§ The Secretary of State for the Colonies (Mr. Alan Lennox-Boyd)I rise to make what is, I am afraid, a rather lengthy statement on Malta.
As the statement made by the Maltese Prime Minister to the Maltese Legislative Assembly on 25th June, of which I have placed a copy in the Library, covers much ground and deals with a number of controversial issues, I consider that I should make a full statement of Her Majesty's Government's position. As it is very long, I am, with permission, circulating it in the OFFICIAL REPORT. The salient points in this statement are as follows.
Her Majesty's Government's attitude has been based all along on the recommendations of the Malta Round Table Conference, particularly paragraphs 58–61 of the Report. I would recall what I said in the debate last March on the specific question of United Kingdom financial aid. I said:
Further, on this financial aspect, we accept the proposals of the Report regarding economic assistance including the need for a clear understanding 'at the start' about the maximum amount of annual assistance by Her Majesty's Government over a number of years. Thus, acceptance of integration would not involve Her Majesty's Government in any obligation to provide financial assistance in excess of the levels envisaged in the Report"—[OFFICIAL REPORT, 26th March, 1956; Vol. 550, c. 1799.]This statement was not challenged at that time by the Maltese Government or by this House.850 When, in accordance with the Conference's recommendations, Her Majesty's Government proposed that discussions should take place at the end of May or early in June on the financial arrangements for the next few years, the Maltese Government asked instead that the discussions should be restricted to the amount of assistance required in the current financial year and to the principles to be adopted after integration came about. Her Majesty's Government accepted this proposal but, in the course of subsequent discussions, it became manifest that serious differences of principle existed between the two sides on the whole question of financial aid.
Briefly, the Maltese Government rejected Her Majesty's Government's endorsement of the recommendations in paragraphs 58–61 of the Report and requested that their Budget for 1956–57 should be considered on its merits. Her Majesty's Government took the view that the merits included the revenue side as well as expenditure and pointed out that the Maltese Government proposed very large increases in expenditure on new services, both capital works and social services, which would involve continuing and increasing commitments in future years.
The Maltese Government, on the other hand, resisted all suggestions that they should themselves find new sources of revenue, either by taxation or from loans. Thus, while expenditure was to rise by £4¼ million, or nearly 45 per cent., over last year, Maltese revenue was to rise by only £250,000, or about 3 per cent., over last year. Her Majesty's Government were thus being asked to meet practically the whole of the increased deficit and thus to increase their contributions from £4¼ million last year to over £8 million, or by nearly 90 per cent.
Her Majesty's Government were prepared to consider granting this year total assistance at the level of £4–5 million recommended by the Conference "for the next few years". However, the Maltese Government, having at first maintained that they could not modify their proposals in any way, were at the end of the talks prepared to consider a reduction of less than £500,000 expenditure, with no increase in domestic revenue, leaving Her Majesty's Government's commitment at £7½ million. 851 Moreover, in the course of my discussion with him, Mr. Mintoff made it clear that his Government were firmly committed to the principle of "economic equivalence" and intended to press for inclusion of this principle in the new Constitution.
The detailed arguments on either side are dealt with in the full statement which I am circulating. There is one point, however, to which I should like to call the attention of the House now. The Maltese Government maintained that any serious modification in their proposals would be unacceptable and that aid at the level of £5 million would result in serious unemployment.
In my talks with the Maltese Prime Minister, I indicated that there was, in my view, considerable room for devising a proper balance between schemes intended primarily to maintain employment and schemes of economic development. I also made it clear to him that, bearing in mind the continuing and increasing burden of new recurrent services and capital works in future years, it was essential for his Government to face up to the obligation which they assumed in the agreed statement of last July, and on which the Round Table Conference laid special emphasis, that the Maltese Government and people should make the best possible contribution from their own resources.
The discussions between the Maltese Prime Minister and myself and subsequently with my right hon. Friend the Prime Minister did not, however, find any common ground, and although conducted in a spirit of good will and mutual consideration on both sides, ended inconclusively.
The Maltese Prime Minister left London on 23rd June. He made a statement in the Maltese Legislative Assembly on 25th June, which attempts to place on this House the obligation of deciding, before the end of this week, to accept a commitment to vote funds for total assistance for this financial year of £7 million. I cannot recommend to this House that it should accede to this demand.
As the House well knows, Her Majesty's Government have warmly supported the recommendations of the Round Table Conference, including the recommendation for representation at 852 Westminster, and I can assure hon. Members that the Government have spared no effort, since the debate in March, to prepare a plan for the legislation which my right hon. Friend the Prime Minister promised to introduce into this House in due course. I know that Members in all parts of the House would share with me a great sense of regret if this plan could not now be proceeded with.
As a contribution towards resolving the present deadlock, I have proposed to Mr. Mintoff, through the Governor, an arrangement whereby an agreed budget would be drawn up on a basis of 18 months from April last and Her Majesty's Government's contribution thereto would be fixed at £7½ million. At the same time, Her Majesty's Government would appoint an Economic Commission to examine and report upon the issues involved in the light of the recommendations of the Round Table Conference. I hope that, with this proposal in mind, the Maltese Prime Minister and his colleagues will seriously reflect on their position.
§ Mr. Lennox-BoydYes.
§ Mr. BevanMay I say, on behalf of my colleagues, that in the first place we deplore the fact that this statement has been delayed until this morning? This is not the first time that the right hon. Gentleman plays this sort of trick on the House. There have been three previous occasions when we have been faced with a fait accompli without any opportunity of discussing the implications involved. The right hon. Gentleman was notified earlier this week that we would like a statement on Malta. It is left until Friday morning, with only the weekend intervening, before we can do anything about it.
Secondly, may I call the attention of the right hon. Gentleman to the fact that he grossly misrepresents the Round Table Conference in this respect? The Round Table Conference made no financial recommendations at all. In the paragraphs to which the right hon. Gentleman has referred, the Round Table Conference accepted financial statements made by the Colonial Office. We did not convert them into financial clauses.
853 If the right hon. Gentleman looks at the latter part of paragraph 59, he will see that we said:
It seems to us to be unlikely that more money could be spent productively in Malta during these years because of the limits set by the skilled labour force available, and the building and constructional capacity of the Islands. The rate of needed assistance towards capital expenditure may possibly increase gradually thereafter …Our information is that the money made available to Malta for capital construction has been spent more efficiently and more quickly than was expected by the Colonial Office. Therefore, the circumstances have been created in which more money should be provided if unemployment is to be avoided. That is my first point.
My second point to the right hon. Gentleman is this. Is it not a fact that the differences between the Government and the Government of Malta have been narrowed considerably? Is it not a fact that it was possible to make an arrangement for the increased rate of expenditure to go up for about three months, during which further talks could be held? Is it not rather deplorable that the whole of this very promising constitutional advance should be jeopardised for the sake of £1 million a year, which, I am informed, is all that divides the two parties on this matter? Therefore, I ask the right hon. Gentleman once more to reconsider this position, for is it not a fact that the Prime Minister of Malta has decided to ask for a dissolution of of the Maltese Parliament?
§ Mr. Lennox-BoydI will try to answer the right hon. Gentleman's three points. May I say straight way that the promising experiment is more likely to be jeopardised, not by any action of mine or by Her Majesty's Government, but by the use by the right hon. Gentleman and others of very intemperate language about the proposal which has been put forward? [Interruption.] I listened to the right hon. Gentleman in silence and with courtesy, and it is not unreasonable to ask for the same treatment for me.
In regard to the right hon. Gentleman's question as to why a statement is being made today, this is a matter of very great importance on which there has been a lot of thought and much consultation during the present week. It was not I who said that a decision had to be arrived 854 at by the end of this week. Very unusual language and procedure was adopted in Malta itself.
I have done my best, quite calmly but clearly, to see whether there was some way out of the difficulty, and I have suggested a way out of it today, but it has, naturally, taken some time to devise a possible compromise. I thought it was worth while delaying until such a proposition was clear and available and then to make the first notification of it to the House.
The second point raised by the right hon. Gentleman concerned what he said was a misrepresentation by me of the thoughts in the minds of the Round Table Conference. It is not for me now to interpret what was in the minds of the members of the Conference at the time, but this I can say. I made it quite clear to the House when commending the proposals to Parliament—and there was no vote upon them—that in my view the Round Table Conference regarded the estimates of £4 to £5 million for financial aid for the next few years as reasonable, which estimates were arrived at both by Her Majesty's Government and by the economic adviser to the Maltese Prime Minister. I said so in the House and it was not challenged at the time, nor was any challenge made by the right hon. Gentleman or by any Front Bench Member speaking for the Socialist Party to what I said.
The third question by the right hon. Gentleman asked whether it would not be possible to agree now to a continuance of aid at the present high rate for the next three months, without prejudice, I imagine, to what would be the total sum for the year. The right hon. Gentleman, I hope, is not so naive as to believe that if in the course of the current year expenditure had continued at a certain level for six months, which, if doubled, would have been £8 million at the end of the year, Her Majesty's Government would at the end of the six months have found themselves committed to the total expenditure of £8 million in the year. It would have been £8 million in this year and more next year, which would have been wholly at variance with the figures I gave to the House and on which the unanimous decision of the House at the time, last March, may well be held to have been arrived at. 855 [Interruption.] It was a unanimous decision, because it was not challenged.
§ Mr. RobensReally.
§ Mr. Lennox-BoydIt was a unanimous decision on the principles of the Round Table Report. Had I at that time suggested to the House that there was no limit to financial aid that would be forthcoming in the first year or that it was very much in excess of the sum involved, a different situation would have confronted Members of the House and they might have come to a different decision.
I ask hon. Members, who, I realise, have had a long statement read to them—and there is an even longer one setting out the position which will appear in the OFFICIAL REPORT—to reflect on these statements before they rush to hasty conclusions, for the statement does, I think, represent something which, if considered calmly and clearly, may well get us out of what is otherwise, I recognise, a difficult position.
§ Mr. Clement DaviesThere will be universal regret if this plan breaks down. I am quite sure that the desire of everyone is that the plan should be carried through to the satisfaction of all. The right hon. Gentleman places far too much emphasis upon a general statement. He cannot expect that it can be regarded as being a factual statement from which there can be no deviation.
With regard to the Economic Commission, does the right hon. Gentleman have in mind the number and kind of people concerned and how soon it can act? That apparently is the new offer which has been made. What does it really convey to the Maltese Government? We ought to have a little more information about this.
§ Mr. Lennox-BoydI share the hope of the right hon. and learned Gentleman that nothing which is happening now or may shortly happen, or may happen at any time in the future, will jeopardise this experiment to which I also pledge my personal support and the support of the Government. The proposal is that there should be £7½ million for the next year and a half, which would enable the Maltese Government to rephase their expenditure and the expenditure to which they feel themselves committed over a 856 longer period, if they had that absolute certainty. In addition to that, there would be a commission, which could be of a single commissioner or of a number of people, whom I would appoint, and whom I would take steps to appoint straight away, to re-examine the position in line with the Round Table Conference Report and the views expressed by the Government at the time of the debate on that Report, to examine both aid to Malta and the revenue side as well. I think that is a reasonable proposition, which, I trust, will not be jeopardised by any rather hasty language in this House.
§ Sir R. RobinsonIs not the best way to find the solution to this problem to have a calm and quiet discussion? In which case, would it not help if the Prime Minister of Malta were to withdraw the ultimatum about a date-line, so that there may be further discussion between all parties?
§ Mr. Lennox-BoydThat certainly would be a major contribution.
§ Mr. J. GriffithsWill the right hon. Gentleman recall, as I am sure my colleagues of the Round Table Conference recall, that the Round Table Conference itself did not enter into very great detail about amounts of financial aid, for the reason given in the Appendix G? Already, before we began our task, the Government, through the Secretary of State, had entered into certain commitments with the Maltese people to serve three purposes, as stated in the Appendix—
(i) Raising the standard of education and other social services; (ii) increasing substantially opportunities for employment outside Service establishments; (iii) avoiding unemployment.The position of Malta at present is that in the first three months of this current financial year, April to June, a tentative agreement was arrived at between the Government and the Maltese Government by which expenditure has been running at an annual rate of about £5½ million. If the proposal of the right hon. Gentleman put forward earlier, which he proposes now, is to govern the annual rate, it means that the Maltese Government during the nine months remaining of this financial year will have to make such cuts as will bring about unemployment in Malta. The Maltese Government will be compelled to make large cuts which will bring about unemployment. 857 Would it not be very much better in this situation if the Maltese Government were allowed to continue at the present rate of expenditure during the next three months to allow time for full consideration?The House will realise that, having agreed upon this proposal for the first year to put the Maltese Government in a position in which they have to put people out of work is to create an entirely wrong atmosphere in which to begin this new policy. I ask the Government to consider this. There is no doubt whatever that we shall have a dissolution and an election—about what? Not about integration; about something else. I ask the Government to realise the importance of this and to resolve to prevent creating a situation in Malta which we shall all of us regret in a few months' time. I have postponed putting this question before in the hope that a settlement would he arrived at. We are left now with the least amount of time, for tomorrow there may be a crisis. If there should be, it will be a very bad day for this House and for our relations with the people of the Colony, who stood by us in our difficulties. To allow that for the sake of these few pounds is unworthy of the Government and the House.
§ Mr. Lennox-BoydI cannot accept, and I am sure that very few people on this side of the House and, possibly, on the other side of the House can possibly accept, the view the right hon. Gentleman has put forward as representing what happened. In so far as the right hon. Gentleman put to me a specific question, I will answer it. It is true that an agreement was arrived at for aid for three months, but the fact that it was agreed for three months is now being used as an argument that aid at the same rate must continue for the remainder of the year. It is now suggested that we should say the same rate should continue for six months, without prejudice, but if the argument after three months is used that we are to continue for the next nine, I cannot see how, if it were granted, the argument could not also be used with even greater force that we should continue it for the next six. Nor can I accept that this would necessarily involve unemployment in Malta. I have considerable authority for saying that there is room for rephasing this programme over 858 18 months in a way which will not necessarily bring about unemployment.
It seems to me very important that, whether this is or is not an important year from the internal political point of view in Malta, the people of Malta must in this year, as in any other, face up to certain facts of life, and I am not prepared to lend myself to a situation in which those facts would be kept from them perhaps for political purposes. I think the proposal I have made is a fair one, and it is certainly not inconsistent with the policy of integration, to which I myself am also publicly committed.
§ Mr. NicholsonIt would be a very great pity if a situation of such far-reaching significance becomes a matter of partisan controversy. Is my right hon. Friend aware that, in spite of many misgivings on the part of many of us, this House and this country, nemine contradicente, loyally accept integration and intend and hope and trust it will be carried out? Will he exert himself to the uttermost to see that misunderstanding, through impetuosity or impatience, or, perhaps, lack of experience on the other side, does not prevent the implementation of this great constitutional and Imperial advance. Will he send out from this House today a message that he as well as all this House and this country devoutly hope that this constitutional problem may be satisfactorily resolved?
§ Mr. Lennox-BoydI share in my hon. Friend's hope that nothing happens this year or in the future to bring about any unfortunate consequences of the kind my hon. Friend has in mind. It is not the Government who have issued an ultimatum. If one was issued, it was issued by the Prime Minister of Malta. I have tried calmly and quietly and fairly to put the facts before the House. Further facts will be published in the OFFICIAL REPORT, which I believe, when they are considered, on reflection will remove any misgivings by fair-minded people here or elsewhere.
§ Mr. CrossmanWill the right hon. Gentleman think of the effects of his remarks about the Round Table Conference? I think the right hon. Gentleman will agree that the Round Table Conference created very good relations between ourselves and Malta. Does he 859 not think it is a bit unfair to try to shuffle off on to the Round Table Conference a completely unilateral decision of his own? How can he pretend that the Colonial Office decision to make an absolute ceiling of £5 million is a recommendation of the Round Table Conference? Does he not realise that he is doing great damage to the relations of this House with Malta, and that he misrepresents what the Round Table Conference was doing? The right hon. Gentleman talks about an ultimatum, but is it not a fact that the sharp reaction of the Prime Minister was to an ultimatum from himself in which he said, "£5 million and no more"? Is it not possible to adopt a more reasonable attitude such as the Round Table Conference seriously advocated?
§ Mr. Lennox-BoydI do not think the hon. Member has made any point I have not already covered. I made it quite clear at the time, without any dissent from any point, how we read the Report of the Round Table Conference.
§ Mr. CrossmanMisread it.
§ Mr. Lennox-BoydI said emphatically that acceptance of integration would not involve the Government in any obligation to provide financial assistance in excess of the levels envisaged in the Report. Last year £4½ million was given by the United Kingdom to Malta. This year under my proposals it would have been £5 million. So there would have been a substantial increase. I see no reason to modify the statement I made to the House.
§ Mr. Gaitskell rose——
§ Mr. SpeakerBefore I call on the right hon. Gentleman, may I remind the House that, in view of the importance of this subject, I have allowed this discussion to go on rather longer than I would feel right in other circumstances, but I hope that the House will not indulge in an irregular debate, because there is no Question before the House. I hope that we can pass to other business.
§ Mr. GaitskellI appreciate what you have said, Sir, but I wish to ask the Colonial Secretary, first, whether he is aware that we on these benches, and I think many other people, simply cannot accept his account of the point of view 860 of the Round Table Conference in this matter of aid? Is the hon. Gentleman further aware that, with few exceptions, all of us in the House are deeply concerned lest the integration proposals should fall through, and that we are seriously worried about what the consequences in Malta would be were that to happen?
Would the right hon. Gentleman agree also that in fact the difference between Her Majesty's Government and the Government of Malta at the moment is between £5 million and £7 million, and that Her Majesty's Government have been quite unwilling to move at all from their figure whereas the Prime Minister of Malta has been willing to negotiate so far as his demands, or requests, are concerned? Would the right hon. Gentleman not be prepared now to say that he is, on behalf of Her Majesty's Government, prepared to negotiate about this very small difference in order to try to reach a settlement with the Prime Minister of Malta?
§ Mr. Lennox-BoydIn courtesy to the right hon. Gentleman's position, I will naturally answer that, but it again raises the points which I have raised before. I would share with him very great distress if the integration proposals, with the imaginative approach which they recommend, should come to shipwreck, and I am anxious to see that they do not. It is not a question that can be simplified to a mere matter of £1 million or so. The proposed provision for this year would inevitably involve larger sums for the next two or three years, and cannot be separated from the question of the principle of equivalence or otherwise which would apply in the integration period and thereafter. I have made what should be regarded as a generous approach in this matter. I hope that the Maltese Prime Minister will make a similar one, because the basis of the financial arrangements arrived at last June was that both parties would try to help in this financial field.
§ Mr. J. GriffithsThe Secretary of State has given an interpretation of the Round Table Conference Report which I, as a member, do not accept. I believe that there are other members who do not accept it. If the Round Table Conference Report is to be misinterpreted—and I speak as a member of the Conference— 861 we ought to be recalled, because we do not think that our Report should be misused in this way.
§ Following is the statement:
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cc861-5
- UNITED KINGDOM FINANCIAL ASSISTANCE TO MALTA 2,526 words