BUDGET INTENTION (SPEECH OF THE PRESIDENT OF THE BOARD OF TRADE)

HC Deb 04 March 1957 vol 566 cc40-134

3.46 p.m.

Mr. Hugh Gaitskell (Leeds, South)

I beg to move, That this House regrets the premature disclosure of a Budget intention by the President of the Board of Trade and calls upon the Prime Minister to uphold the high standards established by Parliamentary tradition in such circumstances. I am sorry that the statements of the President of the Board of Trade on Wednesday and the Prime Minister on Thursday should have made it necessary for us to change the business for today and to move this Motion, but in view of what the right hon. Gentlemen said, we on these benches felt that we had no option. I wish, however, immediately to say that we intend to return at the earliest possible moment to the question of the Government's social policy, which we had originally proposed to discuss this afternoon.

We are not here concerned with the merits of the Cinematograph Films Bill. Still less are we concerned with the question of whether or not the Entertainments Duty should be reduced. Indeed, we would warmly welcome any such reduction which may be forthcoming. One of our anxieties is that what we regard as the premature disclosure of the Governments' intention in this matter can conceivably jeopardise the prospect of that reduction. That there was a premature disclosure, however, seems to us to be perfectly clear.

We base this conclusion on what was actually said by the President of the Board of Trade. I must ask the House to bear with me while I quote those words, since, obviously, the validity of our Motion largely turns upon them. At an earlier stage in his speech on Wednesday, the right hon. Gentleman said that the Chancellor of the Exchequer had authorised him to say that in his Budget the Chancellor would, take account of the consequences of Clause 2—that is, the Clause which fixes the limits of the levy and makes it statutory—together with the other considerations which the exhibitors have brought to his attention. There is no possible objection to that phraseology. That is the usual form. That is what is generally said by or on behalf of the Chancellor in reply to representations about almost anything that may arise which eventually has some connection with his Budget. Nor does a statement of that kind in any may commit the Government to a reduction in Entertainments Duty. That was all that was said on this occasion—that this was one of the things that would be taken into account. Nor could one deduce from that statement that there was necessarily any automatic connection between an increase in the levy and a reduction in the duty.

It was not until a little later on in his speech that the President strayed beyond the safe ground on which, up to that point, he had remained. But he later began to move into the danger area. He said: British cinemas are also hard-hit by television. Some picture houses have gone out of business and some are hanging on with great difficulty, but I hope that tomorrow morning they will feel more cheerful. Hon. Members very naturally picked that up at once and intervened with the question: Why? The President of the Board of Trade went on to say: Because I have said that the Chancellor will take account of Clause 2 in his Budget. I do not know why it was necessary for the President of the Board of Trade to use this phrase about exhibitors being more cheerful on the following day. I would like to ask whether that phrase was authorised by the Chancellor of the Exchequer as well as the earlier one.

The President of the Board of Trade was then asked by my hon. Friend the Member for Govan (Mr. Rankin) this question: Will he reduce the Entertainments Duty? The right hon. Gentleman replied: There is no other way that he can do it. I submit that that is going far beyond the original statement authorised by the Chancellor; indeed, it is that sentence which gave rise to most of the conclusions drawn in the debate and by persons outside this House.

My hon. Friend the Member for Uxbridge (Mr. Beswick) then asked: Will the right hon. Gentleman repeat his last few words?, but the President of the Board of Trade did not do so. He dodged back on to safer ground, and he said: I said that the Chancellor said that he would take account of that. That was not, of course, what he had just said. He went on: The hon. Gentleman can wait for the Budget, when he will see what it means.

Hon. Members

Ah.

Mr. Gaitskell

Certainly. The right hon. Gentleman was back on safe ground. He was not doing what my hon. Friend the Member for Uxbridge had asked, namely, repeating his last few words. I suggest that in his own mind the right hon. Gentleman was a little uneasy about the sentence he had just uttered.

My right hon. Friend the Member for Battersea, North (Mr. Jay) then asked the President of the Board of Trade to elucidate his words. He asked: Did he or did he not say that the only way the Chancellor could take account of the consequences of this part of the Bill was to reduce Entertainments Duty? The President of the Board of Trade replied: I should have thought that it was very difficult to think of any other way. I submit that those sentences in that part of our proceedings show clearly that this was a disclosure of Budget intentions. I fail to understand how any other conclusion can possibly be drawn from them. They are in sharp contrast not only with what the Chancellor authorised the President of the Board of Trade to say, but with what the Government's representatives in another place had answered when they, too, were questioned during the passage of the Bill there on what was to happen about the Entertainments Duty. Lord Mancroft—I shall not quote what he said, Mr. Speaker—was very careful, repeatedly, on the Second Reading and throughout the Committee, to go no further than words which were substantially the same as those authorised by the Chancellor and repeated by the President of the Board of Trade in the earlier part of his speech.

The President of the Board of Trade did not seem to be satisfied even with this, because later in his speech, as if to add point to the intentions that he had already mentioned, he said: I should also remind the House that if the Entertainments Duty were reduced the producers would get a further sum, since a film earns a percentage of the box-office takings after deduction of Entertainments Duty. I am sure the possibility of that interesting bonus will not be far from hon. Members' minds. That was another hint that, in fact, the Government were intending to reduce the Entertainments Duty.

Anybody who reads the debate would agree that hon. Members on both sides of the House clearly deduced from what the President of the Board of Trade had said that the Government were going to reduce the Entertainments Duty. I do not propose to quote all of them, but only the hon. and gallant Baronet the Member for Barkston Ash (Sir L. Ropner). He was asked by my hon. Friend the Member for Govan whether there was to be a reduction in Entertainments Duty. The hon. Baronet replied: I am absolutely certain that that is so. The President of the Board of Trade has to all intents and purposes said so this afternoon. The same point was taken up by a number of other hon. Members, and particularly by my hon. Friends the Members for Uxbridge and Govan. Nevertheless, this did not deter the President of the Board of Trade, later in the debate, that same evening, from trying to retract what he had said. I have no doubt that some anxious consultations took place between the right hon. Gentleman and the Chancellor of the Exchequer between the right hon. Gentleman's opening speech and the winding up of the debate.

When my right hon. Friend the Member for Battersea, North referred to this matter at the beginning of his speech, the President of the Board of Trade said: I knew before the right hon. Gentleman rose that that was the sort of thing that he was going to say I should like to deny that I said that I know it was to be reduced."—[OFFICIAL REPORT, 27th February, 1957; Vol. 565, c. 1237–1317.] No doubt the right hon. Gentleman did not say, "I know that it is going to be reduced." I will concede that to him, but if he really thinks that is a satisfactory explanation, or comment, or apology, for what he did I am afraid that he is a little mistaken.

So much for the first day's debate, last Wednesday. There is no doubt at all what the Press thought about this whole affair. The following morning, virtually every national newspaper headlined it as a Budget indiscretion, to put it no higher. I will quote from three newspapers, all friendly to the Government and unfriendly to the Opposition. The first is the Daily Mail. The main heading was: Budget Leak Rumpus and the story began: Sir David Eccles, President of the Board of Trade, let out a Budget secret in the Commons last night—or what seemed to be a Budget secret. He gave M.P.s to understand that the entertainments tax on cinemas is to be cut by Mr. Peter Thorneycroft, Chancellor of the Exchequer, in April. M.P.s were astonished. This is the time of year when all Ministers refuse to 'anticipate' the Budget. There is believed to be no precedent for such a disclosure. It went on to say: Sir David's gaffe annoyed Mr. Thorneycroft. The Daily Express had, as its main heading: Cinema Budget 'Leak'. It went on: Sir David Eccles, the new President of the Board of Trade, plunged himself into sensational controversy in the Commons last night with what everyone present interpreted as a Budget leakage. He gave a clear impression that Mr. Peter Thorneycroft, the Chancellor of the Exchequer, will cut the cinema entertainment tax in his April budget. Exactly the same kind of impression was created upon the reporter of the Daily Telegraph, another paper friendly to the Government, and, indeed, on all other reporters of the various national newspapers.

Mr. Frederic Harris (Croydon, North-West)

What about the Daily Mirror?

Mr. Gaitskell

The Daily Mirror had, as far as I remember, the main headline: Budget Leak Row, but I have not bothered hon. Members with that because I thought that Government supporters would be more interested in reports of newspapers which were friendly to themselves.

Nor was there any doubt about the Stock Exchange reaction to this statement. The main heading, the next day, on Thursday, 28th February in the Evening Standard City column was: Tax Hint Gives Cinema Shares a Boost. The main heading in the Star was: Cinemas Cheered by Eccles Trailer. Share values, as I think everybody knows, moved upwards on Thursday—[HON. MEMBERS: "No."] certainly—owing to profit-taking, successfully carried out no doubt by those who, helped by the President of the Board of Trade, managed to get in in time—the shares later, on Friday, fell somewhat lower, though not the whole distance that they had risen.

There is really not the slightest doubt, in my opinion, that these movements of shares were the direct result of what the President said. I see that it is suggested that perhaps this might not have been the consequence of what he said in his indiscreet way, but might have been the consequence of the statement authorised by the Chancellor; but I do not think that argument can be sustained for the simple reason that, so far as I am aware, throughout the passage of the Bill through the Lords when, repeatedly, Lord Mancroft gave that assurance—but no more than that assurance—there were no sudden movements of cinema shares on the Stock Exchange.

We come now to the second day in Parliament. I think the least that hon. Members of all parties should expect, judging by our traditions in a matter of this kind, was an apology from the right hon. Gentleman and also some explanation of what, in fact, was the intention of the Government. We got neither. We got from the Prime Minister an attempt at blustering his way through this obvious indiscretion, which we are certainly not prepared to allow. He began by quoting the statement authorised by the Chancellor of the Exchequer, to which we had no objection. Then he said that all the subsequent events could be deduced from that. As I have just pointed out, the Stock Exchange did not deduce from that statement, when it was made in the House of Lords, that there was to be a reduction in Entertainments Duty.

In his first statement, the Prime Minister carefuly avoided quoting the vital words, the really indiscreet words of the President of the Board of Trade. The words: There is no other way that he can do it."—[OFFICIAL REPORT, 27th February, 1957; Vol. 565, c. 1238.] The Prime Minister was content to describe them as hazarding a certain deduction". That is an extraordinary use of English.

The implication of the statement of the Prime Minister at that point was that nothing had been given away—nothing improper or unfortunate had occurred, he said. But a moment or two later he was changing his ground. He was saying: There can be no question of a Budget leak. A statement to Parliament cannot be a leak."—[OFFICIAL REPORT, 28th February, 1957; Vol. 565, c. 1401.] That was a rather remarkable comment. If that really is the case it is hard to understand why for so many years it has been the custom for Chancellors of the Exchequer, when asked questions about their Budget intentions, to say that they must not anticipate their Budget statement and, when other Ministers are asked questions relating to the Budget, they make use of the same form of words. It is a most extraordinary doctrine that a Minister can make a statement and it does not matter however careless or indiscreet it is—never mind—that, apparently, is not a Budget leak. Well, if it is not a Budget leak it is a very grave indiscretion.

Mr. Gerald Nabarro (Kidderminster)

Would not the right hon. Member agree that my right hon. Friend the present Home Secretary, three or four years ago, as a matter of budgetary policy announced, in January or February—I have forgotten the exact date—to dispel uncertainty, that there would be no changes in Purchase Tax in his April Budget? Was that not absolutely proper?

Mr. Gaitskell

I am much obliged to the hon. Member. That is a point I was proposing to make a little later, and I shall return to it.

I return to the Prime Minister. In his original statement he had said, regarding the President of the Board of Trade: In doing so, he was not making a prophecy or speaking with foreknowledge of what may eventually be decided. It does not seem to me that anything improper or unfortunate was said. When I challenged him, as follows: Are we, then, to assume from the Prime Minister's statement that since this is not a Budget leak it is an announcement of Government intention? the Prime Minister's reply was: No, Sir; it was, as I said, a prophecy …"—[OFFICIAL REPORT, 28th February, 1957; Vol. 565, c. 1401.] Which did the Prime Minister mean—the prepared statement or the off-the-cuff answer? Was it in his view a prophecy or was it in his view not a prophecy? If he denied that it was a prophecy, the implication was that had the President of the Board of Trade made a prophecy that would have been improper and unfortunate. A minute or two later he admitted that it was a prophecy. What an extraordinary situation and what a state of confusion the Prime Minister's remarks on this matter have now created!

We are entitled to know exactly what the view of the Government is about the President's statements. It really will not do for the Prime Minister to imply that it is perfectly all right for the President of the Board of Trade or other Ministers to start making prophecies about the Budget. We cannot ignore the fact that the right hon. Gentleman is the Minister charged with responsibility for the cinema industry, as he is for many other industries which are affected by the Budget. Anything he may say on these subjects is bound to be taken extremely seriously and prophecies of any kind, particularly at this time of the year, are, of course, clearly exceedingly indiscreet.

I will give an example which may well be in the minds of hon. Members. The right hon. Gentleman is responsible for the motor car industry. Many people consider that the motor car industry is in a rather depressed state and that, therefore, there should be a reduction in Purchase Tax in the next Budget. Suppose the President had said during the course of a debate on the motor car industry—we had one not long ago "Well, there it is; the industry is in difficulty and I hope that the manufacturers tomorrow will be feeling a little more cheerful than they are today." Suppose one of my hon. Friends then challenged him and he replied, "I mean what I said about the Chancellor's assurance". Then suppose someone said, "Does that mean a reduction in Purchase Tax?" and the President replied, "I cannot see any other way of helping them."

Are we really to assume that that would be a harmless little bit of by-play in the House of Commons to which no one objects? Where are we to stop—there are a number of industries affected by Purchase Tax for which the President of the Board of Trade is responsible—or is it that the cinema industry is in a special situation, is a special case, or that one can always make indiscretions about that industry, but not about any other industry?

I now come to the point raised by the hon. Member for Kidderminster (Mr. Nabarro). It is, of course, perfectly true that on some occasions the Chancellor might find it necessary quite openly, quite specifically, to deal with a matter which normally would be left until the Budget. It is perfectly true, as the hon. Member said, that the Lord Privy Seal, when he was Chancellor, in 1954, made an announcement that there would be no further changes in the Purchase Tax schedules in or before the Budget. We did not object to that. That was a perfectly open statement and everyone knew where he was.

We recognise that there are occasions on which that should be done. It may indeed be necessary, on some occasions, to couple that with a special Finance Bill. If the President of the Board of Trade had said, "I cannot really deal with this matter without dealing with Entertainments Duty. The Chancellor has authorised me to disclose our plans for this and we shall be introducing a Finance Bill in the near future to deal with it," my hon. Friends would have raised no objection, but that is not what happened on this occasion.

The tradition of the House is that either the Government make a perfectly clear, definite statement of intention—certainly, breaking the normal convention, but under perfectly open and unobjectionable conditions—or, the rule is quite clear, they must keep completely silent. Our charge in this case is that there was neither an open statement nor complete silence.

I turn to the second part of the Motion, which bears on the precedents and traditions of this House. The hon. and gallant Member for Knutsford (Lieut.-Colonel Bromley-Davenport), in the course of a somewhat unfortunate intervention on Thursday, referred to the fact that two right hon. Gentlemen had resigned over Budget leakages. I should say at once that to group the late Mr. Thomas with my right hon. Friend the Member for Bishop Auckland (Mr. Dalton) in this matter was decidedly unfortunate. I want to say, too, that we are in no way attacking the integrity of the President of the Board of Trade. This is not a case like that of Mr. Thomas and Sir Alfred Butt, but it is a case, in our view, of a serious indiscretion and extreme carelessness on the part of a Minister.

I should like to say a word or two in his presence about my right hon. Friend the Member for Bishop Auckland who, as we know, when he was Chancellor of the Exchequer, mentioned to a Lobby journalist items in the Budget immediately before he entered the Chamber to deliver his Budget statement. We know what happened. It may be argued that in this case there were differences, and, of course, I agree that the statement was made to a Lobby journalist outside the Chamber. That is true, but I cannot accept the view that there is an automatic and complete difference between whatever is said here and whatever is said outside, unless the Government statement is an official one and an open one such as I have just indicated.

If we are to make other comparisons between these two cases, I would point out that my right hon. Friend committed his indiscretion, as he himself said it was, well under an hour before the actual statement which he was to make, not several weeks before the Budget. I should like to point out that there were no move- ments on the Stock Exchange at all. Indeed, it was closed at that time. The evidence of the Select Committee brings that out very clearly.

I should also like to point out that that indiscretion, as I think we all agreed, had no consequences except to my right hon. Friend himself. Yet the very next day my right hon. Friend made an apology in very strong terms. He said: I very much regret to tell the House that the publication to which the hon. Member refers arose out of an incident which occurred as I was entering the Chamber to make my speech yesterday. In reply to questions put to me by the Lobby correspondent of "The Star" newspaper, I indicated to him the subject matter contained in the publication in question. I appreciate that this was a grave indiscretion on my part, for which I offer my deep apologies to the House. The right hon. Member for Woodford (Sir W. Churchill), at that time Leader of the Opposition, said: May I acknowledge, on behalf of the Opposition, the very frank manner in which the right hon. Gentleman has expressed himself to the House and our sympathy with him at the misuse of his confidence which has occurred?"—[OFFICIAL REPORT, 13th November, 1947; Vol. 444, c. 551.] My right hon. Friend was not satisfied with that. In fact, even before he rose to make that apology he had offered his resignation to the Prime Minister. That was the judgment which he made upon himself.

I believe that in this instance the case for the Motion is abundantly made out. There can be no doubt whatever that the President of the Board of Trade was responsible for the premature disclosure of a Budget intention. No other interpretation of his words is possible. This at least, if no more, is a serious indiscretion and is so regarded and was so regarded by everybody who heard it and by the Press who commented on it.

It is one of our criticisms of the Government, and of the Prime Minister, in particular, that he fails even to acknowledge this. Half the time he is saying that no discretion was committed and the other half he is saying that it is not a very serious indiscretion. Whether it is serious or not is a matter which can be judged only against the background of what our tradition is in these matters. I have quoted the nearest case that I can find to anything of this sort.

I believe that the House is right to be strict in its standards regarding the Budget and I think it would be a very great pity if these standards were ever to be lowered or to be allowed to become slack. Precedents show that in a case of this kind at least a complete and unqualified apology, indicating a realisation that a wrong has been done, is called for. As to whether any further action is necessary, in my opinion that is a matter between the Minister concerned and the Prime Minister. The Minister must ask himself the question whether he thinks that he should remain in office despite a grave indiscretion. The Prime Minister must ask himself whether he can afford any longer to have in office someone who makes an indiscretion of this kind and is likely to repeat it.

4.15 p.m.

The Chancellor of the Exchequer (Mr. Peter Thorneycroft)

As a good deal has been said in these matters about tax questions, it might be convenient if I say a word or two in this debate. I quite recognise that the Leader of the Opposition is perfectly entitled, and indeed right, to call the attention of the House to the importance which all of us, on both sides, attach to matters of this character. I make no complaint whatever about the subject being raised and discussed, though, naturally, I do not accept the terms of the Motion; it is a tradition which we on all sides of the House guard jealously, and it is right that we should have a discussion about it.

I will not include in my remarks anything about Budget leaks, as I understand that term—namely, the giving of information to people outside the House. What I will talk about, which is the subject of our discussion, is what happened on Wednesday and the statements which were made—whether they were right or wrong is the matter we are discussing—to hon. Members within the Chamber itself.

Mr. John Parker (Dagenham)

Will the right hon. Gentleman tell us whether he intends to reduce the Entertainments Duty?

Mr. Thorneycroft

Let us be quite clear, to start with, about the subject which was being discussed on Wednesday. If the House will forgive me, I should like to spend a moment on that, because I think it clarifies the argument.

At the time of the events which are in issue, the subject being discussed was Clause 2 of the Cinematograph Films Bill [Lords], which deals with the levy. For those who do not follow as closely as do some of us the cinematograph industry legislation, I would explain that the levy is a device whereby money is collected from the men who exhibit films and is handed over to those who produce the films in Britain.

The person to whom goes much of the credit—and I think it is credit—for inventing that levy is the right hon. Member for Huyton (Mr. H. Wilson), who invented it when he was President of the Board of Trade. He introduced the levy in 1950. It has been very much attacked as a system from time to time. [HON. MEMBERS: "Get on with it."] I am saying this because it is relevant to what was said later in Wednesday's debate. To any critics of the levy which the right hon. Gentleman invented I would say that it would be very hard to find any other way of adequately protecting the British film industry. The profits of the exhibitors are, at any rate to a large extent, derived from profits made by showing American films, and the levy collects money from them and, so to speak, channels it back to the producers of British films.

I believe that the right hon. Gentleman was right, in 1950, when he made that decision. When he made, it, he was faced with the immediate difficulty of what arrangement the Socialist Government of the day—or, indeed, any Government—could make with the exhibitors and the cinemas. In the event, the cinema exhibitors agreed with the levy on two conditions: first, that the Government should agree to allow certain increases in the price of seats; and, secondly, that there should be an adjustment in the Entertainments Duty.

This is what the right hon. Gentleman did as President of the Board of Trade. In advance of the fiscal proposals, he announced in the House of Commons on 29th June, 1950, not in a debate on the Budget but in a debate on the National Film Finance Corporation, not a broad hint, but the precise changes in Entertainments Duty which were to be introduced in a new Clause in the Finance Bill. That seems to me to have been a clear anticipation of a fiscal decision.

Mr. Harold Wilson (Huyton)

Is it not a fact, first, that that was after the Budget; secondly, that the Finance Bill was, at that time, before the House of Commons and in Committee; and, thirdly, that the precise terms, as the right hon. Gentleman was kind enough to describe them, were negotiated by Treasury officials and that the statement I made was made on behalf of the whole Government and was an agreed statement between the Treasury and the Board of Trade? Can the Chancellor say the same of his right hon. Friend?

Mr. Thorneycroft

I am not questioning the propriety of the right hon. Gentleman's action. I am simply saying that if the question which we are discussing is whether it is right for a Minister to anticipate a fiscal decision, whether it is right for any Minister to anticipate the announcement of a fiscal decision, that is precisely what the right hon. Gentleman did on that occasion. I believe that he was right to do it.

A few days later, a new Clause was introduced into the Finance Bill on a basis different from that which had been proposed in the Budget. In 1951, after further consultation with the industry, the same general principles were followed; the prices, the rates and the levy were all changed. Since then, discussions have continued between the Treasury and the film industry almost every year, the industry claiming that the duty was linked with the levy and the Treasury not concurring.

The right hon. Gentleman is as familiar with those matters as I was when I was President of the Board of Trade. Whether they are linked or not is, perhaps, a fruitless argument. [An HON. MEMBER: "Like the right hon. Gentleman's argument now."] No Chancellor, Socialist or Conservative, could agree to an automatic claim to relief irrespective of other factors each time the levy changes. On the other hand, it is no idle assurance for a Chancellor to say that he should take these as one of the relevant matters into account in the Budget.

At this moment, the exhibitors are already paying a levy. It is known as the Eady Levy. It is on a voluntary basis and it amounts to £2½ million a year. The new basis proposed in the Cinemato- graph Films Bill is that the levy should be statutory and that it should be at £3¾ million this year. That is to say, that the industry will be called upon to pay an additional £1¼ million in the year. It was this £1¼ million that was being discussed on Wednesday. It is the difference between what the cinema owners pay today and what they will have to pay when the Bill becomes law. As a total, it can be compared with, for example, last year's total of Entertainments Duty paid by the cinemas of £33 million.

The question, therefore, which we are discussing is not the whole of the Entertainments Duty, but this small sum, and whether it should be borne in whole or in part by the industry or whether some arrangement should be reached, as it was reached by the right hon. Member for Huyton in 1950, linking it in some way with Entertainments Duty or the prices of admission.

The answer to that question must be perfectly clear: that the £1¼ million should be taken into account in the Budget. Of course, it is only one facet of one factor in the Budget decision on Entertainments Duty as a whole. My conclusions as to what, if anything, should be done to Entertainments Duty will be affected to the extent of £1¼ million by the effect of Clause 2 of the Cinematograph Films Bill.

My right hon. Friend was asked by the hon. Member for Govan (Mr. Rankin) whether he would reduce Entertainments Duty in the Budget, and my right hon. Friend said: There is no other way that he can do it."—[OFFICIAL REPORT, 27th February, 1957; Vol. 565, c. 1238.] To me, in the context of those words, that simply meant that the £1¼ million will be thrown into the balance to the credit of the cinema industry—[HON. MEMBERS: "Oh."]—certainly, in the weighing up of the pros and cons or any increase or decrease in the duty. It did not mean and certainly could not mean, and it certainly was not intended to mean, in the context of a debate on the narrow issue of Clause 2 of the Bill a general reduction in Entertainments Duty, which was not even the subject of discussion. In fact, I have made no decisions yet as to what I shall do about the Entertainments Duty in the coming Budget. There can, therefore, be no information given upon it even if it was proper so to do, as it would not be.

I have studied carefully what has been said. I am satisfied that there is no leak; none, I think, could be suggested. As to the propriety of the statement, I believe it to be right. These things should be weighed with all the other pros and cons among the pluses and the minuses which go to making up a Budget. The method adopted differs little, if at all, from the policy pursued upon this matter for many years, and I believe it to be the correct one.

Hon. Members

Resign.

Mr. H. Wilson

Before the right hon. Gentleman sits down, may I ask him whether this does not depart from the procedure followed in previous years? First, when, in any previous year, has a Minister made a statement of this kind? Secondly, since the right hon. Gentleman has put entirely his own gloss on what the President of the Board of Trade said, will he explain what he thinks was the significance of the President's reference to these people feeling more cheerful "tomorrow morning"?

Mr. Thorneycroft

My right hon. Friend simply was saying that these matters would be taken into account in the Budget and, when asked that particular question, stated that that was what he meant.

Mr. Gaitskell

The Chancellor's authorised statement had already been made in the House of Lords. No one in another place said that the cinema exhibitors would be feeling more cheerful upon the following day. I ask the Chancellor: does he really say that the President of the Board of Trade added nothing to what was said in another place? If so, how does he explain the reference to the exhibitors feeling more cheerful?

Mr. Thorneycroft

I think that the evidence that they did feel more cheerful after the debate in another place is drawn from cinema share movements. Between the Second Reading and the Third Reading of the Bill prices rose 20 per cent. or more. In this case, they rose a few pence and then sank back again.

4.31 p.m.

Mr. Hugh Dalton (Bishop Auckland)

It is not my intention to pursue the many debatable points, as they seem to me to be, raised in the speech of the Chancellor of the Exchequer, but, reading HANSARD, I have observed that on Thursday last, when this matter was first ventilated, an hon. Member on the other side of the House seemed to make a reference to myself, and, that being so, I should not wish to remain wholly silent, though I shall speak only very briefly now, since that reference may be misunderstood or misinterpreted.

As is known to the House, in November, 1947, I was concerned in an incident somewhat similar to this one. [HON. MEMBERS: "No."] Somewhat similar, but in three respects dissimilar from this. Those three respects I shall enumerate. In the first place, as soon as I became aware of what had happened, I tendered my resignation to Earl Attlee, who was at that time the Prime Minister. He did not immediately accept it, but I pressed it upon him, and after an interval of hours he did accept it.

In the second place, at the earliest opportunity open to me, I came to this House, not to sit at the tail-end of the Treasury Bench seeking to combine being present with not being noticed. I immediately went to the Dispatch Box and made an apology and expression of regret of a completely unqualified character.

In the third place, references are being made to Stock Exchange movements, and it seems to be thought to be some defence of or excuse for this latest movement of prices on the Stock Exchange—the latest two movements, up immediately following the right hon. Gentleman's statement and subsequently down again—that there had been previous movements in the prices of cinema shares. In the case in which I was concerned, a Select Committee of the House which investigated the incident reported in these words: Evidence from the Chairman of the Stock Exchange Council establishes that there were no movements of prices or sales which could in any way be attributed to the leakage of news which occurred. It would be interesting if the Chairman of the Stock Exchange Council were now to be asked whether he could give the right hon. Gentleman's observations an equally clean bill of health so far as price movements are concerned.

All that I wish to add is that, for my part, looking back over ten years, I prefer the standards of ministerial conduct and the standards of ministerial respect for the House of Commons which were established under a Labour Government to the lower standards which prevail today.

4.34 p.m.

Sir Ian Fraser (Morecambe and Lonsdale)

This debate is said to be about a premature disclosure of a Budget intention. I submit to the House that one cannot disclose, prematurely or otherwise, anything of an entity which does not exist. There was no Budget, and, therefore, there could not be any disclosure, premature or otherwise, of the Budget.

The situation which the right hon. Gentleman the Member for Bishop Auckland (Mr. Dalton) has described to us was exactly different. He did disclose from a Budget. The text was in his hands; the papers were there; the matter had been agreed by the Cabinet. It was at the last moment when the Budget existed. It not only existed but was on the point of being, born. There was, therefore, something to disclose, and he disclosed it. To say that my right hon. Friend made a similar premature disclosure of a Budget intention presumes there was a Budget. There was not. It is rather like saying that a young couple who intend to get married and have a legitimate baby have the intention to have a baby when there is nothing but a twinkle in the prospective husband's eye.

Mr. William Hamilton (Fife, West)

"There is no other way."

Sir I. Fraser

In this case not only was there no Budget but we may assume that at this stage of the proceedings—indeed, we have been told by the Chancellor himself—he had not made up his mind.

In the case of the right hon. Gentleman the Member for Bishop Auckland I 'thought at that time, I still think in retrospect, that the judgment, whether he made it on himself or whether Earl Attlee made it on him, was harsh and that it was unnecessary, but I am bound to say that I thought the action of the then Prime Minister as well as that of the then Chancellor of the Exchequer reflected the very highest credit upon both of them. However, I do not think the case is in any way comparable with the one we have now before us.

I think the Manchester Guardian, a paper which the Leader of the Opposition did not quote, stated this matter in a reasonable perspective. It said that at the very most my right hon. Friend had been indiscreet—and to Parliament. It seems to me that does make a very real difference.

In the exchange of talk across the Floor between the Opposition and the Prime Minister on Thursday, the right hon. Gentleman the Member for Ebbw Vale (Mr. Bevan) said that surely my right hon. Friend should follow the custom of this House and come down and apologise. One might almost have thought that the right hon. Gentleman the Member for Ebbw Vale when he said that had been drinking the milk of human kindness. One might have thought butter would not have melted in his mouth.

It was easy for the right hon. Gentleman to say that my right hon. Friend should only come to the House and just apologise, and then we in this House, so benevolent in our feeling for the good of the Government and the House and the reputation of Parliament, would say, "Very good, David. That is O.K." But it would not have been like that at all. If my right hon. Friend had apologised for a sin which he had not committed the first to have torn him to pieces would have been the right hon. Gentleman the Member for the milk of human kindness.

My judgment is that my right hon. Friend was quite right not to apologise for an offence he did not commit and that the Prime Minister was quite right not to accept his resignation, which he ought not to have offered. [HON. MEMBERS: "Did he offer it?"] So the Prime Minister said. [HON. MEMBERS: "No."] If he had I should have thought he should not have. This is one of those things which may never be known.

Of the movement of stocks and shares I had intended to say, but the Chancellor has already said it for me, that the movement was negligible, though the question whether there was a crime or not does not depend upon the extent of the movement. That depends only upon the publicity it gets.

It seems to me that this debate today is not to sustain the honour and the custom of this House but to denigrate the Government with any bit of stuff which can be picked up by the Opposition grubbing about in the rubbish heap. They are willing to do this—let the nation note it—even if it means depriving Parliament of three hours' debate upon matters affecting the health of the whole nation, upon the tax to be placed by way of a stamp upon every working man, every independent shopkeeper and person in the land, upon a rise in price of school meals and a further charge upon the people's milk.

So it is clear in the minds of the leaders of the Opposition that these great affairs of state, affecting every working man, every home and every housewife, are of less importance than the opportunity to throw a little mud at a Minister. I suggest that the Opposition have not only let down the House of Commons and the high standard to which they would like to have us think they wish to adhere, but have let down themselves. Let us prevent them from further misery by voting as soon as possible against this miserable Motion.

4.41 p.m.

Sir Thomas O'Brien (Nottingham, West)

All sections of the entertainments industry are genuinely distressed that a subject on which there is so much good will and unanimity in this House, and in the Press and public, should be a subject on which a Party rumpus should arise, namely, Entertainments Duty.

The industry as a whole had looked forward to a very successful resolving of the problem of the tax, as such, and, particularly, the problems facing British films within the coming months. The trade unions in the industry and the employers' organisations now feel that they are likely, and probably innocently, to be made the victims of the situation arising from the statement made by the President of the Board of Trade last Wednesday and the Prime Minister's statement on Thursday.

I do not propose to go into that at all, because it can be left to the more expert of my colleagues. I hope that the House will not misunderstand me at all or misinterpret the motives in my mind when I say that I fully agree with everything which my right hon. Friend the Leader of the Opposition said about the customs and traditions of this House, and of Parliament as a whole, in regard to budgetary matters being in all circumstances held sacrosanct.

However, there are certain considerations which many of us in the industry understand about this matter, and of which I think the House should be aware. Personally, I and many of my Friends in the industry have a great deal of personal sympathy with the President of the Board of Trade in his dilemma. The right hon. Gentleman has just taken over an important Department, and I personally regret that my own industry, or the one with which I am associated, should be the subject of, as it were, his Parliamentary ordeal or trial.

I want to admit frankly that, despite the interruptions from this side of the House, what the Chancellor of the Exchequer told the House a moment ago in his analysis of the situation before the industry was 100 per cent. accurate and factual. I must say that. The considerations of honesty must be brought to the fore, and so let me develop that point.

As my right hon. Friend the Member for Huyton (Mr. H. Wilson) said, we have for many years made strong representations to various Governments about matters concerning the film industry, and not only on Entertainments Duty. The present Prime Minister, when he was Chancellor of the Exchequer last year, gave a pledge that indicated to us that he intended to do something this year about Entertainments Duty. It was not a loose promise such as Chancellors make from time to time. It was a specific pledge, and after it, from last year's Budget onwards, all sections of the entertainments industry, the theatres, the living stage, the cinemas, film production, based their campaign and representations on the belief that there would be a substantial cut in Entertainments Duty this year.

The whole of the entertainments industry believed that, and the industry's campaign was based accordingly. In the industry during the year, therefore, every trade union in the industry, the Federation of Theatre Unions, of which I am president, my own union, the National Association of Theatrical Kine Employees, of which I am secretary, the Technicians' Union, the Electrical Trades Union, the British Actors Equity Association, the Musicians' Union, the Variety Artistes' Federation, have all campaigned separately and jointly with regard to a cut in Entertainments Duty. They have all, jointly and separately, made representations to the Government, and the employers themselves have combined in a practical way in this matter to put their case. This case is before the Chancellor, and the employers have circulated it to hon. Members of the House for their information.

The unions, jointly with the employers, have identified themselves, on this matter of Entertainments Duty, with the belief that the only consideration to be determined by the Government when they came to the consideration of the Budget, was the amount of the cut. Nobody knew exactly how much the cut was to be, but there was a genuine belief, based on the pledge given last year by the present Prime Minister when he was Chancellor, and also based on the replies which we have received from the Department and the Treasury to our deputations and our communications, from which we were all encouraged to believe that there would be a cut. That is the view of the entertainments industry as a whole.

The Cinematograph Films Council, of which two or three hon. Members on this side of the House, including myself, are members, made these representations to the Government on this matter, and strong notice was taken of it. The General Council of the Trades Union Congress made its own representations to the Government this year, and the Prime Minister replied. That reply did not commit the Government to anything, but that reply, with others, encouraged everyone in the trade union movement concerned and in the industry to believe that there would be a cut in the Entertainments Duty, and that the amount was the only thing still to be determined.

It could be argued that the point that I am making is no defence of the Minister on the political issue involved, but I should be failing in my duty as an hon. Member of this House if I did not give this outline of what has been happening on the employers' side and also on the trade union side in this matter over the last several months. I do not know whether it will make any difference at all to the political issue, but what I do want to put forward is this point. We are gravely concerned, as my right hon. Friend the Leader of the Opposition mentioned in his opening speech, about whether this debate might affect the outcome of budgetary policy in the matter of the film industry. It might; we do not know.

I want to appeal to the Government, quite apart from the political issues involved, that they should give whatever consideration they have proposed to give with regard to the Eady Levy. The Chancellor was quite correct in what he said about the money having to be found for the levy, because there is no other way of doing it, because many exhibitors, if they have to pay the levy and there is no money with which to reimburse them, will have to shut up shop. We in the industry all know that, and we agree that the President's statement did not shake us, from the point of view of what he said. Whether he should have said it or not is another matter.

I appeal to the Government and the House to consider that this debate is likely to do harm to the entertainments industry, and I am not putting the industry before the traditions of the House. One must put first things first, and the traditions of this House obviously must come first. If before the debate is over some way can honourably be found to avoid this Motion going to a Division, I appeal to the House to find it, although I think there is an onus upon the Government or the President of the Board of Trade.

The President knew on Wednesday, and certainly on Thursday, that there was extreme doubt in the House as to whether he had gone too far. In fact, by Thursday, hon. Members on this side of the House were convinced that he had gone too far in what he stated. I have no desire to rub anything in, but it would have been quite easy for the right hon. Gentleman to acknowledge the fact that that impression had been created and to make a statement accordingly. I do not think that it is too late for him to do so even now, and I hope that before the debate is over some way will be found within the dignity of the House, of the Minister concerned, and of Parliament, for this course to be taken and thus to avoid the industry which I represent being, as it were, the unfortunate victim of an equally unfortunate political controversy.

4.51 p.m.

Mr. J. Grimond (Orkney and Shetland)

From reading the account of the remarks of the President of the Board of Trade in HANSARD, I must say that I find it extremely difficult to know what he meant unless he meant that, in his view, the Chancellor was going to reduce the Entertainments Duty. On one point at issue is this debate, it seems fairly clear that that is what the right hon. Gentleman had in mind. As the hon. Member for Morecambe and Lonsdale (Sir I. Fraser) said, it is certain, I think, that the President was indiscreet, but I cannot see that any blame attaches to him or that he did anything wrong or immoral.

I think that the right hon. Gentleman was indiscreet and that the whole matter could have been cleared up had he said so. It has been suggested that had the right hon. Gentleman said so he would have been pursued by some evil-minded right hon. Gentleman on the Opposition Front Bench. I am not feeling very well disposed towards the Opposition Front Bench at the moment, but nevertheless I would say that the President would have put himself in an infinitely stronger position had he come forward and said that he was sorry and had no authority to make any speculation about the Entertainments Duty, and that it was unfortunate that he did so.

However, this raises the larger question of whether it is possible any longer to keep to the rule that the Budget must never in any circumstances be spoken about before it is introduced.

Mr. Aneurin Bevan (Ebbw Vale)

With all respect, no one is claiming that, because quite opposite intentions are frankly stated. That is not in keeping at all with what was said. What we are asking now is that there should be some distinction between a statement and a prophecy. The Chancellor is now surrounded by prophets.

Mr. Grimond

I was not saying that the right hon. Member was in any way denying that distinction, but I think that there is a substantial point which may emerge from the debate.

As the hon. Member for Nottingham, West (Sir T. O'Brien) said, it was certainly understood by many people that, even if some reduction in the Entertainments Duty was not actually promised for this year, a very strong indication to that effect had been given—that unless something disastrous happened, a reduction was in fact highly likely.

As has been said, there have been previous occasions on which it became absolutely essential to make a pronouncement about Purchase Tax. It seems to me that in these days, when the Budget covers such immense fields and is not merely concerned with raising a certain amount of revenue, but is an instrument of planning and covers such an immense range of taxation, it really puts Parliament, the country, and the industry and trade of the country in a very difficult position for two or three months each year before the Budget is announced because no one knows what is to happen. Every year there is a hold-up over Purchase Tax. Now we have the Entertainments Duty. There are scares on the Stock Exchange, etc.

My conclusion is that these things should not be let out piecemeal from time to time and then become matters of acrimonious debate in the House, but that when necessary there should be firm statements by the Government. The Government should say that they intend to deal with points which will also be dealt with in the Budget. [HON. MEMBERS: "That is the whole point."] I agree that it is the point of the Opposition, and it is my point too. This point was made by the Leader of the Opposition, and it seems one which should be much stressed.

The difficulty which we have to correct is not the fear that we shall have to anticipate the Budget before it is brought in, but that we may be bound to anticipate the Budget is we are to enable such debates to take place. I should have thought that it would have been better for the President of the Board of Trade to have said, "I was in error, but it was an error which arose out of the subject which we were discussing." He could have said that he did not mean to verge on the question of the Entertainments Duty. He could have said, "I overstepped the mark. I regret it, and I withdraw it."

I think that the House must tackle the matter from the point of view that at this time of year it becomes difficult to discuss different subjects unless the utmost care is taken. There is an unhealthy atmosphere of expectancy and hesitation throughout industry while awaiting the Budget which must determine questions about stocks and all sorts of other things.

4.57 p.m.

Viscount Hinchingbrooke (Dorset, South)

Except for what the hon. Member for Orkney and Shetland (Mr. Grimond) has just said about requiring my right hon. Friend the President of the Board of Trade to apologise, I find myself in profound agreement with the main content of his speech. I think that he is inconsistent in regard to the apology because how can he maintain that these rather old-fashioned practices should be departed from when, as soon as my right hon. Friend departs from them, he finds that unsatisfactory?

Mr. Grimond

My answer is twofold. At present this is the custom of the House. I am merely saying that it might be reconsidered. Secondly, it is the right hon. Gentleman who has departed from it. His case is that he has not departed from it, but really he cannot have it three ways at once.

Viscount Hinchingbrooke

The right hon. Gentleman is trying to have it both ways. He makes the main content of his speech one of progress and reform of our Parliamentary institutions and yet he cannot refrain from saying that we are too steeped in the old-fashioned way not to have regard to all these practices and customs.

I wish to say in agreement with the hon. Gentleman that I find the Motion on the Order Paper most profoundly reactionary for a so-called progressive party. Indeed, I think, and shall find reasons for saying, that the wording of the Motion ought to be completely reversed. It ought to read: That this House applauds the premature disclosure of a Budget intention by the President of the Board of Trade and congratulates the Prime Minister on introducing new procedural practices in the Parliamentary and fiscal year. I should like to say in passing that I think the country will conclude that this debate is an amazing waste of time. Mr. Speaker, on the Report stage of the Civil Estimates, put through a Vote of £150 million and we have not heard one word of comment from the Opposition today about the expenditure of that money. What do our constituents feel when they see the Opposition, who are supposed to be in charge of a critical survey of our financial expenditure, deserting their opportunities and indulging in these little tawdry debates which are quite meaningless?

Something was said about speculation in shares. What does it matter if there was speculation in shares following the speech of my right hon. Friend? It does not even matter that there was no speculation some years ago following the speech of the right hon. Member for Bishop Auckland (Mr. Dalton). After every Chancellor has declared his Budget the Stock Exchange goes haywire. If it can go haywire on the day after the Budget day, why not at any other time? [Interruption.] I am talking about the Stock Exchange and share speculation; I am not saying that before the Budget a Chancellor can release details of fiscal changes imposing a tax to operate on a certain day, and things of that kind.

What actually happened? It is worth putting on record. Hon. and right hon. Members opposite do not seem to have noticed what happened to cinema shares. After remaining idle or, in Stock Exchange language, "stagnant" all summer and autumn, prices began to rise from the date of the Second Reading of the Cinematograph Films Bill in another place on 20th December, 1956. The noble Lord who moved the Second Reading on that occasion said: … the provisions of the Cinematograph Films Bill are amongst the various factors which are being taken into consideration in the review of entertainments duty which has been promised by Her Majesty's Government and which is now in active progress."—[OFFICIAL REPORT, House of Lords, 20th December, 1956; Vol. 200. c. 1336.] Further discussions on Clause 2 and on the Entertainments Duty took place in the Committee and concluding stages of the Bill, which received a Third Reading on 19th February. The Stock Exchange drew its conclusions from these debates.

Mr. Deputy-Speaker (Sir Charles MacAndrew)

Is the noble Lord quoting a speech made on Second Reading in another place this Session?

Viscount Hinchingbrooke

No, Sir.

Mr. Deputy-Speaker

What was the noble Lord quoting from in another place?

Viscount Hinchingbrooke

I finished the Ministerial quotation, with the words, … is now in active progress. I am seeking to inform the House of what happened on the Stock Exchange afterwards.

Mr. Deputy-Speaker

Hon. Members cannot quote what happened in another place this Session.

Viscount Hinchingbrooke

I understand that it is in order to quote a Ministerial statement made in another place.

Mr. Deputy-Speaker

That was on Second Reading was it not?

Mr. Walter Elliot (Glasgow, Kelvingrove)

Is it not correct that a statement of Ministerial policy made by another Minister in another place at any time can be quoted?

Mr. Deputy-Speaker

I said that hon. Members cannot quote what happened in another place in the same Session.

Mr. Elliot

I understood my noble Friend the Member for Dorset, South (Viscount Hinchingbrooke) to be quoting a statement of Government policy by another Minister in another place. I think that we ought to understand the position quite clearly.

Mr. Deputy-Speaker

If that is what the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke) was doing, he was quite in order, but I did not think that he was doing it.

Viscount Hinchingbrooke

I was quoting from a Second Reading speech by the noble Lord the Minister who is concerned with films in another place. It was a statement of policy as announced in the noble Lord's Second Reading speech.

After quoting from that statement, I was going on to say that the Stock Exchange drew its conclusion from the debate and between Second Reading and Third Reading share prices rose 20 per cent. or more. Associated British Cinemas shares rose from 9s. to 11s., and Ranks from 7s. 3d. to 9s. 9d. but after the debate in the House last Wednesday, these shares put on only a few pence, and they have since fallen to what they were before the debate. I trust that disposes of the outcry about speculations in shares.

I was sorry for the intervention of the right hon. Member for Bishop Auckland. One had hoped for something rather more generous from him. I have always taken a wholly sympathetic view about the events with which he was associated. If it is not presumptuous to say so, it was a venial offence. Nobody made any profit out of it. The right hon. Gentleman apologised and he chose to resign, and his resignation was accepted.

Mr. Sydney Silverman (Nelson and Colne)

Was that the view of the noble Lord's party at the time?

Viscount Hinchingbrooke

We all regarded the right hon. Member for Bishop Auckland as a very unfortunate Chancellor and were glad to see him replaced by somebody else, because of his financial policy, but, as far as this particular event went, most of us on this side of the House took a very sympathetic view indeed.

My right hon. Friend the Member for Woodford (Sir W. Churchill) has been quoted this afternoon by the Leader of the Opposition. I should like to remind the House of what he said: May I acknowledge on behalf of the Opposition the very frank manner in which the right hon. Gentleman has expressed himself to the House and our sympathy with him at the misuse of his confidence which has occurred?"—[OFFICIAL REPORT, 13th November, 1947; Vol. 444, c. 551.] I ask the House to note those concluding words. They mean that the right hon. Member for Woodford did not regard it as a serious Parliamentary offence that the right hon. Member for Bishop Auckland, on entering this Chamber, should have confided to an old friend, a member of the Press Gallery, something of his knowledge of the Budget.

Mr. Leslie Hale (Oldham, West)

May I remind the noble Lord of what the right hon. Member for Woodford (Sir W. Churchill) then did? Within two hours of making what appeared to be a magnanimous acceptance of the apology made by my right hon. Friend the Member for Bishop Auckland (Mr. Dalton), the right hon. Gentleman demanded the appointment of a Select Committee, and he wrote a letter to the Press demanding such a Committee and saying that the then Opposition would raise the matter in the House if the Committee were not appointed. The reason he gave was that there were rumours about, of which no evidence was ever proffered to the Select Committee when that Committee was appointed.

Viscount Hinchingbrooke

If the hon. Member intends to make a speech, no doubt he will give those details when he makes it.

This is a House of Commons matter and we are entitled to quote the views of right hon. Members upon it. The Financial Times, of all newspapers, took a very generous view of the right hon. Member for Bishop Auckland. It said on 17th November, 1947: Had Mr. Attlee wished to retain Dr. Dalton in his Cabinet, he could have done so. For no hint of financial scandal attached to the Doctor's conduct. He was simply the victim of his own ebullient personality, and evidently he did not realise the speed of modern communications. … As an indiscretion, the Doctor's action pales beside the performance of our helter-skelter Minister of Defence. Last summer, Mr. A. V. Alexander importantly announced at a function where the Press were present that the Chancellor of the Exchequer would broadcast that evening on the subject of convertibility. This was at a time when the Government's intentions were highly secret, and not known outside Nos. 10 and 11 Downing-street. Even the B.B.C., until Mr. Alexander talked, were unaware that they were to have the honour of putting the Chancellor on the air. This blazing indiscretion might have greatly profited Wall Street operators whose market was still open. To take the theme wider, Ministers are constantly affecting the market by their speeches, inside and outside the House and inside and outside the country.

My right hon. Friend the present Home Secretary—and no one at the time raised the smallest objection—made a speech in the summer of 1955 indicating that convertibility was a main objective of policy. The newspapers drew their conclusions. I have not the details with me, but no doubt Stock Exchange prices varied substantially. So much of a run was there on our gold and dollar reserves that in the following September in Istanbul my right hon. Friend had to deny that absolutely. He had caused the whole world market to react. How many thousands of people made or lost money on that, who can tell? These things are part of the order of the day and should not be exaggerated.

I turn again to the theme of the hon. Member for Orkney and Shetland—this question of the Chancellor of the Exchequer and his Parliamentary Secretaries and Economic Secretaries, the whole entourage of Government going into purdah, as it were, in January and staying there until Budget Day. This is one of the influences of that most baleful of all Government Departments—the Treasury. The Treasury absolutely dominates public life from January to July.

If in early spring so much as a snowdrop of an idea emerges from the green sward of St. James's Park, the Chancellor of the Exchequer and the President of the Board of Trade have to be pole-axed and virtually to retire into private life. If, in the course of the summer, after the introduction of the Finance Bill, in Committee, a back bencher so much as dreams of putting forward a posy of Amendments, the Whips' Office, the Chancellor of the Exchequer and subordinate Ministers, no doubt under the direction of these Treasury moguls, dash the little bunch of flowers from his hand. Not a sentence of the secret writings of these high Treasury officials must at any time be revealed before April or deleted after wards. Meanwhile great businesses throughout the country are held transfixed for months on end as to what is to happen to them when the Chancellor opens his Budget, and little taxpayers raise their pens from their cheque books in January, while they are signing away their life's income to the Inland Revenue, to peer into the distance, wondering ruefully what the Chancellor of the Exchequer will allow them in three months' time.

It is a ludicrous and contemptible 19th century performance which should be brought to an end, and I agree very much with what my hon. Friend the Member for Aberdeenshire, East (Sir R. Boothby) and other very distinguished people have said in the columns of The Times recently about the need for a Royal Commission to consider, and to suggest reforms of, many of these fiscal and financial processes.

Meanwhile a general loosening up of the entire process might well take place, I suggest, and I can see no reason why the Government should not proceed upon a series of declared intentions. Let them be made in the House of Commons. Let that be considered. But on this occasion let the House exercise toleration and sympathy for a phrase made in a debate, full of good intentions, well-meaning, hopeful for the industry concerned, and in every way agreeable to hon. Members of this House.

I said at the beginning that I thought this debate was a great waste of time. I warn the right hon. Gentleman the Leader of the Opposition of what is happening. He has been three times unlucky now. He reminds me very much of Don Quixote rushing at flocks of sheep and tilting at windmills, while Sancho Panza sits grinning on his donkey. First we had the right hon. Gentleman's dire, shocking and, to my mind, un-English pronouncements at the time of Suez. Secondly, we had his foolish absence in the United States of America when Ministers on our Front Bench here were being accused of putting an unconstitutional choice before Her Majesty the Queen. [An HON. MEMBER: "He was not in Jamaica anyway."] Thirdly we have this canard—for it is nothing else—this silly and unnecessary little debate. It derives from a basic lack of political sensibility on the part of the Labour Party which has been so manifest since that ill-famed and ill-starred dinner with Messrs. B. and K.

In my view the Labour Party today is one gorgeous Mrs. Malaprop. Hon. and right hon. Gentlemen opposite still have to learn some of the niceties of political life. Meanwhile, I hope that the Leader of the Opposition will take his attention a little more off us and look two places down the Bench to his right, because Don Quixote cannot go on riding forever; at some time he must take a final fall.

5.13 p.m.

Mrs. Eirene White (Flint, East)

The noble Lord the Member for Dorset, South (Viscount Hinchingbrooke) has tried to lower the temperature of this debate so low that snowdrops cannot come up in St. James's Park. It is natural enough that he wished to do so, because clearly this is an embarrassing debate for the Government and they wish to divert attention from the main charge contained in the Motion on the Order Paper.

I shall return to the main subject of this debate. I was one of the relatively few persons actually in the House during all the relevant times, and therefore I can speak with first-hand knowledge of what occurred on that occasion. I put it to the House that the right hon. Gentleman the President of the Board of Trade had no need to commit this indiscretion, and then to deny it, because what was the course of the debate? At the appropriate moment when the right hon. Gentleman made a statement in similar terms to that which had been made in another place, no one took any exception to it. There was no interjection, no query. We all understood the position perfectly, and we did not expect it to go any further. We did not consider there was any need for elaboration.

Only a moment or two later, however, having read what I have no doubt was carefully written into his brief, the right hon. Gentleman put in something which I am doubtful was in his brief. He went out of his way to use the phrase quoted by my right hon. Friend about the exhibitors being cheerful next day. The right hon. Gentleman was not content to leave it to the Chancellor of the Exchequer in April. Oh no, he had to take some credit to himself. He could perfectly well have left it at his first pronouncement, but little Jack Horner wanted to pull out the plum himself, and therefore people had to be happy next morning.

It was that which really led him astray—his own wish to take credit to himself. I emphasise that it was not because at that point there had been any interjection from either side of the House. The remark about being cheerful next morning was not said in reply to a question. It was not something said, possibly thoughtlessly, because there had been an interjection or a number of interjections. One could have understood that, for it may easily happen. This was a deliberate, unprovoked statement, a little claim for credit on the part of the President of the Board of Trade, and one which was not needed for the sense of the Bill and was not required for the course of the debate. I think that the explanation I have given is the truth.

I make this point because certain newspapers suggested—the Daily Telegraph for one—that hon. Members on both sides took what the President said to be a pledge. They said that the right hon. Gentleman had clearly been provoked by Opposition probing into going further than he intended in his originial statement. Yet at the point when he made that statement there had been no Opposition probing. The Opposition probing followed the statement; it did not precede it.

Then, having made that first statement about being cheerful next morning, as my right hon. Friend the Leader of the Opposition pointed out, the President of the Board of Trade had to go a little further. Not satisfied with the credit he had already taken to himself, the right hon. Gentleman then had to say that the producers, who have an interest in this matter too because they are at the receiving end of it, might take comfort from what he was saying because, as he said: I am sure the possibility of that interesting bonus will not be far from hon. Members' minds. This was a bonus to the producers.

Again there was no Opposition provocation, and that statement was not necessary for the course of the debate, so there was no need to have put it in that form. What makes those of us on this side of the House who were present so indignant at what we consider to be the contemptible conduct of the right hon. Gentleman is the way in which later he denied it. That also was unnecessary and uncalled for. I entirely agree with my hon. Friend the Member for Nottingham, West (Sir T. O'Brien) that there is great interest in the industry about this tax. If what the right hon. Gentleman said was an indication of Government intention, he could at least have left it at that, but not at all. When my right hon. Friend the Member for Battersea, North (Mr. Jay) replied to the debate and, perfectly naturally and with complete propriety, referred to the statement which by that time had been referred to on the tape outside and in the evening Press, and said that the President in a sotto voce aside had stated that the Entertainments Duty was to be reduced in the next Budget, the President of the Board of Trade did not let it go at that.

He was not following the procedure suggested by the Leader of the Liberal Party or the noble Lord the Member for Dorset, South of deciding that now the time had come for a more elastic procedure on Budget matters. No. The President of the Board of Trade then had to get up and deny it. He did not simply deny it and say, as he might have done, realising that he had gone a little too far, "I think it would be wise not to read too much into what I said." He had to make a sneering remark about my right hon. Friend the Member for Battersea, North.

My right hon. Friend had not in any way been provocative, but the right hon. Gentleman said: I knew before the right hon. Gentleman rose that that was the sort of thing that he was going to say. I cannot repeat the tone of voice in which the right hon. Gentleman said that, and I leave it to the imagination of hon. Members. He then said: I should like to deny that I said that I knew it was to be reduced. The right hon. Gentleman was not satisfied even with that. He went on: The right hon. Gentleman, too, knows that that it not true, but I must say that it is in his nature to say it."—[OFFICIAL REPORT, 27th February, 1957; Vol. 565, cc. 1241 and 1317.] I ask hon. Members in all parts of the House whether, if they had been in the position of the President of the Board of Trade and had made an indiscretion, they would have tried to get out of it by making insulting remarks about a Member of the Opposition. Speaking as a woman, I can only call that contemptible conduct in a man—cowardly, but I am not allowed to say that in the House. [HON. MEMBERS: "Oh."] So it was, and it was all in keeping with the right hon. Gentleman's conduct the next day in sitting at the end of the Government Front Bench.

Mr. Cyril Osborne (Louth)

That is a nice, cheap headline for the hon. Lady.

Mrs. White

It is not a cheap headline. I was indignant at the way my right hon. Friend was insulted on that occasion. It is because of that kind of conduct that we feel it necessary to discuss the matter. We are not in the least averse to statements on taxation being made in a proper way, in a definite and authorised manner, when required in the public interest, but to make a statement and then deny that one made it is not conduct becoming a senior Minister of the Crown. The right hon. Gentleman should not have made the first mistake or he should not have made the denial—one or the other.

What is the result of this? The cinema industry has naturally assumed what I think everybody in the House assumed, that it has a pledge. I have with me a copy of the Cinema News and Property Gazette dated Friday of last week, which says in a front page article: There is now no doubt that there is to be a cut in E.T. in the coming Budget. Irrespective of the niceties of Parliamentary parlance, the President of the Board of Trade did make this fact crystal clear. The headline is to the effect that £7 million is to come off the tax. It is suggested that that loss in revenue might be met by raising the television licence fee to £5.

As my hon. Friend the Member for Nottingham, West said, all of us who are concerned with the entertainment industry are well aware that a review is proceeding. For all we know, it has concluded, but it has certainly been undertaken. However, that affects all sections of the entertainment industry, not only the cinema. The pledge given by the Prime Minister when he was Chancellor of the Exchequer concerned the living theatre and not the cinema. The result of this statement and then the denial by the President of the Board of Trade is that the entire entertainment industry is now in a state of confusion because it does not know what will be done. This kind of speculation is extremely damaging. There are many other industries, as has been pointed out, which might also wish to have remission of tax, but we do not expect all of them to be told before the Budget what the tax remission is to be, for that would be an intolerable situation. If there are special circumstances why one industry should be told, that is another matter.

I now want to turn to something which is even more serious. It is not just the effect on the industry, serious as I believe that to be, and in that connection I hope the industry will not suffer from anything that may have arisen in the House. I wish now to refer to something else contained in the publication which I quoted just now.

I wish to ask the President of the Board of Trade whether any assurances about tax were given to the Conservative back-bench Members whom he met on 19th February. I propose to read the relevant passage from the article. The statement has been made in public, and if it is completely untrue—I emphasise those words—with no equivocation, I think the public are entitled to be told. The publication refers to the debate on Wednesday in which there were interventions from the Labour side of the House asking the Minister whether he really meant that the Entertainments Duty was to be reduced. The passage reads: It was significant that not one Conservatime M.P. rose to question Sir David when he made his statement on E.T. in the Commons on Wednesday. The reason is that most of them were already aware of the assurance. I understand that it was given during the private joint meeting of the Conservative Trade and Industry Committee and Films Committee on February 19. And it was for this reason that, as I reported on February 22, Conservative M.P.s … who had been very doubtful about supporting some of the levy proposals … closed their ranks in support of the Bill. I think we are entitled to know whether any assurances, direct or indirect, were given to that private meeting outside the House a week before the debate on the Bill took place.

The President of the Board of Trade (Sir David Eccles)

I should like to tell the hon. Lady that no such assurances were given.

Mrs. White

We have had one denial from the right hon. Gentleman. I do not know what value we can place on this other.

Hon. Members

Withdraw.

Mr. Deputy-Speaker

I do not think we should pursue this any further. [HON. MEMBERS: "Why not?"] If we are to recriminate with each other across the Floor of the House, saying that we do not believe what the other says——

Mr. Bevan

On a point of order, Mr. Deputy-Speaker. A most serious statement has been made, highly relevant to the debate, far more relevant to it than many speeches which have been made on the other side of the House, that one of the explanations for this situation is that Conservative Members of Parliament were made privy to a Government intention before anybody else was.

Mr. Osborne

It has been denied.

Mr. Bevan

It has been denied, but what has been said is that—it is in accordance with perfectly proper Parliamentary conventions as far as I know them—that the same Minister has already made a denial which we do not accept.

Mr. Deputy-Speaker

That was the point that I hoped would not be proceeded with.

Mrs. White

I will not proceed with the point about the denial, but I think I ought to proceed with some of the other things mentioned in the article, because they give the background for such assurances.

The article pointed out that in November, when the statutory levy was known to be the policy of the Government there was considerable Conservative opposition to it and to the rate of levy proposed unless it was accompanied by a firm promise to reduce the Entertainments Duty. It also stated that the news of this opposition was conveyed to the Government Whips from the Conservative Films Committee, and that this information was filtered through to the Chancellor, and that the Lobby grapevine, for what that is worth, is now thinking in terms of a £7 million reduction in Entertainments Duty.

I cannot quote the whole article, but I commend it to hon. Members on all sides of the House, because it gives a very definite impression that these matters have been fully discussed by hon. Members on the other side of the House before being brought before us in Parliament.

Mr. Osborne

rose—

Mrs. White

I am sorry; I shall not give way. I say, therefore, that we on this side of the House are fully entitled to submit this Motion, because there are various matters which need to be cleared up. After all, we in the House of Commons owe our influence in other parts of the world very largely to the respect which other people feel for our traditions. Our traditions are based not merely on our Standing Orders but also upon the unwritten rules of the House. If we feel that one of the unwritten rules of the House has been contravened, then it is only right that we should be jealous of the honour of the House. It is for that reason that we bring forward this Motion.

5.30 p.m.

Captain J. A. L. Duncan (South Angus)

I claim to have two reasons for speaking this evening. First, I have been, off and on, in this House since 1931, and I feel that I have just as much respect for the honour and traditions of the House as has any other Member; and, secondly, I was one of those—the hon. Lady the Member for Flint, East (Mrs. White) was the other—who were present last Wednesday at that debate; no other speaker was. I speak, therefore, as an eye-witness.

It is very important, in discussing this Motion, to get the background to the Bill right. My right hon. Friend the Chancellor of the Exchequer referred to this, and I should like to repeat it, because it is important. This Cinematograph Films Bill——

Mr. Arthur Lewis (West Ham, North)

We are not discussing that.

Captain Duncan

If the hon. Gentleman would only keep quiet, we should get on much better.

Mr. Lewis

rose—

Captain Duncan

The Cinematograph Films Bill provides for what might well be a doubling of the levy. The levy, up to now £2½ million on a voluntary basis, has been subscribed to by not all cinemas; but when it is doubled in two years' time, the maximum going up to £5 million, and it is a statutory levy, it may well be a very heavy burden on the exhibitors who have to pay it in addition to the Entertainments Duty.

Therefore, if this Bill were to be acceptable to the trade and the House, it was obviously necessary to get some idea of whether this levy, doubled as it may well be in certain cases, would be taken into consideration or taken into account—the words are interchangeable—by the Chancellor of the Exchequer in reviewing the Entertainments Duty.

Mr. Lewis

rose—

Hon. Members

Sit down.

Captain Duncan

That is the background of the Bill, and it is important to have it right.

Inquiries have been pursued, and statements have been made. The first statement was made, I think, in another place by my noble Friend. Broadly speaking, it was then said that, in considering this Bill, the Entertainments Duty, and the level of it would be taken into account. The second occasion was when the Financial Secretary to the Treasury referred to it on 13th December, saying: The provisions of the Cinematograph Films Bill"——

Mr. Lewis

On a point of order, Mr. Deputy-Speaker. I have been sitting here during all the time that the hon. and gallant Member for South Angus (Captain Duncan) has been speaking, and I should like to ask you, Mr. Deputy-Speaker, whether it is in order for an hon. Member to go on debating what occurred in a Second Reading debate on a Bill which has nothing to do with the Motion we are now discussing. The hon. and gallant Gentleman has been discussing the Second Reading of a Bill which, I understand, was discussed and debated here last week. Are we not now discussing the Motion on the Order Paper?

Mr. Deputy-Speaker

It arose out of what happened here last week.

Captain Duncan

The Financial Secretary said: The provisions of the Cinematograph Films Bill are amongst the various factors which are being taken into consideration in the review of the Entertainments Duty."—[OFFICIAL REPORT, 13th December, 1956; Vol. 562, c. 80.] Thus, there were two previous statements. The third statement was the one which has been quoted already by the Leader of the Opposition, the statement made by my right hon. Friend the President of the Board of Trade last Wednesday. The only amplification of that last statement came from my right hon. Friend when he was questioned by the hon. Member for Govan (Mr. Rankin), who asked: Will he reduce the Entertainments Duty. My right hon. Friend replied: There is no other way that he can do it"—[OFFICIAL REPORT, 27th February, 1957; Vol. 565, c. 1238.] That is the basis of the complaint. To my mind—and I was here, while the right hon. Gentleman the Leader of the Opposition was not——

Mr. Bevan

I do not want to go on interrupting, but that is really rather a foolish statement to make; it is all in HANSARD, as the hon. and gallant Gentleman knows.

Captain Duncan

Yes, I know that; but the hon. Lady the Member for Flint, East based much of her speech on that very claim, that she was present.

Mr. Osborne

Hear, hear.

Captain Duncan

I am not a lawyer, but I believe that it is of some importance in legal cases to see the demeanour of the prisoner at the bar.

Mr. John Rankin (Glasgow, Govan)

rose—

Captain Duncan

No; I do not want to speak for long.

Mr. Rankin

On a point of order. The hon. and gallant Gentleman referred to me.

Captain Duncan

No.

Mr. Rankin

He has quoted me. Surely, in courtesy, he ought to give way?

Mr. Deputy-Speaker

I did not hear the hon. and gallant Member refer to the hon. Member for Govan.

Mr. Rankin

On a point of order, Mr. Deputy-Speaker. May I remind you that he did?

Mr. Deputy-Speaker

The hon. and gallant Gentleman does not give way. Captain Duncan.

Captain Duncan

From my point of view, hearing those words, it did not seem to me that there was any disclosure additional to what had been disclosed on three previous occasions. It seemed to me that there was just an intelligent comment on what had been said officially three times before by my noble Friend, speaking for the Government in another place, by the Financial Secretary to the Treasury in December, and my right hon. Friend himself earlier in his own speech. It conveyed nothing more than that to me.

Mrs. White

Why did he deny it?

Captain Duncan

On the other hand, my right hon. Friend the Chancellor of the Exchequer tried to make out, from his impression, though he was not here at the time, that the President of the Board of Trade was referring only to the levy. My impression definitely was that he was referring to the whole of the Entertainments Duty. I should make that clear, because that was my impression. It is quite clear, however, from what has been said by my right hon. Friend the Chancellor of the Exchequer today, that there has been no decision about Entertainments Duty, and, therefore, my right hon. Friend the President of the Board of Trade cannot have any prior knowledge of what the Chancellor of the Exchequer is going to do.

There have been murmurs about the evils of speculation. The Leader of the Opposition mentioned that there had been speculation. I had copied out for me this morning a note of all the dealings in all the leading cinema companies in the City for the whole of last week.

Mr. Lewis

How many Members of Parliament amongst them?

Mr. Osborne

The vice-chairman of one of them is there.

Captain Duncan

The hon. Gentleman the Member for Islington, East (Mr. E. Fletcher) can check my figures, because he is vice-chairman of the board of directors of the first company I am going to mention, Associated British Picture Corporation. On Monday there were four dealings; on Tuesday, one; on Wednesday, two; on Thursday, five, and on Friday, two. Does that indicate speculation? To my mind it does not.

I now turn to Gaumont British 10s. ordinary shares. On Monday there were four dealings; on Tuesday, four; on Wednesday, two; on Thursday, six, and on Friday, five. Does that look like vast speculation in cinema shares because somebody has given away a Budget secret? Of course it does not.

My last example concerns the Rank Organisation 5s. ordinary shares. On Monday there were four dealings; on Tuesday, four; on Wednesday, four; on Thursday, eight, and on Friday, five. For the whole week there was barely a change in price. It amounted to a few pence, because the jobbers put the prices up on Thursday morning, but that movement faded out on Friday. There was absolutely no speculation—and if anybody wanted to speculate on my right hon. Friend's statement he must have been awfully foolish to try it on.

The hon. Member for Nottingham, West (Sir T. O'Brien) appealed to the House not to divide tonight. I should like to echo that appeal. To my mind this is a mare's nest—a complete waste of time. Nothing has been proved about speculation or anything else. The hon. Member for Nottingham, West talked about the good traditions and customs of the House. I respect them and honour them just as much as he does. I should like him to appeal to his own side and his own leaders to withdraw the Motion so that we can get on with something worth while, instead of wasting valuable Parliamentary time.

Sir T. O'Brien

I did not appeal to the House not to divide, and leave it at that. I appealed to the House—to both Government and Opposition, but to the Government particularly—to see if they could resolve this issue in such a way as to make a Division unnecessary. That is quite another matter. I referred to the fact that as the President knew last Thursday that hon. Members on this side of the House had, rightly or wrongly, construed his remarks as a breach of the traditions of the House, he could have put matters right then. It is not too late to put them right now. That is the nature of my appeal, and I hope that even at this late hour it can be met.

5.34 p.m.

Mr. Leslie Hale (Oldham, West)

The debate has traversed a fairly wide field, and I make no complaint of that. I listened to the speech of the hon. Member for Dorset, South (Viscount Hinchingbrooke) with the pleasure that I usually do, and I should like to felicitate him upon finding for the first time an issue upon which he could express himself as being in sympathy with the Government.

I was glad that my right hon. Friend the Member for Bishop Auckland (Mr. Dalton) made his intervention. As one who was a Member of the Select Committee concerned, and who remembers the situation, I can say that not a single word of evidence impugning the high integrity of my right hon. Friend was proffered by anybody. I say quite sincerely that, high as my right hon. Friend has always stood in the respect and, indeed, affection of his colleagues, he never stood higher than in those days when he paid a very heavy penalty for a minor indiscretion, and carried himself with high courage and great dignity.

It is just not true to say that the Opposition are trying to stir up mud and make a political issue out of a small matter. My right hon. Friend the Member for Ebbw Vale (Mr. Bevan) intervened on Thursday, during the questioning of the Prime Minister, and said that the House was always generously inclined, and that if there was an apology it would be the end of the matter. All through the debate this afternoon we have been confronted with half-apologies and half-explanations—suggestions that this statement did not mean anything, or that it meant more than it did. We have had a whole series of explanations.

I think that I can say, quite fairly, that the miserable statement of the Chancellor of the Exchequer this afternoon has scarcely been equalled in its variety since Lord North was dealing with the tea duties in the American Colonies. I recall a case that I may have quoted before but which I want to quote again because it is significant. It concerns an honest man who was charged with stealing a cow. In consultation with his legal advisers he was asked to give his explanation of the circumstances. He said, "First, I was not there at all: secondly. I never took the cow; thirdly, it was my cow anyhow, and, fourthly, I sent it back the moment the police arrived."

As tactfully as they could his legal advisers suggested that he should try to reconcile those explanations so as to achieve some measure of synchronisation before he entered the witness box, and not repeat them one by one. One of his advisers, however, who was a sporting gentleman, said, "Put him in the box and let him give all four explanations." He did give all four explanations, and in due course he was acquitted by the jury. I doubt whether the President could anticipate so favourable an outcome tonight, were it not for the fact that a three-line Whip has been issued in his defence.

The President of the Board of Trade has not been wholly happy in his treat- ment of this matter from the start. He has acquired something of a record for indiscretion. After his statement in the House we find him explaining to an audience in Burton that this country could not be defended while, at the same time, one of his colleagues in the United Nations was saying that we would defend the Gulf of Aqaba. It would be well if the Government could make up their mind upon a single question before making statements. This afternoon, in connection with the German contribution to defence support costs, the Chancellor of the Exchequer said that he was dealing with only £75 million and was not sufficiently familiar with the facts to answer further questions. In fact, he had the facts in his hands, and read them to the House afterwards, under pressure.

The President has been far from happy in his defenders, in the Press and in the House. First, there was the speech made by the hon. Member for Morecambe and Lonsdale (Sir I. Fraser), who left the House half a minute after he had concluded, and has not yet returned. He quoted the Manchester Guardian. It is usual for hon. Members opposite to try to dismiss that newspaper as a somewhat Left-wing organ which is getting almost out of hand. The hon. Member's suggestion that the Manchester Guardian was supporting the President is not borne out by what it says this morning. It says: The Eccles affair is but a drop in the cup of Tory bitterness at the moment. Even if Sir David were to resign, the episode would soon be crushed under the weight of graver affairs. But the Prime Minister has said that Sir David is not to resign. It was a Tory Member … who reminded the House last week of the example set by a Labour Chancellor, Mr. Dalton, when he inadvertently gave away the details of his Budget in advance. Mr. Dalton apologised and paid—paid heavily. Sir David has done neither so far, and in its results Sir David's indiscretion may turn out to have been more potent than Mr. Dalton's. The Labour Chancellor revealed his Budget proposals only a few minutes before he announced them to the House. Sir David spoke weeks ahead of the Budget. That is a grave statement, published after mature consideration, by the political correspondent of what I was always taught to believe was the greatest newspaper in the world—and if it does not get too excited about it I will say that I still think so.

One defence of the President of the Board of Trade came from the distinguished writer who entertains us in the Sunday Express. He said: His critics say he is too brash a boy to be a Cabinet Minister. I'm all for brash boys. They are more useful than stick-in-the-muds. They get things done. The writer then looked through the whole record of the right hon. Gentleman in order to find something that he had done, and the only instance he could find was that he was the Minister who persuaded the authorities to permit the televising of the Coronation ceremony. Were I lavished with compliments of that sort I should feel that I had been rather hardly done by.

Mr. Randolph Churchill, who represents the high voice of Toryism, in the Evening Standard, in an article on Thursday last—the very day when this matter was under discussion—showed rather less than his usual ingenuity of reference. He came back to the old question of why a dog did not bark in the night, which most of us have used time after time. It comes from one of the more famous Sherlock Holmes stories. The relevant question on Thursday was not why the dog did not bark in the night time, but why the Prime Minister did in the afternoon. The Prime Minister came to the House and said that there was no leak at all, and that if there was a leak it was a leak to Parliament and leaks to Parliament did not matter. His first explanation was that there was no leak at all.

The Chancellor of the Exchequer, this afternoon, said that this was a statement of Government policy, and quoted as a precedent the fact that my right hon. Friend the Member for Huyton (Mr. H. Wilson), in the course of Budget discussions, announced to the House that he would make an amendment to his Budget, or that an amendment was to be made to the Budget. One would think that it was hardly possible to make an amendment to a current financial Measure without informing the House that it was going to happen. The right hon. Gentleman says that this was a precedent for a statement of policy which the Prime Minister had solemnly assured the House was not a statement of policy at all. It did not mean what it was thought to mean, and nothing was further from the President of the Board of Trade's mind than to make a statement of any kind.

I found myself in disagreement with my right hon. Friend the Member for Ebbw Vale at one point. When my hon. Friend the Member for Flint, East (Mrs. White) made some references to some rather startling articles which had appeared about the previous discussions in the House, my right hon. Friend intervened and said that the President of the Board of Trade had given a denial, or given an assurance. I did not interpret his words as an assurance. I have been careful, in listening to statements from the Government Front Bench, to find out just how far they go and just what they mean. What the right hon. Gentleman said was that no such assurance was given. It is more than probable that at party meetings no such assurance was given.

But was the matter discussed? Were observations made at that meeting which could convey that a certain course was in contemplation? Was the usual statement made that is made at private meetings? "There is really no need for you rebels to get excited. If only you will wait, you will find that the need for rebellion has disappeared. If only you have confidence in your leaders, you will find that they are going in the same direction as you are pursuing, but perhaps a little more slowly." How often have we heard such statements and been reassured by them? I should be grateful if the President of the Board of Trade would tell us what really did happen. I will willingly give way if he will do so.

The hon. and gallant Member for South Angus (Captain Duncan) has said that there were only a limited number of transactions on the Stock Exchange itself. But the figures which he gave did not include the ordinary type of dealing in the country, which is a matter of great importance in this respect. The Daily Express said, on Thursday, that there had been a great appreciation in cinema shares £1½of million in the course of the last fortnight, which was over the relevant period to which my hon. Friend the Member for Flint, East had been referring.

Captain Duncan

They must have gone down very much by Friday.

Mr. Hale

Of course, but it is strange. The hon. and gallant Gentleman gives me my point. He refused to give way when I tried to intervene, but I have extended to him that courtesy. This is what happens on profit taking. This is precisely the thing that we are attacking. The reason that I rose to my feet, speaking as one who has practised only in a small village, was to try to put to the House just what is the position in matters of this kind.

The noble Lord the Member for Dorset, South, made a most entertaining speech, which was more reminiscent of the Chelsea Flower Show than of a Parlimentary performance. I am bound to say that when he makes any remarks about the Treasury I always feel a deep sympathy with him, but when I listened to the noble Lord's speech—and I always listen to them with pleasure—I recalled the only time that Abraham Lincoln reviewed a book. It was a book by a very old friend, and Lincoln was a very honest man. He read the book and found himself torn between the desire to be kind and his duty to be just. He wrote, "For those who like this kind of book, this is exactly the kind of book they like." I always say that if I were a Tory, I should like to make the sort of speeches which the noble Lord makes; but, not being a Tory, I find myself generally in disagreement with him.

The floral metaphor was singularly inappropriate. Mr. Hickey, writing on this matter in the Daily Express today, said that he discussed the whole matter with the President of the Board of Trade yesterday on the telephone. He said that the right hon. Gentleman was among his crocuses, getting his hands dirty. Mr. Hickey wrote: Sir David Eccles said to me yesterday, I do not give a hoot what the Socialists try to do to me tomorrow. Let them get on with it'. Mr. Hickey went on, in a moving and emotional paragraph, to say that not only were the crocuses out at Andover, but the almond blossom was in flower in London, and the Dockers, who, unhappily, were at San Moritz, were unable to see that display of flora. While I applaud the President of the Board of Trade's method of spending a quite Sabbath, he should not have been in the flower garden, looking at the flowers; he should have been in the vegetable garden, looking at the leeks.

No one minds the President of the Board of Trade saying that he does not give a hoot what the Socialists say, but he ought to give a hoot about what the House of Commons is going to say. What is happening today is what the House of Commons is going to say, and if it were not for the three-line Whip it is quite obvious what they would say, because more people than hon. Members on this side are annoyed at what was, to say the least of it, a foolish disclosure and one for which no expression of regret has been made.

I want to try to put the real difficulty in this matter and what is, I think, the answer to one of the points put by the noble Lord. The noble Lord said, "Why not have these statements day by day as they come out and not let the Treasury keep us quiet? Why should profit-making be limited to the day after the Budget?" I will try to tell him. Dealing in shares takes place not only between millionaires. It is always part of the defence put forward in this House for private enterprise, and a perfectly fair part of it, that a great many people, poor people, industrious people, frugal people, own shares in companies about which they know very little. It is their method of investment. The Prime Minister's crofter grandfather might have understood this matter more than the Prime Minister himself. The time comes when those shares have to be disposed of. Mostly, they are unwilling sellers. They are selling their shares either because of the bank squeeze, when the bank says, "You must realise and pay off the overdraft," or because they are trustees following a death and have to realise to distribute the assets and there is not much time left for realisation. The position of the trustees is very often a difficult one indeed.

Captain Duncan

Hear, hear.

Mr. Hale

It is extremely difficult to have knowledge and to have advice. I am obliged for the intervention of the hon. and gallant Member for Angus, South because anyone who invested in Tory security at the time of the last Election—a millionaire who bought Government securities—would not now, if he died, have left enough money with which to pay his death duties.

Mr. Nabarro

If he bought Daltons he would not.

Mr. Hale

It is quite true that the securities of my right hon. Friend have depreciated owing to the new monetary policy and the rising of interest rates. I take the view that a capital levy was necessary; but we will not pursue that today.

The trustees are in this position. With a few cinema shares they have to go to their bankers or solicitors or, where there is a local broker, to the broker, and get advice. They have to sell and, in the end, they have to give an open instruction to sell at a certain minimum price.

In the case of the Wembley circuit, the ruling price on Wednesday was 2s. 10½d., and an open instruction was given to sell. When a statement like this comes out in the House at four o'clock on Wednesday afternoon, it puts the whole chance of profit in the hands of the "wise guys". the "bright boys". the "men-in-the-know." These people who have been trying to sell their shares for weeks find that their offer is accepted within five minutes. What the hon. and gallant Member for South Angus did not tell the House was that the rises in the Stock Exchange prices nearly all occurred in the first hour's business on Thursday morning.

Captain Duncan

They have gone down again.

Mr. Hale

They have gone down again, of course. Those people have taken their profit—the swindle works both ways. In the case of the Wembley circuit the rise was 10½d. on the 2s. 10½d. shares. That is a rise of 30 per cent., which is a serious rise, and that is why these indiscretions mean a loss.

The noble Lord the Member for Dorset, South said that all happens on Budget day. It does not all happen on Budget day; of course it does not. A bank manager in Leicestershire cannot advise his clients that the President of the Board of Trade intends to commit an indiscretion a week on Wednesday. But the bank manager can tell his clients that the Chancellor of the Exchequer will be presenting his Budget on a certain day. He can advise his clients to hold and not to sell until the terms of the Budget are known. At least, he can make a fair and possibly intelligent prognostication about what the content of the Budget may he. If Mr. Randolph Churchill carries on in the Evening Standard, with the ability with which he has been showing, to indicate and forecast and explain political events, it may well be that the Evening Standard may be able to give us the content of the Budget the day before; and then we can all gain some advantage from it.

We have had from the noble Lord a statement that this debate is unnecessary and a waste of the time of the House, and the noble Lord took a rather long time to say it. From the President of the Board of Trade we have had a statement which suggests that this was really a serious statement of Government policy—[HON. MEMBERS: "From the Chancellor of the Exchequer."] Yes, from the Chancellor of the Exchequer.

Mr. Lewis

They change office so much.

Mr. Hale

Yes, they do.

It is true that from the hon. Member for Morecambe and Lonsdale (Sir I. Fraser) we had a suggestion that the Prime Minister was right not to accept an offer of resignation. But when the hon. Gentleman was told that no such offer had been made, he said he thought that the President of the Board of Trade was right in not making an offer. No one can say—and there is this to be said for the argument of the noble Lord—that this debate has made the position any clearer.

But if the President of the Board of Trade really wishes to win the confidence of the House, he should remember two or three things He should remember that all of us can make mistakes, and this may have been a mistake which it was very easy to make in the circumstances in which it was made. I quite understand the temptation—in view of the suggestions which have been made that he is being left a little out of the councils of the Prime Minister at the moment—and desire of the right hon. Gentleman to bring himself a little more into prominence. Reputations rise and reputations fall in these circumstances.

In the same Evening Standard article, last Thursday, we were told by Mr. Randolph Churchill that even the noble Lord the Prime Minister's uncle has been going down a little since the appointment and has been wandering round the corridors—[HON. MEMBERS: "His uncle?"] I am not sure of the relationship of all these people. We used to call it "the cousin-hood" in the old days.

The Prime Minister (Mr. Harold Macmillan)

I have not got an uncle.

Mr. Hale

How fortunate! But how much more fortunate it is for some of the right hon. Gentleman's colleagues that they have got an uncle.

At any rate, Mr. Randolph Churchill particularised the noble Lord by saying that he was the noble Lord responsible for securing the Tory Party's approval of the appointment of the right hon. Gentleman as Prime Minister, and I hope that that description is sufficient to identify him. Mr. Randolph Churchill said that he was now carrying "less guns". It might have been more appropriate to say "fewer ropes". But it shows the rise and fall of political fortunes, of which, indeed, there has been some evidence.

I would say to the President of the Beard of Trade that even though he does not care two hoots for what the Socialist Party think, and even if he does not care tuppence—as the Prime Minister does not—for what has been said by Lewisham, and the voice of Carmarthen or Wednesbury— or what Warwick and Leamington may say in a few days' time—he should bear in mind the old and honoured traditions of this House. When the President of the Board of Trade makes a mistake, he should not say that he did not make it. He should not make a statement which is at variance with the facts. He should not then skulk about and ask his colleagues to come here and say that there is nothing to apologise for; and, when a debate is staged, put forward a wholly different explanation; because, when that is done, the Minister has not in the least the confidence of the House; and a Minister cannot carry on for long unless he retains a trust in his integrity and his approach to the House.

There is here no attack whatever on the integrity of the right hon. Gentleman in the sense that there is any suggestion that this was anything more than an indiscretion. No one suggests anything more than that. It is in the integrity of his approach to the House, the correctness of the information he gives to the House, and in his desire to be fair and frank with the House, that the President of the Board of Trade has failed, and that is why this Motion has been moved today.

6.7 p.m.

Mr. Cyril Osborne (Louth)

I should like to try to follow some of the remarks of the hon. Member for Oldham, West (Mr. Hale) in so far as this charge is really based upon the old tradition of this House, which is jealously guarded, that no Government secrets upon which men can make profit on the Stock Exchange, should be allowed to escape. It is the Stock Exchange reaction which has caused the complaint of hon. Gentlemen opposite.

Mr. Hale indicated assent.

Mr. Osborne

I am glad to see that the hon. Member nods. If hon. Members will allow me—and if they will not go into Committee in the Chamber—I should like to try to explain how the Stock Exchange works in these matters what actually happened: how many dealings took place; and how little speculation there was, or profit taken.

Mr. W. R. Williams (Manchester, Openshaw)

Does it matter?

Mr. Osborne

It means everything, because the basis of the whole charge is that there was speculation and profit made. That was the case of the hon. Member for Oldham, West.

I must make myself clear to the extent of saying that for many years I have tried to earn my living as a country stockbroker, so I have some knowledge of what happens and what has happened in the last week. May I remind the House what was said last Thursday?

The right hon. Member for Battersea, North (Mr. Jay) asked my right hon. Friend the Prime Minister this question: Is the Prime Minister aware that ever since this incident there has been speculation in cinema shares on the Stock Exchange? … The House should know how much speculation did take place and the real facts of the case, and then, upon the facts, the House can make its proper judgment.

Later, the right hon. Member for Huyton (Mr. H. Wilson) said: … speculation immediately began in this matter, will the right hon. Gentleman take the matter a little more seriously … Later still the right hon. Member for Huyton—I am glad to see that he is now in the Chamber—said to my right hon. Friend the Prime Minister: My right hon. Friends have made clear that some very erratic movement is going on in the Stock Exchange over this matter …"—[OFFICIAL REPORT, 28th February, 1957; Vol. 565. c. 1401–8.] There are four big groups whose shares are affected, those of the Rank Organisation, Gaumont British, Associated British and the Stoll group. How far did prices rise? That is the next question. My hon. and gallant Friend the Member for South Angus (Captain Duncan) quoted a number of markings, and an hon. Member opposite was aware that the information, given to my hon. and gallant Friend in all good faith, did not give the whole picture. The number of markings, as we call them, on the board of the Stock Exchange is not quite as reproduced in the newspapers, which do not give the total number of markings done. One marking may cover a dozen or twenty or even a hundred movements.

Let me tell hon. Gentlemen what actually happened. There are five jobbers in the market who deal in this field of cinema shares. On the Wednesday, before the statement was made—hon. Members might bear these figures in mind—the jobbers quoted, for Rank Organisation ordinary shares, 9s. 6d. to 9s. 9d., which is a very close price. Hon. Gentlemen will realise that the figures mean that 9s. 6d. is the price at which the public can sell shares and 9s. 9d. is the price at which they can buy them. The difference between is the jobbers' turnover, what the jobbers make on the transaction.

On the next day, the price was quoted as 10s. to 10s. 3d., so the market had moved up 6d. per share between Wednesday and Thursday. By the Friday, Ranks were quoted by the leading jobbers at 9s. 4½d. to 10s. Instead of the 3d. price there was now a 7½d. price. The jobbers always quote a wider price when there is a great uncertainty. Therefore, the selling price on the Friday was lower than it had been on the Wednesday. What had been gained temporarily on the Thursday was completely lost by the Friday.

Gaumont British were quoted on the Wednesday at 11s. 6d. to 11 s. 9d., again a very close price. By Thursday morning they were 12s. to 12s. 3d. Again, there had been a rise only of 6d. per share, and again on Friday morning the jobbers called them at 11 s. 4½d. to 11s. 10½d. That was a wider price, but lower than had existed before the statement was made.

Let me turn to the case of Associated British. I am sorry that the Deputy-chairman of that great combine who adorns the Opposition benches, the hon. Member for Islington, East (Mr. E. Fletcher), is not present to hear what happened to his own shares. Associated British were called at 10s. 6d. to 11s. on the Wednesday and 11s. to 11 s. 3d. on the Thursday, again a rise of 6d. On the Friday they were back to 10s. 6d. to 11s., the exact quotation that held good before the statement was made. [Laughter.] The hon. and learned Member for Leicester, North-East (Sir Lynn Ungoed-Thomas) should stick to law. Stolls were quoted at 3s. 4½d. to 3s. 6d., again a very close price indeed between the jobbers.

Mr. Herbert Butler (Hackney, Central)

What were the Arsenal figures?

Mr. Osborne

The hon. Member should not he quite so stupid. The whole case of his party for its Motion of censure is based upon its fears of speculation. The hon. Gentleman should re-read what was said in the House last Thursday.

Mr. H. Wilson

Quite apart from the fact that the whole case of the Opposition is not based upon what the hon. Gentleman thinks, all he is proving is the substantial amount of profit-taking on the Thursday afternoon. Will he also bear in mind that what the Prime Minister said about the President of the Board of Trade talking without any knowledge at all would itself be sufficient to bring the share values back to the Wednesday price?

Mr. Osborne

The right hon. Gentleman is well-informed enough to understand. It is his back benchers who do not know. [HON. MEMBERS: "Oh."] Yes. I am trying to show that the amount of speculation which some Members of the Opposition fear took place is exaggerated in their minds. I am trying to put before the House the actual facts, which the right hon. Gentleman Will agree—[Interruption.] Would the hon. and learned Gentleman like to get on his feet?

Sir L. Ungoed-Thomas

Every figure which the hon. Gentleman has quoted shows that speculation took place.

Mr. Osborne

Again, I recommend that the hon. and learned Gentleman should stick to law.

Stolls were quoted on the Wednesday at 3s. 4½d. to 3s. 6d. On the Thursday, they were 3s. 6d. to 3s. 7½d., a margin of 1½d. On the Friday, they were back to 3s. 4½d. to 3s. 7½d. The amount of speculation, of profit that was taken, of gambling, was tiny beyond belief, and the right hon. Member for Huyton knows it.

Mr. Wilson indicated dissent.

Mr. Osborne

Oh, yes, he does. The bargains that could have been done and the amount that could have been dealt in at the time was between 2,000 and 5,000 shares. That is the size of the market. Suppose we take a 5,000-share market and Stolls at 3s. 6d. The total amount that can be dealt with would be less than £1,000, even if the maximum were taken from the jobbers' offices.

All I am saying to the Opposition is that their fears—I admit legitimate fears—that somebody has gained by this so-called leakage, are highly exaggerated and would not bear investigation. I would like somebody on this side of the House to ask for all the jobbers' books to be shown. [HON. MEMBERS: "Hear, hear."] I would be glad to see it. If hon. Gentlemen could be brought to understand what happened they would be astonished at the smallness of the transactions and business involved.

Sir L. Ungoed-Thomas

Let us have an investigation.

Mr. Osborne

I am prepared to have it, and to have other matters investigated, too. I am all for information.

The hon. Member for Islington, East is back in his place. May I just remind him and the House of the size of the enterprise with which he is so honourably associated and of the smallness of the turnover of his shares during those two days? The hon. Gentleman should look through the register of his own company, the Associated British Picture Corporation, of which he is deputy-chairman. It has 5 million 4½ per cent. preference stock, 2 million 6 per cent. preference stock and 2 million ordinary units of 5s. each that is, there are 8 million 5s. ordinary shares in his company. The shares fluctuated between Wednesday and the Thursday by 6d. By the Friday, the jobbers' price was back to what it was on the Wednesday.

Of those 8 million shares which his company have in issue, and which are held by the public, there would not be 1,000 that changed hands. One hon. Member quoted the Daily Express as saying how many millions of pounds had been made by that sudden change. It is just nonsense, and the right hon. Gentleman knows it, too. The bulk of shareholders retain their shares whether the shares go up or down. They stick to their shares year in and year out and neither make a profit when the markets go up or lose when they go down. The people who get in and try to beat the market are very small in number and, in my experience over many years, nearly always lose money.

Mr. Eric Fletcher (Islington, East)

Is the hon. Member now arguing that Budget indiscretions are irrelevant provided that a great many people do not take advantage of them?

Mr. Osborne

What I am trying to say to the House is that the legitimate fear of many hon. Members opposite, which is really behind this Motion of censure—that a lot of money was made by gamblers on the Stock Exchange—is grossly exaggerated, if not completely unfounded.

I should like to make this last point as to how much money was made. As the right hon. Member for Battersea, North knows, when cinema shares are purchased they are purchased at the jobber's high price and they are sold at the jobber's low price. Therefore, when there was a 6d. difference in the jobber's turn and prices have risen by only 6d., the man who has bought, even on the immediate information and got out right at the top of the market, would just get his money back. He could not make a profit because the shares had not risen by more than the jobber's turn. That is what I am trying to get understood by the House. There was no profit made in these dealings at all.

Whatever the rights or wrongs of what my right hon. Friend may have said, I am trying to show that what has been alleged as the great share-out behind it is wholly imaginary and part of the campaign of hon. Members opposite to throw discredit at my right hon. Friend. This debate seems to have been a complete waste of a day's Parliamentary time in order to have a petty little witch hunt. [HON. MEMBERS: "Oh."] Yes, we have today passed a Supplementary Vote which we as guardians of the public purse, ought to have gone into rather carefully. We have allowed it to go through on the nod so that someone might throw some filth at my right hon. Friend—mud and filth picked up in ignorance of the facts.

I protest against this piece of "phoney". Right hon. Members opposite have made a mountain out of a molehill. They will get nothing from it. With by-election results running so much in their favour they think that they are riding on the crest of the wave, but I would remind them of this. I was a Member in 1945, when we occupied only half of one side of the House. At that time Professor Laski was telling hon. Members opposite that they were in for twenty years and could never be beaten. I beg them to remember that public favour is extremely fickle. While, at the moment, it is running against us and in their favour, it will not always run that way. I think that they will live to regret this waste of time on an utterly "phoney" issue.

6.24 p.m.

Mr. John Rankin (Glasgow, Govan)

The hon. Member for Louth (Mr. Osborne) said that the issue we are discussing is a "phoney" one, but in saying so he merely proves that he is not acquainted with what has happened in the House since last Wednesday. When the President of the Board of Trade was speaking then I was clear about one thing. That was on the word of the right hon. Gentleman in reply to the interchange which took place between him and me. Entertainments Duty was now to be reduced and, as a result of that reduction, there would be a more cheerful look on the faces of many people the following morning.

That was one thing which the President will not disagree about, because he made it perfectly clear by his statement in the House last Wednesday. From that point the issue has become more and more clouded. That is entirely due to the antics of the Front Bench opposite. No one shares a greater responsibility for that than the President of the Board of Trade, the Chancellor of the Exchequer and the Prime Minister. The responsibility of the President of the Board of Trade comes in because, having made the statement at the beginning of the debate which everyone accepted at its face value, he proceeded later to deny that statement. That was a most serious thing to do.

Sir D. Eccles indicated dissent.

Mr. Rankin

The right hon. Gentleman shakes his head. I hope that if he is to intervene in what remains of the debate he will show to the House how the statement which he made later in the debate, towards its concluson, was not a denial of what he said at the beginning. Today, the Chancellor of the Exchequer made a speech in which he declared that he had not yet made up his mind about what was to happen to the Entertainments Duty. He said that today in face of the fact that the President of the Board of Trade, speaking here last Wednesday, on the assurance of the Chancellor, told us that there was to be a reduction of Entertainments Duty. Today, the Chancellor says that he has not made up his mind on the matter at all.

A year ago, at the time of the Budget, the present Prime Minister, who was then Chancellor of the Exchequer, stated that before the next Budget became due it was his intention to have a review of the whole structure and incidence of Entertainments Duty and to report to the House. Thus the Budget proposals could be framed in keeping with the state of the industry shown by the review. Does this mean that the review, which must have entered the mind of the Chancellor when he was giving the President of the Board of Trade the assurance he gave him last Wednesday, is not completed? Are we to hear nothing about it, or is it completed? If it is completed, was that the reason the Chancellor was able to tell the right hon. Gentleman that there was to be a reduction of Entertainments Duty?

The matter deteriorated towards the conclusion of the debate. Then it took a further fall. It passed into the hands of the Prime Minister. He came to the rescue of the President. As a result of his efforts to save his Minister, the whole thing reached a still lower level. During the questions and replies which took place last Thursday, we had, first, from the Prime Minister the statement that … the President of the Board of Trade was led to hazard a certain deduction. …"—[OFFICIAL REPORT, 28th February, 1957; Vol. 565, c. 1400.] It was merely a deduction. Then he went on, as reported in column 1401 of HANSARD, to tell us that the President of the Board of Trade was not making a prophecy when he made this statement. It was a deduction, not a prophecy. As reported towards the middle of the column, we are led to believe that it was a statement. It became a statement to Parliament, which could not be a leak. In the course of a few minutes it was a deduction, not a prophecy, then a statement. But before the right hon. Gentleman parted with it, it had become a prophecy, because he replied to my right hon. Friend the Leader of the Opposition in these words: … it was, as I said, a prophecy—."—[OFFICIAL REPORT, 28th February, 1957: Vol. 565, c. 1401.] In fact, he had said nothing of the kind; as reported at the top of the column, he had said that it was not a prophecy.

From that point the issue has become so hazy that it is doubtful whether the Government Front Bench can see any clarity in it whatever. The person chiefly responsible for the fogging of the whole business has been the Prime Minister.

When the President of the Board of Trade gave the assurance that there would be a reduction in Entertainments Duty, he was saying nothing which surprised those of us who were in the House for the simple reason that the Bill imposed on the entertainments industry a burden of £3¾ million on top of an existing burden of £33 million, which everyone in the House, from the Government Front Bench downwards, knows quite clearly the industry cannot bear.

When he was introducing the Bill, the President of the Board of Trade knew perfectly well that on both sides of the House there would be serious opposition to the Bill unless he were able to give some assurances about the extent of the Entertainments Duty. It was to modify that opposition that he made the statement that the duty would be reduced. In my view, he did it for a further reason, too, because it was accepted, when the voluntary levy was introduced, that the levy and the Entertainments Duty must go together.

In the words of Sir Wilfrid Eady, they were the shape of things to come, "Levy and tax were the shape of things to come." It has been accepted that the one must naturally vary with the other. Consequently, if the levy were to become statutory there must be some modification of the Entertainments Duty in order that the increased statutory levy might reasonably be borne by the industry.

The President of the Board of Trade is well aware of that, as is the Chancellor of the Exchequer, and I submit that these matters were in his mind, as they were in the President of the Board of Trade's mind, when we discussed this point last Wednesday. I hope that he will not go back on the promise which he made then, because it would be unfair and unfortunate if, as a result of what has happened in the House since Wednesday, the industry, which has been looking to this Budget to bring it some relief, is to be penalised. That will be done only if the Government adopt a mean attitude.

I urge the Prime Minister, if he is to reply to the debate, to make it clear that whatever difficulty may have occurred as a result of something said by the President of the Board of Trade last Wednesday, the cinematograph industry will not be made the victim of circumstances over which it has absolutely no control.

6.35 p.m.

Mr. Michael Stewart (Fulham)

I had some hesitation in beginning my speech, because I thought that an hon. Member opposite would follow the example of the hon. Member for Louth (Mr. Osborne) and endeavour to come to the Government's assistance. The hon. Member for Louth seems to be under a misapprehension about the scope of the debate. It deals partly with matters which are concerned with money making on the Stock Exchange and partly with matters of honour and the standards of the House. The hon. Member for Louth confined himself to the part which was no doubt within his own experience—[Laughter.]—but there is another part of greater importance.

Mr. Osborne

I am sure the hon. Member did not mean that remark in the way that the Welsh right hon. and hon. Members below him took it.

Mr. Gordon Walker (Smethwick)

If the cap fits——

Mr. Stewart

I realise that hon. Members opposite are somewhat sensitive about Welshmen at the moment.

Three times in the course of his speech the hon. Member for Louth accused the House of stupidity and insincerity because hon. Members could not follow his extremely muddled argument. If he dishes it out like that he must learn to take it.

We are, however, concerned with rather more serious matters than the hon. Member's contribution. For a long time it has been our general custom in this country that changes in taxation should be announced at one time, in the Budget statement, and that there should be exceptions only——

Mr. Osborne

Where is the hon. Member's halo?

Mr. Stewart

I notice that the hon. Member for Louth is afraid to get up.

Mr. Osborne

I am not in the least afraid to get up. I thought the hon. Member was at least generous enough not to suggest that I had no sense of honour in dealing with the House, as his hon. and learned Friend the Member for Leicester, North-East (Sir L. Ungoed-Thomas) had the audacity to suggest.

Mr. Stewart

I would only advise the hon. Member that if he is to address the House in that tone he must learn to be less offensive and abusive when he makes his own speech.

I was saying that it is our general custom that taxation changes should be made only at one time in the year and that if there is any departure from that general custom it should be for good and sufficient reasons and for a reason appropriate to the special case. Several speakers, notably the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke), have suggested that there would he a case for departing from that custom and for taxation changes to be announced on separate special occasions.

That is a very interesting proposal which the House might possibly discuss with profit at some other time, but it is not the matter before us at the moment, because part of the case of the Chancellor of the Exchequer was that the President of the Board of Trade was not making a pronouncement of Government policy. If we are to assume that the Chancellor was speaking the truth in the later part of his speech, then the President of the Board of Trade was not making a considered statement of Government policy. I agree that the Chancellor is a contradictory performer and I am trying to accept at least half of what he said. It is not within human capability to accept both parts as correct.

I should have thought that one thing at least was perfectly clear—that whatever case there may be for making considered statements of Government policy about taxation at different times, there can he no case at all for the dropping of hints and conjectures by Ministers, particularly shortly before the Budget, because the whole point of our rules on this matter is to reduce for the people who are engaged in the production of wealth the degree of uncertainty in which they have to work. The proposals of the noble Lord the Member for Dorset, South were made with the object of reducing that uncertainty. It might well be that last Wednesday a considered, deliberate statement of Government policy on the cinematograph industry would have helped that industry, or even would help it now. What certainly could not help an industry and could not help production at all, however, is for a hint to be thrown out by a Minister and for us still to be left in doubt whether or not that hint is to be realised.

Our case, put at its most modest, is that the President of the Board of Trade in making that conjecture was guilty of an indiscretion. The first of his hon. Friends who leapt to his support—the hon. Member for Morecambe and Lonsdale (Sir I. Fraser)—agreed that the President of the Board of Trade had been guilty of an indiscretion but decided that he ought not to apologise for it.

Sir I. Fraser

Not quite. I said that the Manchester Guardian had said that.

Mr. Stewart

The hon. Member expressed agreement with the Manchester Guardian's view. His words were to the effect that he thought the Manchester Guardian had put the matter in its proper perspective.

Sir I. Fraser indicated assent.

Mr. Stewart

That means that the hon. Member in substance accepted the Manchester Guardian's view that the President of the Board of Trade had been guilty of an indiscretion.

Sir I. Fraser

Not quite.

Mr. Stewart

The Manchester Guardian said—let us spell it out—that the right hon. Gentleman had been guilty of an indiscretion. The hon. Member said that the Manchester Guardian had put the matter in proper perspective. We can leave the House to draw what deductions it likes from that. If, however, the hon. Member wishes to unsay what he said, he will not be the first person on his side of the House who has tried to do that during this debate, nor, seeing that the Prime Minister is to wind up the debate, will he be the last.

The view was expressed that an indiscretion had been committed but that there was no need to apologise for it. That, perhaps, is the most serious aspect of the whole matter. If, when this matter was raised in the House on Thursday, the President of the Board of Trade had come forward and made an apology for an indiscretion, if he had said that it was an indiscretion and had expressed his regret, I should not have been in favour of the matter being pressed any further. It would have been both wrong and ungenerous, and, incidentally, quite politically silly, to do that if the right hon. Gentleman had made the apology.

The Prime Minister, however, was quite determined in the view that indiscretions committed by members of the exalted circle who compose his Cabinet need not be apologised for, and that the ordinary rules which apply to ordinary mortals do not apply to the charmed circle that he has gathered around himself in the Government.

Mr. S. Silverman

It is possible for there to be another interpretation, is it not? The Prime Minister may have thought that if he once conceded the prin- ciple that the Government were to apologise for every indiscretion that ever happened on his own Front Bench, the time of the House would be fully occupied.

Mr. Stewart

I accept my hon. Friend's point of view. Possibly, we might be able to arrange some alteration in the procedure of the House by which the Government have a season ticket for apologies for Ministerial indiscretions.

The Prime Minister, instead of apologising, preferred to do what he called putting the matter in perspective. Those of us who know the Prime Minister knew that when he used that phrase he was proposing to try to dodge the main issue. It has been a general tactic of this Government, as of their predecessor, when they are asked one question, to try to answer several others with an air of great frankness, so as to leave the impression that they were answering the question which they were originally asked.

If the Prime Minister is to put the matter into perspective, let me help him to do so. He had better remember that this is not the first occasion on which the President of the Board of Trade has taken his position as a Cabinet Minister rather lightly. My hon. Friend the Member for Govan (Mr. Rankin) pointed out that one of the right hon. Gentleman's reasons for this indiscretion was that it might make the passage of the Bill through the House somewhat easier. In exactly the same way, when endeavouring to ease the passage of the Second Reading of the Teachers (Superannuation) Bill, the right hon. Gentleman professed himself a believer in a more generous scheme of pensions for teachers than the Bill itself contained. Later, of course, it appeared that although the form of words used by the right hon. Gentleman on that occasion could only bear to any reasonable person the imputation that the Government would try to arrange a more generous scheme, the Government had no intention of doing any such thing.

The right hon. Gentleman then said, in effect, "I should like to have done this, but my Cabinet colleagues would not agree." The right hon. Gentleman has followed the technique by which, as my hon. Friend the Member for Flint, East (Mrs. White) pointed out, he desired on this occasion to get for himself a little bit of the credit for anything that might be done for the cinema industry; so on the former occasion he wished to avoid any of the unpopularity that might spring from the Government's decision on teachers' pensions by indicating that he was in disagreement with his Cabinet colleagues on the matter.

Mr. J. C. Jennings (Burton)

Would it not be better to give the full picture and say that the main stumbling block to a more generous teachers' pension scheme was not necessarily the Minister or the Cabinet, but the local authorities, who refused absolutely to play ball with the teachers on the matter?

Mr. Stewart

We know in other contexts what this Government are liable to do with local authorities when they really want to have their own way.

Mr. Jennings

Is not what I have said true?

Mr. Stewart

Certainly, but it does not hear on what I was saying.

I was pointing out that, quite apart from anything that the local authorities might think, the Government themselves were not proposing to do anything about it and that the right hon. Gentleman, then Minister of Education, misled the House on the Government's intention and then tried to divorce himself of Cabinet responsibility in the matter. Perhaps when the Prime Minister is trying to put the matter into perspective, he will remember that fact.

If we are to put into perspective the doctrine that a member of the present Government can commit a grave indiscretion but need not bother to apologise for it, we might set it side by side with the behaviour of the Chancellor of the Exchequer at the Box today, when part of an agreement which would have been somewhat less attractive was not read out by him at first but had to be extracted from him by question and answer afterwards. That, again, is not a standard of conduct that most Governments in this country, at least in the last hundred years, have observed.

If one were carrying the matter back a little further, one might remember the offensive attitude of the Minister of Defence when answering Questions a week or so ago. Apparently, just as Ministers in the present Government who commit indiscretions need not apologise for them, so other Ministers in the Gov- ernment, if they are asked Questions, need not trouble to answer them but need only attempt to score off the Members who have asked them.

I said that no Government had observed these low standards since about a hundred years ago, bat the—[Interruption.] I recognise that I am only a Member of Parliament and not worthy of the Prime Minister's attention, but it is usual for Ministers at least to put up a show of listening to the debate. In the standards of conduct which he has selected for his Government, the Prime Minister has gone back rather further than a hundred years. He has gone back to the family compact idea of the eighteenth century, when it was believed that the Members of the Government were a kind of herrenvolk to whom the ordinary rules of morality and good behaviour did not apply.

What we object to, perhaps, more than anything else in the whole of this rather shabby incident is that an indiscretion was undoubtedly committed but that while an ordinary mortal would have got out of it by apologising, because of the Government's claim that they are above the rules of conduct as applied to ordinary mortals we have, first, the Prime Minister's prevarications in the attempt to pretend that no indiscretion had been committed and then the completely self-contradictory speech of the Chancellor of the Exchequer, while the Minister particularly concerned, the President of the Board of Trade—or, as one of his hon. Friends has so felicitously called him, the prisoner in the dock—remains prudently in the dock and shuns the witness box.

The hon. Member for Louth said that we might have legitimate fears that there had been speculation arising from this matter. A situation arises in which the House of Commons can have legitimate fears that money has been improperly made as a result of a Ministerial indiscretion. The proper answer is a Select Committee of this House to inquire into the matter. The hon. Gentleman really cannot expect that all legitimate fears will be dispelled solely by a speech from himself.

Mr. Osborne

The Motion does not ask for that. If it did, I could understand it.

Mr. Stewart

Would the hon. Gentleman be in favour of a Select Committee of inquiry? [HON. MEMBERS: "Answer."]

Mr. Osborne

I am never afraid of the truth, whether it hurts my party or another, or not. I am certain that it would not hurt my right hon. Friend or my party.

Miss Margaret Herbison (Lanarkshire, North)

Then the hon. Gentleman is in favour of a Select Committee of inquiry?

Mr. Stewart

May I know whether the hon. Gentleman is in favour of it or not?

Mr. Osborne

Yes.

Mr. Stewart

The hon. Gentleman did not say "Yes" before. I am glad he has done so now. I am quite sure that after a few minutes' conversation with someone on the Treasury Bench he will change his opinion of that matter.

Mr. Osborne

I am not like the Socialists. I am not being browbeaten by my Front Bench.

Mr. Stewart

The hon. Gentleman really must try to develop his sense of humour. It is perfectly well known that his speeches always start with a declaration of impartiality and high moral principle and always conclude by a direct following of the party line. He must know that.

Mr. Osborne

If the hon. Gentleman would ask his right hon. Friend who was once a Secretary of State he may learn that in an important debate in those days I did not follow my party line. Perhaps he would like to withdraw his statement.

Mr. Stewart

I should be happy to pursue that question with my right hon. Friend on another occasion.

This is the serious fact, that an indiscretion has been committed. It has been pointed out by my hon. Friend the Member for Oldham, West (Mr. Hale) that if any people suffer from it they will probably be the poorer investors who can least afford it. My hon. Friend spoke to a full House on this matter, and no hon. Member opposite ventured to question his line of reasoning. Despite the fact that there has been opportunity for hon. Gentlemen opposite to answer my hon. Friend they have not done so. They have not done so because they know there is no answer to what he said on that matter. If the indiscretion has had any financial results at all—though that is not the major question—it will be the poorer investors who will be the most likely to suffer from it. Apparently because of that, it is not felt to be worthy of an apology.

We are being governed by a collection of people who, although they put themselves above the ordinary rules of morality, are a people who, as one can see both from debates in the United Nations abroad and from by-elections in this country, are heartily disliked and distrusted by the great majority of mankind.

Several Hon. Members

rose—

Mr. Speaker

Mr. Harold Wilson.

6.54 p.m.

Mr. Harold Wilson (Huyton)

I am sorry, Mr. Speaker, that I did not rise at once. I thought that my hon. Friend the Member for Islington, East (Mr. E. Fletcher) was hoping to catch your eye. Nevertheless, before the Prime Minister replies to the debate and, I hope, fills some of the gaps which have been left by his hon. Friends. I should like to offer a few observations to the House.

There have been some hon. Members on the other side of the House who have suggested that this debate is unnecessary and a waste of the time of the House. That was not the view of the Chancellor of the Exchequer, for he at least—and so far he has been the only one on the other side of the House to have done so—emphasised the very high traditions that this House has in matters of finance and the vital importance of sticking to them.

Since the Chancellor spoke we have had a succession of hon. Members opposite to speak, none of whom has attempted to defend the President of the Board of Trade. The hon. Gentleman the Member for Morecambe and Lonsdale (Sir I. Fraser) seemed to agree that the right hon. Gentleman had committed an indiscretion, but he went on to suggest that it was right of the Prime Minister to refuse the President of the Board of Trade's offer of resignation; and, on being told that the right hon. Gentleman had not offered to resign, said how right that was, too, and that the President of the Board of Trade was quite right not to offer to resign.

Then we heard the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke), who applauded the President of the Board of Trade's indiscretion and wants to see it happen every day. He thinks that there is far too much certainty and rigidity in our financial arrangements, and he seemed to think that it was the best thing that could possibly happen that the Stock Exchange, in his own words, should have "gone haywire" the next day, and he wants to see the Stock Exchange go "haywire" every day.

That view was not taken by the hon. and gallant Gentleman the Member for South Angus (Captain Duncan) or the hon. Gentleman the Member for Louth (Mr. Osborne). Their view was, "Well, there was not very much speculation. The housemaid's baby was only a little one, so not much harm was done."

Mr. Kenneth Pickthorn (Carlton)

Not the housemaid's. It was the nurse.

Mr. Wilson

I bow to the hon. Gentleman's superior knowledge of this question.

Mr. Pickthorn

It does not need any reference more remote than Marryatt.

Mr. Wilson

Obviously, he has been reading Captain Marryatt since I have.

The one speaker we have not had and ought to have had is, of course, the President of the Board of Trade himself. Apart from a small intervention, we have heard nothing from him, and the House is entitled to ask why. Was he ready, and would not right hon. Gentlemen allow him to get up and explain what it was he was about last Wednesday? Or were they willing to let him speak, but he was too cowardly to get up and confess what he had done? Which was it? Or is it simply that, as my hon. Friend suggested, he is one of those Ministers who insist on treating the House with contempt?

My hon. Friend the Member for Oldham, West (Mr. Hale), a few minutes ago, drew attention to the right hon. Gentleman's interview with Mr. William Hickey in this morning's issue of the Daily Express. William Hickey writes: Sir David Eccles said to me yesterday, 'I don't give a hoot what the Socialists try to do to me tomorrow. Let them get on with it.' And so far as I could tell he wasn't worrying the least about the Motion Mr. Gaitskell and his friends are bringing up today. According to William Hickey's report, what the President was doing was: 'Rumaging among the flowers and getting my hands dirty.' It is not a question of what the Socialists are trying to do to him. This is the House of Commons calling a Minister to account for something he has done. We are getting a little tired of Ministers who will not accept their responsibility to the House of Commons.

I should like now, and before coming to the main issue of the Motion, to say a word, as the Chancellor of the Exchequer himself did, about the Entertainments Duty itself, and the point which was made by my hon. Friend the Member for Nottingham, West (Sir T. O'Brien) and my hon. Friend the Member for Govan (Mr. Rankin), because it is important that the position should be clarified. I think hon. Members in all parts of the House will agree that there is a very strong case for the reduction of Entertainments Duty on the cinemas; that is, without in any way detracting from the very strong case for complete abolition of the Entertainments Duty on the living theatre and sport, to which, we understand, the Government are already committed.

There is a strong case for a reduction in Entertainments Duty, and, year by year, as it affects cinemas, we have moved Amendments designed to secure a reduction in that duty for cinemas. Last year, we warned the Government of the very severe consequences that would result if they failed to reduce the duty last year in the closure of cinemas, and so on. Certainly, those warnings have proved to be only too true. We did force the former Chancellor of the Exchequer, now the Prime Minister, to agree to a complete review of his Entertainments Duty system.

There is undoubtedly a need for reduction, and I am not referring, as other hon. Members may have done, to the Rank Organisation. The Government's favouritism for the Rank Organisation has been nothing less than a public scandal for the last two or three years. I am referring to the small cinemas, and I want to make this appeal to the Chancellor tonight. The small cinemas, which are those worst hit, should not suffer as a result of last week's unfortunate incident. We know that the Chancellor has been placed in very serious difficulty by the President of the Board of Trade, but I hope that he will not try to get out of that difficulty by refusing to do what he ought to do in relation to Entertainments Duty on cinemas. There is always that temptation open to him, and we recognise it frankly. To prove that his right hon. Friend the President has not been guilty of a leak, the Chancellor may on Budget day, come along to the House of Commons and say, "There is nothing for the cinemas."

I hope that the right hon. Gentleman will resist that temptation. It has happened recently. The former Home Secretary was having negotiations with certain interests during the summer before last about a quite important little Bill. Unfortunately, someone said in public that the Bill would be included in the Gracious Speech in 1955. As a result, the then Home Secretary dropped the Bill for the time being, and he dropped it, one suspects——

Mr. E. Partridge (Battersea, South)

Ah.

Mr. Wilson

There seems every reason to suspect it. The Bill which finally reached the Statute Book under his protection was, in fact, introduced by my hon. Friend the Member for Enfield, East (Mr. Ernest Davies), namely, the Small Lotteries and Gaming Bill. I therefore hope that the right hon. Gentleman will not, to prove that his right hon. Friend was not guilty of a leakage, fail to take the action which everyone knows to be necessary in regard to Entertainments Duty on cinemas.

Today, we have been debating something which has been called everything from an indiscretion to a leakage. As far as the present Government are concerned, there is nothing unusual about leakages. They leak almost everything. There has been a regular flow of information from the Government to the Press. I do not want to weary the House by listing everything which has leaked to the Press before it was told to this House during the last 12 or 18 months. The defence policy decisions were leaked. The Government did not even announce their intention to introduce the Rent Bill in the Gracious Speech, which would be the normal manner. It was announced at the Conservative Party Conference last October—another breach of the traditions of the House. Concessions recently made in that Bill were published in the Press days before they were announced in circumstances which obviously showed that someone had been talking to the Press.

The Government's recent rating proposals were leaked to the Press several days in advance. Even the decision to set up a Committee to investigate the export of live cattle to the Continent was given to the Press before it was known to the House. With the help of Mr. Randolph Churchill, the very secrets of the Cabinet Room are now laid bare to the whole country, including even the mechanism by which the Government choose their leader. We have even had that leaked to the Press.

A Budget leakage, one would have thought, would have been different from all these. We might have understood a slip of the tongue; we might have understood it if there had been an accidental release of information to the House under pressure, and it was known that heavy pressure was being applied; but there was no question of any pressure in this House last Wednesday. The President of the Board of Trade was quietly reading his speech, and the House was certainly not very full, and was certainly not at all noisy.

The right hon. Gentleman began with a sentence—I do not want to give all these quotations again, because it was done by my right hon. Friend the Leader of the Opposition this afternoon—which had obviously been cleared with the Chancellor. He said that he had been authorised by the Chancellor to say that, in his Budget, he would take account of the consequences of Clause 2. Now, that is the very point which exhibitors have brought to his attention, and it is perfectly right and proper, if the Chancellor feels that a statement should be made, but the Chancellor must judge whether a particular statement of Government policy should be made, even though, even then, there was the danger that considerable uncertainty would be created by it.

But it is a fact that the Chancellor had himself approved those words, that there had been the usual discussions between the Treasury and the Board of Trade, as the Chancellor said this afternoon. We accept this; it is no idle thing for the Chancellor to say, or to authorise someone else to say, that he would take this into account. He did not even say that he would take this into account in framing his Budget, that he would weigh the pros and cons and then decide whether or not to accept it. He said that he would take it into account in his Budget, which, as a form of words, suggests that there is to be a definite reference to it in the Budget itself.

Then, however, the President of the Board of Trade went on peacefully with what my hon. Friend the Member for Flint, East (Mrs. White) called a cultural homily with a re-statement of a number of very obvious truths related to the closure of cinemas, and, quite out of the blue, without any interruption, or any pressure of any kind, he said that they were— … hanging on with great difficulty, but I hope that tomorrow morning they will feel more cheerful. Obviously, that was part of his prepared speech, and the Chancellor should have told us this afternoon whether that phrase was authorised by the Chancellor as well; or was it a gratuitous piece of information thrown in by the President of the Board of Trade?

The rest of the remarks of the President of the Board of Trade are within the recollection of hon. Members who have been listening to the debate this afternoon. The right hon. Gentleman said, first: There is no other way that he can do it. and, later: I should have thought that it was very difficult to think of any other way. Then, later still, we got his denial that he had used those words. The words he used were: I should like to deny that I said it was to be reduced."—[OFFICIAL REPORT, 27th February, 1957; Vol. 565, c. 1238.] That was a clear equivocation. He did not know that it was to be reduced, but did he think it was to be reduced? Had the Chancellor given him the impression that it was to be reduced? Was it not a prophecy, as the Prime Minister said at first last Thursday, or was it a prophecy, as the Prime Minister said five minutes later? That is what we want to know. Perhaps the Prime Minister has made up his mind, and will tell the House.

There, we have from the President of the Board of Trade a clear and most unusual disclosure of a Budget intention, and it was so interpreted by hon. Members in all parts of the House when he made it last Wednesday. The hon. Member for Barkston Ash (Sir L. Ropner), in his speech, clearly thought that the President of the Board of Trade was giving advance notice of a Budget change.

Sir Leonard Ropner (Barkston Ash)

The remarks which I made had no reference whatever to what the President of the Board of Trade had said. [HON. MEMBERS: "Oh."] No, no reference whatever. It is quite obvious from their context that such was the case. What I said was that the whole world knew that there was to be a reduction in Entertainments Duty, in exactly the same way as I would say that the whole world knows, for instance, that the Tories are going to win the next General Election.

Mr. Wilson

I only hope, for the sake of the future of the cinema industry, that the hon. Gentleman's first statement has more accuracy behind it than the second. All right; I will accept what the hon. Baronet has said, but I am going——

Mr. George Jeger (Goole)

The hon. Member for Barkston Ash (Sir L. Ropner) has not quoted in full the words which he used on that occasion. While he did say, and I am quoting from col. 1264 of the OFFICIAL REPORT that The whole world—at least, everybody in this country—knows that there is going to be a reduction in Entertainments Duty"— he went on to say: The President of the Board of Trade has to all intents and purposes said so this afternoon."—[OFFICIAL REPORT, 27th February, 1957; Vol. 565, c. 1264.]

Mr. Wilson

So we get deeper into the mire the longer we go on. The hon. Member for Barkston Ash is, or was, the Chairman of the Conservative Films Committee, but perhaps he resigned when he became a director of the Rank Organisation. I do not know.

I want to come in a moment to certain aspects of the Government's relations with that Committee, so I will not pursue the point of the hon. Baronet's remarks at this stage. Here, apparently, we have the hon. Baronet, most well-informed about film matters, himself assuming that it was positive and certain that the Entertainments Duty was to be reduced.

Then we had the Prime Minister, the next day—the only person in the world, or, at any rate, in this country who did not know about it—saying no, this was not a prophecy and that the President of the Board of Trade had no foreknowledge. Perhaps, soon, we shall know who was right? I think we would all agree, whatever the hon. Baronet thought, that the Press unanimously interpreted the statement of the President of the Board of Trade as meaning that there was to be a reduction in Entertainments Duty. Certainly, the stock market thought so.

Of course, it is most unusual, as we have all said, for a Minister to give any hint or indication of what will be in the Budget. All Ministers, when asked about this, invariably say, "I cannot anticipate my right hon. Friend's Budget statement." The present Minister of Housing and Local Government was an adept at saying that. He started saying it about the previous May or June. Even so warm hearted and expansive a character as the present Financial Secretary to the Treasury always uses this time-honoured formula. They have all been well trained.

Why is it that the House is so strict about Budget intentions? It may be that the Prime Minister will tell us tonight that the Government want to change the practice, that they want to break down the sanctity of the annual Budget, as the noble Lord the Member for Dorset, South suggested a few minutes ago. If so, that is a matter we might debate on a future occasion though I think that I, personally, should be against it. We know, of course, that under this Government the convention of having an annual Budget has been very much weakened both under the Lord Privy Seal and, indeed, the present Prime Minister, and no doubt the present Chancellor's recent statement in anticipation of the Budget.

We have had a succession of little Budgets and supplementary Budgets and Finance (No. 2) Bills and Estimates and revised Estimates—first revised down, then revised up—Ways and Means Resolutions in December, and all the rest of it. The only way we can now distinguish when the annual Budget has come is by the fact that the hon. Member for Kidderminster (Mr. Nabarro) comes along in his top hat.

We still hope, however, that, despite all appearances, the Prime Minister still stands by the sanctity of the annual Budget. Let me remind the House that his predecessor, Sir Anthony Eden, had standards in this matter. When a junior Minister improperly disclosed, early in the afternoon, during a debate on the Finance Bill, to some of his hon. Friends who had an Amendment on the Notice Paper, that he was going to accept the Amendment later in the evening, the then Prime Minister was quite clear about the position, though it was only a very minor indiscretion.

I put a question to the Prime Minister, making it clear that we did not want to make heavy weather of it. This is what he replied: As to changes which may be proposed during discussion of the Finance Bill, as of any other Bill, nothing should ever be said about Government intentions in circumstances where that could result in private gain."—[OFFICIAL REPORT, 19th June, 1956; Vol. 554, c. 79.] That was the right approach. If, then, during the passage of a Finance Bill that is the right approach, how much more is it so in the period preceding the annual Budget? I hope that the Prime Minister will tell us tonight whether he stands by the statement of Sir Anthony Eden.

Sir Anthony Eden clearly had in mind the possibility of speculation. I do not think that the concern of the House is that Government statements might lead to changes in share values. The noble Lord was quite right, they nearly always do that. Official Government statements do lead to changes in share values. What we are concerned about is that these changes should be equally open to the whole market and not made in a way that enables certain people to gain an advantage.

Was there any advantage here? It is difficult to find out. There is a very strong case for an inquiry, as the hon. Member for Louth (Mr. Osborne) seemed to imply. The Stock Exchange closes at 3.30, though business goes on for some time afterwards. That is why every Chancellor, in his Budget speech, discusses almost everything under the sun except taxation changes until well after 4 o'clock in the afternoon, and usually much later than that.

Mr. Osborne

Since the right hon. Gentleman is making that point, may I tell him that business takes place between offices well after 4 o'clock, indeed, well after 5 o'clock?

Mr. Wilson

That is what I said. I said "usually much later." The Chancellor goes on usually until about 5 o'clock before he says very much about his tax changes. The President of the Board of Trade made his statement between 3.30 and 3.45. I wonder whether we can be sure that no one took advantage of it?

I have said that there were representatives of big film combines within earshot. I know I must keep in order on this, Mr. Speaker. The Public Gallery does not exist as far as we are concerned. Certainly, I am not making any suggestion as to the integrity of the gentlemen concerned, because I know them, and I know them to be honourable men who would not use such an advantage for private gain or for the gain of their companies. But for certain of these people to be out of their seats after the President of the Board of Trade had spoken, and then to return afterwards—well, I am sure that nothing improper occurred as far as they are concerned, but what is serious is that the procedure which the President followed could lead, could have led, and, for all we know, may have led, to improper speculation.

We have had plenty of evidence about the fact that cinema share prices went up on Thursday morning. Were there any inter-office dealings on Wednesday night? We have not been told that by the Stock Exchange pundits who have been addressing the House today. There has been an attempt to play down the amount of speculation that followed. We have been told that cinema share prices have been rising for several weeks. We wonder what has been said about this thing, quite apart from what was said last Wednesday.

My hon. Friend the Member for Flint, East produced in the House last Friday's issue of the paper called the "Cinema News and Property Gazette", which stated categorically that Entertainments Duty was coming down by£7 million. I do not know who told it that. I will repeat what it went on to say, because I do not think that the Prime Miniser heard it: It was significant that not one Conservative M.P. rose to question Sir David when he made his statement on E.T. in the Commons on Wednesday. The reason is that most of them were already aware of the assurance. I understand that it was given during the Private Joint meeting of the Conservative Trade and Industry Committee and Films Commitee on February 19. The right hon. Gentleman was asked whether this was true and he said that no assurance had been given. But we want to know was this subject discussed at that meeting on 19th February or not? Was there any discussion of this subject? Was a hint of any kind given? Of course, I accept the statement of the right hon. Gentleman that no clear assurance was given, but was there any hint?

If, indeed, there was not a hint of any kind, then this is one of the most damaging remarks ever made about a Minister of the Crown, and I hope that the President of the Board of Trade will take the necessary action on it. His honour is very much at stake if this statement remains on the record and he does nothing about it. We all know that the_ right hon. Gentleman was not slow to sue a Labour councillor in Manchester who quoted his remark, "Treat 'em mean and keep 'em keen," though that phrase was never intended for old-age pensioners, I agree; it was meant for Tory back benchers. But if the right hon. Gentleman is so litigious then, clearly, he must, to protect his honour, take action in connection with this statement or deny it unequivocally in this House.

I now turn to the Prime Minister's handling of this matter last Thursday. He really should have taken this matter more seriously. He should have gone out of his way to re-emphasise the special status of Budget secrets. What did he do? He tried to make light of it. He said: It does not seem to me that anything improper or unfortunate was said."—[OFFICIAL REPORT, 28th February, 1957; Vol. 565, c. 1401.] Then, from making light of it, he turned to offensive abuse. When my right hon. Friend the Member for Ebbw Vale (Mr. Bevan) made a point which exactly reiterated the line taken by Sir Anthony Eden last summer, the Prime Minister's only comment was: I have no answer to make to what was merely a false and foolish statement."—[OFFICIAL REPORT. 28th February, 1957 Vol. 565. c. 1407.] When I referred to Lord Attlee last Thursday, the Prime Minister dodged the point—there is none better than he at dodging a point at Question Time—with that curl of the lip that we have come to know so well, though hon. Gentlemen opposite do not see it. He said that Lord Attlee: … is one of the few friends of the right hon. Gentleman who ever showed some sort of loyalty to his colleagues.—[OFFICIAL REPORT, 28th February. 1957; Vol. 565, c. 1403.] That from the right hon. Gentleman of all people, talking about loyalty to his comrades!

Only a few days ago I drew the attention of the House to what I described as the right hon. Gentleman's endearing habit of always describing in the frankest terms the mess he has inherited from whichever one of his colleagues he has just succeeded. We had it last year with his devastating criticism of the Lord Privy Seal. We have had it this year, when he was referring to the fact that he had succeeded Sir Anthony Eden. The right hon. Gentleman said that there was something to be said for buying shares at the bottom of the market. That may well be so—if one can count on a ministerial indiscretion to raise their value.

The reference which I made to Lord Attlee was abundantly justified by what has been said in the debate today, particularly in the most moving intervention by my right hon. Friend the Member for Bishop Auckland (Mr. Dalton). I would remind the Prime Minister about my right hon. Friend's intervention and about that case, because it has been mentioned on both sides of the House. In 1947, there was no speculation at all arising from my right hon. Friend's action. That was made clear by the Report of the Select Committee, and it was vouched for by the Chairman of the Stock Exchange Council.

Will anyone guarantee that if the Chairman of the Stock Exchange Council were today asked about the statement of the President of the Board of Trade he could put his hand on his heart and say that there was no speculation at all following the right hon. Gentleman's statement? Further, my right hon. Friend made a very full and frank apology to the House at the time, and that was, indeed, accepted by the right hon. Gentleman the Member for Woodford (Sir W. Churchill), and the rest of the House.

There was another occasion. This was not a leakage, but it was something which bears on the Motion. It was regarded by the then Opposition, the Tory Party, as of sufficient importance for them to have a full, all-day debate. It was the occasion when my right hon. Friend the Member for Dundee, West (Mr. Strachey) made a speech at Colchester about the Schuman Plan. Right hon. Gentlemen belonging to the Tory Party took this so seriously and worried so much about it that we had a debate in which the right hon. Member for Woodford, then Leader of the Opposition, the present Lord Chancellor, the present Minister of Education, and Lord Winterton, as well as a number of other lesser stars, took part.

On that occasion Lord Attlee himself intervened, and he made it very plain that, although he did not accept the Tory view on the main issue of the debate, which certainly was not proved at all, he had talked to my right hon. Friend. He said that he had told my right hon. Friend frankly that he thought he had made mistakes in his speech. My right hon. Friend has described that interview to me in terms which suggest that it was put in a particularly crisp and colourful manner. As a result of these, in themselves, minor mistakes, my right hon. Friend apologised to the House. Has the Prime Minister talked to the President of the Board of Trade in a similar manner to that? We should like to know.

In the debate on the Colchester speech, which was on 11th July, 1950, we had a speech from the present Lord Chancellor, fresh from his labours at Nuremberg, and he turned the full force of his prosecuting ability on my right hon. Friend. In the course of his speech he used some words which I think are singularly appropriate to today's debate, and I hope that the Prime Minister will take them very much to heart. I am sure the whole House will endorse them.

This is what the present Lord Chancellor, then Sir David Maxwell Fyfe, said: … may I say with genuine humility that there is no assembly more generous, or gathering more kind, than the House of Commons to anyone who makes a mistake in the heat of a speech and frankly admits his error. On the other hand, the more stagnant backwaters of politics are white with the bones of the overhasty careerists who have tried to mend such errors with equivocal excuses."—[OFFICIAL REPORT, 11th July, 1950; Vol. 477. c. 1165.] That has been our view. The President of the Board of Trade committed an indiscretion—a serious one in our view—and he should have apologised to the House last Thursday instead of waiting for this debate today. But the Prime Minister has put him up to brazening it out.

Our concern is with the Prime Minister's characteristic frivolity, a frivolity which always turns to petulance and arrogance when he finds that it does not come off in the House. We must say frankly to the House that in recent weeks, since the Prime Minister achieved his present office, there has been enough evidence to justify our concern that he and his Ministers are more and more embarking on a policy of treating this House with calculated arrogance, with a "Take it or leave it" attitude, an attitude of, "We have got our majority in the House. It does not matter about the country."—something very near the phrase once used by a former Conservative Prime Minister, "I have my friends."

It should not be necesary, I am sure—because the Prime Minister himself showed such great courtesy to the House last year during the passing of the Finance Act—to tell the right hon. Gentleman, a very old parliamentarian, that his responsibility is to the House. It is not enough for him merely to please the Marquess of Salisbury. That may have been rewarding on one famous occasion, but it is to this House that he and his Ministers are responsible. Some recent performances, both by himself and by his team, have, in our view, been an insult to the House.

It will be kinder to pass over the recent performances of the Secretary of State for War and the Secretary of State for Air, but we have noted that the junior Ministers of the Treasury, the Economic Secretary and the Financial Secretary, unlike their predecessors, seem to think that smart, cheap replies constitute the best way of avoiding the giving of information. They had better change their ways before the Finance Bill. Last week the Joint Parliamentary Secretary to the Ministry of Pensions and National Insurance gave a brazen assertion of Tory callousness and showed disregard for the views of the House. Then there is the Minister of Defence. If ever there was a job which called for the understanding of all parties, it is his. But he is relying more and more on a typical patrician arrogance in his replies.

The trouble is that it is the Prime Minister who sets the tone, and he is setting the wrong tone. It would appear that the more the present Government lose the support of the country, the more the Right wing of the Government push on with their reactionary policy, "Come wind, come weather, come hell, come high water", riding roughshod over parliamentary criticism.

The Prime Minister's demeanour in the exchanges which arose last Thursday is the latest and, in our view, most serious example of this, and that is why, in our Motion, we are not merely concerned with the indiscretion of the President of the Board of Trade but find it necessary, in all sincerity and with full responsibility, to call on the Prime Minister to show that he really means to uphold the high traditions of the House.

7.29 p.m.

The Prime Minister (Mr. Harold Macmillan)

The discussion has ranged over a very large field and has provided, in its course, some very witty and amusing speeches on a wide variety of topics. On the whole, it has been a very agreeable debate, except perhaps for the speech of the hon. Member for Fulham (Mr. M. Stewart), who seemed to suffer from some grievance against things in general, which weighs upon him.

Even the wind-up speech of the right hon. Gentleman the Member of Huyton (Mr. H. Wilson), though it had not very much to do with the Motion, was a very good example of his great talents in a wind-up speech, and I think we all enjoyed it. He reproved me at the end for what he called arrogance. It seems a strange charge from the authors of the famous phrase, "We are the masters now". I fear that what he really objects to is any firmness or resolution.

I hope that hon. and right hon. Gentlemen will not hink me discourteous if I try to recall to the House for a very short time what the debate was supposed to be about. I cannot help feeling that the right hon. Gentleman and his hon. Friends, when they raised this matter, did not themselves quite appreciate how very narrow the issue really is. I said on Thursday that, if hon. Gentlemen wished to press the matter, they could, of course, take any course open to them, but I think they were themselves under some misapprehension as to the scope and importance of this matter. Perhaps this confusion was pardonable, because, as the right hon. Gentleman the Member for Huyton has pointed out, I fell into some verbal confusion upon it myself. May I, therefore, restate the main points very simply and, I hope, without any undue heat?

The actual level of the Entertainments Duty, so far as it affects cinemas, must be decided after all sorts of considerations have been taken into account, the most important being the broad prospects of the industry, to which the hon. Gentleman the Member for Nottingham, West (Sir T. O'Brien) made special reference this afternoon in a very well-informed speech. We have to consider how the industry is doing, and especially we have to consider what burdens the industry is carrying and what fresh burdens are being placed upon it. It was to all these burdens, the old and the new, that my right hon. Friend the President of the Board of Trade was referring on Wednesday.

My right hon. Friend had talked about the consequences of Clause 2 of the Cinematograph Films Bill. That is how the debate arose. Clause 2, as I understand it, does two things: it converts the levy on the industry, which has so far been voluntary, into a compulsory levy, and increases the incidence of the levy so as to raise the charge or cost to the whole industry by about £¼ million. These are clearly among the financial considerations in the industry which the Chancellor of the Exchequer will take into account in reaching his final decision about the level of the Entertainments Duty which he will propose to Parliament in due course.

My right hon. Friend has explained today that he cannot yet say, nor can any other Minister, what the level of Entertainments Duty will be. All of us may have our opinions upon what might be done. We may even have our opinions upon what ought to be done. We may even have opinions upon what will perhaps be done. But it is for the Chancellor of the Exchequer, and for him alone, to propose to the House—not to decide—to propose to the House what shall be done. In fact, as he has told today, he has not made his decision. But one firm undertaking he has given; he has said that in making his decision he will take into account this additional burden laid upon the industry by Clause 2 of the Bill, an extra burden both in quality, since it is compulsory instead of voluntary, and in quantity, since it adds £1¼ million to the burden on the industry.

That is what he authorised the President of the Board of Trade to say on 27th February. It was not a very novel announcement, because it is very much what the Financial Secretary had already said on 13th December, and what my noble Friend who moved the Second Reading of the Bill in another place had said on 20th December. Nobody seems to have objected to what they said. Indeed, it was generally welcomed. This afternoon the Chancellor of the Exchequer has repeated that he recognises that this additional burden of the increased and statutory levy is an element on the credit side of the film industry, as he called it, which will influence his calculations in fixing the final level of the duty which he will propose to Parliament in his Budget.

I read again, and read with great care, the report of the discussion during the Second Reading debate on Wednesday. It is quite clear that what the President of the Board of Trade then said related to the effect upon the industry of Clause 2 of the Bill. That is what he was talking about; that was the Clause under debate. My right hon. Friend said that he hoped that the cinema industry would feel more cheerful. When he was asked why, he said it was because he had said that the Chancellor will take account of the consequences of Clause 2 of the Bill. When the hon. Gentleman the Member for Glasgow, Govan (Mr. Rankin) asked, by way of interjection, Will he reduce the Entertainments Duty? my right hon. Friend said, There is no other way that he can do it. The "it", of course, referred, as it could only have referred, to taking into account the additional burden upon the industry.

Mr. H. Wilson

rose—

The Prime Minister

No. If I may finish this part of what I have to say, I will then give way. [HON. MEMBERS: "Arrogance] If I may be allowed to finish this part of what I have to say—as I am sure the right hon. Gentleman will agree—I will then, of course, give way.

I said "it" referred, and, in the context, could only have referred, to taking into account the additional burden, which was the consequence of Clause 2, because it was out of Clause 2 that the whole discussion arose. But if there was any misunderstanding, immediately, within a few seconds, and not as the right hon. Gentleman said, later in the evening, my right hon. Friend in his very next phrase reaffirmed, or, if one likes, clarified his meaning. He did not wait, as the right hon. Gentleman has suggested, to the end of the debate, but he did it immediately. I have the OFFICIAL REPORT here, and these are the very next words of my right hon. Friend: I said that the Chancellor said that he would take account of that. The hon. Gentleman can wait for the Budget, when he will see what it means. He made the correction immediately, if it was a correction—what the right hon. Gentleman wrongly said was a correction—[interruption.]—within a second or two, and it is not true to say, as the right hon. Gentleman said, I am sure, by inadvertence, that he waited until the evening.

Mr. H. Wilson

I am trying to follow the Prime Minister's argument. Are we to understand from what he has just said that this word "it", to which he attaches such importance, relates purely to Clause 2 of the Bill? Is that what he said? If so, will he tell us why, in the prepared part of the President's speech he used these words, The Chancellor …has authorised me to say that in his Budget he will take account of the consequences of Clause 2 …together with the other considerations which the exhibitors have brought to his attention. Secondly, will the Prime Minister tell us why the President said, I hope that tomorrow morning they will feel more cheerful.… If all the Prime Minister has told us is right, why should they feel more cheerful on the morning of last Thursday than they felt after the noble Lord spoke in another place or after the Financial Secretary gave his answer last December?

The Prime Minister

I shall try to explain to the right hon. Gentleman the answer to both his questions. If he will read column 1238, he will see that my right hon. Friend said, I hope that tomorrow morning they will feel more cheerful—[HON. MEMBERS: 'Why?'] Because I have said that the Chancellor will take account of Clause 2 in his Budget. He was answering the question.

The right hon. Gentleman's other point seems to be quite clear. The phrase, There is no other way that he can do it must apply to what he has spoken of, namely, taking account of what this Bill was about. That is why the Bill was under discussion and the new burdens under it were being debated.

I say, therefore, that it is clear that that sequence of what my right hon. Friend said meant this, and this only: that the Chancellor would take account of the consequences of Clause 2; that the additional burden of the increased levy would be an element to the credit of the industry in reaching a final decision on the Budget, and that the obvious way of taking account of the credit of the industry would be in considering the level of the Entertainments Duty—but making it clear, as I am sure was clear to the House and the country, that the final decision upon the level of the duty would rest with the Chancellor of the Exchequer.

Mr. Gaitskell

Does the Prime Minister realise that the phrase which he has quoted so often The Chancellor …has authorised me to say that in his Budget he will take account of the consequences of Clause 2 was said in similar terms in another place, not once but several times, and that all the cinema industry knew it already? Why, therefore, were they to be more cheerful on the morning of Thursday than they were beforehand?

The Prime Minister

I will come to the effect upon the cinema industry of what was said in another place when I come to the question of speculation. I am now saying what my right hon. Friend said—and what the right hon. Member for Huyton said was not a quotation of what he said; the right hon. Gentleman was careful to leave out certain words; just as in an earlier part of his speech he said that the President had—shall I use the word—amplified, or explained, his words in the evening when in fact he explained them in the very next phrase after the interruption. I do not think that that is a very fair method of arguing this matter.

Mr. Wilson

If the Prime Minister will read what his right hon. Friend said in the evening he will see that what I said was perfectly correct. Since the Prime Minister is talking about suppressing parts of quotations, will he read the whole sentence that he has just been talking about—that which includes the reference to feeling cheerful. It begins with the President saying: Some picture houses have gone out of business and some are hanging on with great difficulty …"—[OFFICIAL REPORT, 27th February, 1957; Vol. 565, c. 1237–8.] Why should they feel more cheerful merely because the Chancellor is going to reduce the Duty by £¼ million, when he is going to increase the statutory levy?

The Prime Minister

I believe that it was the hon. Member for Nottingham, West, who spoke with great knowledge of the industry, who made it clear that, quite apart from the general discussion of Entertainments Duty, it was this extra burden that was being imposed by the Bill which was being discussed—and only this extra burden. No other subject arose. It was the extra burden which the Chancellor of the Exchequer undertook to take account of in his broad view. At any rate, it is upon this very slender foundation of these precise phrases that the whole of this row has been built. I say, as one of my hon. Friends said, that never was such a mountain built out of a molehill.

I have been reproved for two faults; first, for taking this matter very lightly and then, in the next phrase, for taking it rather heavily. I find it difficult to suit all the moods of right hon. Members opposite. I was vehement in my support of my right hon. Friend on Thursday, when I said that I thought the President was being very unfairly treated. Everybody knows that the Entertainments Duty in general may have to be remodelled. When I was Chancellor of the Exchequer I said that more than once during the course of debates—as I think hon. Members will remember. I said that we were going to reconsider and reshape the whole structure of the tax. It would be a bad day if, in this House, we could not discuss with some freedom the considerations and the factors which go to make up the eventual decisions which are made in a Budget. That was the position before this matter arose, and that is still the position.

It may be said that it is regrettable that there should be uncertainty. There must frequently be uncertainty about the future of taxation—and not only in this industry. I suppose that I started the uncertainty, last summer—and nobody seemed to think it very wrong of me—when I said that we were going to reconsider the structure of the tax. I remember the great debates that we had then, in which the hon. Member for Nottingham, West took a great part. I got rather a lot of credit for saying that. Nobody thought it wrong for me to say that this tax would be remodelled during the year. It may be said that uncertainty leads to speculation, but I do not think that anybody has been given any unfair advantage. In point of fact, there was very little speculation after my right hon. Friend's speech last Wednesday, for the very good reason that it had all been said before.

I am not an expert on the movement of stocks and shares in cinematograph companies, but I have asked for an analysis of the dealings in the main companies concerned over a period. What I have found is that there has been a gradual appreciation of these shares between the Second and Third Readings of the Bill in another place. It is clear that what-ever optimism was felt in this industry sprang not from any remarks of the President of the Board of Trade but from the observations made earlier by a Government spokesman, to which no objection was raised, and which was specifically applauded by the Leader of the Opposition.

It is rather interesting to note that for every penny these shares rose after last Wednesday they have risen four times as much in the case of one company and seven or eight times as much in the case of other companies during the period to which I have referred. The figures of the actual transactions given to the House today by my hon. and gallant Friend the Member for South Angus (Captain Duncan) really put an end to all this bogy of speculation, because he proved that there had been not only no speculation but practically no dealings at all.

That is very disappointing to some people. It is disappointing when one is looking for a scandal and it turns out to be a mare's nest. However that may be, this Motion is a Motion of Censure. It calls upon me to treat what is at the worst a minor lack of precision in phraseology, corrected within five seconds of being uttered, as a serious offence. It asserts, in effect if not in terms, that I ought to have asked for my right hon. Friend's resignation. Why? Not because there has been a Budget leak; a leak involves the disclosure of a Budget secret, whether corruptly or inadvertently —as I am afraid happened in one case that has been mentioned—in such a way as to limit it to the selected few who are the recipients of the leak.

The Manchester Guardian pointed out in a leading article what I believe is absolutely true, when it said: The Prime Minister stated the constitutional position correctly when he said that a statement to Parliament cannot be a leak. The question of a leak has now been dropped. We now have the question of the premature disclosure of a Budget intention. But even that is not true—and even if it were, there are plenty of precedents, as my right hon. Friend pointed out. My right hon. Friend said, in fact,

that the additional burden imposed by the Bill would be taken into account when the Chancellor of the Exchequer finally decided on the measures affecting this industry.

Whatever our disagreements in this House—and perhaps they ought to be fierce and bitter—we are traditionally fair towards individuals, and usually inclined to be generous. I believe that many hon. Members on both sides of the House—I have felt this reflected in the debate today—feel in their hearts that it would be terribly unfair to press for the resignation of my right hon. Friend.

Mr. Hamilton

Nonsense.

The Prime Minister

I hope, therefore, that the Motion may not be taken to a Division. If it is, I must appeal to the House to reject it decisively. If I were to accept my right hon. Friend's resignation, or had been prepared to accept it—and still more if I demanded it—upon such a trivial charge against him, I should be committing an act of shameful cowardice and disloyalty. Whatever else may be held against me I hope that I shall not be guilty of this.

Question put:—

The House divided: Ayes 252, Noes 307.

Division No. 75.]	AYES	[7.50 p.m.
Ainsley, J. W.	Chapman, W. D.	Gaitskell, Rt. Hon. H. T. N.
Albu, A. H.	Chetwynd, G. R.	Gibson, C. W.
Allaun, Frank (Salford, E.)	Clunle, J.	Gooch, E. G
Allen, Arthur (Bosworth)	Coldrick, W.	Gordon Walker, Rt. Hon. P. C.
Allen, Scholefield (Crewe)	Collick, P. H. (Birkenhead)	Greenwood, Anthony
Awbery, S. S.	Collins, V.J. (Shoreditch & Finsbury)	Grenfell, Rt. Hon. D. R.
Baird, J.	Corbet, Mrs. Freda	Grey, C. F.
Balfour, A.	Cove, W. G.	Griffiths, William (Exchange)
Bellenger, Rt. Hon. F. J.	Craddock, George (Bradford, S.)	Grimond, J.
Bence, C. R. (Dunbartonshire, E.)	Cronin, J. D.	Hale, Leslie
Benn, Hn. Wedgwood (Bristol, S.E.)	Cullen, Mrs. A.	Hamilton, W. W.
Benson, G.	Dalton, Rt. Hon. H.	Hannan, W.
Beswick, Frank	Darling, George (Hillsborough)	Harrison, J. (Nottingham, N.)
Bevan, Rt. Hon. A. (Ebbw Vale)	Davies, Ernest (Enfield, E.)	Hastings, S.
Blackburn, F.	Davies, Harold (Leek)	Hayman, F. H.
Blenkintop, A.	Davies, Stephen (Marthyr)	Healey, Denis
Blyton, W. R.	de Freitas, Geoffrey	Henderson, Rt. Hn. A. (Rwly Regis)
Boardman, H.	Delargy, H. J.	Herbison, Miss M.
Bottomley, Rt. Hon. A. G.	Dodds, N. N.	Hewitson, Capt. M.
Bowden, H. W. (Leicester, S.W.)	Donnelly, D. L.	Hobson, C. R.
Bowles, F. G.	Dugdale, Rt. Hn. John (W. Brmwch)	Holman, P.
Boyd, T. C.	Dye, S.	Holmes, Horace
Braddock, Mrs. Elizabeth	Ede, Rt. Hon. J. C.	Holt, A. F.
Brockway, A. F.	Edelman, M.	Howell, Charles (Perry Barr)
Broughton, Dr. A. D. D.	Edwards, Rt. Hon. John (Brighouse)	Howell, Denis (All Saints)
Brown, Rt. Hon. George (Belper)	Edwards, Rt. Hon. Ness (Caerphilly)	Hoy, J. H.
Brown, Thomas (Ince)	Edwards, Robert (Bilston)	Hubbard, T. F.
Burke, W. A.	Edwards, W. J. (Stepney)	Hughes, Cledwyn (Anglesey)
Burton, Miss F. E.	Evans, Albert (Islington, S.W.)	Hughes, Emrys (S. Ayrshire)
Butler, Herbert (Hackney, c.)	Evans, Edward (Lowestoft)	Hughes, Hector (Aberdeen, N.)
Butler, Mrs. Joyce (Wood Green)	Fernyhough, E.	Hunter, A. E.
Callaghan, L. J.	Fienburgh, W.	Hynd, J. B. (Attercliffe)
Carmichael, J.	Finch, H. J.	Irvine, A. J. (Edge Hill)
Castle, Mrs. B. A.	Fletcher, Erie	Irving, Sydney (Dartford)
Champion, A. J.	Forman, J. C.	Isaacs, Rt. Hon. G. A.
Janner, B.	Neal, Harold (Bolsover)	Soskice, Rt. Hon. Sir Frank
Jay, Rt. Hon. D. P. T.	Noel-Baker, Francis (Swindon)	Sparks, J. A.
Jeger, George (Goole)	Noel-Baker. Rt. Hon. P. (Derby, S.)	Steele, T.
Jeger, Mrs. Lena (Holbn & S. Pncs, S.)	O'Brien, Sir Thomas	Stewart, Michael (Fulham)
Jenkins, Roy (Stechford)	Oliver, G. H.	Stokes, Rt. Hon. R. R. (Ipswich)
Johnson, James (Rugby)	Oram, A. E.	Stones, W. (Consett)
Johnston, Douglas (Paisley)	Orbach, M.	Strachey, Rt. Hon. J.
Jones, Rt. Hn. A. Creech(Wakefield)	Oswald, T,	Strauss, Rt. Hon. George (Vauxhall)
Jones, Elwyn (W. Ham, S.)	Owen, W. J.	Stross, Dr. Barnett (Stoke-on-Trent, C.)
Jones, Jack (Rotherham)	Padley W. E.	Summerskill, Rt. Hon. E.
Jones, J. Idwal (Wrexham)	Paget, R. T.	Swingler, S. T.
Jones, T. W. (Merioneth)	Paling, Rt. Hon. W. (Dearne Valley)	Sylvester, G. O.
Key, Rt. Hon. C. W.	Palmer, A. M. F.	Taylor, Bernard (Mansfield)
King, Dr. H. M.	Pannell, Charles (Leeds, W.)	Taylor, John (West Lothian)
Lawson, G. M.	Pargiter, G. A.	Thomas, Iorwerth (Rhondda, W.)
Ledger, R. J.	Parker, J.	Thomson, George (Dundee, E.)
Lee, Frederick (Newton)	Parkin, B. T.	Thornton, E.
Lee, Miss Jennie (Cannock)	Paton, John	Timmons, J.
Lever, Harold (Cheetham)	Peart, T. F.	Turner-Samuels, M.
Lever, Leslie (Ardwick)	Pentland, N.	Ungoed-Thomas, Sir Lynn
Lewis, Arthur	Plummer, Sir Leslie	Viant, S. P.
Lindgren, G. S.	Price J. T. (Westhoughton)	Warbey, W. N.
Lipton, Marcus	Price, Philips (Gloucestershire, W.)	Watkins, T. E.
Mabon, Dr. J. Dickson	Probert A. R.	Weitzman, D.
MacColl, J. E.	Proctor, W. T.	Wells, Percy (Faversham)
McGhee, H. G.	Pryde, D. J.	Wells, William (Walsall, N.)
McGovern, J.	Pursey, Cmdr. H.	West, D. G.
McInnes, J.	Rankin, John	Wheeldon, W. E.
McKay, John (Wallsend)	Redhead, E. C.	White, Mrs. Eirene (E. Flint)
MacDermot, Niall	Reeves, J.	White, Henry (Derbyshire, N.E.)
MacPherson, Malcolm (Stirling)	Reid, William	Wigg, George
Mainwaring, W. H.	Rhodes, H.	Wilcock, Group Capt. C. A. B.
Mallalieu, E. L. (Brigg)	Roberts, Albert (Normanton)	Wilkins, W. A.
Mallalieu, J. P. W. (Huddersfd, E.)	Roberts, Goronwy (Caernarvon)	Willey, Frederick
Mann, Mrs. Jean	Robinson, Kenneth (S. Pancras, N.)	Williams, David (Neath)
Marquand, Rt. Hon. H. A.	Rogers, George (Kensington, N.)	Williams, Rev. Llywelyn (Ab?tillery)
Mason, Roy	Ross, William	Williams, Ronald (Wigan)
Mayhew, C. P.	Royle, C.	Williams, Rt. Hon. T. (Don Valley)
Mellish, R. J.	Shawcross, Rt. Hon. Sir Hartley	Williams, W. R. (Openshaw)
Messer, Sir F.	Shinwell, Rt. Hon. E.	Williams, W. T. (Barons Court)
Mikardo, Ian	Short, E. W.	Willis, Eustace (Edinburgh, E.)
Mitchison, G. R.	Shurmer, P. L. E.	Wilson, Rt. Hon. Harold (Huyton)
Monslow, W.	Silverman, Julius (Aston)	Winterbottom, Richard
Moody, A. S.	Silverman, Sydney (Nelson)	Woodburn, Rt. Hon. A.
Morris, Percy (Swansea, W.)	Simmons, C. J. (Brierley Hill)	Yates, V. (Ladywood)
Morrison, Rt. Hn. Herbert (Lewis'm, S.)	Skeffington, A. M.	Younger, Rt. Hon. K.
Mort, D.L.	Slater, Mrs. H. (Stoke, N.)	Zilliacus, K.
Moss, R.	Smith, Ellis (Stoke, S.)
Moyle, A.	Snow, J. W.	TELLERS FOR THE AYES:
Mulley, F. W.	Sorensen, R. W.	Mr. Popplewell and Mr. Pearson.
NOES
Agnew, Sir Peter	Boyd-Carpenter, Rt. Hon. J. A.	Davidson, Viscountess
Aitken, W. T.	Boyle, Sir Edward	D'Avigdor-Goldsmid, Sir Henry
Allan, R. A. (Paddington, S.)	Braine, B. R.	Deedes, W. F.
Alport, C. J. M.	Braithwaite, Sir Albert (Harrow, W.)	Dodds-Parker, A. D.
Amery, Julian (Preston, N.)	Bromley-Davenport, Lt.-Col. W. H.	Donaldson, Cmdr. C. E. McA.
Amory, Rt. Hn. Heathcoat (Tiverton)	Brooke, Rt. Hon. Henry	Doughty, C. J. A.
Anstruther-Gray, Major Sir William	Brooman-White, R. C.	du Cann, E. D. L.
Arbuthnot, John	Browne, J. Nixon (Craigton)	Dugdale, Rt. Hn. Sir T. (Richmond)
Armstrong, C. W.	Bryan, P.	Duncan, Capt. J. A. L.
Ashton, H.	Bullus, Wing Commander E. E.	Duthie, W. S.
Astor, Hon. J. J.	Burden, F. F. A.	Eccles, Rt. Hon. Sir David
Atkins, H. E.	Butcher, Sir Herbert	Eden, J. B. (Bournemouth, West)
Baldock, Lt.-Cmdr. J. M.	Campbell, Sir David	Elliot, Rt. Hon. W. E.
Baldwin, A. E.	Carr, Robert	Emmet, Hon. Mrs. Evelyn
Balniel, Lord	Cary, Sir Robert	Errington, Sir Eric
Barber, Anthony	Channon, Sir Henry	Erroll, F. J.
Barlow, Sir John	Chichester-Clark, R.	Farey-Jones, F. W.
Baxter, Sir Beverley	Clarke, Brig. Terence (Portsmth, W.)	Fell, A.
Beamish, Maj. Tufton	Cole, Norman	Finlay, Graeme
Bell, Philip (Bolton, E.)	Conant, Maj. Sir Roger	Fisher, Nigel
Bell, Ronald (Bucks, S.)	Cooper, A. E.	Fletcher-Cooke, C.
Bennett, Dr. Reginald	Cooper-Key, E. M.	Forrest, G.
Bevins, J. R. (Toxteth)	Cordeaux, Lt.-Col. J. K.	Fort, R.
Bidgood, J. C.	Corfield, Capt. F. V.	Foster, John
Biggs-Davison, J. A.	Craddock, Beresford (Spelthorne)	Fraser, Hon. Hugh (Stone)
Birch, Rt. Hon. Nigel	Crouch, R. F.	Fraser, Sir Ian (M'cmbe & Lonsdale)
Bishop, F. P.	Crowder, Sir John (Finchley)	Freeth, Denzil
Black, C. W.	Crowder, Petre (Ruislip—Northwood)	Galbraith, Hon. T. G. D.
Body, R. F.	Cunningham, Knox	Garner-Evans, E. H.
Boothby, Sir Robert	Currie, G. B. H.	Gibson-Watt, D.
Bossom, Sir Alfred	Dance, J. C. G.	Glover, D.

Godber, J. B.	Legh, Hon. Peter (Petersfield)	Rawlinson, Peter
Gomme-Duncan, Col. Sir Alan	Lennox-Boyd, Rt. Hon. A. T.	Redmayne, M.
Gough, C. F. H.	Lindsay, Hon. James (Devon, N.)	Rees-Davies, W. R.
Gower, H. R.	Lindsay, Martin (Solihull)	Remnant, Hon. P.
Graham, Sir Fergus	Linstead, Sir H. N.	Renton, D. L. M.
Grant, W. (Woodside)	Llewellyn, D. T.	Ridsdale, J. E.
Grant-Ferris, Wg Cdr. R. (Nantwich)	Lloyd, Rt. Hon. G. (Sutton Coldfield)	Rippon, A. G. F.
Green, A.	Lloyd, Maj. Sir Guy (Renfrew, E.)	Robertson, Sir David
Gresham Cooke, R.	Lloyd, Rt. Hon. Selwyn (Wirral)	Robinson, Sir Roland (Blackpool, S.)
Grimston, Hon. John (St. Albans)	Longden, Gilbert	Robson-Brown, W.
Grimston, Sir Robert (Westbury)	Low, Rt. Hon. A. R. W.	Rodgers, John (Sevenoaks)
Grosvenor, Lt.-Col. R. G.	Lucas, Sir Jocelyn (Portsmouth, S.)	Roper, Sir Harold
Gurden, Harold	Lucas, P. B. (Brentford & Chiswick)	Ropner Col. Sir Leonard
Hare, Rt. Hon. J. H.	Lucas-Tooth, Sir Hugh	Russell, R. S.
Harris, Frederic (Croydon, N.W.)	McAdden, S. J.	Sandys, Rt. Hon. D.
Harris, Reader (Heston)	Macdonald, Sir Peter	Schofield, Lt.-Col. W.
Harrison, A. B. C. (Maldon)	Mackeson, Brig. Sir Harry	Scott-Miller, Cmdr. R.
Harrison, Col. J. H. (Eye)	McKibbin, A. J.	Sharples, R. C.
Harvey, Air Cmdr, A. V. (Macclesfd)	Mackie, J. H. (Galloway)	Shepherd, William
Harvey, Ian (Harrow, E.)	McLaughlin, Mrs. P.	Simon, J. E. S. (Middlesbrough, W.)
Harvey, John (Walthamstow, E.)	McLean, Neil (Inverness)	Smithers, Peter (Winchester)
Harvie-Watt, Sir George	Macleod, Rt. Hn. Iain (Enfield, W.)	Smyth, Brig. Sir John (Norwood)
Hay, John	MacLeod, John (Ross & Cromarty)	Soames, Capt. C.
Heald, Rt. Hon. Sir Lionel	Macmillan, Rt. Hn. Harold(Bromley)	Spearman, Sir Alexander
Henderson, John (Cathcart)	Macmillan, Maurice (Halifax)	Speir, R. M.
Hesketh, R. F.	Macpherson, Niall (Dumfries)	Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)
Hicks-Beach, Maj. W. W.	Maddan, Martin	Stevens, Geoffrey
Hill, Rt. Hon. Charles (Luton)	Maitland, Cdr. J. F. W. (Horncastle)	Steward, Harold (Stockport, S.)
Hill, Mrs. E. (Wythenshawe)	Maitland, Hon. Patrick (Lanark)	Steward, Sir William (Woolwich, W.)
Hill, John (S. Norfolk)	Manningham-Buller, Rt. Hn. Sir R.	Stewart, Henderson (Fife, E.)
Hinchingbrooke, Viscount	Markham, Major Sir Frank	Stoddart-Scott, Col. M.
Holland-Martin, C. J.	Marlowe, A. A. H.	Storey, S.
Hope, Lord John	Marples, Rt. Hon. A. E.	Studholme, Sir Henry
Hornby, R. P.	Marshall, Douglas	Summers, Sir Spencer
Hornsby-Smith, Miss M. P.	Mathew, R.	Sumner, W. D. M. (Orpington)
Horobin, Sir Ian	Maude, Angus	Taylor, Sir Charles (Eastbourne)
	Maudling, Rt. Hon. R.	Taylor, William (Bradford, N.)
Horsburgh, Rt. Hon. Dame Florence	Mawby, R. L.	Temple, J. M,
Howard, Gerald (Cambridgeshire)	Medlicott, Sir Frank	Thomas, Leslie (Canterbury)
Howard, Hon. Greville (St. Ives)	Milligan, Rt. Hon. W. R.	Thomas, P. J. M. (Conway)
Howard, John (Test)	Molson, Rt. Hon. Hugh	Thompson, Kenneth (Walton),
Hudson, W. R. A. (Hull, N.)	Moore, Sir Thomas	Thompson, Lt.-Cdr. R. (Croydon, S.)
Hughes Hallett, Vice-Admiral J.	Morrison, John (Salisbury)	Thorneycroft, Rt. Hon. p.
Hughes-Young, M, H. C.	Mott-Radclyffe, Sir Charles	Thornton-Kemsley, C. N.
Hulbert, Sir Norman	Nabarro, G. D. N.	Tiley, A. (Bradford, W.).
Hurd, A. R.	Nairn, D. L. S.	Tilney, John (Wavertree)
Hutchison, Sir James (Sootstoun)	Neave, Airey	Turner, H. F. L.
Hylton-Foster, Rt. Hon. Sir Harry	Nicholls, Harmar	Turton, Rt. Hon. R. H.
Iremonger, T. L.	Nicholson Godfrey (Farnham)	Tweedsmuir, Lady
Irvine, Bryant Godman (Rye)	Nicolson, N. (B'n'm'th, E. & Chr'ch)	Vane, W. M. F.
Jenkins, Robert (Dulwich)	Nugent, G. R. H.	Vaughan-Morgan, J. K.
Jennings, J. C. (Burton)	O'Neill, Hn. Phelim (Co. Antrim, N.)	Vickers, Miss J. H.
Johnson, Dr. Donald (Carlisle)	Ormsby-Gore, Rt. Hon. W. D.	Vosper, Rt. Hon. D. F.
Johnson, Eric (Blackley)	Orr, Capt. L. P. S.	Wakefield, Edward (Derbyshire, W.)
Johnson, Howard (Kemptown)	Orr-Ewing, Charles Ian (Hendon, N.)	Wakefield, Sir Wavell (St. M'lebone)
Jones, Rt. Hon. Aubrey (Hall Green)	Orr-Ewing, Sir Ian (Weston-S-Mare)	Walker-Smith, Rt. Hon. D. C.
Joseph, Sir Keith	Osborne, C.	Wall, Major Patrick
Joynson-Hicks, Hon. Sir Lancelot	Page R. G.	Ward, Rt. Hon. G. R. (Worcester)
Kaberry, D.	Pannell, N. A. (Kirkdale)	Ward, Dame Irene (Tynemouth)
Keegan, D.	Partridge, E.	Waterhouse, Capt. Rt. Hon. C.
Kerby, Capt. H. B.	Peyton, J. W. W.	Webbe, Sir H.
Kerr, H. W.	Pickthorn, K. W, M.	Whitelaw, W.S.I.(Penrith & Border)
Kimball, M.	Pike, Miss Mervyn	Williams, Paul (Sunderland, S.)
Kirk, P. M.	Pilkington, Capt. R. A.	Williams, R. Dudley (Exeter)
Lagden, G. W.	Pitman, I, J.	Wills, G. (Bridgwater)
Lambert, Hon. C.	Pitt, Miss E. M.	Wilson, Geoffrey (Truro)
Lambton, Viscount	Pott, H. P.	Wood, Hon. R.
Lancaster, Col. C. G.	Powell, J. Enoch	Woollam, John Victor
Langford-Holt, J. A.	Price, David (Eastleigh)	Yates, William (The Wrekin)
Leather, E. H. C.	Price, Henry (Lewisham, W.)
Leavey, J. A.	Prior-Palmer, Brig. O. L.	TELLERS FOR THE NOES:
Leburn, W. G.	Profumo, J. D.	Mr. Heath and Mr. Oaksbott.
Legge-Bourke, Maj. E. A. H.	Ramsden, J. E.