AIRCRAFT PRODUCTION

HC Deb 16 July 1959 vol 609 cc632-722

5.43 p.m.

Mrs. White

I was remarking when our attention was diverted that there had been this considerable delay in giving the green light to the DH121, whereupon the Minister intervened and said that, after the financial discussions had been concluded, the delay had been only a short one. The burden of my complaint was that the financial discussions had taken a time which, in the very highly competitive state of the world aircraft industry, was of very considerable importance.

Furthermore, I am sure that all hon. Members on this side of the Committee—and I should have thought a number of hon. Members opposite—would share the feeling expressed by my hon. Friend the Member for Uxbridge (Mr. Beswick) that the Government cannot now wash their hands altogether of concern or responsibility for this aircraft. Finance should be subservient. Finance is not the only consideration in these matters. I cannot feel happy at the situation in which the Government say that, as far as possible, they want all this done by private industry and want it to be privately financed. One feels that the fact that this is of extreme importance to our whole future standing in matters of technique, and so on, is of no account provided that the enterprise is privately finance. I cannot feel happy at that. The Government simply wash their hands of the whole matter, stand back and say that they are no longer interested; they are not interested apparently in the design, the number or anything else, because they have no penny piece committed to it.

That is not an attitude which my right hon. and hon. Friends and I can possibly accept. I do not think that I am being unnecessarily doctrinaire. The whole attitude as expressed by the Minister, both in answering Questions recently and in his speech today, can cause us only considerable disquiet and apprehension. It is clear that there are difficulties over this aircraft, and changes have been made which will obviously very considerably add to its cost. There have been changes in the size which will involve changes in engines, and so on. It is a most disturbing situation. It is not good enough for the Minister to stand at the Dispatch Box and say, "I am not putting any money into this. Therefore, I have no further concern about it. I have no official cognisance of what is going on." That is what he said the other day.

Therefore, we are amply justified in asking for a very much more convincing statement than has been made so far. After all, those of us who are laymen in this matter are reinforced in our feelings of apprehension about this industry by a number of remarks made in the Report of the Select Committee. No one could be satisfied. I do not propose to go into more detail on that at this moment, because many of its aspects will be discussed on Monday. As far as the actual ordering and production of aircraft are concerned, it is only right to emphasise the considerable dissatisfaction expressed in this Report at the working of the Transport Aircraft Requirements Committee, the fact that it does not seem to be endowed with much foresight and that it does not come into the picture early enough. I have marked one paragraph after another in this sense. We have a right to ask the Government to look very much more closely at co-ordination and choice.

My right hon. Friend the Member for Helper (Mr. G. Brown) spoke of the necessary partnership between private industry and the Government. We on this side of the House are often accused of being doctrinaire in this matter. As far as the aircraft production industry is concerned, it is the Government who are being doctrinaire. They are allowing their political ideology to stand in the way of their accepting responsibility and taking action which the workers in the industry and the public have a right to expect. When one has the Select Committee, the extremely active shop stewards in my constituency at Broughton and The Times all in line, one has a very convincing case against the right hon. Gentleman.

5.49 p.m.

Sir Arthur Vere Harvey (Macclesfield)

The hon. Lady the Member for Flint, East (Mrs. White) has made a helpful speech, certainly to her constituents. She was a little off the mark in comparing the Comet with the Boeing 707, because it is an entirely different proposition. The real snag is that when the long-range Boeing comes on to the Atlantic route later this year it will do the trip over the Atlantic both ways nonstop. Considering everything, the Comet has done a remarkable job in fitting into the picture at all and carrying a very-high payload of passengers.

I hope that the Government will look at the matter again and, if necessary, give De Havilland's a contract for Transport Command. I am far from satisfied that the 20 Britannias will fill the bill. We must have a larger Transport Command and one that moves fast, as has been said already today.

Dr. Horace King (Southampton, Itchen)

Would the hon. Member not agree that if the Comet is not preeminently suitable for long-range flying there is a sphere of flying at less than long range for which it would be suitable?

Sir A. Harvey

The Comet suits the Commonwealth routes very well, but not against headwinds of 100 knots going east to west across the Atlantic.

The right hon. Member for Belper (Mr. G. Brown) made a lively, good Opposition speech. It was a helpful speech, but the right hon. Gentleman skipped over matters concerned with the money spent since the war. He said nothing about the large sums spent on the Brabazon projects and the Princess flying boats. We on this side, when in opposition, pressed the right hon. Gentleman to make up his mind about them. The Brabazon was broken up for scrap and the Princess flying boats are cocooned at Calshot.

Mr. A. Woodburn (Clackmannan and East Stirlingshire)

The hon. Member talks about the Brabazon being broken up. It was realised when that aircraft was started that it was a new excursion into a quite different type and that it would be made as a prototype and was not intended to be used as an aeroplane. But without the Brabazon we could not have had the Britannia.

Sir A. Harvey

Everybody says that the Britannia is out of date, with which I do not agree, but my criticism is that the Brabazon should have been scrapped earlier.

Had it not been for the Korean War, and even without missiles, the aircraft industry would have been going through at that time exactly what it is going through now. Reference has been made to the slow rundown of employment and its effect. I should have thought that it was an advantage to those in the industry to have a slower rundown than was anticipated. They have had adequate warning that the industry must contract. It gives people a long time to make up their minds where to go. It is far better for them than being pushed out on their ears at short notice.

Whether fortunately or not, I am not now engaged in the aircraft industry, but I was responsible at one time for conceiving the idea of building the Herald, and Handley Page was the first company to spend its own money on development. It spent about £3 million and not a penny of it was Government money. That aeroplane has recently flown the South Atlantic and has been successfully demonstrated in South America. Anything said here about the Herald not being any good does not help the firm or the industry. The hon. Member for Belper should weigh his words, because he knows the story of the Herald perfectly well.

Mr. G. Brown

I was not saying that it was no good, but asking why the Ministry was ordering three, and what was our responsibility, but I had no answer.

Sir A. Harvey

The Government, in the past, had no responsibility. I understand that three are being ordered at somewhere near the market price of £170,000 to £180,000 each. They are being delivered to B.E.A. They have the same engine as the Viscount and, presumably, will be operated on internal routes. As a North Country Member like myself, I should have thought that the right hon. Member for Belper would have been glad to have more aeroplanes on the northern internal routes. I have great difficulty in securing a seat on aircraft on these routes. B.E.A. should ensure that it has sufficient number of aircraft on them.

Costs carried by the industry today are considerable. I ask hon. Members opposite to consider what is being done by the industry to help itself. First, there was the Hawker supersonic fighter, a private venture. It was a thin-winged fighter which I was sorry to see dropped. If only for research and technical reasons it might have led to greater things in the long run. Development of the Vanguard airframe is paid for by the manufacturers. The same is true of the VC10, the Herald, the DH121 and the Avro 748. A number of engine companies are also developing engines, and helicopters of all sorts are being partially financed by the manufacturers.

It was said in a recent Select Committee Report that the Corporations are the backbone of the production of civil types which are coming along. That is perfectly true. Let hon. Members consider what happened in the case of the VC1000, an aircraft for which the prototype was practically flying. It was thrown overboard, I imagine, by the Corporation itself. It must have made that decision in conjunction with the Government, and I think that my right hon. Friends bear a share of the responsibility.

We were told that the weight of the Vickers 1000 was increasing to such an extent that longer runways were needed, but longer runways have been needed for the Boeing and the DC8. I have yet to know of an aeroplane that has not grown in weight in the course of construction. Had we gone on with the development of the Vickers 1000 at that time we might today have had a trans-Atlantic aeroplane flying. It is a tragedy, because there is a great deal at stake.

Since the war and the nationalisation of the airlines B.O.A.C. has had 98 American-made aircraft either bought or ordered for vast sums of money. B.O.A.C. has done a magnificent job of flying in its services. We hear that the Corporation is better than the American airline companies and runs probably the best airline in the world. Nevertheless, it has ordered practically every aircraft ever thought of.

My criticism of B.O.A.C. is that while it has good flying, maintenance and sales services, it lacks men with sufficient brains and ingenuity to make back-room boys who can work out what the Corporation will want five or ten years hence, coupled with the consideration of what aircraft may sell to other countries. It is rumoured that B.E.A. rather regrets have ordered the Vanguard. I think that the aircraft will pay the Corporation well, but these Corporations must know what they are ordering, for all this costs vast sums of taxpayers' money. They must be certain before they enter into a contract, even if making certain means delay. The Corporations need strengthening with men who can work out what is required in the years ahead.

The mistake we have made since the war has been that we have always put Transport Command in the background. Transport Command should take a new aeroplane first, try it out and get through all the teething troubles. The Americans have been doing that for years, but B.O.A.C. took the Britannia on its routes and had endless trouble, and it is only now that the Royal Air Force is beginning to accept that aircraft. That is all the wrong way round.

The Transport Aircraft Requirements Committee, under the Minister of Supply, has not been nearly active enough. I asked a Question about it eighteen months ago. I understand that the Committee has met only once in nine months. It needs gingering up. It should be meeting practically all the time. It is quite incredible that an important Committee like this should be meeting only every few months. I am told that there has been an improvement in this respect, but the Committee still has far to go.

A Ministry of Supply witness before the Select Committee on Nationalised Industries doubted if the American industry received as much benefit from Air Force orders as B.O.A.C. averred… None of us should underestimate the help that the American airlines receive through military orders. I understand that about 300 Boeing tankers were built for the American Air Force before they came on to airline scheduled service. That is something which British airlines have to contend with. The Americans have large initial orders and can spread out development costs not over 100, but several hundred aircraft.

In the case of the DC8, however, there are so far no Government contracts in the United States; this aircraft has been developed from scratch, and about 170 have been sold. I believe they must sell about 300 to pay for the development of the aircraft. People talk about getting back development costs on 100 aircraft, but it is possible to get them back on 50 if enough money is charged for each. On the other hand, it can be spread out over 200 aircraft. It is an arbitrary figure.

I noticed in this morning's Press that in respect of future orders for the DC8 costs have been increased by 10 per cent. We must realise that in this respect the British industry has a tremendous advantage over the Americans. The labour content of aircraft in this country is about 7s. per hour, whereas it is 20s. in America, In some respects their production methods may be better, but we have a tremendous advantage in labour costs if we go to it.

Most airlines are short of money, and they will be even shorter when they take delivery of their new aircraft in the next three or four years. Many will find it difficult to pay for them. There is already a surplus of piston-engined aircraft. The Americans are looking into the question of a supersonic civil airliner. They have an advantage in this respect, because they are already building, or have built, a supersonic bomber. I am told that only about 50 supersonic airliners would be required to serve all the world's air routes, but to build one prototype might cost £150 million.

My right hon. Friend is quite right to say that this matter needs serious consideration, but we must not say that we are too poor to look at it. We must do so. We must see whether we can go in for this project. Perhaps we can collaborate with the French, and other countries. The French aircraft industry is coming on in leaps and bounds, and we must realise that it will be a serious competitor, just as is the American industry.

The supersonic aircraft has reached the stage of development where it is necessary to define specific directions of effort. Investment in subsonic aircraft projects have been judged by prospects at home and abroad, and we have had regard to the question of getting the best market, but the supersonic aircraft must be judged on economics. Nobody knows the complete story, so far.

The aircraft industry cannot do everything. In the past it has tried to do too much, under pressure from successive Governments. A clear programme should be set out, after due consideration, informing the industry what it must do and where it is going. I should like my right hon. Friend to publish a White Paper showing what aircraft are at present on order, and when they are due for delivery. We are all rather confused as to what has been ordered, and a White Paper would help some of us to make up our minds in the matter.

Last week I had the privilege of going round the Hawker Company's works, at Kingston-upon-Thames with Sir Sidney Camm, the man who designed the Hurricane, which saved this country early in the war. Speaking to him is a most encouraging experience. He has spent a lifetime in designing aircraft, and he says that there is a limitless future for highspeed manned aircraft. Other countries are continuing to develop these projects and he said that Britain cannot afford not to do so. I am sure that he is right.

It may be frightening to think of an aircraft flying at Mach II or Mach III—1,200/1,800 miles an hour—but when we have overcome the initial difficulties of friction causing metal surfaces to heat up, we are there. Britain, with her great technical achievements and the ability of her technicians and designers, cannot afford to be left out. We may not be able to go the whole way, but we must watch the situation very carefully.

I saw a project which the Hawker Company may be flying next year—a vertical take-off aircraft. This is the type of aircraft which we dreamt about as boys. It will go up vertically and then have the forward speed of an orthodox fast aircraft. This is a project which we should be backing. My right hon. Friend the Minister of Supply has said that he will order some, but there has not yet been any order.

The Minister of Supply should be showing some initiative and drive. He should be sitting on the firm's doorstep and asking it how quickly it can do the job.

Mr. Frederick Gough (Horsham)

As I understand, my right hon. Friend said that he was going to give only a design study contract.

Sir A. Harvey

That is worse still. A comparatively small sum is involved—probably under £100,000. The Americans have an indirect interest in this aircraft, because it has a modified Orpheus engine, which was ordered for N.A.T.O. and mainly paid for by the United States. If we are not careful America will grab the whole thing from us. I beg my right hon. Friend to get a move on, in the national interest.

There is no doubt that the air frame industry today is too big. We cannot force rationalisation, but the process is going along very well, and shareholders will take care of that. When they see these firms starting to slip there will be criticism, and the executives will also criticise. The sooner this happens the better.

I was pleased to hear my right hon. Friend say something about the DH121 this afternoon, but I am still not clear what the real story is. I understand that the engine is now too big, but it has been suggested that somebody at B.E.A. wanted a larger aeroplane and somebody else a smaller one. It is about time B.E.A. made up its mind. It is now eighteen months or more since we debated this aircraft in the House. With the right specification it could capture large orders overseas. It is an intermediate jet, with the engines in the rear of the fuselage.

My right hon. Friend also referred to the Argosy contract. I repeat what I said last week. In January, I was told that a contract would probably be placed within three months. Six months have now gone by and the contract has not yet been placed. I understand that since that date about 188 modifications have gone through, I imagine, from the Air Force. Here is a standard freighter. Somebody at the Ministry must say, "You must stop here and build this aeroplane," otherwise it will go on being modified for the next five years. That is what has been happening since the end of the war with successive types of aircraft. I ask my right hon. Friend to "turn on the heat" and get it out.

Britain must spend a considerable amount of money on research and development. By that I do not mean in design and wind-tunnel work; the money must be spent in a practical form, with aircraft flying. Nobody can see where we may be in another ten years' time, but if people know what is expected of them I am sure that we can produce an aircraft which is out of this world. It is being done within 20 miles of London.

What is being done about laminar flow, which I have been talking about for years? This involves sucking air through a porous wing or fuselage, thereby increasing the performance of the aircraft by 30 per cent. Are we going to allow the Americans to do this first, or are we going to build a prototype and see what can be done? I hope that these matters will be given full consideration. It is the same with the Saunders-Roe Hovercraft, which appears to be quite promising.

The value of the aircraft industry is such that I do not think that what the people in it hand over to other engineering industries can be ignored. The lightness of structure which comes out of its designs, the strength and high performance of new materials which have resulted from various requirements of different types, the strong light alloys and high-strength glues and metal bonding, new precise methods of calculation, measurement resulting from the low factor of safety, new methods of construction to combat fatigue, the hydraulic servo systems requiring five tolerances—there is an endless list—have been passed on to other industries. They are particularly valuable in the atomic field, which has had the advantage of this experience.

One aircraft firm recently went out and secured the contract for elements at Calder Hall and showed completely its ability to do better than the rest of the industry. The aircraft industry, because of its exacting technical requirements, must train technical staff to very high standards and many of these go to other industries. It might not be a bad thing for British engineering to receive men from the aircraft industry who can enlighten it more than other industries.

The right hon. Member for Belper referred to the exports last year of over £150 million, but he did not say that since the war the amount has been £860 million and that last year they equalled 11 per cent. of the whole total engineering exports. This is a lead we cannot afford to lose, but, unless there is some very clear thinking, in three years' time it will be down to £30 million instead of £150 million. Whereas a motor car sells at a cost of about 5s. per lb. weight, an airliner sells at £15 per lb. weight. This is a staggering performance and shows how we can sell the brains of a country in a piece of engineering.

Of course, it is a big problem for everyone, but I believe that the industry—which after all, to put it crudely, has been spoon-fed for many years, for various reasons—is beginning to learn how to take care of itself; but it has to have a clearer lead from the Government. I do not believe in the Government running industries, but Governments are there to give a lead. We want from the Government closer relations with the industry on forward intentions so that it may know what Government officials are thinking about and we want a quicker decision where possible. My right hon. Friend the Minister said that he has very limited powers. I agree that he has very limited powers, but his Ministry has powers of delay. That is the real danger in this Ministry.

I have made no secret of the fact for several years now that I think the Ministry of Supply has outlived its usefulness. It ought to be broken up as soon as possible. There are alternatives. It is not for me to suggest them, but I put forward two suggestions. One is that the Ministry of Defence should take over aircraft and electronics and be responsible for those two projects, while the rest of the materials required by the fighting Services should be ordered by the Departments themselves.

I think that the Army today orders shells for the other Services, or at least it used to do so. The work could be parcelled out in that way, or there could be a separate Ministry, as was suggested by the right hon. Member for Belper. We cannot continue this great industry, with all it involves, under the present system. The right hon. Member said he thought that two Ministries were involved, but I make it nine, because Lord Mills presides over an important committee. It was the same in the days of the Labour Government, but there is no need to continue with that system.

We have the Victor and the Vulcan, and even the Valiant flew non-stop to Capetown this week in just over 10 hours. We have better brains in the industry than have the Americans. I ask the Committee to be reasonably tolerant of the industry. We are giving the Government help and this is something we cannot work out overnight, but I believe that we can give a lead by which the British aircraft industry can hold its own with anyone in the world, to the credit of the nation.

6.15 p.m.

Mr. Ian Mikardo (Reading)

By no means for the first time in our debates on the aircraft industry, it is my fortune to follow the hon. Member for Macclesfield (Sir A. V. Harvey). I always consider it to be a good fortune to do so, because he brings to our debates on aircraft manufacturing a great deal of experience, knowledge and thought, and we always learn a great deal from him during the course of these debates.

He has, however, a habit which must be irritating to himself, when he rereads his speeches. Sometimes towards the end he contradicts something which he said earlier. He did not fail to delight us with that today. He criticised the choice of aircraft by the British Overseas Airways Corporation and, at a later stage, he said the Corporation should not carry the can "for doing pioneering, but that that ought to be done by Transport Command. He instanced the case of the Britannia. I agree that the way in which that ought to have been developed was, first, by Transport Command and then by B.O.A.C, not the other way round.

The plain fact is that with all the assistance given by the Ministry and the Service Departments, the aircraft manufacturing industry, over and above the direct subsidies which mean predominantly that the revenue of the industry comes from public moneys, receives also a number of disguised subsidies. The hon. Member, perhaps inadvertently, put his finger on one when he talked about the Airways Corporations pioneering the developing of new types, and talked in particular about the Britannia. We heard something said about the Britannia earlier. I think it is all right now, but it cost British Overseas Airways Corporation about £2 million to do the manufacturer's job of ironing out the snags. B.O.A.C. is sometimes criticised for buying American aircraft. It might well reply, by instancing the Britannia, that no major aircraft bought by a major airline has ever been delivered so much behind the promised date, so much below the promised specification and with so many snags still to be ironed out by the operator.

Sir A. Harvey

I think it would be fair if the hon. Member cast his mind back to the time when we took delivery of Stratocruisers. We had only to pass London Airport to see one coming back on three engines.

Mr. Mikardo

I am not at the moment making a general comparison but a statistical one, and I ask the hon. Member to look at the figures, because he is one hon. Member who could interpret the figures. He would then find that it is true that this aircraft was later in delivery and had more snags than any other, and there was more shortfall in specification than in any other.

The Minister said, "Let us have the facts before we start drawing lessons." All I am doing is adding to the facts the plain fact that the Corporation lost a great deal of business on the Pacific and Indian Ocean littorals because of the Britannia in the early stages. I am delighted that that has now been overcome and put right, but the £2 million which it cost the Corporation is, in fact, a subsidy except in so far as it is offset by payments to take care of the money put into it.

Mr. F. V. Corfield (Gloucestershire, South)

Will not the hon. Gentleman agree that the main trouble which caused the lateness of the Britannia was the fact that its engines were designed for the Brabazon which, as one of his right hon. Friends has said, contributed to the Britannia? It may have done that indirectly, but it also contributed to the fact that the Britannia was late, because those engines were designed to run in pair with the gearbox in front. It was that which caused the icing up which led to so much trouble. The trouble with the Britannia was that its faults resulted from its success.

Mr. Mikardo

It is my own fault for starting a little digression which has been carried into a much longer digression. The trouble which the hon.

Gentleman has mentioned was only a small part of the reason for the lateness. That was a factor which the manufacturers ought to have taken into account and which was their justification for deferring the delivery date once. However, they broke that delivery date and several others afterwards as well.

Any independent observer listening to the debate would already have come to the conclusion, although we have been debating for only two or three hours, that by and large the aircraft industry was not one of our best organised and best managed industries. If one had to cite only one piece of evidence for that, it lies in the fact that the nation has little to show for the thousands of millions of £s—not tens or hundreds, but thousands of millions of £s—of public money which have been poured into the industry since 1945, and especially since 1951.

When the industry is booming, it somehow manages to disguise its difficulties. Now that it is finding itself in a shrinking market, as the Minister said, its difficulties are becoming more obvious. So long as the wind is set fair, the manufacturers manage to get along, but now that they have run into slightly stormy weather, the whole industry is creaking at the seams and has totally failed to show any capacity to adjust itself to the different and more difficult circumstances of a shrinking market. In this situation, the Minister should have intervened strongly and used his influence to get the industry to cure at least the worst of its defects.

It is true that the industry consists almost entirely of private firms, but those firms live predominantly, as we have heard from both sides of the Committee, on public money. The Minister is the guardian of that public money, and that gives him every right to intervene in the industry. In fact, his intervention is always too little and too late. In the last couple of years, those interventions have been timid, vacillating and ineffective.

The trouble with the right hon. Gentleman is that he is a natural backroom boy, and, I should have thought, a very good backroom boy, who has, somewhat to his surprise, found himself in the front line and has discovered rather ruefully that a thesis and a slide-rule are not really implements of battle.

I was amazed by his speech today. It was a nice, pleasant, academic speech, a nice little lecture about aircraft. Had it been given one evening to the Institute of Transport or to the Air League of the British Empire, it would have been a pleasant academic lecture. It would even have been a good lecture if it had been delivered ten years ago, when the ideas it contained were fresh and not as stale as they are today.

I was astounded to hear the right hon. Gentleman tell us that it takes a long time from the inception of an aircraft until it starts to give large-scale employment. He told us that as though it were a new discovery his telling of which should have smitten us with a blinding light. I was amazed to hear him tell us that in the selection of aircraft there are two choices—either the customer makes the choice, in which case the Government do not subsidise, or, if the Government subsidise, they have some say in the choice. That was a brilliant idea when Noah stepped out of the Ark, but it has been a fundamental of the industry ever since it existed. Yet along comes the right hon. Gentleman to regale us with his academic lecture, his nice style and his beautiful diction. But he is the man who is supposed to be doing things and not merely talking about them.

First of all, he said, he would tell us the facts, and he told us many facts. He then asked what lessons ought to be drawn, and he derived some lessons. He then asked what we were to do. He said that there were three things which we had to do. At that point I thought that we were to hear a call for action, that the great man was going into battle. I thought that there would come the blare of trumpets. Instead, we had a squeak on a penny tin whistle. He said, "First, we must begin to ask ourselves whether—". That is a jolly fine call to action. He has watched the industry slide into decline for all the years he has been Minister and he should have realised that there was a critical situation—which the hon. and gallant Member for Macclesfield described so vividly—and that someone should get weaving about it. What a man of action to have in the industry! He came with his blunt sword and with all his pathetic, timid attempts at intervention. In a vague, dreamy and blunt-edged sort of way he has been trying to organise joint working arrangements among different manufacturers, but highly individualistic men who run this highly individualistic industry have been for too tough for him. His efforts have not got very far.

About a year ago he was claiming success for having got together a consortium for the DH121. Today we have heard that that success can be considered at best only a partial success. There are delays, changes of mind and design snags of all sorts. If that is all the success that he has got to show with his intervention, it is not very much.

Without going into detail, it seems obvious that more Government intervention in some form is required to ensure that we do not continue to waste public money and that scarce resources, especially in design and development, are not dissipated as they are now being dissipated by overlapping between different firms.

It is one of the paradoxes of the present situation that, whilst the industry as a whole is shrinking, we are still short of the research and design people required in relation to what the industry now is and what it is likely to be. The recently published Twenty-Second Annual Report of the Air Registration Board for the year 1957–58, a document to which I call the attention of hon. Members, expresses concern about the extent to which we are falling behind in aeronautical research and development.

Now there is a new competitive threat to our aircraft manufacturers, one which has not yet been mentioned today and to which I want to draw attention. It comes in the shape of the Air Union which has been set up as one of the instruments of the European Common Market to integrate the activities of the five major airlines within the European Common Market—Sabena, Alitalia, Air France, Deutsche Lufthansa and K.L.M. It is in its initial stage of development, but it is making very rapid progress.

The other day, the European staff of the Financial Times described Air Union as the most spectacular and far-ranging manifestation of the Common Market on the commercial side to date. It is significant that one of the committees set up by Air Union is an equipment committee. That suggests to me that at some stage, and perhaps at an early stage, Air Union will move towards a common organisation for aircraft maintenance. If that happens, it would be only natural that it should move towards common arrangements for aircraft design, manufacture and purchase. Indeed, if I may speculate about it, I would guess that as Deutsche Lufthansa has easily the greatest expansion rate of all five airlines, the common arrangements will operate from Western Germany.

If that sort of thing comes about, and the possibility is clearly there, it will create a serious increase in the competitive threat to the British aircraft manufacturing industry. It will mean that our individual aircraft manufacturers, who compete wastefully with each other, particularly in their competition to hold out a begging bowl to the Minister which is their most important activity, will be faced with competition not only from integrated national industries, such as the French aircraft manufacturing industry to which the hon. Member for Macclesfield paid tribute and which is publicly owned, but also with competition from an at least partially integrated supranational organisation which would be a keen competitive force because it could make use of very substantial economies of scale, spreading overheads over really sizeable quantities.

Mr. Julian Snow (Lichfield and Tamworth)

I hesitate to interrupt my hon. Friend's very informed speech, but perhaps he will recall that two years ago two hon. Members, including myself, published correspondence in The Times between ourselves and the Secretary of the Society of British Aircraft Constructors in which we put forward reasons for saying that there should be some form of amalgamation, and the Secretary rejected it as a futile idea.

Mr. Mikardo

I did not know that the idea that I was putting forward had such a respectable ancestry. I am delighted to learn it. I am not surprised to learn from my hon. Friend that the S.B.A.C. did not bite on to this one, because it is not very good at biting on to new ideas. I do not expect the right hon. Gentleman to agree publicly with that, but I know what he would say if he were having a private conversation.

The more I look at our national needs in aircraft over the next few years, the more I am convinced that not one of them—and I mean not one of them—will be fully met without much more drastic Government intervention than the Minister has attempted up to now, or appears to have in mind for the future. It seems to me that these needs in the next few years are five in number. The first is that we must develop what might be called a family of civil aircraft, one generation going on to the next, and, of course, with related aero engines which are planned ahead to meet the requirements of the next fifteen or twenty years.

On this point I am not at all satisfied that the Minister is working on the right lines. He told us in a Written Answer to a Question on 13th April—and he made some remark about it today—that the Report of the Supersonic Transport Committee, which was set up in November, 1956, had recommended starting detailed design work on two first-generation supersonic aircraft, of which he gave particulars.

This recommendation, which he said in April he was studying and which it appears he is still studying, raises two very pertinent questions which were cogently put in a statement by the managing director of the Bristol Aeroplane Company, who also has the advantage, as a former chief executive of British European Airways, of a great deal of experience in airline operation.

The Committee might think for a moment about these two questions. The first is whether we ought not to consider whether Great Britain can afford this venture at all. I have been somewhat critical of the right hon. Gentleman in the last few minutes. It is with relief that I am able to praise him and say that I am very grateful that he spoke on this matter with so much reserve today, because it seems to suggest to me that he has not fallen for all the ballyhoo about supersonic flying. If we look at this project for very high speed supersonic civil aircraft, it becomes clear that it cannot be justified intrinsically and that if it can be justified at all it can be justified only on prestige grounds. I would take a lot of convincing that the prestige value is enough to justify the huge expenditure which would be involved.

We have got to face the situation that the International Air Transport Authority refuses to agree on premium fares for very fast travel. That is a very important factor in the situation, and so long as that is so the only effect of our airlines going in for supersonic aircraft is that they will have spend more money to get the same revenue as they are getting at present. That is not going to make their profit and loss accounts look very healthy.

The second query which arises is whether the second of the two types envisaged by the Supersonic Transport Committee will not be much too slow for its generation by the time that it comes along. It is obvious that if the Americans choose to compete with it directly, they will have no difficulty in out-speeding it. They already have some developments for military purposes, as the hon. Member for Macclesfield said, which are much faster than we are projecting for our second supersonic aircraft. Some of those military developments are easily convertible to civil use.

I was delighted that the right hon. Gentleman threw a questioning glance—and I hope he will continue to throw a very questioning glance—at this development of supersonic aircraft. But that does not alter the fact that even if they are not supersonic we need a proper family of aircraft which will be economic, never mind about flashy, for as far ahead as we can see. Those hon. Members opposite who have demanded a lot of expenditure on supersonic aircraft are the first to complain when the aircraft corporations get into the red. They cannot have it both ways. It is our business to see that they get the best aircraft which are economic, and not the flashiest.

The second of our five needs over the next few years, on which the industry has fallen down, is in the development of missiles. Here I have to speak with great reserve because the subject is shrouded in an enormous, thick veil of secrecy, but, as far as I can find out, we have three different types of missiles being made by three different firms, and all are too slow to attack other missiles.

Therefore, they can be used only against aircraft, and they are not going to be much use for defence unless the enemy chooses to oblige us by sending his H-bombs in very slow projectiles. The same applies to rocket engines, in which each manufacturing firm is paddling its own canoe without any interchange of information on research or technique. That is extremely wasteful of very scarce resources.

Third in this list of five there is the question of any space project which we may have in mind. I understand that three firms are working on some sort of space project, independently of one another and with a good deal of waste due to overlapping of resources.

Our fourth requirement is the one to which the hon. Member for Macclesfield devoted so much attention, and that is the development of vertical take-off and landing aircraft. I was pleased to hear from the Minister today that he has at least, in his sluggard's progress, got as far as thinking about giving a contract for a design study. This is very slow indeed. What worries me is that at one time we were well ahead of the rest of the world in vertical take-off and landing aircraft, and I am not at all satisfied that we are maintaining the lead which we once had. I certainly do not think we will maintain the lead if the Minister continues to move at that snail's pace.

Fifth in this list of requirements for the next few years is helicopter development. The Minister has been waffling around with the Rotodyne since "kingdom come" almost. At least, he told us today that he is in negotiation about placing an order for them, but he gave us no forecast of when these negotiations might come to an end. They could, of course, be interrupted by the election and the Minister ceasing to have responsibility for them. I hope they will be, because otherwise I do not think they will come to an end for another couple of years. It is really time that we did something about this.

I have never made much secret of the fact that I never had great faith in the ability of the aircraft manufacturing industry as it is now organised to cope with a range of problems of this magnitude. My scepticism about its ability to do that has been reinforced by some sections of the Report on the Civil Appropriation Accounts for 1957–58 which were submitted to us on 3rd March by the Comptroller and Auditor General. Some of the things which he reveals in that Report are nothing short of a national scandal. It amazes me that so little attention has been directed to them.

I will quote two examples. The first concerns the Orion turbo-prop, for which the Treasury approved a development contract in 1954 at an estimated cost of £6,500,000. Three years later, in March, 1957, it was reported that the cost of the contract would be nearly double the estimate, namely, £12,900,000. When an examination was made of why the estimate was so far out, it was found that some of the contractor's calculations in the estimate had been—this is the Comptroller's point, not mine—flagrantly incorrect. The inaccuracies included the fact—believe it or not—that the contractor had just forgotten the little item of six engines which would be required for the test programme. He thought that he would be testing some engines without having an engine to test, and he forgot to allow for that little item of six engines.

Finally, the whole job was dropped. We shall not have the project at all, but we spent nearly £5 million on it, for absolutely nothing. The Committee can well imagine what a scream would have gone up if this pathetic muck-up involving the loss of £5 million public money had been the work not of a privately-owned aircraft manufacturing company but of one of the public corporations. My right hon. Friend the Member for Belper (Mr. G. Brown) spoke very rightly about this double standard of morality which right hon. and hon. Members opposite have about these matters. If public money is wasted by private enterprise, we must not criticise; it is political to criticise. On the other hand, if it is a mistake by public enterprise, then that is fair game for everyone to have a go. If this muck-up had been made by one of the public corporations we should have seen it in the newspapers for months. As it is, we have heard scarcely a word.

The second example I take from the Report of the Comptroller and Auditor General is even worse. It concerns the RA29 engine developed by Rolls-Royce. That project started its life with an estimated cost of £2,360,000. Eventually, its estimated cost rose to nearly £9 million. Once again, the Comptroller and Auditor General examined what had gone wrong. The examination revealed, first, that the contractor's estimate had included only two of the four years during which expenditure would be incurred, and, second, the absolutely amazing fact that the contractor never revealed to the Ministry that the estimate was only a partial estimate but led the Ministry to believe that it covered all the four years' expenditure, not just two. I do not like using harsh terms in this Committee, but I am bound to say that anyone reading the Comptroller and Auditor General's Report on this item might well be led to the conclusion that, if the contractor's estimate in this case was not a bit of sharp practice, it came very near to it.

When this RA29 project finally got into a mess, the Ministry wanted to get out of it altogether. But the Ministry found that it could not do so, because it had just forgotten to insert a break clause in the contract. What a shocking tale of muddle and incompetence! Again, I ask the Committee, what would have happened if this had been not Rolls-Royce but the National Coal Board or British European Airways'? Every sub-editor in Fleet Street would have reached for his 72 point headline type and the blackest ink he had—if he still had any—and he would have planted this story all over his front pages, perhaps even giving it priority over the love story of the young lady who does not want to marry one of the Queen's footmen. It would have been all over the front pages for weeks.

I apologise for having kept the Committee so long. I want to make only two other points about the present run-down in the industry. The run-down is releasing some extremely valuable capacity, some of it in areas like Northern Ireland and the Isle of Wight where little or inadequate alternative employment is available. This is a problem similar to the problem of redundant capacity in Royal Ordnance Factories and Royal Dockyards. In all these spheres, it is obvious that the Government are doing little or nothing to avoid the shocking waste of first-class engineering capacity and first-class engineers in all these establishments.

What is happening to the men now being thrown out of work in the aircraft manufacturing industry? We were all greatly relieved to hear the right hon. Gentleman tell us that, of those who have been thrown out, up to now the great majority have managed to find other work, although I am sure that it is very often work at lower wages—

Mr. John Diamond (Gloucester)

Much.

Mr. Mikardo

—and, all too often, work not fully using their skill. This is a great tragedy for the nation. I do not think that this process can go on indefinitely. The law of diminishing returns applies to it, and the men who are being thrown out of work now are in a much more difficult position. The right hon. Gentleman, with his customary kindness, said—I took down his words—"We must do everything possible to abate the contraction and to smoothe it". What does he mean by that, in practical terms, for the men being declared redundant? Many of them, as he knows, have the highest degree of skill, and many of them have worked in their companies for a long time.

Many men are being thrown out with just a week's notice or a week's pay in lieu of notice. Is it only the directors of the aircraft manufacturing companies who are entitled to some pay on losing office? The right hon. Gentleman knows that recently a director of one of those companies. Sir Frank Spriggs, was discovered by his colleagues to be redundant. He was persuaded by them to retire from office two or three years before he would have reached retirement age. He was persuaded to do this by being given a tax-free compensation for loss of office amounting to the small sum of £75,000. That is about double the sum that the ordinary aircraft worker earns in the whole of his working life

Mr. Diamond

Less tax, too.

Mr. Mikardo

Yes; this was free of tax. For Sir Frank Spriggs, anyhow, the Minister certainly fulfilled his promise that everything possible should be done "to abate the contraction and to smoothe it". Sir Frank was certainly abated and smoothed, was he not? The contrast between that, on the one hand, and workers being thrown out at short notice without compensation, on the other hand, is, surely, too glaring to be acceptable to any Member of the Committee.

I appeal to the right hon. Gentleman. He holds the purse-strings. Because of that, he wields great power and influence in this industry. He is a kindly man. I put it to him that he ought to exercise his power and influence and show his natural kindliness in order to ensure much better treatment for redundant aircraft workers than they are being given at present.

6.48 p.m.

Sir Lionel Heald (Chertsey)

Hon. Members may wonder why a Member for a Surrey constituency should venture to intervene in the debate. Some hon. Members may not be aware that there have been between 5,000 and 10,000 people in my constituency working either in the Vickers factories or in the branches of the engineering industry which are closely connected with them.

Although I cannot pretend to deal with technical aspects, as the hon. Member for Reading (Mr. Mikardo) and my hon. Friend the Member for Macclesfield (Sir A. V. Harvey) have done, I have studied the matter as well as I can. Also, I have had the opportunity of having discussions with the management, including Sir George Edwards, who needs no introduction to anyone familiar with these things, and with the men employed in the industry, the shop stewards. I met some of the shop stewards and had a conversation with them before the debate began.

One of the most impressive remarks the shop stewards made to me in that conversation was that they did not want any "so-and-so" politics about this business. I cannot repeat the exact language, but that is an indication of what they said. Although, naturally, he could not resist having a bit of a go, the hon. Member for Reading, I feel, must have exercised great restraint in the very interesting remarks that he made, with some of which I found myself in a measure of agreement.

The important thing, I think, is that today those engaged in the industry do not look at the matter from a doctrinaire political point of view. It must be encouraging to all of us that we have not so far heard from the other side of the Committee any suggestion that nationalisation of the industry would cure all its troubles, or anything of that sort. It has been accepted, as I think it must be accepted, that essentially in an industry of this kind we want all the flexibility and enterprise that we can obtain, particularly in relation to exports, and that it is a matter of partnership between the industry, the Government and the Corporations. If it goes out from this Committee that we have accepted that point of view, I feel that that will be of some comfort to those who are concerned about the future.

Of course, people are concerned about the future. I am particularly fortunate in having contact with Vickers, who, I suppose, everyone would agree have achieved very great success with the Viscount, in particular, apart from their development of other famous aircraft. The Viscount has been a remarkable export. I recall that I was once travelling in one of these aircraft, which was being flown by one of the United States airlines. Sitting in front of me were two Americans, who did not realise who I was and did not realise that I was listening. One said to the other, "I think that we must hand it to them. This is the finest aircraft we have ever been in". That sort of thing gives great encouragement to the people engaged in the industry. Any idea that the industry will run down and fade out is something which fills them with horror.

From a national point of view, I think that we can take it from what the Minister said today that the Government have no intention of seeing such a thing happen if they can possibly avoid it. With the need in the Commonwealth for communications because of our geographical position, and all the other reasons, it is unthinkable that that should happen to the aircraft industry. I therefore believe that we can start with the accepted proposition that we are all agreed that everything possible must be done to maintain and strengthen the industry.

I am sure that the layman has very little appreciation of the competition which we have to encounter, particularly from the United States. In view of the enormous military orders which the United States Government are able to give to American manufacturers and the tremendous home market which they have, it is a tremendous task to compete with them. For instance, I think that the American Army or Navy—I imagine that it would be the Navy—has given an order to the Lockheed company for 120 of the Electra aircraft, which was developed by that company. When one compares that sort of thing with our own companies, which have to decide whether they can afford to put down many millions of pounds in the hope of obtaining orders at some time in the future, and are subject to all sorts of possibilities, one realises the tremendous difficulties.

As has been said and accepted by right hon. Members on both sides of the Committee, some degree of Government assistance to an industry such as this is essential. The question is: how should that assistance be given and in what direction? If it can go out from this Committee today that we do not intend that the aircraft industry should be a plaything of politics and that the Government will ensure that it is maintained in an efficient state by means of a system such as that described as some kind of partnership, then I think that those engaged in the industry, whether management or workers, both of whom are equally essential, will feel that there is more hope for the future than some of them are inclined to think at present.

I should like my right hon. Friend to deal with one aspect which I am surprised no one has mentioned. There is such a thing as rushing in, sticking one's neck out, or whatever one likes to call it, but I am surprised that, apart from a passing reference to it in my right hon. Friend's remarks, nothing has been said about the encouragement of cheaper and more popular travel, and the steps, if any, that will be taken to further that. In the knowledge that I have been able to gather about this subject, a particularly interesting point concerns the Vanguard. The Vanguard, which may be termed the second generation of turbo-prop aircraft, has been developed on the basis of a judgment that there will be a demand for more inexpensive but very efficient passenger travel.

It may be that the Vanguard is, in some respects, ahead of its time, but I believe that there is a very good and very well-informed body of opinion that considers that in a year or two's time people will be rushing round wanting to obtain this kind of aeroplane. In the industry—perhaps more among operators than in the industry—there seems to be a tendency suddenly to say, "We must get something new. Somebody has one of those. We must have one, too." Once there is the idea of cheaper travel it may well be that there will be a sudden demand. I should like to know the view of this Government on this matter.

The question of fares is a very thorny subject and it is much too complicated a matter for discussion today, but a great deal of discussion is going on about it. There is a body of opinion which considers that every possible step must be taken to try to get people to appreciate that cheaper travel will be an advantage from every point of view and that we cannot progress unless we have cheaper fares. If we want cheaper fares we must have the aircraft which have been developed for the purpose. What is being done in that direction?

The international arrangements are very difficult to work, but I think that we cannot help but be impressed when eminent and well-qualified people express their views. For example, a statement was made yesterday in which very interesting figures were given and it was said that in a few years' time it may be possible to reduce the cost of air travel to a figure which at present would seem to be quite out of the question. No doubt, when that time comes, some people probably will complain that air travel is not as comfortable as it might be, but, after all, that is something which one must accept if we can travel about 350 miles in an hour in an aircraft costing £500,000. Even if one travels at night, one has to pay for it, but the question of cheap travel is a relative matter and I believe that that is one of the aspects into which we ought to look.

I, and least of all those with whom I have discussed the matter, would not like to think that we will make no effort to take part in the higher realms of speed development and eventually of supersonic flight. However, that will not help the people who are worrying whether they will have a job in the next year or two. That is something with which many people are concerned. I therefore think that our discussion today has this great advantage: we are able to say what we think in the interests of those concerned, from the point of view of the manufacturers and their employees, from the point of view of the airlines, and from the point of view of the travelling public.

Everyone is interested in this subject. It is something in which we can say to the Government that if they will take a firm line, if they will have a firm policy, work it out and tell us what it is, we shall be prepared to support it. They may be surprised to find what a volume of support they would get in all quarters, having regard to the fact that as we have seen, at least so far, today, the fundamental political differences on this subject are very small indeed.

7.0 p.m.

Mr. Frederick Mulley (Sheffield. Park)

I was a little distressed when the right hon. and learned Member for Chertsey (Sir L. Heald) began his speech by referring to the idea that my hon. Friends on this side were trying to make the aircraft industry a plaything of politics. I hope the right hon. and learned Member will take it from what he has heard today, and what, I hope, he will stay to listen to as the debate develops, that we are not in the least concerned to do that to win votes and that we do not imagine that we have any miraculous solution to the problems of the industry.

Nobody would be able to provide work for the aircraft industry unless a use can be found for the machines that it makes or which must be sold abroad as they cannot all be absorbed in this country. At the same time, however, the right hon. and learned Gentleman should realise that one cannot divorce the future of the aircraft industry from political decisions that must be taken by the Government of the day, whatever Government it might be.

To begin with, there is the question of defence policy and the contribution that the aircraft industry is required to make in that direction. When people advocate disarmament, they do not always appreciate some of the consequences to employment that would flow from it. We cannot divorce the aircraft industry or, indeed, other industries from political decisions. Our complaint on this side is that the Government do not seem to take any decision at all.

When I heard the excellent speech of the Minister of Supply this afternoon, I thought, as my hon. Friend the Member for Reading (Mr. Mikardo) said in more colourful language than I can command, that he gave an admirable analysis of the problems of the industry. If the right hon. Gentleman had been engaged in writing a thesis or giving a lecture to a learned society on the problems of the aircraft industry, it would have been wholly admirable; but one never suspected that he was the person who was responsible or who ought to be responsible for taking decisions. In these days, there are probably too many Hamlets in Whitehall. Certainly, the Ministry of Supply is a place where we want a man of action and not a philosopher.

What we need, not only in the wider interests of the industry but in the interests of the workers in it, is certainty and planning for the future. That certainty and direction can come only from the Government themselves. There may well have to be redundancy, but at least it could be planned for in a way that would remove some of its worst features. We were glad to learn that so far redundancy by displacement has affected only one person in twenty. Nineteen out of twenty have found other jobs. At the same time, we must recognise that often the new jobs are not as good and do not permit people to use the skills which they have acquired. Very often, the new jobs are not even at the same place of work. They necessitate the complete upheaval of a man's family and his home.

Some aircraft workers have said to me that it was only a few years ago that they were persuaded by advertisements in the newspapers to give up their jobs and move their homes to come to work in the aircraft industry where, they were urged, they were wanted for national purposes. That provides the contrast. Many people feel particularly sore because they have given up a livelihood in other industries to come into the aircraft industry where they are liable to be dismissed at a week's notice.

As has been clearly said, in the aircraft industry one cannot distinguish the civil and the military sides. The industry must be taken as a whole. The simple question is how much subsidy it needs and how it should be administered. There is a consensus of opinion on both sides of the Committee—indeed, there is overwhelming evidence from other countries besides our own—that we cannot expect the industry to be profitable without some form of Government assistance, whether by way of orders, finance for development or direct subsidy. How is that assistance to be administered? While I have no belief in public ownership for its own sake, I have a strong objection to pouring public money into an industry without there being some means of public control and accountability and, in the instances where the investment and the decisions prove to be profitable, part of the profit coming back to the taxpayer as some small return for what is laid out in the beginning.

Mr. Shepherd

Is the hon. Member aware that precisely that arrangement obtains in the case of the Viscount and that, as far as I am aware, the Government are making a nice little profit out of the Viscount—at least, I hope so?

Mr. Mulley

Had I been allowed to make my own speech, I was coming to that precise point. I am not criticising. The point to which I am directing my remarks is that the Minister of Supply, when speaking earlier this afternoon, said that he did not know which way we should resolve this problem and whether the Government should give any support at all to the industry. It is because the Minister seemed unaware about the future that I mentioned that. I do not think that the Viscount financing system is wholly satisfactory. There is a lot to be said for the French system, in which part of the industry is nationalised and part under private ownership.

In last year's debate, the Minister said that he did not believe in shot-gun weddings. In the context of men and women, that is probably true, but in the aircraft industry some of them have, perhaps, been living in sin too long and some element of persuasion may be necessary if we are to achieve the purpose we want. This industry, above any other, is one in which planning is essential.

I was concerned when, this afternoon, the Minister posed the problem of whether the industry should have no financial help from the Government and, therefore, the customer could choose in great detail what he wanted, or whether, on the other hand, the money should come from the Government with the Government taking a direct hand in design and in deciding upon the plan for the future. We on this side are in no doubt whatever that it is the second of the two choices posed by the Minister that the industry wants. The industry wants to know quickly what the Government are doing. The posing of problems at this stage will not do more than irritate those concerned.

Mr. Aubrey Jones

I remind the hon. Member that the airline Corporations are nationalised undertakings enjoying under statute commercial autonomy.

Mr. Mulley

That may be so. The Minister himself told us, however, that 85 per cent. of the problem was a military one, and that is a responsibility which he cannot evade.

The size of the problem is obviously enormous. The hon. Member for Macclesfield (Sir A. V. Harvey) told us that the cost of research and development for a supersonic airliner would be £150 million. I was told only last week in a European international organisation that it was likely to be £600 million. In addition, we are told that probably only fifty of these supersonic airliners would be required. As a nation, can we possibly afford this? Again, we were told by the Minister this afternoon that the breakeven point for any machine is not reached until something like 100 are produced. Clearly, the suggestion that the industry can be self-financing is wide of the mark.

The suggestion of the right hon. and learned Member for Chertsey that one of the possibilities is to provide cheaper air travel is worth pursuing. We know that there are many practical difficulties, one of them being the international agreement on fares, which prevents an enterprising airline from reducing its fares and prevents special facilities being provided and a premium being charged therefor.

It is quite fantastic that we should be talking about the need to increase the speed of our aeroplanes at a time when the Daily Mail is spending a little money in more or less demonstrating that the important way of economising time is by good organisation on the ground, and that whatever speed one can get in the air if one cannot get good contact between the centre of travel and the aeroplane one does not really gain by the extra speed of the aircraft employed.

I should like to say a word about the military side, which the Minister says is 85 per cent. of the problem. I think that the problem of the aircraft industry stems from the unfortunate Defence White Papers of 1957–58. It is ironic to recall that in the 1956 Defence White Paper the Government made it quite clear, when talking about the "outbreak of localised conflicts on a scale short of a global war"—"outbreaks of limited war" and so on—that they were then preparing for the possibilities of limited war. This was at a time when the Western Alliance had undoubtedly supremacy in the field of nuclear deterrents. But when the Soviet Union was clearly approaching the West in nuclear parity and capability of delivering nuclear bombs, the Government switched over and became completely committed, in the notorious paragraph 12 of last year's White Paper, "to rely primarily on a vast stockpile of nuclear weapons and the capacity to deliver them."

Ironically, just at the time when the approach to nuclear parity on both sides made a global nuclear war less likely, the Government not only took the surprising decision to rely primarily on nuclear deterrents, but began to switch their orders to the aircraft industry on the basis of what seemed to me to be a wrong assessment. I shall not go into great details on the strategic aspects, because, quite properly, they were the subject of the general defence debate which we had earlier in the year. But clearly this has meant a reduction in the number of fighters. I understand that the number of fighters actually in Fighter Command has been reduced by about two-thirds over the last two or three years, and I think that the position is that after the Lightning, formerly the P1, which we are told in the Defence White Paper is due to be put to the squadrons next year, there will not be any further fighter planes ordered. I think that this is possibly a mistake.

Clearly, the essence of the fighter is that it must be faster than the bomber it is sent to deal with and the number of fighters required will be reduced if potential enemies do not appear to have manned bombers, because the danger to this island will be more from missiles than from manned bombers. That point has not yet been reached, and may not be reached for some years. Some fighters will still be needed for identification and rôles of that sort.

The Bloodhound missile has been a success and has been sold to Sweden. Despite the optimism of the Government on more than one occasion, however, we do not appear to have succeeded in getting the Bloodhound adopted as a surface-to-air missile for Western Europe. It seems that the American Hawk will be used instead. At the same time, it would not appear likely that the Blue Streak will be adopted by the European countries as a whole.

The Minister of Supply said in February that as the Americans would not be producing a second generation of intermediate-range ballistic missiles it was our job in Europe to do so, and he hoped that the Blue Streak would be adopted by all Continental countries. From my reading of the French papers last week and from what one can gather in France, I think this is hardly likely to be the case. The French seem to be quite determined not only to have their own nuclear bomb but also to have their own independent means of delivery. That seems to be at least ten years ahead. But a consortium of French companies, nationalised and private, has been formed and is likely soon to start work. I believe that substantial German capital has also been secured for this venture. They say quite clearly that unless they can get licences to develop an American missile they will have a French-European one, and it is quite clear from this that they are not interested in the British Blue Streak.

We have not been told about the possibilities of helicopters. I would have thought that there was a case for a substantial increase in the number of helicopters available. In all these directions—and I do not claim to have the technical knowledge at the disposal of some hon. Members who have spoken in this debate—when one looks at the various possibilities for the British aircraft industry, it seems certain that it must contract and, consequently it seems to me that there is no future for the aircraft industry of any individual country taking a long view in Europe.

If we are to compete in the future with the United States, we have to do so on the basis of European co-operation. We should seek to extend this French consortium to include British companies as well and try, through Western European Union or some other means, to get some of our missiles or planes adopted as a standard for Western European countries. We cannot hope in the present context to expect the Americans to do very much for us. We know the particular problems in trading, as my right hon. Friend said in his opening speech, against unscrupulous trading competition which one meets from time to time from the Americans. Therefore, it does not seem to me that we can hope to solve these problems in a purely British context.

In the 1957 White Paper, paragraph 64 states: The Government will explore with the French Government and other member States the possibility of greater research and development within the framework of Western European Union. We have not yet had any concrete results from the co-operation which we hope the Government promoted. It may not be the Government's own fault. If that is the case, they should tell us why they have not succeeded in getting our products, either the Bloodhound, which, I am sure, is a first-class missile, or the Blue Streak, adopted by any of the other countries. If it is the case that the other countries do not want them, we should be told.

I myself have the feeling that we did not consult the other countries until we had already reached a fairly advanced stage and then said, "What about having these?" We surely ought in the interests of our own aircraft industry, in the interests of getting more value for money in our defence expenditure and generally in the interest of the political advantages which stem from European co-operation, to do much more in this direction.

My own feeling is that if we have not already missed the European bus, it is likely to leave very soon. I do not myself see, unless in the very near future we can come to terms with the Common Market countries, that many of these matters can be solved in time. The door will be firmly closed against Britain, with the political and economic consequences that involves. Among the catalogue of Ministers who ought to be concerning themselves with these problems I would add the Foreign Secretary, because I think that the insistence of the Foreign Office on trying to keep all these international negotiations in its own hands and not allowing the Minister of Supply and the Minister of Defence to take part, is one of the aspects—one of the smaller ones, perhaps, but still one—of the problem which have landed us where we are. I hope, therefore, that we shall look at this problem not only in the British context but also in the international and especially the European context, as well.

7.21 p.m.

Mr. Stanley McMaster (Belfast, East)

There seems to be no need to stress to this Committee the importance of the British aircraft industry. Right hon. and hon. Members have already referred to the fact that the exports of aircraft engines and components earned over £154 million for this country last year and accounted for 11 per cent. of our total engineering exports.

The aircraft industry makes a very important contribution to technical progress in all parts of British engineering. Metal alloys and other materials and adhesives have been developed which are capable of withstanding great stress at high temperatures. They are of use not only in aircraft, but in such machinery as atomic reactors. New, precise methods of calculation and measurement have been developed, and also computer techniques, simulators, and vibration measurement have been perfected.

Problems connected with fatigue have been very carefully studied, and methods of ensuring that the complex electrical and mechanical and hydraulic systems are reliable in aircraft which are made to travel at high speeds and under conditions of very great physical stress and strain. Also, testing and inspection techniques have been very greatly improved by the aircraft industry, and all these developments help to improve the standards throughout the engineering industry.

From the point of view of my own constituency, East Belfast, Messrs. Short Brothers and Harland are at present engaged on the production of the Britannia airliner, which is an airliner in service in 10 airlines all over the world and also with the Royal Air Force Transport Command. This airline has built up a very impressive record for reliability and flexibility and, after its original teething problems, profitability. Short's also produce some special types of Canberra reconnaissance and drone aircraft which they have helped to develop. They have trained in Northern Ireland many young engineers to the high standards required by the aircraft industry.

In Northern Ireland, we have the difficult problem that if this industry, which is ideally suited to local needs, because of the high cost-to-weight ratio of its products, already referred to by hon. Members, cannot find sufficient orders to keep going, then the men employed in the industry cannot be given alternative employment in Ulster. There are over 8,000 men employed at Short and Harland's in one of the largest and best-equipped aircraft factories in Great Britain. The management of Short's is well aware of the problems facing the industry. Great emphasis is placed at all levels in that firm on reducing the cost of the aircraft produced by the factory.

Much has been said during the debate about supersonic passenger aircraft. I believe that in the carriage of freight by air we are on the verge of a major breakthrough. At present, the rate of passenger expansion in world airlines has slowed down very considerably. The report of the International Civil Aviation Organisation for 1959 has pointed out that last year the average world passenger traffic increased by only 4.3 per cent. as compared with an annual increase of over 15 per cent. in the preceding six years. A recent air freight survey in Great Britain shows that 75 per cent. of potential consignors of air freight in the United Kingdom seldom or never use this form of transport and only 7 per cent. use it regularly.

More than two-thirds of potential consignors quote cost as the prime reason for not using air freight. A writer in Tuesday's Financial Times has pointed out that among the advantages of using air freight are lower packaging costs, less danger of damage by pilfering, and cheaper insurance. One manufacturer of popular cars has found it worth while to fly assembled cars, and spare parts and tools, direct to Northern Ireland rather than consign them by rail and ship from his Midlands factory.

However, it is suggested in the Financial Times that most shippers would not consider using aircraft till freight rates drop as low as sea rates. About Is. 6d. per ton mile is quoted in comparison with current air rates for the same class of cargo of about 3s. per ton mile. Short Brothers have high hopes that the Britannic freighter which they are developing will be capable of cutting current air freight rates by at least 50 per cent. It may even be possible to reduce certain classes of air freight carried in this very large and new turbo-prop plane to as little as 1s. per ton mile. This has opened up a vast new possibility of expansion in the carriage of many classes of freight by air. Its possibilities are greatly in excess of the likely expansion of passenger traffic in the foreseeable future.

We have in Belfast a company which is capable of producing large numbers of such freighter aircraft very economically. Short Brothers' factory has a floor space of about 2 million square feet. The doors of the final assembly hangar are 300 feet wide, capable of allowing two Britannias to pass out together on to the runway of the aerodrome that they are fortunate enough to have on their own doorstep. Also, at the side of Short Brothers' works is a deep-water berth where merchant ships can unload straight into the factory.

With a little foresight and assistance during the difficult development stage, this company, specialising in this class of large, economical freighter planes with a straight-through fuselage which measures 12 feet by 12 feet, and box fuselage which is 70 feet long, could soon be producing planes cheaper and more efficient than any other plane in their class which has as yet been developed.

At the same time, the advanced technical team at Short Brothers has had a notable success with the SCI, which is a vertical take-off and landing aircraft which may well become the prototype for the supersonic airlines of the future, capable of using very small landing fields situated not far from the centres of large cities throughout the world.

I should like to say a few words about the reorganisation within the aircraft industry. Here the Government's function should be to encourage and not to try to force the pattern of such reorganisation as is necessary. Companies are best left to select their own partners. They will have to work smoothly and efficiently together, and forced amalgamations might well be disastrous to a key industry which faces such strong and heavily subsidised competition.

The Prime Minister has undertaken to review the functions of the Minister of Transport and Civil Aviation, but there are strong constitutional objections to creating too many Ministers. I would subnit that what is needed is a civil air staff, charged with the responsibility of evolving requirements for civil aircraft to meet the needs of our airline Corporations while, at the same time, having regard to the export potential of the British aircraft industry.

The aircraft industry is of immense importance to the United Kingdom's engineering prestige. It is a substantial contributor to our export drive. Technical advances are used not only within the industry itself, but in the motor car industry and the development of nuclear energy plants, to mention but two examples. The industry is surely worthy of all the assistance that the Government can give, both by way of military orders so that our Army, along with most of its equipment, can become really mobile, and by direct assistance in civil research and development. Thus, we can help to ensure that we maintain our lead in engineering standards, protect our export trade and secure and improve the standard of living of our people in the difficult competitive days ahead.

7.32 p.m.

Mr. Austen Albu (Edmonton)

The constituents of the hon. Member for Belfast. East (Mr. McMaster) will be very satisfied that they have in the House an excellent salesman for their products. I could agree with much of what the hon. Member said, but I could not quite agree with him about the reliability of Britannia aircraft. What the hon. Member said at the beginning and end of his speech about the contribution which the aircraft industry has made to the advance of engineering science is of great importance. It is perfectly true and it must be weighed in the balance when we consider the industry. It is extremely difficult to measure, but it is something of the greatest importance, and if there were no aircraft industry something else would have to be invented to take its place.

I intend to speak only, and not for a long time, of the development of civil aircraft. The development and production of civil aircraft are now having to stand on their own feet. That is to say, in future they will be less and less able to depend upon the research and development of military aircraft and types for defence. There are one or two exceptions, to which the Minister of Supply drew attention, but, on the whole, civil developments in future must stand on their own feet, and by that I do not mean only that they will not be supported by Government finance, but that they will have to develop along paths separate from those of military aircraft.

When we talk about the development of the civil aircraft industry, there is a great deal of double-thinking. We are subject to a barrage of propaganda, to large half-page prestige advertisements, and to perhaps one of the strongest lobbies in the country. It is not surprising that the British people are proud of developments in the aircraft industry as of all our engineering and industrial products. There are many developments of which we can be proud, but we are too much inclined to think of the industry in terms of the prestige and glory which it brings to its engineers and manufacturers when we should be thinking about it in terms of hard cash.

Let us look at the industry not from the point of view of prestige, but entirely from the point of view of what return it brings to our economy. There has been only one successful British airliner since the war, and by "successful" I mean an airliner which operates not only from this country but in foreign markets. Only the Viscount family of British civil aircraft has in service over 100 aircraft. There are well over 300 of the Viscounts 700 and 800. Compared with this one aircraft, of which there are over 100 in service, there are in the United States 10 aircraft, of which there are over 100 in service. There are very nearly 4,000 American transport aircraft in service in the world, and there are 600 on order. There are 560 British airliners in service, and 163 on order, mostly to British airlines. These figures are taken from an extremely interesting paper given by Lord Douglas of Kirtleside to the conference held by the Institution of Production Engineers, in April.

It is interesting to note that the 600 American transport aircraft still on order are of five basic types, whereas the 163 British aircraft on order are of six basic types. We begin to see from this one of the reasons why the cost of development and production of British aircraft is so much greater than that of American aircraft. We have been told that there are approximately 40 Vanguards on order at present. The Minister of Supply, in his extremely interesting and factual speech drew attention to these facts, but I do not think that we have really faced them. The American industry has the advantage not only of the orders from the American Air Force, of which we are all so well aware, but of very large orders from its own internal civil airlines.

This came out very clearly in evidence which was placed before the Select Committee on Nationalised Industries which examined the air Corporations. In Appendix 10 of the Committee's Report we print a memorandum from the Ministry of Supply on "Governmental Assistance to Civil Aircraft Industries", which gives astonishing figures of the numbers of aircraft ordered off the drawing board in the United States.

The memorandum states: Airlines are reluctant to order aircraft that have not been ordered in the countries of their origin either by domestic airlines or by the Government. In the case of all the aircraft referred to above, the initial orders came either from the Services or a domestic airline, and orders from these sources facilitated the establishment of a major foothold in world markets. As we know, with very few exceptions, no one buys an aircraft which has not flown in its own country first. The airline orders for the Boeing 707 total to date 180.

Figures have been quoted in the debate relating to what our industry has achieved since the war. The Minister of Supply said that over 80 per cent. of our exports since the war have been of military types. I have seen a slightly lower figure quoted, but at any rate it is somewhere around that mark. Therefore, in the last ten years, when our total aircraft exports have totalled £653 million, civil exports represented in that period about 5 per cent. of the industry's output. Of this, about one-half are engine exports. To this not only have the Government contributed £550 million to research and development, but a substantial additional support to the industry has come in the past from defence orders.

Much of what I have said has been said earlier in the debate in another form, and in his speech the Minister of Supply put the facts in an admirable if academic way. What is extraordinary to us on this side of the Committee is that with his knowledge, which, after all, has been in the possession of the Government presumably for many months, the right hon. Gentleman comes to the Committee, throws the facts on the Box as it were, and asks the Committee to decide his policy for him.

I can well understand that the right hon. Gentleman hopes to be able to "pass the buck" in two or three months' time to another Minister, but it is extraordinary that the right hon. Gentleman can come to the Committee, give a first-class and objective statement of the position and then say, "Although we know all the facts, we are incapable of making up our minds ".

The truth is that the Government have not got the political courage to grasp this nettle, for the reasons given in the speech of the hon. Member for Belfast, East and because of the various constituency pressures put on the Government in this matter, apart altogether from the great pressure coming from the industry itself. I have no constituency interest in this matter and I am prepared to face the fact that we must make up cur minds about the industry and decide what we have to do.

It is clear that we cannot hope to compete in every part of the industry. We must carve out for ourselves, if possible, a niche in which we can become, and perhaps remain, preeminent. This is where a committee of inquiry could do useful work. That niche might well be found in certain types of smaller aircraft, in medium-range aircraft and in certain types of engines. I am not in a position to say what types they might be, but I am certain that we must concentrate our research, development and manufacture on a limited number of types.

Then, as many other hon. Members have said, and as the Minister himself said, we must give up the attempt to do these things by ourselves in the more expensive sections. We must try to cooperate with other European countries. For instance, I am certain that it would be impossible for us to enter the supersonic jet aircraft race by ourselves. Figures of the cost of doing this are often thrown about and range between £100 million and £600 million. I will quote Mr. Peter Masefield, who gave £300 million as the cost of developing a supersonic jet aircraft.

The point the Committee must remember is that the orders for the aircraft, given the speed at which it will cross the Atlantic and the number of routes on which it is likely to fly, will probably be very small indeed. As we have already been told, no other country is likely to buy the aircraft until it has been flown here, so we shall have to start with 6 or 10 aircraft which will cost about £300 million, and it might then fail to sell abroad, as others have failed to sell. I am certain that it would be a waste of public money to attempt to do this by ourselves.

We must collaborate, therefore, with the continental manufacturers on this aircraft. We might then be able to produce the resources, and the orders which are equally important, to compete with the Americans, but, first, we must get agreement with the continental airlines to place orders on a sufficiently large scale to make such a project worth while, and we should have to get agreement on a division of labour: research, development and manufacture. It would be a complete waste, in view of our shortage of scientific and technical manpower, and in view of the backwardness of many of our industries, to put our resources into such a project in this country.

All this means a substantial contraction of the aircraft industry, which must be faced, and I understand that the Minister is facing it. It must be done in an orderly and planned manner. As was pointed out by the hon. Member for Belfast, East, the industry makes a great contribution to engineering research and development and particularly to the development of new materials, metals and processes and also to the development of skills, of which there are many in the industry.

Luckily, the skills of its engineers and workers can be converted to other industries requiring a fine degree of skill and professional knowledge. Many firms are already doing this, but in my opinion there are other ways in which we might use the resources at present available in the aircraft industry. What would happen in this country if, instead of spending £300 million on the supersonic jet aircraft, we divided that sum into 300 separate million pounds and devoted it to research in other industries? What would happen to the cotton textile machinery industry, now being superseded by the Swiss? What would happen to the machine tool and instrument industry? There are a number of such industries where we could usefully spread these scientific resources, and in that way we would not have all our eggs in one basket but a much broader spread of our industrial development for export.

If we continue to devote the main part of our scientific resources to one or two projects such as the supersonic jet aircraft and nuclear power stations or flying to the moon we shall end by having backward industries and nothing to sell. This problem must be faced, and I am convinced that nobody has yet had the guts, certainly not this Government, to face it. The Minister of Supply funked the issue completely when he came to the Box today, threw the facts on the table and said that the Committee should decide. I do not know what other hon. Members may think, but I have made up my mind on this mater, and I shall be interested to hear, when the Minister winds up the debate, that his right hon. Friend has now been able to make up his mind on what is his duty in this matter.

7.47 p.m.

Mr. William Shepherd (Cheadle)

The hon. Member for Edmonton (Mr. Albu) has said a great deal of sense in his speech. He has been able to speak with freedom because he does not represent any aircraft interest. Although I represent a substantial interest, I hope to speak with equal freedom. I want to utter a word of protest about his rather hurried peroration, in which he said that the Swiss textile machinery manufacturers had superseded ours. That is not really true. What is true is that the Swiss have some very specialised developments, especially on control and other devices, which have certainly passed ours, but it would not be true to say that the generality of our textile machinery was hopelessly outdated.

Mr. Albu

Would it not be true to say that in textile machinery, as in machine tools, we export weight and they sell us sophistication?

Mr. Shepherd

That is not necessarily so, because we have some sophisticated machinery in the Lancashire textile industry. I would prefer to say that the Swiss, with their special experience, have gone off into perhaps the more sophisticated line of development, particularly on controls and machines of that kind. We have not seen fit to follow them, and there may be wisdom in our not doing so.

I suggest that I represent a substantial interest in my constituency since we have there the Avro factory which, as hon. Members will know, is a large one and has an honourable, and I hope I may say without any question, a not too expensive history. The aircraft which have come out of the Avro factory have done a magnificent job and have cost materially less than other aircraft coming out of other factories.

It is exceedingly difficult to make the sort of speech one wants to make about this industry. The difficulty is enhanced by some of the speeches which have been made by hon. Members opposite this afternoon. I absolve the right hon. Member for Belper (Mr. G. Brown) from that criticism, because his speech was sound in most respects and I hope that the industry will read with attention what he had to say. However, there were some hon. Members opposite, particularly the hon. Member for Reading (Mr. Mikardo), who can hardly help sneering in every other sentence, who made very irrational and unreasonable criticisms of the industry.

I hope that hon. Members and the country at large will realise how tremendous are the problems facing the men who run an industry such as this. It is not really an industry at all. It is a wildly expensive form of industrial insanity. This is a condition forced upon those who engage in it. It is not a question of doing things in a rational and economic way. It is a question of having to face pressures of all kinds, national prestige and meeting the demand of the customers who also engage in a form of economic insanity and who buy aircraft more expensive than they can afford and in greater quantities than they can afford. Therefore, those of us who sometimes have to be critical of the industry should appreciate the tremendous problems which face people in it at the behest of Government decisions, international pressure, technological progress, or the extreme demand of their customers. In this country there is also the disadvantage of duality of voices which are raised when aircraft are ordered.

However difficult it may be, we should not avoid facing the facts. The facts are that the industry presents the nation with the biggest problem of any industry in the country. There has been much criticism by hon. Members opposite of the apparent inability of my right hon. Friend the Minister of Transport to find the answers. People who believe that the answers can easily be found are those who do not understand the problems. I should not like to be pessimistic and say that this is an insoluble problem, because it is not, but I do not know a situation in British industry which is so difficult to solve as this is. Those who criticise my right hon. Friend ought to pause and think of the immense difficulties in the way of finding a solution before they indulge in this hurried and ill-considered criticism.

Industry has undergone a dramatic change. In a sense the same sort of dramatic change has taken place in the last fourteen years as that which took place in general industry in this country after First World War. After that war, America went ahead at an enormous rate because of the impetus of industrialisation during that war. It can be said that at the end of the Second World War we had the same sort of superiority over the Americans in aircraft production—certainly in quality and advanced design —as we had in general industry over America in 1914.

What happened in general industry from 1914 onwards has unfortunately happened in the aircraft industry. Today there is no doubt about the predominant position of the United States, which has used its enormous resources and its immense drive to bolster up this industry to a pitch at which it is exceedingly difficult—I would not say impossible—for less favoured nations to hold a balance against them.

We now find ourselves in an extremely hazardous position, and while we are very properly saying that our exports have reached record figures, the industry is nevertheless facing a grim future. I urge the Committee not to attempt to minimise the difficulties which face the industry and which are very real. I think that it can be said without doubt that we have lost the lead which we had in 1945, with the exception that we have some advantage—although it is slight and possibly diminishing—with aircraft engines. That factor ought to be a lead to us in determining our future policy for the industry.

Many people will say that this failure, this change in the position with America now dominant, is due to the inability of private enterprise. That is often said by hon. Members opposite. I would not like to say that there has not been any failure of private enterprise. I say without hesitation that there has often been a failure to think and a failure to create and seize opportunities, but that is by no means the sole reason for the present somewhat distressing position.

There have been tremendous technical changes and some extraordinary bad luck, because the great change in defence policy was a shattering blow to an industry previously largely dependent on defence orders. It has certainly been largely due to the immense growth of the strength and volume of United States efforts.

Undoubtedly, during the Korean War in 1950 the industry was blown up to a size larger than was justified. What has to be faced, whether we like it or not, is that it has come down to a size which is certainly not larger than that which obtained at the beginning of the Korean War. Being cautious, I prefer to say that the industry will have to come down to a size smaller than that which obtained in the pre-Korean era, because since that time there has been a marked decline in the use of military aircraft in warfare. I expect that there will be a much lower level of activity than there was in the pre-Korean period. It may well be that at least 50 per cent. of present floor space and at least 50 per cent. of present manpower will have to leave the industry.

Many people have said that the British industry is at a great disadvantage because of the predominance of the American industry. That is quite true. Perhaps people in this country do not realise how much the Americans are dependent on military orders, which is a tremendous disadvantage to our own constructors. In this country there is about 25 per cent. dependence on military orders and 75 per cent. dependence on civil orders. In the United States of America, despite the many transports which were detailed by the hon. Member for Edmonton, American producers depend for about 75 per cent. of their business on military orders and for 25 per cent. on civil orders. Our industry here has to face a very difficult situation.

Some hon. Members have said that the Government have not done enough to help the industry. That is a constant complaint of hon. Members opposite. As one representing a constituency concerned with aircraft manufacture, I do not share that view. Indeed, I believe that the Governments' mistake has been to assist the industry too much and too long. If the White Paper indicating the change had come in 1954 instead of 1957, the position of the industry today would have been very much more satisfactory than it is. The truth is that if there is private enterprise, it must, as far as possible, be compelled to stand on its own feet.

If private enterprise is heavily subsidised by the Government it exhibits nearly all the objectionable features of State enterprise and there is the additional disadvantage that one has less control over it. I do not, therefore, make the case against the Government that they have given this industry too little support. On the whole, they have given it too much support. They supported the industry for too long and told it to get on its feet at what was perhaps the worst possible time. If the public knew some of the amounts of money that had been given to aircraft companies for abortive developments they would be horrified. I hope that we shall not hear too much from hon. Members on both sides about the inadequacy of what the Government have done.

Some hon. Members say that the Government ought to do more and one is faced with the question of the way in which they should do more. Should the Government give more money in general to the industry, or should they give more money specifically? These questions must be answered. If I were asked whether the Government should give more money generally, I would have no hesitation in answering. The industry must be reduced to approximately half its present size. Any form of general increased assistance would slow down that process. The reduction must be achieved with the greatest possible rapidity consistent with reasonable social conditions in the interests of the industry itself. Any dramatic increase in the general support available to the industry would be against its better interests.

If we consider specific increases in the industry we face a question which is not so easily answered. There may well be a case for more specialised assistance to some firms and the withdrawal of projects from others. It may well be that in this field the Government could show a little more realism and drive. Of course, it would be asking a lot of a Government a month or two before an election to make discriminating moves of this kind, but it is a field in which there might be some Government action.

Mr. Diamond

Does the hon. Gentleman mean a month, two months or three months?

Mr. Shepherd

A month, two months or three months. That will keep the hon Gentleman guessing.

When hon. Members opposite say that my right hon. Friend the Minister of Supply ought to do more, I wonder whether they have considered how difficult his problem is. If one considers the military side, one has a reasonably straightforward situation. Our main concern must be with civil aviation because military aviation is bound to die out as time passes and we hope that civil aviation will increase. It is no good hon. Gentlemen saying that the Minister ought to do this, that or the other, because in civil aviation today we face a despairing situation.

There is not one single product in progress today on the civil aviation side which has any reasonable prospect of selling abroad in sufficient quantities to get its makers out of a loss.

Lord Balniel (Hertford)

The DH121.

Mr. Shepherd

I hope my hon. Friend is right, but one must remember that this aircraft will not be in service until 1964 at the earliest. The Caravel is already in service and the Super-Caravel, which will be similar to the DH121, will be in service before 1964. The Convair 880 will be in service shortly, and the DC9 is likely to be in service before the DH121. I hope that De Havilland's will be able to sell the DH121 in substantial quantities overseas, but if I were taking a commercial view of this I should look round at these competitive products and say, "By jove we have got something to meet here". One can have the best aircraft, but if it comes out two years behind similar aircraft it will not be possible to sell it.

During the last few years the British aircraft industry has been guilty of producing aircraft too late. We are coming into almost every field one, two, three, four or even five years behind our competitors in America. What is worse, in some cases we are behind our competitors in Europe. The most disheartening aspect in the aircraft industry during the last two years has been the phenomenal industry, ingenuity and drive of the French industry, and the relative slipping back of the British industry.

Why is it that the French are bringing out the Caravel five years before we can bring out something similar when they are using 50 per cent. British parts?

Mr. Diamond

Is not the French industry nationalised? Might that not provide the answer?

Mr. Shepherd

I do not think it does. Part of the industry is nationalised, and part of it is not. Some nationalised parts of the industry have produced good planes, and some good planes have been produced by the non-nationalised side.

One therefore does not want to draw too much on the argument of nationalised versus private enterprise. It is exceedingly unfortunate that we are producing aircraft that are years behind in their arrival dates of our competitors both in the States and Europe.

As one who likes to defend the British aircraft industry, I do not know of any reason why the Caravel should be produced by the French largely with British parts five years before we could do it, or why the Fokker Friendship should have been produced years in advance of the Argosy, again with 62 per cent. of British parts. The only answer is that if one feeds people with Government money and they can have an easy time they will not be on their toes commercially seeking the opportunities to advance. I am convinced that had we put the industry on its own feet two or three years before we did we should not today see the industry so far behind many of its foreign competitors.

My right hon. Friend the Minister of Supply faces an extremely difficult situation. It is no good pouring public money into propositions which, by all reasonable commercial calculations, will not sell overseas. The issue that the Committee has to face is not that of some dole to the industry but how we can devote our national resources to making the aircraft industry what it was sight or ten years ago, a world leader.

The first thing that has to be done is to reduce the size. A lot of aircraft manufacturers are hanging on in the hope that they are going to get more Government support which will enable them to carry on at their existing levels

Mr. Christopher Boyd (Bristol, North West)

They are hoping for a Labour Government.

Mr. Shepherd

That may well be—I know that the Labour Government are champion dolers-out of public funds.

Many aircraft manufacturers are hanging on to their human and material assets. The hon. Member for Edmonton said that the aircraft industry is commanding scientific and technological resources which might well be used to advantage in other directions. I hope that the industry will try to effect the quickest concentration, so that it is best fitted to meet the task before it and is not guilty of wasting any of our very scarce national resources.

Secondly, we must concentrate upon engine production. We have been almost as successful in producing engines as we have been unsuccessful in producing air frames. We still have a slight lead in engine manufacture. Some British firms have been foolish enough to produce both engines and air frames. This form of insanity should not have been allowed to go on as long as it has, because the great American industry realised many years ago that if a company wanted to be ahead it could not produce both engines and air frames. Therefore, I hope that those firms which are producing both engines and air frames will decide which to give up. They will have to do that if they want to stay in business. I should like to see a specialisation in engine manufacture, where we have an advantage.

Thirdly, we must cut down the number of projects. I understand that in the world today there are over 500 civil aircraft projects on the drawing board or in various stages of production, but it is questionable whether more than six will make a profit for their producers. Because of the excessively large number of makers, this country has a proportionately large number of types in hand. We must cut down that number. If we had cut down on the number of types years ago we should not have spread as thinly as we did our scientific and technical resources, and we should not now have been so behind on delivery dates and production.

My next positive suggestion has already been actively canvassed in this Committee. One of the saddest things today is our position in relation to that of the European aircraft industry, when one realises what we might have been able to do four or five years ago. I know that we can blame the Government for some things. There is no doubt that in the provision of supplies for N.A.T.O. we have not proceeded as actively as we should have done. We have stepped outside rather too daintily. But we cannot exclude aircraft manufacturers from criticism. Four or five years ago they took the view that they did not need any European assistance, and that to link up with European manufacturers was somewhat undignified, because we were in the lead of the Europeans. Now the situation is almost reversed. It is urgently necessary for us to associate ourselves with our European friends in the industry as quickly as possible.

As the right hon. Member for Belper said, already one American engine is being produced under licence in Germany, and one can readily see a situation developing in which Germany will produce engines, under American licence, for the use of European aircraft produced by France and Holland, and in service for N.A.T.O. requirements. Urgent steps must be taken to ally ourselves as rapidly as possible with European firms in order to work progressively together. I would pay a tribute to one manufacturer who is already doing so, namely, De Havilland. This firm is developing an engine produced by the General Electric Company of America which will eventually be sold to France. We hope that De Havilland's may also produce the aircraft in this country, if it is successful. That is the pattern that we want to see, and I hope that the industry will pursue it very actively.

In addition, we must invest in the future, and it is in that connection that we have a most critical decision to take. How are the Government to spend money in order to give our industry its rightful position? The intention of the Government must be directed to the point at which they can put our industry back into the lead in six, seven, eight or nine years' time. Many ideas have been canvassed. Some hon. Members opposite seem to think that we have only to say that an aircraft is a vertical take-off aircraft, and to pour a great deal of money into it, for everything to be all right, and that we should also put a lot of money into helicopters. I know of nothing which has had so much money put into it as the helicopter, but there is not yet a commercial one in existence. I hope that my right hon. Friend will resist these blandishments. It may be a long time before there is any substantial market for the vertical take-off aircraft, and I suspect that it will be a very long time before there is a commercial market for the helicopter.

We must carefully consider the question of supersonic transport. I doubt whether we can afford to spend £300 million or £400 million upon the development of a supersonic transport aircraft. I doubt whether we could do it with any degree of commercial success. The Americans have said that, given the money, they could have a supersonic aircraft flying within thirty months. That may be a slight exaggeration, but that is what they say. We have no hope of doing that, and it is no good our bringing out a supersonic transport aircraft four or five years after the Americans have successfully launched theirs on world markets. We should try to get some kind of liaison with the Americans. Perhaps we can adopt their techniques. I understand that the Americans have developed a technique, which we have not got, for brazing steel for a supersonic aircraft. We may be able to produce the aircraft, and the engines for it, under licence.

It is a great misfortune that the development of the British supersonic engine—the Gyron—has been dropped by its makers, because it is a project which would be worth our while to carry on. I hope that the Government will provide money for some kind of supersonic engine to go into an airframe which we may produce under licence from the Americans.

Next, we should alter the pattern in the industry, under which the Corporations dictate the order policy. At the moment, the requirement of any British civil manufacturer is virtually dictated by B.O.A.C. and B.E.A. It is not necessarily the case that aircraft which B.O.A.C. or B.E.A. desire to have will sell in the world market. If we do not sell our aircraft in the world market, we had better not produce them, because no manufacturer can produce an aircraft purely to meet the British demand without incurring an enormous loss on the project. I hope, therefore, that my right hon. Friend will bring pressure on the Corporations and alter this pattern.

The British aircraft industry should drop this nonsense about always using British components. If the people who produced the Britannia had gone to the United States or elsewhere to buy components, instead of relying on people in this country to produce them especially for that job, there would not have been the trouble which there was at the beginning of the life of the Britannia. It is unreasonable to expect British manufacturers to make a few specialised components for one project when there is no future need for them. Yet the stupid nonsense continues of insisting that everything put into every aircraft shall be British. We ought to use the best components that we can obtain, irrespective of where they come from. The world desires an aircraft which is absolutely reliable, but that will not be achieved by producing an aircraft packed with new components which are virtually untried.

If we are to succeed we ought to be able to produce more economically than is the case at present. Our wages are about 7s. an hour compared with 20s. in America, and it is absurd that our costs are as much and in some cases more than in America. It is true to say that the Americans have a better system of production, but aircraft manufacture still remains a one-operation job; they cannot be mass-produced although it may be that things are fabricated more effectively in America than in this country. But there is no reason why the immense disparity in production costs should not be reflected in the cost of the product. I cannot understand why British aircraft manufacturers, with roughly the same sort of production methods and one-third of the labour costs, cannot sell their aircraft more cheaply than the American product. I think that we have a long way to go in the matter of reducing costs.

I am sorry that I have spoken so long. It is the first time that I have taken part in a debate of this kind. I hope I have not given the impression that I am too disheartened about the prospects of the British aircraft industry, but I feel it unwise to give ourselves the glory that the Daily Express sheds on the industry from time to time. According to the Daily Express, when we produced the hovercraft the problems of the industry were solved, but I do not think that there is any future for us unless we face reality. In doing so we may reflect that in this country we have people who are as good at this business as one may find anywhere in the world.

Our manufacturers, technicians and workers are as good as any in the world.

If we do not try to do the impossible, and if we concentrate on the things we can do, I am convinced that Britain will be making and selling the aircraft that must be flying in increasing quantities along the civil airlines of the world.

7.24 p.m.

Mr. Christopher Boyd (Bristol, North West)

We have listened to a fascinating speech from the hon. Member for Cheadle (Mr. Shepherd), who has no need to apologise for speaking at such length. Obviously, he had prepared his speech with care to keep in line with his party shibboleth, but as he warmed to his theme his personal knowledge of the subject took possession of him and he began to flay the aircraft manufacturers—first in the interests of the Government; and later throwing caution to the winds and weighing into the Ministers as well. I am sure that hon. Members on both sides of the Committee enjoyed listening to him. His strictures on the Daily Express were well deserved. I cannot comment on all the other interesting things which the hon. Gentleman said, because were I to do so my speech would be excessively long.

The hon. Gentleman was right to emphasise that this industry is faced with some peculiar difficulties of organisation. We still have too many types of aircraft. Only once since the war have we broken even on the manufacture of an aircraft. Whether it be the Government or the industry, someone should have been cutting down on the number of types. But, whatever happens about the future of the industry, the airlines of the world are bound at a particular time to go in for one type of aircraft. All the aircraft designers are scrambling to produce the design which will provide what people want. Once someone has dared to decide on the winning design for a particular generation that is likely to be followed quickly by every airline in order to avoid being left behind.

It would seem that the aircraft industry has to face a world in which at any one time very few types of aircraft, perhaps only one airliner, will be in demand in large numbers by all the airlines, which are expanding rapidly all over the world. Therefore, a great many aeroplanes of that type will be needed at one time. That problem can be solved only when we have the same aircraft being produced by every manufacturer. The only way to provide some sort of continuity of employment, some sort of order in the industry, would appear to be by separating the designing from the manufacture of aircraft.

I think we require a lively spirit of emulation among rival teams of designers, although at the same time it would be desirable that the knowledge, the discoveries and the advances made by one group of designers should be available to assist others. To combine those two needs appears very difficult in a situation where we have a collection of private firms competing with each other, because necessarily they try to keep their secrets from each other. In my opinion, only the State can provide a framework in which there can exist competition between groups of designers, and facilities for making all the available knowledge known to everyone, and so assist their efforts to produce the best design. Only in that way can this country hope to make the fullest use of its resources, brains and knowledge in its efforts to get a design sufficiently in advance of that produced in America to have a chance of getting the orders from the airlines of the world.

It has been rightly emphasised that we have to be well ahead in order to get these orders. It is quite understandable, and the Minister said so himself, that Continental airlines and Defence Departments, too, tend to take the American rather than the British design, if there is not too much difference and there is not too much certainty that the British product is superior. They have American finance, and always, from the security point of view, they want to increase the American interest in the safety of their countries. We have to be as far in front as we possibly can in order to have a chance. The hon. Member for Cheadle was saying we should not be afraid to buy components from other countries and get the cheapest and quickest, and I think this is very relevant.

Many hon. Members have mentioned the difficulties which have been increased by the creation of the Common Market and the failure of Britain so far to get into any trading arrangement with the Continental countries and this is a very serious threat to the whole future of our aircraft industry.

I hope it is agreed, although not all of my hon. Friends seem to agree about this, that it is worth while making the effort to ensure the continuance of an aircraft industry in this country, not only from the point of view of the aircraft industry itself and those employed in it, but also from that of the benefit that accrues to many other industries from the technical advances achieved by a competitive aircraft industry and the benefit to industry in general.

The Minister says that we must get into the European market. To my mind, we shall soon come to the stage when we shall have to work out arrangements by which we can come to terms with the American market. Unless we are prepared to remove the prejudices on both sides and have this sort of interchange between Europe and America, such as providing British engines for American airframes and our buying components for our aircraft from America, it may be difficult, except on those lines, to achieve a future for a substantial aircraft industry here. I must say that the effort should be made, and that it will be worth while making a big effort, though the outcome cannot be certain in such an uncertain field.

It seems to me that a good many hon. Members have been unduly pessimistic about the rate of expansion of civil aviation. One hon. Member mentioned some statistics and drew an unnecessarily gloomy conclusion from the slowing up last year of the rate of expansion. Even so, he mentioned that there still was expansion of about 4½ per cent., I think he said, in the total amount of civil flying or freight flying last year.

Mr. McMaster

The slowing up of the rate of expansion was solely in the expansion of passenger flying. What I was trying to stress was that the expansion of freight flying had a great future and was very much higher than that in flying passengers last year.

Mr. Boyd

I am much obliged. What I was trying to suggest was that even during last year, a year of world recession, with a drop in production of about 12 per cent. in America—and conditions there dominated the rest of the world-even in that year, civil aviation continued to expand to some extent, and, in fact, in earlier years, the rate of expansion was fairly considerable. The hon. Member mentioned a figure of over 15 per cent. When I was looking at the figures, it appeared that in any four-year period since the war the amount of travelling from and to this country, or the total amount of passenger travelling round the world, was about double in each of those four-year periods. I think that 15 per cent. per year works out at compound interest to about the same thing, so that our figures approximately tally.

With that great expansion, it must mean a considerable increase each year, and there was quite clear evidence, quite apart from that recession, that it had not come to an end. The figures which the hon. Member gave even for the latest year indicate a tremendous further expansion in world civil aviation, anyway. Although it is true that larger aircraft are being made, not all the designs increase in size as they proceed, and certainly there has been a reduction in the size of one type. It may be that a smaller number of aircraft of higher speed will take up a larger proportion of the available traffic. But with that enormous expansion of air traffic there must inevitably be in the course of time a continuing expansion of the aircraft industry.

The question for us is whether in ten years' time we can still get a reasonable share of world production of aircraft, or whether, in the meantime, we shall have allowed our aircraft industry to break up and disappear, so that it is no longer able to compete for the expanded traffic of ten years' time. By that time we should have reached the stage of having expanded enough to offset fully the falling away of military aircraft production—that is, more than two doublings, in that period—if anything like the previous rate of expansion is to take place.

Some hon. Members have doubted whether the expansion in the aircraft industry will continue. Let us consider that for a moment. Aviation is the most recent method of travel. Let me compare it with its predecessor, the motor car. The motor car industry is still rapidly expanding, and so is the number of motor cars on the road. Only in America is motor transport anywhere near to saturation point. Throughout the rest of the world, if the standard of living continues to increase, we must expect for some considerable time an expansion of motoring and of the motor car industry, because motoring has by no means reached saturation point in the world as a whole. How much less likely then is it that the next phase of transport, aviation, is anywhere near the end of its expansion?

If it is true that it is reasonable to suppose that civil aviation has this large and dramatic expansion in front of it, what we are considering at the moment is not the permanent decline of the aircraft industry—unless we allow that this country should go out of production of aircraft in favour of countries like the United States, Germany and France—but how to get over a temporary period of decline in military aviation until civil aviation will have expanded sufficiently fully to take its place. Therefore, there is an exceptional case for asking the Government to do something artificially to accelerate the expansion of civil aviation during this period of recession to minimise the depth of the trough into which the aircraft industry has to fall, and to develop it rapidly so that it will be in a strong position in ten years' time. We may lose a lot of the most ambitious people, experts, technicians and skilled craftsmen, from the industry to other industries in this interval, and it might not be possible for them to be won back later on.

I have been in correspondence with the Government on this matter. There is a special case for trying to stimulate expansion of civil aviation. I put the matter to the Government like this: The air Corporations have their particular points of view. They do not necessarily want to order an aircraft suitable for other airlines; it is not their interest. It is much more the interest of the Government, the Board of Trade and the Ministry of Supply. We cannot just leave it to the interplay of the manufacturers, the air Corporations and the Air Force all acting separately, and the Board of Trade also acting separately. Someone has to give a lead somewhere and try to concentrate orders on a particular aircraft which can serve a variety of needs both of this country's airlines and R.A.F. transport and also to be a strong bidder for selling abroad.

It seems that the Government have failed to do this, judging by the figures which have been given. We have had four different aircraft in recent years and they have only added up to enough orders for making one worth while. Instead of a couple of dozen Britannics in Northern Ireland, if Britannias had been ordered they could have been run off much more quickly. Then we could have got an aircraft which was more up to date and helped to make one particular aircraft fully in the clear as a commercial proposition. That is an example.

It is necessary for the Government to take some initiative. It may be difficult for politicians and changes of Ministers, all subject to constituency pressures and so forth. Maybe what is needed is that the permanent civil servants at the head of the Ministry of Supply, or whatever Ministry is considered suitable, should be tough enough to keep their Ministers in order and to see that pressures which play on the Ministers are subordinated. One cannot help suspecting that little dollops are given out here and there because that is easier politically. I may be wrong, but the Committee should be on guard against that danger. We do not want democracy to be inefficient and earn discredit for itself as it has done in some other countries.

Even if all our efforts reach more success than we anticipate, I suppose we all accept that some decline in the aircraft industry in the next year or two is inevitable, but I hope the Minister will assure us that the Government are not holding back a large dollop of redundancy until after polling day. I hope they will try to ensure that it is gradual and as little as possible. At this time in any industry which is having to contract there is a specially strong case for instituting a 40-hour week so as to share the work which is available. It would be well worth instituting that in the aircraft industry at present.

That is all I have to say, and it boils down mostly to the need for more leadership from the Government. I should think we can only get maximum results out of an industry of this kind by coordination on a national scale, if not on an international scale, of a kind which can only come from public ownership.

8.44 p.m.

Lord Balniel (Hertford)

I am very glad to have the opportunity of following the hon. Member for Bristol, Northwest (Mr. Boyd) who, if he does not think me presumptuous, I should say made a very sensible speech which should commend itself to the whole Committee. In particular, I should like to refer to one point he made if I have time during my speech. That is the point about concentration of orders rather than the dissipation of orders—which I think was the word used by the hon. Member—that we have seen in the past. When speaking about the concentration of orders on one instead of two or three types, the hon. Member was touching a key problem in the industry.

I shall come to that matter later, but perhaps, first, the Committee will allow me to refer to what I admit is a purely constituency point of view. My right hon. Friend is well aware of and very sympathetic with the difficulties which we are having in my constituency in maintaining employment in the de Havilland aircraft works. In normal circumstances, I should make the difficulty of maintaining employment the main part of my speech, but I cannot help feeling, after the very important speech, indeed, the crucial speech, made by my right hon. Friend the Minister of Supply, that it will probably be more in the interests of my constituents if refer to the general factors affecting the future of the aircraft industry. Before coming to those matters, however, I shall ask one or two questions about the de Havilland Aircraft Company.

My first question concerns a matter which has been raised a number of times this afternoon. Is there any possibility of the order which B.O.A.C. has placed for the Boeing 707, or some part of it, being shifted in favour of the Comet? I realise quite well that the Comet was not designed as a trans-Atlantic aircraft. I realise that, on the westward trip, the Comet has to make a stop before arriving at New York. I realise, also, that, for the trans-Atlantic trip, the Comet has had to be specially fitted with pods for holding fuel.

Nevertheless, the Comet is proving to be an extremely successful money-spinner for B.O.A.C. I think that the load factor is 92 per cent., which certainly is not the load factor of the Boeing 707. Is there any possibility at all of some of the Boeing 707 order being transferred to the Comet? It is an extremely difficult question at this very late stage, but I should very much like to hear from my right hon. Friend about it.

The order for the DH121 is a very limited one. I think that it amounts to only 24 aircraft. From the company's point of view, it cannot possibly be an economic proposition. Is there, within the knowledge of my right hon. Friend, any possibility of orders coming? If there were further orders for the DH121, the employees in the company, who are, of course, extremely concerned about their future employment prospects, would be reassured.

In my view, we face a very simple question in the aircraft industry in general. Do we, as a nation, regard a strong and healthy aircraft industry as an absolutely essential part of our economic life? I was a little disturbed to hear the hon. Member for Bristol, North-West say that some of his right hon. Friends did not regard the aircraft industry as an essential component of the economic life of the country.

Mr. Boyd

I did not mention any of ray right hon. Friends. I hope very much that my right hon. Friends have more sense than one or two of my hon. Friends whom I had in mind.

Lord Balniel

HANSARD will prove it. Perhaps I have exposed one more split between the back benches of the Opposition and the Front Bench.

Assuming that we in this Committee do regard the preservation of the aircraft industry as essential to this country, the second part of the question which we must put to ourselves is: are we satisfied with the existing structure of the industry, whereby the entire cost of all basic research is borne by the Government, if the entire finance of producing, developing and proving an aircraft is borne by private industry?

I do not wish to discuss the strategic implications of the aircraft industry except to comment on what was said by my hon. Friend the Member for Cheadle (Mr. Shepherd). He cast doubt on the advisability of proceeding with designs and plans for a supersonic airliner on the ground that it was unlikely to be a commercial success. This is very understandable when one bears in mind that the total cost of developing a supersonic airliner must be between £400 million and £600 million. I think that those figures are right. Therefore, of course, the possibility of supersonic airliners travelling at 2,000 miles an hour is, from a commercial point of view, extremely doubtful. I do not, however, consider that we ought to regard it from a commercial point of view alone.

In the past, we have always regarded military orders as the basis on which civil orders can be developed. Just as the Boeing 707 is a direct child of the Boeing tanker, ordered in massive quantities by the United States Air Force, the Boeing tanker itself is a direct child of the Boeing 52 bomber. Therefore, whereas, in the past, we have always regarded civil aircraft as the children of military aircraft, when we move into the field of supersonic aircraft we in this country might well regard military aircraft as the children of civil aircraft. I do not think that we should take a decision only on whether to go into the supersonic field for purely commercial reasons. We should consider the implications that it would have on the development of a supersonic bomber in this country.

The aircraft industry is, in my eyes at least, fundamentally important from the point of view that it gives a great impulse which is transmitted into almost every sphere of major engineering. The aircraft industry is a kind of pinnacle. It is a direct force for the research and development of many of the greatest industries in the country. It certainly has a direct impact on radio, metallurgy, electronic control, precision engineering, and on the production of power units. All this arises from the fact that the aircraft industry is working at the very frontiers of technology, and its impact on the technological standards in the country as a whole is a very direct and important one.

In a Committee like this, which has considerable knowledge about aircraft, it is perhaps rather trite to talk about the tremendous rate of technological advance in this industry, but if we do not take the rate of technological advance into account we will fail completely to understand one of the main factors in the aircraft industry. Perhaps I might give an example. I believe that I am right in saying that the American Lockheed Company, if given the orders, is prepared to place in commercial operation by 1965—only six years hence—a supersonic airliner which will travel at 2,000 miles an hour. I should have thought that for the leadership which the aircraft industry gives in technology and its impact on industries throughout the entire industrial life of this country, it is incumbent on the Government to see that they do not falter and fail.

I suppose that many people in the country are not really concerned about and do not realise the implications and strategic importance of national prestige and the importance of maintaining this leadership in technology, but, merely from the financial point of view and because the aircraft industry brings into this country export orders worth £150 million a year, I should have thought that the Government were bound to do what they possibly could to assist it.

The prospects before the aircraft industry are not very happy at the moment. Military orders have dwindled. The whole aircraft industry has been stripped of what was almost a cocoon of military orders which supported it when hon. Members opposite were in office. My right hon. Friend said that he expects that employment in the industry will be run down from about 245,000 persons to 150,000.

The difficulties lying before the aircraft industry fall into two categories. First, there is the difficulty of financing expenditure at the pre-production stage of development of an aircraft. Secondly, there is the continuing and ever-present difficulty of a home market which is quite inadequate to support an aircraft industry of any size. I should like to comment only on the first of these two problems.

As hon. Members know, the costs of pre-production in the aircraft industry are simply immense. The pre-production cost of an aero engine in use in a modern jet airliner is in the region of £15 to £20 million. The pre-production cost of an air frame for a modern jet airliner is another £15 million. This total cost of about £30 million has to be spread over a period of five years, during any moment of which a competitor might jump in with a rival aircraft and so nullify the entire expenditure and all the work which has been done.

In this country, the entire finance of the pre-production phase and the entire risk have to be borne by the private investor. In no other major aircraft-producing country is this the case. In Russia, which is rapidly becoming a serious competitor of our aircraft, the costs are borne by the State from beginning to end. In France, where the aircraft industry is largely nationalised, again the finance and the risks are borne by the taxpayer. In the United States, where there is private industry, the whole industry is cushioned from harsh economic reality by the massive military orders, massive to such an extent that 90 per cent. of the entire production of the American aircraft industry is devoted to military orders.

In face of that kind of competition, if we are to continue to see a strong, healthy and vigorous aircraft industry, the Government must be prepared to underwrite the risks which are borne by the aircraft industry. There is nothing revolutionary in this. It is the situation which existed when the military orders were forthcoming in large quantities. I do not want to specify in any detail how this underwriting should be done, but perhaps the most suitable and the easiest way, which would leave freedom and flexibility and the many advantages of private industry, at the same time supporting and butressing what all would agree to be one of our most vital industries, is to follow exactly the procedure that was followed when we tried to develop, in the first instance, the Comet, and also the Viscount, whereby the Government, placing their money on an aircraft which they considered to have a great future, and which would be an asset to the nationalised air corporations, guaranteed to buy a certain number of the aircraft if they did not sell in the overseas market, but, in the event of the aircraft selling successfully, their manufacturers guaranteeing to recoup the Government by a levy on the profits that were made by the sales of aircraft overseas.

Mr. Diamond

Does the noble Lord mean that if a loss is sustained the whole of it is borne by the Government, and that if a profit is made the loan is repaid?

Or does he mean that if a profit is made, a continuing payment is made, so that the State gets a share of the benefit of the profit made by the manufacturer?

Lord Balniel

The latter explanation given by the hon. Member is the one I am trying to convey. It is exactly the system which operates with the Viscount. I believe I am right in saying that the profits which have been made on the Viscount are continually being paid back to recoup the Treasury for the money which it advanced.

About a year ago, my right hon. Friend was bringing great pressure to bear upon the aircraft companies to reorganise themselves. The orders that were needed for the new aircraft for the nationalised air corporations were being withheld until the aircraft companies had agreed to reorganise themselves and create stronger units of production with stronger financial resources. Out of that have grown many important aircraft companies; for example, Airco, the combination of Fairey, Hunting and de Havilland, the combination of Vickers-Armstrong and English Electric and the combination, which was announced only yesterday, between Saunders-Roe and Westland.

If, however, my right hon. Friend brings pressure to bear on the aircraft companies to concentrate themselves into more powerful units of production with greater financial resources, then I think that it is right that a quid pro quo should be demanded from the Government. Here, I should like to take exactly the point made by the hon. Gentleman the Member for Bristol, North-West. The quid pro quo is surely to concentrate the orders of the Government. At the moment, they are being dissipated between quite a number of companies, and I would urge that instead of, say, 20 DH121S, half a dozen VC 10s, and a few Short Britannics, my right hon. Friend should try to concentrate orders to one or two companies.

9.0 p.m.

Mr. Frank Beswick (Uxbridge)

We come soon to the end of another debate on aircraft production and probably the last on the subject that we shall have in this Parliament. Whatever Ministers may say as to their plans, what power they will eventually have to put their plans into operation is, of course, something which the people of the country will decide. No doubt, that thought has been behind speeches from both sides of the Committee and has had a moderating influence.

There has been some controversy today, as my hon. Friend the Member for Reading (Mr. Mikardo) pointed out, particularly in some of the speeches of hon. Members opposite, as between the beginning and the end of their speeches. That was specially notable in the speech that we had from the Minister of Supply. There has also been some common ground. Despite all the criticism that anyone can make of this industry, there is no doubt that in this Committee and outside there is a good deal of good will and good feeling towards the industry. That applies not only to the old people, but to the young people, as well, as anyone who has children will bear out.

The reasons for this special and peculiar importance of the aircraft industry have been stated before and I have no need to go over them again although I myself place special importance, as was mentioned by the hon Member for Hertford (Lord Balniel) upon the contribution which this industry can make to general engineering advance.

I am not ashamed to use the term "national prestige" in this matter. It is becoming an almost old-fashioned phrase to use. The difficulty is to decide on what we are going to base our prestige, and I have made no secret of the fact that I should like more and more to place our national prestige and economic and social influence in the world upon our technical advances, especially in the field of aviation.

There is no disagreement about our objectives. We want a firmly-based British aircraft industry, serving the British operator, selling abroad, and pushing ahead all the time with economic and technical developments, tackling rather fewer tasks maybe, but what we tackle should be accomplished superbly well. If we agree about the end, it cannot be said that we agree about the means to that end.

I join with those who recognise the pleasant character of the speech which the Minister of Supply made today. I do not think that it can be said that it was possible to discern from his speech a really clear, firm and coherent policy in aviation. At the beginning of last year, when the industry ran a particularly high temperature, there were urgent appeals made to the Government to help. Ministers were beseeched, lobbying was intense, and a policy was promised. I remember that there was delay. Expectations were raised, the tension increased and eventually we had the great statement about the future of the British aircraft industry. How pathetically inadequate that statement was has been shown by events since then, by the debate today and by what has been said by hon. Members on both sides of the Committee.

The Minister now says that no one is happy about the industry. The Prime Minister has expressed concern. The companies' chairmen are crying for help and up and down the country men are being put off. From Hatfield, Hawarden, Hurn, Weybridge, Coventry and up to Prestwick—all over the country, we hear the same cry about skilled men losing their jobs. It is not enough to say that many of them are finding work. What we really want to know is whether the nation is enjoying still the skills which they acquired.

Moreover, what we also want to know is whether this contraction which the Minister has said he has planned is leading to the greater efficiency of the industry. So far as we can judge, that is not proving the case. The old faults of the industry are still there. We still hear, and we have heard today, of the delays in placing orders. Every time the Minister mentions a new aircraft type he has to confess—"freely," as he said on Monday—that there are delays.

It is not my purpose tonight to run down our own side. I always remember what the late Lord Wavell said, that when things are going badly for oneself one should think how equally difficult they are for the enemy. Certainly, in this business of aircraft, there are troubles for our competitors as well. An hon. Member went out of his way today to run down the Comet IV as against the Boeing 707, but the fact is that the Boeing 707 is not really an intercontinental aircraft, either. It is not a trans-Atlantic aircraft and I gather that its economics are not proving very well. It lost a wheel, an engine, and then there was the undignified spectacle of its undercarriage giving way. The DC8 is not even with us. I am informed that not only its price but its fuel consumption has gone up, and if and when it does come along it is not likely to be able to cross the Atlantic. So it is not only here in this country that we have these difficulties.

The Minister's great specific for releasing the potential skill of our industry has been, apparently, rationalisation. Last year, he told us that there were 14 major airframe firms and five major aero engine firms, and he suggested that they could be cut down to four air frame firms and two engine firms. Today, he has said that he is quite satisfied with the way this process of rationalisation is proceeding.

Mr. Aubrey Jones

No.

Mr. Beswick

The right hon. Gentleman told us he was satisfied. HANSARD will show.

Mr. Aubrey Jones

The hon. Gentleman will forgive me, but I think that what I really said—I cannot recall my exact words—was that there was progress, but that much still remained to be done.

Mr. Beswick

It is, of course, quite true that the Minister qualified nearly everything he said, but the general impression he left was that rationalisation, the specific he has for the industry, is going reasonably well. The right hon. Gentleman instanced various ways in which he thought it was working out.

However, the fact is that, despite everything he has done, there are today two more major firms in this industry than there were to begin with, setting aside the possible consequences of the merger which we read about this week between Westlands and Saunders Roe. One of the new firms is Bristol-Siddeley, under the leadership, trained in public enterprise, of Sir Arnold Hall. It has bedded down well and we are glad to see it, but it is another unit. The other newcomer, Airco, is a consortium of companies, as the noble Lord the Member for Hertford said, and that, too, is in the field. But that is not rationalisation. It is duplication.

I must say that whatever solution we eventually find for the DH121 problem I cannot think that it will be solved more easily because there are three more firms to take into account--apart from the engine manufacturers.

Sir A. V. Harveyrose—

Mr. Keswick

I ought not to give way, because I have not much time, but the hon. Gentleman may perhaps prefer to interrupt me when I refer to him. He said that he could not understand the present position of the DH121. I can understand his difficulty, although I think I also can guess at the reason for the Minister's lack of clarity.

Let us understand what has happened, and what has been said about it. It was only on Monday this week that the Minister told us: I have no responsibility for the D.H. 121, which is a matter between the operator and the manufacturer."—[OFFICIAL REPORT, 13th July, l959; Vol. 609, c. 3.] At the beginning of his speech today he told us how he had compelled De Havilland's to find the finance themselves for this project, and he said that from that time when it agreed to find the finance he had no standing in the matter. But what now? What are we to gather from what he said at the end of his speech? Apparently, he has some standing, or intends to have some standing. If he has to find some money for this project, clearly there should be some accountability to him as to what kind of aircraft it will be.

But it is worth considering the implications of this, quite apart from the question of finance. The success or otherwise of this machine, the short or medium-range jetliner can help to make or break the British aircraft industry. There can be a mass market for this machine, as there was for the DC3 and its true successor, the Viscount. It is clearly in the national interest that there should be some part played by the Government in this venture. Equally clearly, the Government administration and the present relationship between the industry and the Government cannot be considered satisfactory in so far as it has led to these delays. It is now over eighteen months, and there is still confusion as to what really is the position.

I do not want the Minister of Transport and Civil Aviation, when he replies to the debate, to cloud the issue on this point with stories about the way in which the RB141 engine developed in power. We are very pleased with that technical achievement, but we should like to know about public responsibility in this matter. Is there to be public money for this venture? If there is, on what basis is it to be made available? Can the right hon. Gentleman really justify an arrangement which has led to this muddle of divided responsibility? What lessons have the Government learned for the future?

So much for the DH121. I should like to say a few words about the extraordinary case of the Handley Page Herald. We have to consider this question against the background of the Minister's declared satisfaction at the way in which rationalisation is going. Here we have the Handley Page Herald and the Avro 748, which are intended for precisely the same market, and the Minister has bought three of each. Either he has some reason for believing that the Avro 748, still on the drawing board, will be superior to the Herald, in which case he should not have bought the Herald, or else, if it is not superior, he has absolutely no excuse for spending money on the Avro 748.

The right bon. Gentleman may reply that India has promised orders for 130 of the Avro 748, but if there is this big order in the pocket already why should the public advance money to this firm? If Hawker Siddeley had conserved half the money which it has distributed to shareholders, it would not have to come to the Treasury for assistance. If the Transport Commission had been treated as generously betwen 1945 and 1955 as has Hawker Siddeley, it would not be in the position which it is in today.

There has been talk for years about the part which Transport Command could play in the development of civil transport aircraft. Hon. Members opposite have always regarded Transport Command as a very convenient instrument through which public money could be injected without criticism of its being a public subsidy. On our side, we have said that if Transport Command had been allowed to transport Service men and materials it could have provided a good part of that home market which we all say is necessary.

It has been interesting to hear again today from both sides of the Committee that if there were full and proper cooperation between military and civil transport requirements as envisaged by the Transport Aircraft Requirements Committee, we could have developed basic designs on which we could have eventually built our aircraft for the civil markets. I agree with the noble Lord the Member for Hertford, who mentioned the classic case of the development of the Boeing tanker into what we now know as the Boeing 707. The only time we came near to exploiting the possibilities of this civil-military partnership was with the V1,000, that was cancelled, left half-finished on the stocks, because there was not a single Minister in the Government who had enough knowledge of the aviation business and enough authority to persuade the Cabinet that we should have carried that project through. There is absolutely no excuse for pointing to what Sir Miles Thomas said or did in this business.

Sir A, V. Harvey

Would the hon. Gentleman suggest, then, that the Government should over-ride the advisers of B.O.A.C?

Mr. Beswick

What I am saying is that if there is a national requirement and a Minister with enough knowledge of the needs of the industry, he should have the guts to say, "This machine will go on. It will be developed because we believe it is one for which there will eventually be a market". It would have been built for Transport Command, it was a Government responsibility, and I am sure that the development of the Service transport aircraft would have sold in the civil market as well.

What is now the position of Transport Command? Service Ministers have boasted that it is equipped with modern aircraft, namely, the Britannias and the Comets. The Britannia order for the Royal Air Force is not yet delivered and, in any case, it is an obsolescent aircraft. The Comet II was never ordered for the Royal Air Force. The R.A.F. was compelled to take these machines as part of a salvage operation to prevent the firm concerned from running into serious financial difficulties. That was the reason why Transport Command had to take on the responsibility for operating the Comet II.

I must say that since it has taken on the Comet II they have done a good job of work. Transport Command has gained a lot of experience from operating jet aircraft, but it is my information that for safety reasons the operating life of the Comet II is now being shortened and that in two or three years' time there will be no large jet transport aircraft in Transport Command. In other words, Transport Command is progressing backwards. Throughout the 1960s, under present planning, it will have no big jet transport to operate. I challenge the Minister of Transport and Civil Aviation to tell me whether that will be the case or not.

Then we have the affair of the order for the Britannic III. We were told today that the real reasons why the machine was ordered were, first, that it had a larger fuselage and, secondly, because of a certain telegram. The Minister of Defence, however, did not seek to justify the purchase in the first place by reference to any telegram, nor indeed did he refer to the size of the fuselage. As a matter of fact, my information is that the size of the fuselage was not a critical factor in the purchase.

What the Minister of Defence told us were the reasons were that the machine was much the same as the Britannia, and, therefore, would come along more quickly: that it would be cheaper to produce, and would sell in the world's markets. Now we gather that it is practically a different aircraft. The delivery dates are slipping back. The only similarity, indeed, between the Britannic III and the Britannia will be the wing tips and the air in the tyres, as far as I can make out.

Mr. McMaster

Would the hon. Gentleman tell me why, if the shape of the fuselage is not important, it is not important that a medium-sized tank can be carried in the centre of the Britannic which could not be carried in the centre of a jet aircraft adapted for the purpose?

Mr. Beswick

I am not proposing to go into details on this matter, but the particular item of equipment which can be carried in the Brittanic III could be carried in two other jet aircraft which could have been built in Britain. Moreover the item of equipment concerned was not one for which there was a very frequent requirement. In all other respects a straight jet British aircraft could have performed the task necessary.

The Minister of Defence (Mr. Duncan Sandys)

Will the hon. Gentleman say when I said all the things that he has attributed to me, and what I said?

Mr. Beswick

What the right hon. Gentleman said—and he will see it in HANSARD—when we questioned him on the reason for this order was that delivery would be quicker and that there was an expected order in the overseas markets and that because this aircraft was based on the Britannia it would be cheaper to produce.

Mr. Sandys

Does the hon. Gentleman know when I said all that?

Mr. G. Brown

We will look it up for the right hon. Gentleman.

Mr. Beswick

If the research facilities of the Minister of Defence are not adequate, I can give him the reference. If I have been misleading the Committee I shall withdraw, but I think that the right hon. Gentleman will find that what I have said is correct.

If I am not correct, I invite the right hon. Gentleman now to say with which of those matters he does not now agree. Did he not agree with the delivery? Did he not agree with the price? Did he not agree that the aircraft would sell in overseas markets? If he does not agree with those three things, and if they were not behind the decision to order, the matter becomes even more confused. I do not see why we should quarrel about this, because I understand that all the quarrelling is going on in the Cabinet.

What really came into this matter was what might be called, and what is generally called, "politics ". I am not against "politics" coming into a purchase of this kind, if, by "politics", we mean that Government purchases should serve a wider economic and social purpose. If it was a question of finding employment in Northern Ireland, then that should have stood very high in the considerations which the Government took into account. I am not contesting the necessity for giving the order to Northern Ireland. What I am saying is that this specification, which has not yet been decided and for which firm orders have not been placed, was not the best way of helping Northern Ireland in the long run. That is my view and it is shared by others.

Although the Minister of Supply appeared to say this with qualifications, I say without qualification that I agree that the rock-bottom question is that of finance. Where is the money to come from? This is primarily a question for civil aircraft, but since we agree that in future the industry will depend on civil aircraft we are here talking about the future of the entire industry.

A year ago, and in part of his speech today, the Minister of Supply was saying that the industry must become self-supporting. It is true that he said that for the time being the cost of research would be undertaken by the Government, but even that, he thought, would be progressively assumed by the industry itself. We are now told that there is to be some kind of ad hoc aid. There have been little bits of aid in recent months—£750,000 to this firm and £750,000 to another. The cost of proving flights is now to be charged to Government account, apparently, and now we have the possibility, the hint, of some ad hoc aid being given for the new engine for the DH121.

Mr. Aubrey Jones

This is a most important matter. I repeat that I have given no hint at all of the possibility of Government financial aid for the new engine for the DH121.

Mr. Beswick

If there is no question of Government aid, I do not see what the second part of the right hon. Gentleman's speech was about, because he appeared to be leading up to the fact, and on the other side of the Committee fingers were shaken wisely in recognition of this evidence that the company was to be helped. I shall be very interested to learn in what other way help will be given other than by indirect or direct financial aid.

I was going on to say that I shall continue to criticise the provision of financial aid on an ad hoc basis. What we want is a clear and discernible plan upon which financial aid is granted.

As my right hon. Friend the Member for Belper (Mr. G. Brown) said, it is surprising today how few people in this industry talk in the old terms. There may still be some who shake a righteous fist at all forms of public ownership, but they are usually men who have already got their other fist in the public purse. The fact is that when we look at the question of finance I do not see how we can leave out the State, and if we are to bring in the State then very much wider questions are opened up than have been put forward by the Minister in his speech today.

I was impressed by what the chairman of Vickers Armstrong had to say earlier this year. He said that unless aid was forthcoming this country is more than likely, and sooner than some people might expect, to find itself without a real aircraft industry at all. I was impressed by that remark, because I should have thought that Vickers Armstrong had made more strenuous efforts than any other company in the country to make itself self-supporting.

Why is there this financial difficulty? I do not think that we should overestimate the importance of the contraction of the military demand. Certainly, that magnifies the problem, but that is not the basic trouble. We are seeing in this country what has happened and what will happen elsewhere. The tools of production have become too expensive for competitive private enterprise to buy. The sums involved and the risks entailed are too big for private industry to carry.

It is worth while looking at the figures again. Before the war a reciprocating aero engine cost a few thousands of pounds. The cost of a gas turbine engine today is between £15 million and £20 million. It is now not a matter of waiting for five years for a return on that expenditure. It is a matter of waiting from fifteen to twenty years for a return on these large capital sums. Before a single sheet of metal was shifted in the Weybridge workshops to build the Vanguard there was an expenditure of millions of pounds on jigs and tools. Vickers need 80 aircraft to go through the production line before it stands a chance of breaking even. At present moment, it has had orders for only 40.

Making a £30 million take-over bid for an established business with tangible and physical assets is very different from expending the same sum of money on one article of production which may yield no return for at least ten and probably fifteen to twenty years, and which may, for no discreditable reason, not find a market at all. Those figures are big enough, but they are completely dwarfed when we come into the supersonic age. One hundred million pounds have been mentioned for one aircraft of the supersonic type, and other estimates have been for two or three times that sum. I am told that the Committee which advised the Ministry of Supply about this matter spent £750,000 simply in working out the sums. And the machine which is recommended, as the Minister told us today, is, in any case, out of date and too modest in its scope.

A lot has been said about the American effort. I am told that the Americans are thinking about and spending money on a machine which is intended initially, to fly at 15,000 to 20,000 miles an hour at 150,000 to 200,000 feet. The United States Secretary for Air informed the Appropriation Committee of Congress the other day that the allocation for this venture had been cut by 136 million dollars. What the total cost was, I could not say.

This is the industry that we are talking about. This is the industry about which we have to decide whether we shall stay in or not. If we are going to stay in, we must change the basis upon which the industry now rests. It just is not feasible to advance financial aid in bits and pieces, and on an ad hoc basis. I have no doubt that hundreds of men will consider this debate as partly academic. Some will probably think that another little Government order will ensure the payment of next week's salaries or wages. But many of the most thoughtful of the executives are getting completely "fed up" with this hand-to-mouth existence. They want to see the industry put upon a firm basis. We cannot approach the problems of the industry in the way in which the Minister of Supply approached them today. He is approaching a twentieth or a twenty-first century industry in the old nineteenth century laissez, faire way, und for that reason I shall ask the Committee to divide tonight.

9.30 p.m.

The Minister of Transport and Civil Aviation (Mr. Harold Watkinson)

We have had a very good, fair and factual debate, and I will try to respond to the mood of the Committee by looking at a slightly different aspect of the problem, which was covered by the hon. Member for Uxbridge (Mr. Beswick). My right hon. Friend gave what the Committee accepted as an accurate and penetrating analysis of the production side, and I want to look for a moment at the civil sphere, apart from the marketing of military aircraft. Nobody has challenged the fact that this is a difficult transitional period for military aircraft. On the whole, the situation has been handled very well. It is to the civil sphere and the export market that this great industry must look very largely for its future. We would all agree about that, and we probably disagree, as the hon. Member for Uxbridge has said, only as to the means of achieving this.

Let us consider what the Government are doing and propose to do, about the problem. Hon. Members opposite have been very restrained in putting forward their solutions. I listened carefully to the right hon. Member for Belper (Mr. G. Brown) and the hon. Member for Uxbridge, but I could not discern what their solution was. It has been said this afternoon that there is no convenient focus within the Government for the discussion of these matters. I would point out that, to begin with, there is the Transport Aircraft Requirement Committee, on which the Corporations, the Air Ministry, my Ministry and all other aircraft interests are represented. The Committee reports to my right hon. Friend the Minister of Supply, and he, the Secretary of State and I are in constant consultation, pooling developments arising in our different spheres of interest. I do not accept the charge that we do not have proper co-ordination. Nor do I accept the right hon. Gentleman's idea that some sort of inquiry, which would fob off any decision for months, would advance the case of the aircraft industry.

The Government are doing four things. First, they are trying to give the industry the broadest possible base, and some continuity—although the industry must contract—because that is very important. I shall return to that point in a moment. Secondly, I want to announce some plans to try to stimulate world air traffic. Thirdly, I want to say what we are doing to try to get the largest share of that traffic for Britain, and, fourthly, what we are doing to encourage sales.

First, as to the problem of giving the industry a fixed base and some continuity for the future, the Corporations have now rightly committed themselves to an expenditure of no less than £220 million in aircraft either in service or on order. That is a very formidable sum, but it does not provide enough, in many cases, to give a sufficiently large order to make a particular aircraft type profitable. Nonetheless, it has an important part to play, as I shall show in a moment. Also, the Corporations have the important job of trying to expand the market by expanding themselves. I will give two examples.

I am glad to be able to tell the Committee that B.O.A.C. will renew its services to the east coast of South America on 25th January next year. They plan to operate two Comet IV frequencies a week to Rio de Janeiro, Montevideo, Buenos Aires and Santiago. I think that this news will be welcomed in South America. I hope it will sell more Comets in South America where there are distinct possibilities, and it is a good example of the kind of co-operation which exists between the Corporations and the aircraft industry.

Secondly, I should like to mention the remarkable achievement of the independent airline in pioneering the exclusive tour business. Now B.E.A. have rightly got into that business, and good luck to that Corporation. But we should not forget that it was the independent companies who pioneered this quite new type of business. Nor should we forget that the independent companies have bought modern aircraft and are part of the home market. For the aircraft industry it is Government policy that the Corporations should buy British, except when that is absolutely impossible; that they should buy as many aircraft as possible and fly them in such a way as to provide the best shop window for the industry. I consider that hon. Members opposite are greatly in error in constantly denigrating the independent airlines, because they too have a part to play.

Many hon. Members have spoken today about a supersonic project. My right hon. Friend announced the design study of a supersonic aircraft. Here we have great difficulties to face. I have recently been in America talking to my opposite numbers and there is no doubt that the Americans may well produce a civil aircraft capable of Mach 3, and that is quite a formidable proposition.

Therefore, I think I should make plain that while this study is going on, while the Americans and ourselves are brooding over this very difficult next step, some of the problems should be faced. At San Diego there has been a conference of I.C.A.O., and one of my deputy secretaries fed the British delegation to that conference. The Committee would like to know that the conference came to the view that we should take this step very slowly and consider the social problems associated with supersonic transport, especially noise, and all the other difficulties which arise; because we rushed into the subsonic jet era much too quickly and without proper consideration, as those who live round London Airport know only too well.

It is Government policy to press on with this study and to seek co-operation with other countries, because I think it right to say that this is something which we cannot do alone. But none the less we must make plain that what the world wants, what airlines want, is ten years in the subsonic jet era to recoup some of the vast amounts spent on aircraft which are only just going into service. Unless we have such a period, these great new jets, both British and American, and the French Caravelle, will lose vast sums of money for the airlines which use them. If we can have a ten year period in this era the face of the industry may be changed, because for once, a model may run through its probable life.

It may be that this will not happen. That is why I think it is the duty of the Government in I.C.A.O. and elsewhere, to point out the difficulties. While we must press on with development we should try to make the next step in a fairly orderly manner. We are also examining the prospects of vertical take-off, which I think has very great civilian prospects, as well as military. But on that particular front, which I would say is that we are doing all that we can to try to get a period of reasonable stability, which would be very important, for example, for the VC 10 and our big jets. In order to try to make people realise that, I should add, as an American manufacturer said recently, the accompaniment to the supersonic jet would mean a noise like distant thunder. As Minister responsible for airports, I must say that I am quite sure that people living round airports will not tolerate a constant noise of distant thunder over their houses. There are a great many problems to be faced on the subject of noise before we move into the supersonic age.

Now, we come to the next step which the Government propose, which is to try to stimulate a public upsurge in traffic. Passenger traffics are going up this year anyway, but we believe, judging by the experience in the North Atlantic and the economy fares, that the world is doing itself out of a very big rise in airline passengers by the refusal of I.A.T.A. to have a sensible method of reducing world aircraft fares. Therefore, I want to say, with the Government's full support, that B.E.A. and B.O.A.C. and the independent airlines will go to the I.A.T.A. Conference in September determined to press for a reduction in fares What they want is a fare reduction on the European, African and Eastern routes, and I say with all seriousness that I hope LATA, will approve this proposal.

If it will not, we shall have to reconsider our position in I.A.T.A., and also, if it will not, we shall have to consider what we can do in our own cabotage area, where matters are still under our own control. I have had quite a number of very interesting proposals from independent airlines and from the Corporations for their cheap fares. They are not necessarily on scheduled services, but they are all very interesting propositions. I am studying them very carefully, and, because this is of vital importance, I say that if we cannot get an orderly reduction by I.A.T.A., we shall have to do the best we can with our own resources, as well as considering our position in I.A.T.A.

May I now turn to the turbo-props? In the Vanguard, we have a turbo-prop which is not only better than its specification but is a very cheap aircraft to operate, and I believe that if we could get this fares reduction it might completely change the outlook for that type of aircraft. We might then have a two-tier structure of what we might call the bus passenger—low prices and high density—and those passengers who want to go higher and faster using the jets. Government policy, therefore, at the moment is to concentrate on the reduction in fares.

Mr. Boydrose—

Mr. Watkinson

I am sorry, but I have a great deal to say.

Perhaps I could mention in passing, although it is clearly not a matter that Parliament can deal with this Session, that I do intend to press for some central licensing authority, which would license both operators and organisations. It will do both sides of the job, but it needs legislation, and proposals are now being worked out.

Now, I come to the third thing which the Government are doing, which is to try to get the largest share for our country. We should be very grateful both to B.O.A.C. and B.E.A. for the very hard work they have put in quietly, and I do not intend to disclose entirely tonight their plans to expand their influence across the world. B.O.A.C. recently got a new arrangement with Australia and Qantas. Talks are now going on with India and Canada, and it is my hope that we shall get a much closer Commonwealth link up—something we have wanted very badly for a long time, and something that might be the first step to a common Commonwealth aircraft policy, as well as a common Commonwealth airline policy. That is very difficult, and it will take some time to achieve, but there would be such enormous gains, if we could secure it, to the Commonwealth as well as to ourselves, that I am hopeful that we shall make some progress.

Mr. Beswick

Everybody will be very pleased to hear that, but does the right hon. Gentleman intend to tell us that his plan to license independent operators also to go down the Commonwealth routes to Africa will expedite this policy?

Mr. Watkinson

The hon. Gentleman will get another half-day on Monday and he can have another go at it then.

As to Europe, B.E.A. does not for the moment intend to join Europe Air, as it was originally called. It is in very good relations with its competitors. For example, it has a most successful pool with Air France, and it proposes to continue it with the independent members and to press forward with new arrangements with other countries in Europe which I will not specify at the moment. It might be very interesting and might again offer the chance of selling more aircraft. The two Corporations are playing their part, and I hope that we can get the biggest possible share of the business.

I come to the fourth thing which the Government are doing which is to try directly to encourage aircraft sales. In passing, I would remind the House that in the past four years E.C.G.D. has issued guarantees on aircraft and aero-engines amounting to no less than £160 million, so there is a little Government support there. It is important now to examine the truth of what the Opposition have said, namely, that we do not have a policy.

In my view, we have the best possible policy, indeed, the only possible policy we could have in this industry. We have to try to pick winners. In the Viscount, because of the partnership between B.E.A. and Vickers which developed it, we had an aircraft which sold well and made a very large profit for the Government as well as for B.E.A. The problem that faced the partnership—[Interruption.] If the hon. Member for Uxbridge really means that his policy is for partnership then we do not quarrel with him. The policy is to try to pick more winners, and to try to pick certain types of aircraft which we think might be winners.

We are aiming at three particular markets. They are the Dakota replacements; the medium-range aircraft, and the long-range Atlantic market.

I am asked why we backed the Herald and the Avro 748, which I am glad to say has just secured a very satisfactory Indian order. The Herald is a very good aircraft. It is two years ahead of the 748. We thought it was quite wrong that the chance should be missed now to sell more aircraft against the Fokker Friendship and other competing aircraft. Therefore, I think it right that my right hon. Friend has done a deal which will enable B.E.A. to operate three Heralds on their Scottish services, where they will be very useful. They will fly the flag, and I hope that they will have the right backing to enable us to break into this promising and profitable market. We have also promised similar support to the Avro 748.

I come to the story of the DH121 about which hon. Members have asked me. The simple story is that it was designed for B.E.A. as a medium-range aircraft. As development went on it became more and more apparent that what the B.E.A. wanted—and, indeed, the world wanted—was a jet Viscount-replacement. In the meantime, the Rolls Royce engine which was originally designed for the aircraft had developed too much thrust through the efficiency with which it had been designed. It is quite natural and wise that a certain amount of redesigning has been going on of the aircraft and of the airframe, as well as with the engine.

There is no doubt that the next biggest market for the DC3 replacement is the Viscount-replacement market. Some of it might be filled with the Vanguard if we can get the fares down. There is undoubtedly in Canada, America and all over the world a great market for a small jet replacement of the current-generation Viscount. Lord Douglas and de Havillands, or Airco, the combination, in my view are doing the right thing by the aircraft industry and the country to make quite sure that the proposition on which they are working is tailored to a world market as well as the 24 for B.E.A. They will not make a lot of money out of 24. The essential thing is to try to attract foreign business as well as to pilot the pump-priming order.

In the meantime, there is the possibility of selling more Comets. There is not, unfortunately, the possibility, so to speak, of swapping Comets for Boeings, because that is not matching like with like and the Boeing ordered by B.O.A.C. has a British Rolls-Royce Conway engine in it. I agree that the present Boeing and DC8 are not up to specification and are having the normal teething troubles which one expects. I entirely dissociate myself from the very mischievous speech of the hon. Member for Reading (Mr. Mikardo), who spent a long time denigrating the aircraft.

Mr. Mikardo

Does the right hon. Gentleman dispute the facts?

Mr. Watkinson

What I do dispute is the mischievous way in which the hon. Member put them, because he intended—

Mr. Mikardo

The right hon. Gentleman does not dispute them.

Mr. Watkinson

—to do the maximum damage to the aircraft industry, to my right hon. Friend and anyone else on whom he could lay his tongue.

Mr. Mikardorose—

Sir Thomas Moore (Ayr)

Order.

Mr. Mikardo

I am perfectly in order. It is not for the hon. Member to keep order in the Committee, but for the Chair. I am grateful to the right hon. Gentleman for giving way. He has still not disputed any of the facts I quoted, and he cannot.

Mr. Watkinson

I am not disputing that the Britannia had its teething troubles, like any other aircraft.

Having dealt with the three main types of aircraft, I think we must also have a low-cost freighter aircraft. That is the reason for the Argosy and the Britannic, and we also have a vertical-lift aircraft. I very much hope that B.E.A., after final negotiations with my right hon. Friend, will be able to place an order for six Fairey Rotodynes in the near future. My Ministry is working on the programme for landing sites for them, and the Committee had its first meeting today. We may be wrong, it may not be a winner, but the view of B.E.A. and my view is that it is a winner and that this vertical-lift aircraft can give a city to city transit with fifty or sixty passengers and might be another Viscount in its own sphere.

There again is an example of the Government trying to pick winners and, quite properly, supporting them in one way or another. We are not doctrinaire. We do not say there should be some standard type. What is proper for one aircraft is not proper to another. Through the Corporations, through direct assistance or the military requirement, we want to try to back the kind of winners I have described. It is quite a good "stable", and I think there must be some in it which will do as well as the Viscount. In the air world traffic is growing again. In the first six months of 1959, B.O.A.C.'s passenger miles were up 14 per cent. and B.E.A.'s up 20 per cent. That compares with an increase of only 6 per cent. and 3 per cent. for the corresponding period last year. I hope we are coming out of the doldrums of the stability, or recession, we had last year in air traffic. Therefore, I do not take such a gloomy view as some hon. Members who have spoken today. I think that if the aircraft industry gets the support the Government are willing to give it, it is prepared to hold on and back its faith in what is still the best passenger aircraft in the world.

As has been said, the Vanguard is ahead of specification, whereas the DC8 is far below. That is the tradition of the British aircraft industry, despite what the hon. Member for Reading says about its difficulties. In the end, it has the best aircraft in the world.

I understand that the Opposition wishes to divide. I do not know why. There is no Motion before the Committee, nor has the Opposition put forward any solution to the acknowledged difficulties

which confront this great industry. In his concluding remarks, the right hon. Member for Belper mentioned ulcers. I warn him that his party will suffer several political ulcers if it cannot be clearer about what its policy is.

The facts are as the hon. Member for Uxbridge nearly said but did not quite say: the party opposite really dares not mention its own solution because it is one that it knows would introduce a degree of State control which would be unwelcome to the industry and unworkable as a means of solving its problems. Therefore, I ask the Committee to reject the Motion which, I suppose, the Opposition will put forward, as making no contribution towards the solution of the difficulties of this great industry which I am confident it will overcome with the present Government's help and the courage which it has.

Mr. G. Brown

Since that long catalogue mentioning almost every plane that ever existed is no answer to the case that we have put from this side of the Committee, I beg to move, That Item Class VI, Vote 10 (Ministry of Supply), be reduced by £5. I wish that I could make the reduction much larger.

Question put:—

The Committee divided: Ayes 222, Noes 291.

Division No. 169.]	AYES	[9.56 p.m.
Abse, Leo	Collick, P. H. (Birkenhead)	Grey, C. F.
Ainsley, J. W.	Corbet, Mrs. Freda	Griffiths, David (Rother Valley)
Alba, A. H.	Craddock, George (Bradford, S.)	Griffiths, Rt. Hon. James (Llanelly)
Allaun, Frank (Saltord, E.)	Cronin, J. D.	Griffiths, William (Exchange)
Allen, Arthur (Bosworth)	Crossman, R. H. s.	Hale, Leslie
Awbery, S. S.	Cullen, Mrs. A.	Hall, Rt. Hn. Glenvil (Colne Valley)
Baird, J.	Davies, Ernest (Enfield, E.)	Hamilton, W. W.
Bellenger, Rt. Hon. F. J.	Davies, Harold (Leek)	Hannan, W.
Bence, C. R. (Dunbartonshire, E.)	Davies, S. 0. (Merthyr)	Hastings, S,
Benson, Sir George	Deer, G.	Hayman, F. H.
Beswick, Frank	Diamond, John	Henderson, Rt. Hn. A.(Rwly Regis)
Blackburn, F.	Dodds, N. N.	Herbison, Miss M.
Blyton, W. R.	Donnelly, D. L.	Hewitson, Capt. M.
Boardman, H.	Dugdale, Rt. Hn. John (W. Brmwch)	Hilton, A. V.
Bottomley, Rt. Hon. A. G.	Edelman, M.	Hobson, C. R. (Keighley)
Bowden, H. W. (Leicester, S. W.)	Edwards, Rt. Hon. John (Brighouse)	Holman, P.
Bowles, F. G.	Edwards, Rt. Hn. Ness (Caerphilly)	Holmes, Horace
Boyd, T. C.	Edwards, W. J. (Stepney)	Houghton, Douglas
Braddock, Mrs. Elizabeth	Evans, Albert (Islington, S. W.)	Howell, Charles (Perry Barr)
Brookway, A. F.	Evans, Edward (Lowestoft)	Howell, Denis (All Saints)
Broughton, Dr. A. D. D.	Fernyhough, E.	Hughes, Cledwyn (Anglesey)
Brown, Rt. Hon. George (Belper)	Finch, H. J. (Bedwellty)	Hughes, Emrys (S. Ayrshire)
Brown, Thomas (Ince)	Fitch, A. E. (Wigan)	Hughes, Hector (Aberdeen, N.)
Burton, Miss F. E.	Fletcher, Eric	Hunter, A. E.
Butler, Herbert (Hackney, C.)	Foot, D. M.	Hynd, H. (Accrington)
Butler, Mrs. Joyce (Wood Green)	Forman, J C.	Irvine, A. J. (Edge Hill)
Callaghan, L. J.	Fraser, Thomas (Hamilton)	Irving, Sydney (Dartford)
Carmichael, J.	George, Lady Megan Lloyd (Car'then)	Isaacs, Rt. Hon. G. A.
Champion, A. J.	Gibson, C. W.	Janner, B.
Chapman, W. D.	Gooch, E. G.	Jay, Rt. Hon. D. P. T.
Chetwynd, G. R.	Gordon Walker, Rt. Hon. P. C.	Jeger, George (Goole)
cliffe, Michael	Greenwood, Anthony	Jeger, Mrs. Lena (Holbn & St. Pacrs, S.)
Coldrick, W.	Grenfell, Rt. Hon. D. R.	Jenkins, Roy (Stechford)
Jones, Rt. Hn. A. Creech (Wakefield)	Oliver, G. H.	Sparks, J. A.
Jones, David (The Hartlepools)	Oram, A. E.	Spriggs, Leslie
Jones, Jack (Rotherham)	Orbach, M.	Steele, T.
Jones, J. Idwal (Wrexham)	Oswald, T.	Stewart, Michael (Fulham)
Jones, T. w. (Merioneth)	Owen, W. J.	Stonehouse, John
Kenyon, C.	Padley, W. E.	Stones, W. (Consett)
Key, Rt. Hon. C. W.	Palmer, A. M. F.	Strauss, Rt. Hon. George (Vauxhall)
King, Dr. H. M.	Pannell, Charles (Leeds, W.)	Stross, Dr. Barnett (Stoke-on-Trent, C.)
Lawson, G. M.	Pargiter, G. A.	Summerskill, Rt. Hon. E.
Lee, Frederick (Newton)	Parker, J.	Swingler, S. T.
Lee, Miss Jennie (Cannock)	Parkin, B. T.	Sylvester, G. 0.
Lever, Harold (Cheetham)	Paton, John	Symonds, J. B.
Lever, Leslie (Ardwick)	Peart, T. F.	Taylor, Bernard (Mansfield)
Lewis, Arthur	Pentland, N.	Taylor, John (West Lothian)
Lindgren, G. S.	Plummer, Sir Leslie	Thomas, George (Cardiff)
Mabon, Dr. J. Dickson	Popplewell, E.	Thomas, lorwerth (Rhondda, W.)
McAlister, Mrs. Mary	Price, J. T. (Westhoughton)	Thomson, George (Dundee, E.)
McCann, J.	Price, Philips (Gloucestershire, W.)	Thornton, E.
MacColl, J. E.	Probert, A. R.	Tomney, F,
MacDermot, Niall	Proctor, W. T.	Ungoed-Thomas, Sir Lynn
Mclnnes, J.	Pursey, Cmdr. H.	Warbey, W. N.
McKay, John (Wallsend)	Randall, H. E.	Watkins, T. E.
McLeavy, Frank	Rankin, John	Weitzman, D.
MacPherson, Malcolm (Stirling)	Redhead, E. C.	Wells, Percy (Faversham)
Mahon, Simon	Reid, William	Wells, William (Walsall, N.)
Mallalieu, J. P. w. (Huddersfd, E.)	Reynolds, G. W.	White, Mrs. Eirene (E. Flint)
Mann, Mrs. Jean	Rhodes, H.	White, Henry (Derbyshire, N. E.)
Marquand, Rt. Hon. H. A.	Robens, Rt. Hon. A.	Wilcock, Group Capt. C. A. B.
Mason, Roy	Roberts, Albert (Normanton)	Wilkins, W. A.
Mayhew, C. P.	Roberts, Goronwy (Caernarvon)	Willey, Frederick
Mendelson, J. J.	Robinson, Kenneth (St. Pancras, N.)	Williams, David (Neath)
Mikardo, lan	Ross, William	Williams Rt. Hon. T. (Don Valley)
Mitchison, G. R.	Shinwell, Rt. Hon. E.	Williams, W. R. (Openshaw)
Monslow, W.	Short, E. W.	Willis, Eustace (Edinburgh, E.)
Morris, Percy (Swansea, W.)	Silverman, Julius (Aston)	Wilson, Rt. Hon. Harold (Huyton)
Mort, D. L.	Silverman, Sydney (Nelson)	Woodburn, Rt. Hon. A.
Moyle, A.	Skeffington, A. M.	Woof, R. E.
Mulley, F. W.	Slater, Mrs. H. (Stoke, N.)	Yates, V. (Ladywood)
Neal, Harold (Bolsover)	Slater, J. (Sedgefield)	Zilliacus, K.
Noel-Baker, Francis (Swindon)	Smith, Ellis (Stoke, S.)
Noel-Baker, Rt. Hon. P. (Derby, S.)	Snow, J. W.	TELLERS FOR THE AYES:
O'Brien, Sir Thomas	Sorensen, R. W.	Mr. Pearson and Mr. Simmons
NOES
Agnew, Sir Peter	Bryan, P.	Erroll, F. J.
Allan, R. A. (Paddington, S.)	Bullus, Wing Commander E. E.	Farey-Jones, F. W.
Alport, C. J. M.	Butcher, Sir Herbert	Fell, A.
Amery, Julian (Preston, N.)	Butler, Rt. Hn. R. A. (Saffron Walden)	Finlay, Graeme
Amory, Rt. Hn. Heathcoat (Tiverton)	Campbell, Sir David	Fisher, Nigel
Anstruther-Cray, Major Sir William	Carr, Robert	Fletcher-Cooke, C.
Arbuthnot, John	Cary, Sir Robert	Foster, John
Armstrong, C. W.	Channon, H. P. G.	Fraser, Hon. Hugh (Stone)
Ashton, Sir Hubert	Chichester-Clark, R.	Freeth, Denzil
Atkins, H. E.	Clarke, Brig. Terence (Portsmth, w.)	Galbraith, Hon. T. G. D.
Baldock, Lt.-Cmdr. J. M.	Conant, Maj. Sir Roger	Gammans, Lady
Baldwin, Sir Archer	Cooke, Robert	Garner-Evans, E. H.
Balniel, Lord	Cooper, A. E.	George, J. C. (Pollok)
Banks, Col. C.	Cooper-Key, E. M.	Gibson-Watt, D.
Barber, Anthony	Cordeaux, Lt.-Col. J. K.	Glyn, Col. Richard H.
Barlow, Sir John	Corfield, F. V.	Godber, J. B.
Barter, John	Courtney, Cdr. Anthony	Goodhart, Philip
Batsford, Brian	Craddock, Beresford (Spelthorne)	Gough, C. F. H.
Baxter, Sir Beverley	Crosthwaite-Eyre, Col. O. E.	Gower, H. R.
Beamish, Col. Tufton	Crowder, Sir John (Finchley)	Graham, Sir Fergus
Bell, Ronald (Bucks, S.)	Crowder, Petre (Ruislip—Northwood)	Grant-Ferris, Wg. Cdr. R. (Nantwlch)
Bennett, F. M. (Torquay)	Cunningham, Knox	Green, A.
Bidgood, J. C.	Currie, G. B. H.	Gresham Cooke, R.
Biggs-Davison, J. A.	Dance, J. C. G.	Grimond, J.
Bingham, R. M.	Davidson, Viscountess	Grimston, Hon. John (St. Albans)
Birch, Rt. Hon. Nigel	D'Avigdor-Goldsmid, Sir Henry	Grimston, Sir Robert (Westbury)
Bishop, F. P.	Deedes, W. F.	Grosvenor, Lt.-Col. R. G.
Black, Sir Cyril	de Ferranti, Basil	Gurden, Harold
Body, R. F.	Dodds-Parker, A. D.	Hall, John (Wycombe)
Bonham Carter, Mark	Donaldson, Cmdr. C. E. McA.	Harris, Frederic (Croydon N. W.)
Bossom, Sir Alfred	Doughty, C. J. A.	Harris, Reader (Heston)
Bowen, E. R. (Cardigan)	Drayson, G. B.	Harrison, A. B. C. (Maldton)
Boyd-Carpenter, Rt. Hon. J. A.	du Cann, E. D. L.	Harrison, Col. J. H. (Eye)
Boyle, Sir Edward	Duncan, Sir James	Harvey, Sir Arthur vere (Maccesf'd)
Braine, B. R.	Duthie, Sir William	Harvey, John (Walthamstow, E.)
Braithwaite, Sir Albert (Harrow, W.)	Eccles, Rt. Hon. Sir David	Harvie-Watt, Sir George
Brewis, John	Eden, J. B. (Bournemouth, West)	Hay, John
Bromley-Davenport, Lt.-Col. W. H.	Elliott, R. W. (Ne'oastleupon Tyne, N.)	Head, Rt. Hon. A. H.
Brooke, Rt. Hon. Henry	Emmet, Hon. Mrs. Evelyn	Heald, Rt. Hon. Sir Lionel
Browne, J. Nixon (Cralgton)	Errington, Sir Eric	Heath, Rt. Hon. E. R. G.

Henderson, John (Cathoart)	McLean, Neil (Inverness)	Rodgers, John (Sevenoaks)
Henderson-Stewart, Sir James	Macleod, Rt. Hn. lain (Enfield, W.)	Roper, Sir Harold
Hesketh, R. F.	MacLeod, John (Ross & Cromarty)	Ropner, Col. Sir Leonard
Hill, Rt. Hon. Charles (Luton)	McMaster, Stanley	Russell, R. S.
Hill, John (S. Norfolk)	Macmillan, Rt. Hn. Harold (Bromley)	Sandys, Rt. Hon. D.
Hirst, Geoffrey	Macmillan, Maurice (Halifax)	Scott-Miller, Cmdr. R.
Hobson, John (Warwick & Leam'gt'n)	Macpherson, Niall (Dumfries)	Sharples, R. C.
Holland-Martin, C. J.	Maddan, Martin	Shepherd, William
Holt, A. F.	Maltland, Cdr. J. F. w. ([...]orncastle)	Simon, J. E. S. (Middlesbrough, W.)
Hope, Lord John	Maitland, Hon. Patrick (Lanark)	Smithers, Peter (Winchester)
Hornby, R. P.	Markham, Major Sir Frank	Smyth, Brig. Sir John (Norwood)
Hornsby-Smith, Miss M. P.	Marlowe, A. A. H.	Speir, R. M.
Horobin, Sir Ian	Marples, Rt. Hon. A. E.	Spence, H. R. (Aberdeen, W.)
Horsbrugh, Rt. Hon. Dame Florence	Marshall, Douglas	Stanley, Capt. Hon. Richard
Howard, Gerald (Cambridgeshire)	Mathew, R.	Stevens, Geoffrey
Howard, Hon. Greville (St. Ives)	Maudling, Rt. Hon. R.	Steward, Harold (Stockport, S.)
Howard, John (Test)	Mawby, R. L.	Steward, Sir William (Woolwich W.)
Hughes Hallett, Vice-Admiral J.	Maydon, Lt.-Comdr. S. L. C.	Stoddart-Scott, Col. Sir Malcolm
Hughes-Young, M. H. C.	Medlicott, Sir Frank	Storey, S.
Hurd, Sir Anthony	Milligan, Rt. Hon. W. R.	Stuart, Rt. Hon. James (Moray)
Hutchison Michael Clark (E'b'gh, S.)	Molson, Rt. Hon. Hugh	Studholme, Sir Henry
Hutchison, Sir James (Scotstoun)	Moore, Sir Thomas	Summers, Sir Spencer
Hylton-Foster, Rt. Hon. Sir Harry	Mott-Radclyffe, Sir Charles	Sumner, W. D. M. (Orpington)
Irvine, Bryant Godman (Rye)	Nabarro, G. D. N.	Taylor, Sir Charles (Eastbourne)
Jenkins, Robert (Dulwich)	Nairn, D. L. S.	Taylor, William (Bradford, N.)
Jennings, J. C. (Burton)	Neave, Alrey	Teeling, w.
Jennings, Sir Roland (Hallam)	Nicholls, Harmar	Temple, John M.
Johnson, Dr. Donald (Carlisle)	Nicolson, N. (B'n'm'th, E. & Chr'ch)	Thomas, Leslie (Canterbury)
Johnson, Eric (Blackley)	Noble Comdr. Rt. Hon. Sir Allan	Thomas, P. J. M. (Conway)
Jones, Rt. Hon. Aubrey (Hall Green)	Noble, Michael (Argyll)	Thompson, Kenneth (Walton)
Joseph, Sir Keith	Nugent, Richard	Thompson, R. (Croydon, S.)
Kaberry, D.	Oakshott, Sir Hendrie	Thorneycroft, Rt. Hon. P.
Keegan, D.	O'Neill, Hn. Phelim (Co. Antrim, N.)	Thornton-Kemsley, Sir Colin
Kerby, Capt. H. B.	Orr, Capt. L. P. S.	Tiley, A. (Bradford, W.)
Kerr, Sir Hamilton	Orr-Ewing, C. Ian (Hendon, N.)	Tilney, John (Wavertree)
Kershaw, J. A.	Page, R. G.	Turton, Rt. Hon. R. H.
Kimball, M.	Pannell, N. A. (Kirkdale)	Tweedsmuir, Lady
Kirk, P. M.	Partridge, E.	Vane, W. M. F.
Lagden, G. W.	Peel, W. J.	Vaughan-Morgan, J. K.
Lambton, Viscount	Peyton, J. W. W.	Vosper, Rt. Hon. D. F.
Lancaster, Col. C. G.	Pickthorn, Sir Kenneth	Wakefield, Sir Wavell (St. M'lebone)
Leavey, J. A.	Pike, Miss Mervyn	Walker-Smith, Rt. Hon. Derek
Leburn, W. G.	Pilkington, Capt. R. A.	Wall, Patrick
Legge-Bourke, Maj. E. A. H.	Pitt, Miss E. M.	Ward, Rt. Hon. G. R. (Worcester)
Lennox-Boyd, Rt. Hon. A. T.	Pott, H. P.	Watkinson, Rt. Hon. Harold
Lindsay, Hon. James (Devon, N.)	Powell, J. Enoch	Webbe, Sir H.
Lindsay, Martin (Solihull)	Price, David (Eastleigh)	Webster, David
Llewellyn, D. T.	Price, Henry (Lewisham, W.)	Whitelaw, W. S. l.
Lloyd, Maj. Sir Guy (Renfrew, E.)	Prior-Palmer, Brig. Sir Otho	Williams, Paul (Sunderland, S.)
Longden, Gilbert	Profumo, J. D.	Williams, R. Dudley (Exeter)
Loveys, Walter H.	Ramsden, J. E.	Wilson, Geoffrey (Truro)
Low, Rt. Hon. Sir Toby	Rawlinson, Peter	Wolrige-Cordon, Patrick
Lucas, P. B. (Brentford & Chiswick)	Redmayne, M.	Wood, Hon. R.
Lucas-Tooth, Sir Hugh	Rees-Davles, w. R.	Woollam, John Victor
McAdden, S. J.	Renton, D. L. M.	Yates, William (The Wrekin)
Macdonald, Sir Peter	Ridsdale, J. E.
Maclay, Rt. Hon. John	Roberts, Sir Peter (Heeley)	TELLERS FOR THE NOES:
Maclean, Sir Fitzroy (Lancaster)	Robinson, Sir Roland (Blackpool, S.)	Mr. Legh and Mr. Brooman-White.

Original Question again proposed.

Mr. Ray Mawby (Totnes)rose—

It being after Ten o'clock, The CHAIRMAN left the Chair to report Progress and ask leave to sit again.

Committee report Progress; to sit again Tomorrow.