flax, and I feel most strongly that we should at least keep one mill to provide the nucleus of the crop. I therefore ask my hon. and learned Friend to reconsider this matter in that light.
§ 10.13 p.m.
§ Mr. Sidney Dye (Norfolk, South-West)
I should like to thank my hon. Friend the Member for Goole (Mr. G. Jeger) for raising this matter which, as he said, affects his constituency. It is also a matter in which farmers over a great part of the country are interested. We were shocked to learn that it is apparently the intention of the Government to bring to an end the growing of flax in this country and the manufacture of it for industrial and other purposes.
This would indeed be a blow to those farmers who have been growing flax as one of their crops in rotation. It would mean, as my hon. Friend pointed out, finding another crop to take its place in the rotation—one which has the same purpose, namely, of providing a complete change in the plant food taken from the soil which would enable it in that year to kill some of the pests which prey upon the other crops in the rotation. Therefore, it has a value greater than its own inherent value as a crop.
If, therefore, we are now to reach the position when we shall no longer be able to depend on a certain proportion of home-grown flax, but shall be dependent upon imported flax, then we shall lose in knowledge and experience. And we shall be giving up this crop at a time when we must be spending an enormous amount on rearmament, on providing against the possibility of having to face a situation similar to that which we faced in 1939 to 1945.
It does not seem that we should do this, and if it is said that £500,000 a year is an excessive sum to spend for this purpose on a crop which has so many uses in industry and commerce, as well as being vital in time of war, we should ask Her Majesty's Government to reconsider this matter, rather than to reach a position which may upset the farming community and deprive us of an article which was vital to our needs during the last war and which may be so again. Therefore, 886 I hope that in replying tothe debate, the hon. and learned Gentleman will have something better to say than what he may be considering saying at the moment.
§ 10.16 p.m.
§ Captain J. A. L. Duncan (South Angus)
I support the plea made by the hon. Gentleman the Member for Goole (Mr. G. Jeger). He referred to a pamphlet produced by the Flax Manufacturers' Association. That pamphlet was inspired from my constituency. I agree with the hon. Gentleman that on strategic, on trade, and on other grounds it is of interest to the flax trade, quite apart from the farming community, that a certain amount of flax should continue to be grown in this country. This would then be available if ever again we were at war.
My constituency used to clothe the Navy in sail and it is making sail for the model "Mayflower" which will cross the Atlantic shortly. With that great tradition I think we should not part with this crop because, if we do so, and rely entirely on foreign flax, we may find ourselves short of flax when we really need it.
§ 10.18 p.m.
§ The Parliamentary Secretary to the Board of Trade (Mr. Derek Walker-Smith)
The House is indebted to the hon. Members for Goole (Mr. G. Jeger) and Norfolk, South-West (Mr. Dye) and to my hon. and gallant Friends the Members for King's Lynn (Commander Scott-Miller) and South Angus (Captain Duncan) for the lucid, temperate and persuasive way in which they have put their case on this matter. I do not say that there is no substance in the points which they have made, but it is the duty of the Government to look at this matter as a whole and to see whether the sum total of these considerations outweighs the plain and disagreeable economic facts of this case. Those facts are that this scheme has always been run at a loss, that the loss was increasing and that it was thereby involving an increasingly heavy subsidisation by the taxpayer.
The hon. Member for Goole said that the Board of Trade has no supporters in this matter. That may not be a matter for great surprise because, where economy is involved, it is well known that, although all subscribe to it as a general principle, 887 specific acts of economy are generally friendless. In this case, however, the Government have been driven to the inescapable conclusion that these considerations do not justify a continuance of the scheme and a consequential increasing burden on the public purse.
The hon. Member for Goole referred to a loss of about £250,000 a year. Of course, as subsequent hon. Members have made clear.the loss is in fact a good deal more than that. It was however not only the size of the loss but the trend of the loss which was showing a marked increase.
If I may give the House the figures for the year ending July, 1952, there was a loss of £89,000, whereas two years later, for the year ending July, 1954, the loss had grown to £547,000. There was at the time the Government decided to discontinue the scheme, in August, 1954, a loss running at about £500,000 a year.
Though there had been increases in wages and other costs, the main reasons for the increased loss were the higher costs that had to be paid to the farmers for growing the crop, together with the lower level of prices at which the flax and some of the by-products had to be sold. Therefore, we had the position that, whereas the price to be paid to the farmer was going up, the price received for the sale of the processed product was going down. Thus, for the 1951 crop the farmer's price was 10 guineas per ton. For the 1954 crop it had risen to 14 guineas per ton.
Looking at the other side of the equation, in the year ending July, 1952, the world price for flax was £300 per ton, but in the period immediately preceding August, 1954, the date of the decision, the price had gone down to a little over £200 a ton. The trend since the date of the decision to discontinue has fully confirmed the unwelcome wisdom of this decision. It is true that the price to the farmer for the 1955 crop showed a slight decline to £14 per ton, but the world price of flax fell to £180 per ton. The cost of producing a ton of flax was £500 and the world price of flax only £180, showing a net loss of £320 per ton.
It is right that the House should have the matter in perspective and to record that the annual output of the ten flax factories—now only nine, as the hon. 888 Member said—was running at a rate of something less than 2,000 tons, and that figure had to be set against a total United Kingdom consumption in the neighbourhood of 45,000 tons, which means that that production represented only about 5 per cent. of our total consumption.
The hon. Member for Goole referred to the position of Northern Ireland. Before the Government reached their decision in August, 1954, they consulted the Government of Northern Ireland and received the assurance that it would be possible for Northern Ireland to build up an alternative source of seed supplies by the time supplies from this country were no longer available.
With regard to the Scottish position, to which my hon. and gallant Friend the Member for South Angus has referred, only 10–15 per cent. of the raw material of the Scottish flax spinning and weaving industry was obtained from these mills. The actual figure for 1954 was 1,571 tons out of the 14,000 tons actually used in Scotland during that year.
Both the mills to which specific reference has been made, the Howden Mill in the constituency of the hon. Member for Goole and the West Newton Mill in the constituency of my hon. and gallant Friend the Member for King's Lynn, will remain in operation until the end of processing the 1955 flax crop. That is to say, they will not be disposed of until some time in the course of 1957.
That will give a very reasonable time, as my right hon. Friend the President of the Board of Trade has pointed out in the House, for the workers to obtain alternative employment. He pointed out, in answer to the hon. Member for Goole on 23rd November, 1954, that the Ministry of Labour would do its best to help them to find other employment. In point of fact the total number of people employed at these mills is only 721, and no mill, except the mills in Norfolk and Lincoln, employs more than 100 people.
In general, as the House is aware, there is no shortage of jobs, and it is to be hoped that the workers who leave the flax factories will be able to obtain jobs either in agriculture or in light industry in the neighbourhood. The hon. Member for Goole referred to the special position of elderly workers. I should tell him that this is not in fact an industry with an 889 elderly age structure. More than half of the people employed are under 40.
So far as the older people are concerned, if it is found towards the end of a particular operation at a mill that it is likely to prove extremely difficult for reasons of age or infirmity for a few workers to find alternative employment, the Directorate of Home Flax Production will do the best it can to find other work in the mill to keep them on pay as long as possible. It may not always be possible as suitable work may not be available, but it will do what it can.
The hon. Member for Goole said that the benefit of research would be lost. It is true that the closing down of the scheme also involves the closing down of the research development, but I am happy to say that it does not mean that the benefit of the research work will be lost, because the history of this flax scheme, together with all supporting records, is being prepared and will be preserved against any possible future need of the kind to which the hon. Member for Goole and my hon. and gallant Friend the Member for South Angus referred.
Hon. Members referred to the possibilities of economies. It is of course true that economies are always possible, but we are convinced with knowledge of many years of operation and research that nothing could be done which would more than touch the fringe of this problem, unless considerable sums are to be spent on plant and new machinery. As I think the hon. Member appreciates, the machinery in these mills was installed in wartime and was designed to deal with green flax. The method now used is to 890 ret the flax and then scutch it, which requires different machinery.
Even if we were to incur the expense of this re-equipment, we are satisfied that the use of this more modern machinery would not make a large enough reduction in the loss to justify continuing the scheme. I should say that, of course, if there is this confidence in the scheme, there is nothing to stop private interests from cultivating and processing flax if they so wish. Should the flax industry in Scotland or any other body think it worth while to make an offer to buy one or more of the Government-owned factories with a view to their subsequent operation as private undertakings, the offer will be very carefully considered along with others that may be made.
I have done my best within the limitations of time to answer the points made. I must conclude as I began that, although the Government recognise that a decision of this kind must result in some difficulties of various kinds to the interests affected, we do not consider that the sum total of the arguments justifies continuance of the expenditure of half a million pounds a year from public funds to maintain this small scheme covering only about 16,000 acres of land. Therefore, it is an unwelcome necessity that these mills be closed down.
§ The Question having been proposed after Ten o'clock, and the Debate having continued for half an hour,Mr. SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
§ Adjourned at twenty-nine minutes to Eleven o'clock.