HC Deb 21 June 1960 vol 625 cc287-321

(1) On and after the third day of August, nineteen hundred and sixty, hydrocarbon oil produced from shale mined in Scotland shall be exempted from excise duty, and accordingly, on and after that date section two of the

Finance Act, 1950 (which imposes a duty on hydrocarbon oils), shall have effect with the addition at the end of subsection (2) of that section of the following words, that is to say, or (c) to oils produced from shale mined in Scotland".

(2) The powers of the Commissioners of Customs and Excise to make regulations under section one hundred and ninety-eight of the Customs and Excise Act, 1952 (which empowers those Commissioners to make regulations relating to hydrocarbon oils), shall include power to make such regulations as appear to the Commissioners to be required to give effect to the last foregoing subsection.

(3) Where excise duty has been charged before or after the passing of this Act, and by virtue of this section no such duty should have been charged, or the duty should have been charged at the lower rate than that at which it was in fact charged, the person by whom the duty was paid shall be entitled to repayment of the amount of the overcharge.—[Mr. J. Taylor.]

Brought up, and read the First time.

Mr. John Taylor (West Lothian)

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

The purpose and intention of the Clause is clearly stated in the rubric. It is to exempt from Excise Duty Scottish shale oil—oil produced from shale mined in Scotland. There is no intention of asking for exemption from Excise Duty of any other kind of indigenous hydrocarbon oil. It is strictly confined to the shale oil product.

We recognise that oil produced from shale is not the only indigenous oil produced in Britain. More oil is produced as a by-product of coal than from the oil-bearing shale mined in the Lothians of Scotland. Some oil is produced from natural deposits, mainly in Nottinghamshire, and, incidentally, this is all refined in the refineries of the shale oil plants in the Lothians. But, apart from the small yield from native wells, the shale oil industry is the only indigenous oil industry which produces oil as its main product. In all other British oil-producing industries, the oil is a byproduct; it is an incidental product of a larger industry. That is why the Clause deals with Excise Duty only on oil produced from Scottish-mined shale.

Nowhere in Britain is oil produced from shale except on the shalefields of West Lothian and Midlothian. Moreover, the Scottish shale oil industry is the world's pioneer oil industry. It was the first fuel oil industry in the world. The first fuel oil ever produced was a product of my constituency, first as paraffin from cannel coal and later as oil from shale mined from the then rich shale deposits in West Lothian and Midlothian. It has been said in previous debates on this issue that it is interesting to recall that the very first oil to reach the United States was transported from my constituency about 150 years ago.

In previous attempts to secure the remission of this crippling tax on the industry, I have outlined its exciting and romantic history. I do not propose to repeat that history tonight, but I will briefly outline the present position of the industry and state some of the reasons why I submit that the remission of duty is economically essential to the industry's survival and is morally the right and fair course for the Treasury to pursue.

The oil product from shale is Dery—diesel engined vehicle fuel—and motor spirit, both of very high quality. These products are both sold from pumps at prices which are fixed by the big oil combines. In other words, the shale oil industry has to sell its product at a price determined by its competitors and not, as is the normal commercial practice, at the cost of production plus a reasonable profit margin.

The cost of producing oil from shale is greater than the cost of oil from the oil wells of the Middle East, Mexico, Venezuela, Texas or anywhere else. That is now frankly admitted and as frankly stated. In other words, the apparent, visible cost of Middle East oil is less than the gross cost of shale-produced indigenous oil. The costs of wayleaves, royalties, pipelines, tankers and refineries—all these costs of desert oil—are borne by the oil companies.

But the unseen costs of desert oil are borne by the taxpayers at large—for the cost of safeguarding our sources of supply in a vulnerable part of the world, the cost of armies, navies and air forces stationed in barren, uncomfortable and expensive places, is a heavy and unseen overhead cost on imported, desert-produced oil. We all help to pay to maintain our supplies by bearing, as taxpayers, our share of that cost. No such cost is incurred by the nation for home-produced oil or, for that matter, for coal or atomic energy. For that reason alone, but among several others, it is wise for the nation to conserve, encourage and, indeed, nurture every possible source of indigenous oil.

The Scottish shale oil industry has for several years been completely unable, because of these factors, to make a trading profit on its main product—oil. For as many years as I have been advocating the abolition of the duty on shale oil, the industry has made a trading loss and has been able to survive so long only because of the small profits which it makes on the by-products of the industry—detergents, sulphate of ammonia, industrial wax, bricks from spent shale and several others. Only because of the profits made from this source has it been able to survive, plus a very drastic, indeed ruthless, contraction of the industry during the past three years.

We saw this morning that the price of motor spirit has been reduced by ld. a gallon. This news would come in the shape of a great disaster to the shale oil industry in Scotland, because, as I pointed out, the price of its product is determined by the large oil companies. This reduction of Id. per gallon, although it is welcome news to the vast multitude of motorists in this country, is a shock, and may be an irreparable blow, unless we can secure the acceptance of this new Clause today, for this traditional and otherwise healthy Scottish industry.

In common with other indigenous oil, the duty on shale oil is 1s. 3d. per gallon. In previous debates, in which the present Financial Secretary to the Treasury has had no part—and I welcome a new face on the Treasury Bench in dealing with this subject—some of his predecessors who dealt with similar new Clauses have treated them with contempt, if not indeed with contumely. Others have been more kindly towards them. Two years ago, when the unanswerable nature of this Clause was recognised on all sides of the House, with all party support for it, the present Chancellor of the Exchequer had a very uncomfortable time when replying to the debate, because he could only stick to his brief from the Treasury and repeat the previous decision on this new Clause in the face of the arguments, which, as the debate developed, became obviously stronger and more and more unanswerable.

There has been one common factor to all the previous answers to the plea I am making. The Government have advanced two rather curious reasons why the Clause should not be accepted. The first was that because imported motor spirit pays duty at the rate of 2s. 6d. per gallon, therefore the indigenous oil is enjoying a subsidy of 1s. 3d. a gallon. The second argument was that it would not be practicable to make a reduction of the duty on shale oil without similarly reducing the duty on all other forms of indigenous hydro-carbon oils. As to the latter argument, the difficulty exists only in the mind of the Government. Everyone else recognises the simple fact that when a business is being strangled by taxation there is a special case for saving that business by reducing or abolishing taxation. Everyone recognises that as oil is the main product of the shale industry, and is a by-product of other sections of the indigenous hydro-carbon oil industry, there is a specially strong case for remission.

As to the first argument—that the industry, instead of being taxed, is actually being subsidised—it is surely a strange dictum which claims that if we impose a strangling, and in this case a swingeing, tax on an industry we are not really killing it but helping it by subsidising it because the other fellow has to pay a still heavier tax. The amount of the subsidy is the amount of the difference between the duty which this industry pays and that which other sections of the industry are paying. I do not think that that is a very logical and very defensible argument, and I hope it will not be advanced again. As a matter of fact, this industry has never had a ha'penny of subsidy in all the 150 years of its existence, but it has paid millions of pounds in tax into the Exchequer during that period.

At one time, at the height of its prosperity, the industry employed over 9,000 people. Its present labour force is less than 2,500, who are constituents of mine and of my hon. Friend the Member for Midlothian (Mr. J. Hill). Only five years ago, its labour force was 5,000, and that recent very severe contraction was directly and entirely due to the Excise Duty on its product, which rendered it unable to compete with other forms of oil. A few years ago, the cost of this remission which I am now suggesting would have been about £1 million in a fiscal year. At the present time, it will cost the Exchequer about a quarter of that sum, or a little more, but it would save the industry from extinction.

At present, the labour force in the industry is unable to secure the normal wane increases which have applied over the last few years in similar industries and in neighbouring industries. Indeed, if anybody is having a subsidy, it is the Exchequer, not the industry, and the persons who are paying that subsidy are those employed in the industry, who are content to carry on at lower rates of wages than those in the mining industry and its subsidiary industries and other forms of mining enjoyed. Yet, such is the pride of the people engaged in this industry in its traditions and past records, that they have stood by it with a loyalty which is remarkable, despite the sacrifices entailed by so doing to their standard of living.

This pride and this high regard for the industry is not confined to those employed in it. It extends all over Scotland. All Scotland has a special interest in this industry and in the fate of this new Clause today. The fate of the Scottish shale oil industry has become almost symbolical in Scotland. It will be regarded as a test of the Government's sincerity in their protestations of their concern for Scotland's industrial future whether they accept or once more reject this new Clause. Remission will enable the industry to continue. Rejection will, if not immediately, and it may very well be very soon, as a result of the decrease in the retail price of petrol, lead to its demise.

Therefore, the Treasury will lose its quarter of a million pounds in any case. If it insists upon its pound of flesh by rejecting this new Clause, the industry will perish, and the Treasury will lose the revenue from it. That revenue will disappear, along with over 2,000 jobs and a famous industry in which Scotland has pioneered the world. Is it not much better, much more sensible, much more economic and much more gracious for the Treasury voluntarily to offer this blood transfusion to the industry and thus continue to receive some revenue in the shape of normal taxation through the various Schedules and through P.A.Y.E. which it receives from an operating concern?

7.0 p.m.

So, if the Treasury is blind to the plight of the workers and their families dependent on the industry, if the Treasury is deaf to appeals to make this minor effort to save a traditional Scottish and British industry, if the Treasury is abysmally ignorant of the need to conserve every possible source of home-produced oil, let it regard this solely from the viewpoint of economic self interest.

If the industry dies, the Treasury will suffer and the nation will be poorer. If the Clause is accepted, the Treasury will continue to have some revenue from it. What is more important, the industry will have a chance to continue as an efficient British industry providing jobs and livelihood for men and women and oil for the nation as long as the shale measures last. There are still many years of life in the shale measures. It would be a sad and tragic thing for my constituents if this industry died and all the skills which have grown up over the years were spread out over a wider field of endeavour.

The Treasury tonight at an infinitesimally small cost in comparison to our national income and national taxation Revenue could save the industry, give it a shot in the arm, give it encouragement, enable those employed in it to have the wage increases which are so long overdue to them, and maintain a traditional industry of which this nation has long been proud.

For those reasons, I hope that this time the Economic Secretary will have a more kindly and helpful story to tell us than his predecessors have had.

Mr. H. Wilson

On a point of order. Mr. Thomas, I rise to ask whether you will accept a Motion to report Progress, on the ground that we are debating this important new Clause, which has been debated in past years, without a single representative of the Scottish Office on the Government Front Bench, which I think is scandalous, and without a representative of the Board of Trade, which ought to be doing something to get industry to the area affected. The fact that there are only about three Conservative back benchers present is perhaps not material to the Motion I seek to move.

I submit to you, Mr. Thomas, that the absence of a representative from the Scottish Office and the Board of Trade and the complete lack of interest on the part of Her Majesty's Government is utterly deplorable. We hope to move to report Progress to give them a chance to be here.

The Temporary Chairman (Mr. G. Thomas)

I cannot accept the Motion to report Progress at this stage.

Mr. Wilson

Further to that point of order. I obviously cannot move the Motion if you, Mr. Thomas, will not allow me to move it. Perhaps the fact that we have sought to move it will give the Government an opportunity to repair a great discourtesy to my hon. Friends and send out the one remaining Whip they have around the place to find the Secretary of State for Scotland or some of his Under-Secretaries so that, unless the Government intend to accept the new Clause, they can see the serious state of affairs created—not one of them has heard the speech of my hon. Friend the Member for West Lothian (Mr. J. Taylor)—and can take other action and reassure the Committee on this question.

Mr. J. Hill (Midlothian)

I support this Clause, representing a neighbouring constituency entirely concerned with shale oil in Scotland. My area in Midlothian has been scheduled under the Local Employment Act because of an unemployment figure of 4.8 per cent. An unemployment figure of that size is nothing new in my area. For some years we have been trying to attract new industry into the area to employ the people displaced from the shale oil industry over a period of years. So far we have been unsuccessful.

The Government have told us that they are unable to direct industry into any scheduled area. They have an opportunity here, not to direct an industry but to help keep an industry alive. My hon. Friend the Member for West Lothian (Mr. J. Taylor) mentioned the stranglehold which there has been on shale oil for some years. He mentioned also that ours was the first country to produce oil. I believe that the name of the man who started this was "Paraffin" Young, and Scottish oils are the follow-on of "Paraffin" Young's foresight in starting this industry in the Lothians.

As my hon. Friend the Member for West Lothian said, the industry used to employ many thousands. It is reduced now to a miserable 2,500. Yet this is an industry which supplies four-fifths of the diesel oil for Scottish public transport. It produces 5,000 tons of paraffin wax per year, which would otherwise have to be imported from America, costing very precious dollars. If the industry goes to the wall, it will add an estimated 10 per cent. to the unemployment figure already existing in that part of Scotland. Ninety-eight per cent. of the produce of the industry is of some value to this country. There is only 2 per cent. waste from it.

Shale oil in Scotland, and especially in my constituency, has been one of the basic industries. In Midlothian we have only three basic industries—shale oil, coal and paper. There is same doubt whether paper will be able to survive the Outer Seven agreement, although the Government say that it will. The employers in the paper industry have a different opinion.

The money accruing to the Government from the tax of 1s. 3d. per gallon is £660,000 per year. I learned that from a Question I asked the Chancellor of the Exchequer some months ago. If the Government allow the industry to go to the wall, it will cost more than that to pay the men unemployment benefit throughout the years they will be idle.

Some miners employed in shale oil have twice become redundant within a period of less than five years as a result of the closure of shale pits when coal was booming. Some of those men were directed to coal pits. Since then, those coal pits have been closed. The men had devoted 45 years' work to producing shale oil in the area. It would be worth the Government's while to forgo what they receive from this tax, always remembering what they spend in other directions. They should forgo this money and allow the industry to prosper. We do not ask for any new industry. All we ask for is some assistance to keep our remaining industry going.

I toured my constituency during the Recess, and spoke to the people employed in this area. They are watching the Government very carefully to see whether they are honest in their proposals to reduce unemployment figures in Scotland. If those proposals are not honest, it will be held against the Government at the appropriate time. My predecessor, Mr. Pryde, argued this case without success in this House for some years, and I appeal now to the Chancellor to allow this great industry to continue. Otherwise, unemployment in Midlothian will increase—and increase rapidly. It is now up to the Government to do something. We hope that they will do it.

Mr. A. Woodburn (Clackmannan and East Stirlingshire)

My constituency, also, borders on West Lothian. Moreover, it is over forty years since I got to know the miners there very well. They and their leaders were an exceptionally fine set of men, and some of the leaders were regarded as the statesmen of a very difficult mining industry. At all times, there was the utmost co-operation between these miners and the oil industry to keep it going during a very difficult period—even, as has been said, sometimes doing so by the subsidy of the low wages and hard work of the miners themselves.

I am fairly sure, of course, that, when dealing with the economics of this problem, the Financial Secretary may be able to argue that were the industry not in existence the Government could get more money from oil and that, therefore, they are losing something. I do not think that that is the issue at all. The issue is, quite squarely: is it the Government's policy to keep this industry ticking over during the latter part of its life?

To allow the industry to die would be a considerable waste, but a far worse waste would be that of human beings. Men who have given forty years to shale mining cannot just adapt themselves to new industries. We welcome to the area the great British Motor Corporation—it is coming right into the centre of the area that originally made the motor car possible—but it will not be very easy for men of 40, 50 or, perhaps, 60 years of age to adapt themselves to a new modern industry when they have given their lives to this one. Therefore, the threatened closing down would really mean a sacrifice of men and women.

7.15 p.m.

Quite apart from the economics of it all, there is a social problem, and I should like the Financial Secretary to tell us what is the Government's attitude to it. Are these men to be thrown on the scrap heap merely because circumstances now allow us to get oil that runs out of the ground in different parts of the world? The economic aspect has nothing to do with the men who produce this shale oil. Obviously, if there were no oil wells, this shale oil would sell very profitably, as it did in early days, but it cannot compete now with the oil that runs out of the ground.

We have other industries that are in the same position. If farming were to be treated merely as a matter of economics, what would happen to it? There would be no people left on great stretches of land unless we agreed, as a matter of social policy, that the country should maintain its agricultural industry. We do not maintain agriculture altogether for its own sake, because much of its produce could be bought more cheaply from abroad. We maintain it because it is necessary to build up and maintain men and women on the land. For that reason, as a social policy, we make possible an economically sound agriculture industry.

The same policy should apply here. It is not easy to attract other industries to this area. Many of the shale mining villages are up towards the Pentland Hills, and it is not likely that industry will ever go there. Unless something is done, houses, schools and social institutions, as well as the men, will be rendered redundant. There will be great waste from a social point of view, and it is, therefore, desirable that over 2,000 men should have a means of earning their living.

They do not want to live on doles, or charity, or anything of that kind. They are prepared to work to earn their living, and wish to be allowed to do so. The Government's policy should be to provide the means. If the continuance of this industry means that the Government are not getting some money that they would otherwise get—well, my hon. Friend the Member for West Lothian (Mr. J. Taylor) has put the amount at £250,000, and my hon. Friend the Member for Midlothian (Mr. J. Hill) has calculated what lies on the other side of the balance sheet.

The Government have two responsibilities. They have a considerable interest in the oil company that owns the Scottish shale mines—British Petroleum. The amount involved here is a mere bagatelle in the petroleum company's finances. They lost more than that in one day's quarrel with Persia. If it is inconvenient to keep the industry going because of difficulty in separating Scottish oil and other oil there, then—although they seem to do it now with the present subsidy, as they call it—surely they can promise that the British petroleum industry will not allow this small industry to go to the wall as long as it is able to tick over and earn its living, so that these men may be able to work until the industry tapers off gradually.

The whole oil industry started here, and it might any day become quite valuable again. So long as the shale measures are there, they should be worked, and the people willing to work them should be allowed to do so. The houses should not be allowed to become derelict, as some already have become. People from Edinburgh use some of them as country cottages—miles from anywhere. On the other hand, here we have still some thriving villages in which live good, sturdy Scottish people who want to finish their lives at work. I ask the Government to tackle this not so much as an economic, but as a social problem much as we do in the case of the farming industry in the remoter parts. The Government should have a settled policy that, whether it is done through British Petroleum, or by remission of taxation, they will take such steps as are necessary to ensure that this shale oil industry carries on.

Mr. Willis

It is two years since we last debated this matter. We then had a representative of the Scottish Office with us from the beginning of the debate—I am glad to see that a Scottish Minister has at last come into the Chamber. On that occasion, a number of hon. Members opposite supported a similar new Clause, and I am alarmed that that does not appear to be the case tonight. Before the election we heard a lot of speeches from the other side about the necessity of maintaining this industry.

Another feature of the debate two years ago is that when that debate took place unemployment in Scotland was only half what it is today. Therefore, while this matter was important at that time, it is far more important now. As my hon. Friend the Member for Midlothian (Mr. J. Hill) has said, this matter is very important for Midlothian. I know the difficulties of Midlothian because I represent a small portion of that area, although not the portion with which we are immediately concerned at the moment, and I am constantly having drawn to my attention the fact that no new industries have gone to Midlothian since the war.

What is the situation? It is well known in the Committee that unemployment in Scotland is the most serious issue that faces us. We have debated what has now become the Local Employment Act, and on numerous occasions we have approached Ministers with questions and deputations on this issue. We cannot afford to see any industry, no matter how small, disappear.

As I said on a former occasion, I can understand a United Kingdom Minister looking upon this as a small matter. Such a Minister views the economy in terms of 50 million people, in terms of huge industrial conurbations in the Midlands, London, Lancashire and South Yorkshire. When one is dealing with these huge industrial conurbations, a small thing like the Scottish shale oil industry does not seem to matter very much. It employs 2,500 men and, no doubt, a United Kingdom Minister would say "After all, we have managed to get the motor car industry to go somewhere near that area." But to Scotland it is of far greater importance and significance than that. To us 2,500 jobs are important.

We cannot afford to see any of our industrial potential untapped and unused simply because we as a country lack the will to use it. Up to the present the Government have not shown the will to develop this potential. We have been given the most ridiculous excuses. As my hon. Friend the Member for West Lothian (Mr. J. Taylor) said, the reasons given on the last occasion that we debated this matter were ridiculous. We were told that the industry was already getting a subsidy and that we could not give it a larger subsidy. That is a strange doctrine coming from a Government who are lavishing millions on all sorts of other industries—not a mere £250,000 but £50 million, £60 million and so on. The cotton industry is getting £40 million. One could go through the list and it would take a long time.

Mr. H. Wilson

The £40 million is the figure which was quoted by Ministers to mislead the Committee a year ago, but during the election campaign they said that it would be £60 million but that they dared not tell Parliament that it would be as much as that.

Mr. Willis

I agree with my right hon. Friend that the Tory Party always dresses things up very well before an Election. That is why we had so many Tory Members here last time we debated this subject. This is a strange doctrine to come from this Government, that we cannot afford £250,000, when all over the country they are lavishing millions on private enterprise of every kind to encourage and develop it. That is not good enough.

Mr. Thomas Fraser (Hamilton)

They would not even lose £250,000.s

Mr. Willis

As my hon. Friend says, they would not lose it. This is a tax, and all they are being asked to do is to remit the tax. They are not being asked to pay out anything.

I am sorry to see that once again a United Kingdom Minister is to answer this debate. This might seem a small point, but it is exceedingly important from the point of view of Midlothian. It is a very important industry in view of the employment that it provides, and the whole matter is very important because of the social issues which are involved, and which my hon. Friend mentioned. It is also important because it is symbolic of the Government's attitude and intentions towards Scotland. If the Government are really sincere, if they want genuinely to create and build up the Scottish economy and to get rid of unemployment in Scotland, this is one thing which the Government could do to demonstrate to the people of Scotland that the Government want to do the things they say they do.

Up to the present, whenever we have argued about this issue we have been told that we have had legislation which treats Scotland in a manner similar to that in which England is treated. I believe, as I think most of my colleagues believe, that Scotland requires something more than that. This is not a question of coming along with a begging bowl; it is facing up to the economic facts of the situation. Because of the situation in Scotland and its particular problems, something more is required. Scotland requires special treatment. It might be special treatment for which we are asking tonight when we ask for the complete revision of this duty, but it is not on a very large scale. A sum of £250,000 is almost as much as the Royal honeymoon cost. Surely the Government cannot say that we are unable to afford as much as that honeymoon cost in order to save an old and valuable industry in Scotland.

I hope the Economic Secretary will have a much better story to tell us than we had on the last occasion. We certainly got no hope from the last debate. I do not think there has been an improvement in the industry since then. In fact, I believe the industry is now steadily declining. This is a raw material that we possess. We possess very few raw materials in this country, and we possess this one in considerable quantities. Why should we not use it? It would help considerably and it would also be an indication of the Government's attitude towards problems in Scotland. I trust that the hon. Gentleman will give us a favourable reply and will accept this Clause.

Mr. Hector Hughes (Aberdeen, North)

This proposed new Clause has been moved and supported in able speeches. I would not dream of addressing the Committee on the technical side of shale oil because I do not know anything about it, but I do say that if the Government refuse to accept this new Clause it will be the mark of their shame. It will be the acid test of their insincerity.

Coming from north Aberdeen, I extend my sympathy to the people of the south-east of Scotland, in the shale oil area, who are suffering from the Government's insincerity. We in Aberdeen know the promises that have been made, that new industries would be brought to Aberdeen, that old industries would be assisted and existing industries extended. Here is an existing industry which is languishing because of the burden of taxation which it bears. If the Government are sincere in their expressions of sympathy and in their expressed intention to promote industry in Scotland, here is an opportunity to save that existing industry from destruction.

We heard from my hon. Friend the Member for West Lothian (Mr. J. Taylor) that the industry formerly employed 9,000 workers and now the number is only a quarter of that, about 2,500. It would be a shame to allow the industry to be wiped out because of the burden of taxation upon it. My right hon. Friend the Member for Clackmannan and East Stirlingshire (Mr. Woodburn) spoke of the social implications. Here is a community of people brought up in one industry who know no other industry. If it is wiped out, they will be in great social difficulties. They will have to scatter just as some of the people of Aberdeen, deprived of their work in the shipyards, have had to go down to Luton in Bedfordshire.

The break-up of communities in that way is bad for social and family life. It is wrong economically. I beg the Government to look at the matter not just as economists but as human beings. They must extend their sympathy to this languishing industry. They must remove the present burden from it and give it an opportunity to recuperate and expand for the benefit of the community in which it exists.

7.30 p.m.

Mr. William Hamilton (Fife, West)

I hope that the Minister who is to reply will have taken due note of the concern felt by Scottish Members on this side of the Committee and will have taken note also of the complete indifference of Scottish Members on his own side of the Committee in what is an extremely important social problem, though a rather insignificant one financially from the Treasury's point of view.

My hon. Friend the Member for Edinburgh, East (Mr. Willis) has a mind which runs in channels parallel to my own. He referred to the cost of the Royal honeymoon. I wish to refer to the cost of hobby farming. A month or two ago, in answer to a Question which I put, it was stated that hobby farmers in Scotland were costing the Revenue more than £1 million a year, exclusive of Surtax. In other words, hobby farmers in Scotland were filching from the Treasury four times the amount we are asking for to save one industry.

Who would have thought that, in the United Kingdom as a whole or in Scot land in particular, within twelve months of a General Election, Scottish Members would be fighting not for new industry but to preserve an old one? The General Election in Scotland was fought on the precise issue of unemployment. The Government lost in Scotland, and it is no wonder. They would have lost much more heavily if people had known what kind of response we were to receive in this debate from the Government side.

There was not even a representative of the Scottish Office present until pressure was exerted from this side of the Committee. In any case, even though the Scottish Office is now represented, we shall not hear a word from it, I suspect. Are we to hear from the Scottish Office? We ought to. Scottish Ministers ought to be very intimately concerned with the problem, and they ought to make their own representations. I should like to know whether the Scottish Office made representations to the Treasury before this debate to ensure that the Treasury knew what the facts were from both the financial and the social point of view.

I live on the other side of the Forth from this industry. I represent a coal mining area. When the coal mining industry was expanding, shale miners came across and took their place in the coal mining industry. They had to suffer social dislocation, of course; they had to take up their roots in the Lothians, cross the Forth, and set down new roots in Fife; but they could do that in the context of an expanding coal mining industry. These conditions no longer exist. If the men in the shale oil industry have to be unemployed now, they will face increasing difficulty in finding alternative employment in coal mining in Fife.

My hon. Friend the Member for West Lothian (Mr. J. Taylor) referred to the decrease in petroleum retail prices recently announced. Of course, that pressure will become worse and the competitive position of the shale oil industry in Scotland will deteriorate. Even if the Government accept the new Clause, we must have no illusions about the future difficulties of the industry, although, of course, such a move would help. My hon. Friends are quite right to assert that this is the test of the Government's sincerity in their attempts to deal with unemployment in Scotland. That is what the Clause is about. It is not about £250,000. It is about the Government's sincerity in tackling unemployment in the worst hit area of the United Kingdom. I hope that the Minister will address himself to the matter in those terms when he comes to reply.

Mr. H. Wilson

Some months ago, my right hon. Friend the Member for Ebbw Vale (Mr. Bevan) raised the question of whether the proceedings of the House should be televised. I cannot help feeling that it would be extremely goad for the country if some of the proceedings on this Finance Bill were televised. Two or three weeks ago, when we were debating the position of dividend strippers, tax dodgers and the rest, the benches opposite were crowded, packed with hon. Gentlemen ostensibly fighting for the rights of the ordinary taxpayer but, in fact, putting up a strong rearguard action against their own Chancellor who was attempting to interfere with some of the ill-begotten forms of tax dodging.

Today, in contrast, we are debating the problems of a small industry in Scotland, small in the numbers it employs and small, certainly, in political influence—that is very obvious—yet an industry which, as my hon. Friends have pointed out, has great social importance and a long history. It has made its own contribution to the economic life of Scotland and, indeed, of the United Kingdom. During the greater part of the debate, there have been four hon. Members on the back benches opposite. On the Front Bench there has been the unhappy Economic Secretary to the Treasury. At least, I hope he is unhappy, unless he intends to accept the new Clause. During part of the debate, there has been a representative of the Scottish Office present but he has not risen to say a word yet. I shall be very glad to give way now if he wants to speak. He should at least have the decency to apologise for not being here until sent for.

We have had present the Financial Secretary to the Treasury. He has a lot to live down in this respect because one of his Predecessors in office gave a pledge three years ago which has not been honoured. We have had one or two Whips present, and now we have the Patronage Secretary. Throughout the debate so far there have been hardly any Scottish Unionist Members present—is that what they are called up there?—

Mr. Willis

That is not what the ordinary people call them.

Mr. Wilson

I am well aware of that. Only three or four Scottish Tories have been present and not one of them has spoken, in contradistinction to what happened two years ago when, at any rate, one or two hon. Members opposite spoke, and spoke very powerfully, on behalf of this industry which has suffered for two years more since we last debated its difficulties. I will leave that point now. As I say, if these debates were televised and they were put out on the Scottish television service, they would have a profound effect. I am sure, in displaying the fundamental hypocrisy of hon. Members opposite on some of these tax questions.

As my hon. Friends have reminded the Committee, we have debated the problems of the Scottish shale oil industry and the Excise Duty upon it more than once in recent years. I very much welcome the arrival in his place of the hon. Member for Wolverhampton, South-West (Mr. Powell). He is not himself a Scotsman, but he will, I think, remember that when he was Financial Secretary he made an important speech during the debate on a new Clause similar to this three years ago. I should like to remind the Committee of what he said. He rejected the proposed remission of Excise Duty. He called on the Committee to reject the proposed new Clause, but he held out the very clear hope that other assistance would be given to the industry. I repeat the word "industry" because there have been attempts since to pretend that what he was talking about was not the industry but the area. The hon. Member for Wolverhampton, South-West, who was then the Financial Secretary, said: I repeat that that does not mean"— he was referring to the rejection of the proposed new Clause— that because the fiscal method is impracticable—and certainly highly unselective—there may be no case for other means being used for the assistance of the industry, as the hon. Member himself mentioned. That is not a question for the Treasury. I am concerned here only with the fiscal question. I would ask the Committee, however, not to deduce that, because I feel obliged to advise it against making a concession upon the Excise Duty, the Government are unaware of the difficulties under which the shale oil industry is placed, and that for this reason the application of other means is necessarily ruled out."—[OFFICIAL REPORT, 2nd July, 1957; Vol. 572, c. 997–8.] It was a little more tortuous than some of the hon. Member's more recent speeches. When he was at the Dispatch Box, he sometimes lacked that clarity and vigour which we always associated with his rather freer speeches. However, anyone hearing that speech could have been in no doubt that the Government were considering, not the provision of alternative employment for those displaced in the industry, but help for the industry. They rejected the proposal for fiscal easement but they were considering other help for the industry. In view of that pledge, one would have thought that something would have happened.

Two years ago the Chancellor of the Exchequer himself replied to the debate on this matter, and I am sorry, despite his burdens, that he has not been here tonight to hear what has been said by my hon. Friend. The Chancellor tried to wriggle out of the commitment of his hon. Friend the then Financial Secretary. He even went so far as to say that there had not been a pledge given to consider help for the industry but only a pledge to provide alternative employment. Some of my hon. Friends showed what an empty pledge that was. The Chancellor, in dealing with this matter, said: The best solution in the long term was to do, first, what I understand is being done at present, cut out the less productive sections of the industry"— to which one of my hon. Friends said, "There will be none left". The Chancellor went on: and, in the longer term, to help in every way we can to encourage new industries to come to the area to absorb those for whom this industry cannot any longer provide employment."—[OFFICIAL REPORT, 2nd July, 1958; Vol. 590, c. 1456.] That was the very callous attitude of the Government to the problems of this industry. It was, I should have thought, completely out of harmony with the indication—I will not say pledge—given by the then Financial Secretary a year earlier. The Government clearly have been running out on their pledge.

I thought that I heard an hon. Member opposite ask why we did not raise the matter last year. We sought to do so. We had a new Clause very high up on the Notice Paper, but, for reasons which lay entirely within the discretion of one of your predecessors, Mr. Arbuthnot, it was not selected, and there was nothing more we could do about it. We also sought to raise the matter on Report, but again, unfortunately, we were not able to do so. We make no complaint about it, but that is why two years have passed before we have been able to return to this problem. It will be within the recollection of the Committee that many of my hon. Friends during the passage of the Local Employment Act raised the problem of employment within this industry.

7.45 p.m.

I have referred to the pledge given by the Treasury Bench three years ago. I have referred to the very clear breach of that pledge, so far as it went, by the Chancellor two years ago. There is another hon. Member to whom I should like to draw attention, namely, the hon. Member for Glasgow, Pollok (Mr. George), who is now Parliamentary Secretary to the Ministry of Power and, therefore, in a very key position to influence the welfare of this industry and to do something about it. Together with his right hon. Friend the Minister, he is the spokesman in the House for this industry, and he should be doing something about it. Let me remind the Committee of what the hon. Member for Pollok said on 2nd July, 1957: I confess that I am not able to answer the argument put forward by the Financial Secretary regarding the impossibility of separating the products of the shale oil industry from other oil products. I can quite appreciate that that is a tremendous difficulty, but, though I may be putting it too high, I felt that in not ruling out some other method of assisting the industry, my hon. Friend had gone a very long way to giving us hope"— There the hon. Member for Pollok was accepting that hope had been given to the industry by the then Financial Secretary's pledge. Unfortunately, this hope was punctured a little by my hon. Friend the Member for Glasgow, Central (Mr. McInnes) saying: Could the hon. Member say what the other methods are? To this the hon. Member for Pollok, now a junior Minister with responsibility for this industry, said, I would not press that issue at this stage. I am quite happy to feel that the Government are thinking along other lines to assist"—[OFFICIAL, REPORT, 2nd July, 1957; Vol. 572, c. 1000.] Three years ago an hon. Member who got himself re-elected with pledges similar to those we have heard from other hon. Members opposite and who now finds himself on the Government Front Bench as a junior Minister at the Ministry of Power asked the House to stay its hand in voting on the proposed new Clause then moved by the then Member for Midlothian, the late Mr. David Pryde, on the ground that a pledge of assistance had been given. Three years later still nothing has been done, and that is why my hon. Friends press this proposed new Clause.

We shall be interested to know from the new Economic Secretary—because Treasury Ministers come and go—whether he intends to announce that the Chancellor is to honour the pledge so clearly given three years ago and either accept our proposal and give fiscal relief to the industry or that he proposes to introduce some other measures to help not merely the area but the industry itself. We hope that the Economic Secretary will make it clear where the Government stand.

The Economic Secretary to the Treasury (Mr. Anthony Barber)

I hope that the Committee will forgive me if I do not refer either to the televising of these proceedings, or to dividend stripping, but stick to the difficulties of the shale oil industry of Scotland.

As the Committee will be aware, identical new Clauses to this one were moved in 1956, 1957, and 1958. Hon. Members who have been Members of the House for a few years will be very familiar with the real difficulties of the industry. I recognise that this is a very important matter. There are also some new Members, particularly the hon. Member for Midlothian (Mr. J. Hill), who is speaking on this subject for the first time. It is right, therefore, that I should answer the criticisms which have been made at some length.

I recognise that there is great force in what the right hon. Member for Clackmannan and East Stirlingshire (Mr. Woodburn) said about this being not only an economic and financial problem but also a very difficult human problem with important social aspects.

The right hon. Member for Huyton (Mr. H. Wilson) and the hon. Member for Edinburgh, East (Mr. Willis) said that this is a very small industry, but I can assure them that we have not been deterred from attempting to find a solution to this problem merely because it is a small industry. I think that anyone considering this matter fairly must consider it in the light of what has happened in the past. As was said by an hon. Member, this industry is operated by one firm which is a wholly owned subsidiary of British Petroleum. The industry has been "on the go" for more than 100 years. Production reached its peak in 1913, when the industry employed about 10,000 workers. By 1925, the labour force had dropped to 7,000.

The industry was then helped by two factors—first, in 1928, the imposition of Customs duty on imported light oils, and, secondly, in 1935, the extension of that duty to diesel oil used in road vehicles. The blunt fact is that these measures were not enough to do more than merely slow down the decline which had been apparent in the industry for some years. Further contraction was necessary and employment dropped to about 4,000 shortly after the last war. Then in 1955–56, certain mines were closed and the labour force dropped to 3,000. The number of people employed now is only about 2,500 compared with 10,000 which the industry employed at its peak.

We have to recognise that this is not a new or sudden phenomenon; it is something that has been going on for a number of years. The hon. Member for West Lothian (Mr. J. Taylor) described it as a ruthless contraction, but this, I would add, is a contraction which, if we face the facts, has been inevitable. The hon. and learned Member for Aberdeen, North (Mr. Hector Hughes) said that the industry was languishing because of the burden of taxation. Surely the truth is that the industry is languishing not because of that, but because it simply is not competitive.

The hon. Member for West Lothian said that if the industry were to contract further, the Treasury would be the loser. As the right hon. Gentleman the Member for East Stirlingshire recognised—and I agree that this is only a small point—if the industry were to contract further oil would come from elsewhere and would, of course, pay double the rate of duty being paid by oil which is not imported.

In fact, the assistance to this industry has been considerable. The hon. Member for West Lothian said that it should not be called a subsidy. I do not mind what we call it, but the industry, over a number of years, has been getting preferential treatment.

Mr. Willis

So have a number of other industries.

Mr. Barber

I am referring to this industry because it is right that we should consider help given to it in the past.

Since the Customs duty on hydrocarbon oil was imposed in 1928—the first for a good many years—this industry was given preferential treatment because it was left free from the duty until 1950. The Committee will remember that in 1950 when the Excise duty was imposed it was lower than the prevailing Customs duty.

The extent of this assistance which applies to light oils and to derv as well was 9d. a gallon in 1938 and it remained at that level until 1953. Since then the preference has been 1s. 3d. a gallon. I think that the Committee should know that the preference over those years involved a total of over £20 million to the Scottish shale oil industry, so it cannot be said in truth that assistance has not been given to this industry.

I recognise that the economic arguments in a matter of this kind are not always conclusive. Whatever may be the social considerations involved, and I repeat that I am under no illusion that this is an intensely human problem, the fact is that one has to consider these economic arguments.

I would again like to draw the Committee's attention to one or two facts. The amount of diesel oil and light oil which are the industry's main products obtained from shale in 1959 was about 10 million gallons, a little more than one-third of 1 per cent. of the total quantity of derv and light oil used in the United Kingdom, or equivalent to less than one-ninth of 1 per cent. of the total quantity of all hydrocarbon oils used in the United Kingdom.

Hon. Members have talked about the future of this industry. But the total proved reserves, estimated three years ago to be sufficient to last twenty-five years at the rate that they were being exploited, would yield little more than one month's consumption of light oil and diesel oil used by vehicles on the roads in the United Kingdom. This is very relevant when one is considering whether or not one should give some fiscal advantage to an industry, which is what is being asked for.

I will explain to the Committee why I must ask it not to accept this new Clause. There are three reasons. First, there is the cost. Secondly, there is—a minor point I agree—the question of administration, and, thirdly, an important point connected with the European Free Trade Association. As to cost, the existing duty preference of 1s. 3d. a gallon was worth in 1959, as one hon. Gentleman said, about £650,000, or about £10 a ton of the shale oil which was produced. That £10 a ton preference is worth comparing with the average landed cost of crude petrol in the United Kingdom in 1959 which was £8 a ton.

Despite this assistance, which amounted—and this is a very important fact—to over £5 a week for each person employed in the Scottish shale industry and equivalent to a protective duty of more than 100 per cent the industry has operated for several years at a heavy loss. There is, in fact, little or no prospect of improvement because the industry is uneconomic.

As already pointed out, shale oil is only one source of indigenous oil in Britain, and, quantitatively, it is only a minor one. Oil from shale is only 10 per cent. of the country's total production of indigenous oil. The protection afforded to the Scottish shale oil industry in the past has always applied equally to all our other indigenous oil producing industries. While it is true to say, as the hon. Member for Midlothian said, that the cost of the concession for which he is asking would be only £650,000, if this relief were to be given to this section of the industry there is little doubt that others, or, at least, some of them, would press for equal treatment. If that was granted the cost would be anything up to £7½ million a year.

The hon. Member for Edinburgh, East criticised the Government Front Bench because he said that he expected a United Kingdom Minister to reply to this debate. The reason why I am replying and not my hon. Friend is simply that this is a Revenue matter, with implications which go far beyond Scotland and, therefore, it must be considered over all as a Treasury matter. I assure the Committee that I have been in touch with the Scottish Office and the Board of Trade before I came here to reply to this debate.

Mr. H. Wilson

What did they say?

Mr. Willis

Are we to take it that the Scottish Office agreed that this industry must die?

Mr. Barber

If the hon. Gentleman will listen to what I have to say he can draw his own conclusions, but he can certainly conclude that the Scottish Office and the Secretary of State for Scotland agree with the point of view which I am putting forward.

The hon. Member for West Lothian said that previous Treasury spokemen had said that there were practical difficulties about the proposals contained in this new Clause. It is true that there are practical difficulties because it would be rather difficult to discriminate between the various indigenous oils produced in Britain. As hon. Members from Scotland will know, they are all refined in the same plant. I do not suggest that these practical difficulties are insuperable. There is, however, one objection to the Clause which is insuperable. Even if the other objections to which I have referred could be overcome, the Government's decision to adhere to the European Free Trade Association raises an insurmountable difficulty.

8.0 p.m.

At present, the dutiable products derived from Scottish shale oils, like those derived from the other indigenous oils, enjoy a preference of 1s. 3d. per gallon over imported oils and, therefore, over oils of E.F.T.A. origin. The proposal to exclude from the Excise duty oils which are derived from Scottish shale would increase this preference to 2s. 6d. This would be a direct breach of Article 6 of the Convention, which prohibits increasing the protection of a domestic product against E.F.T.A. supplies over that existing on 1st January this year.

I hope that in view of what I have said, and especially in view of this last aspect, the Committee will agree—

Mr. Woodburn

I am not clear what part of the Seven produces oil which competes with this type of oil.

Mr. Barber

The difficulty arises because in the Convention shale oil is treated as what is called a basic material. Consequently, dutiable oils produced in E.F.T.A. countries from crude shale oil of any origin would be included. Quite apart from that, however, this would be contrary to the Convention.

Mr. H. Wilson

Who negotiated the Convention? Did not Her Majesty's Ministers have any say in the classification? Were they not aware of the effect that the Convention would have on this problem? Did they not study these debates in the past? When putting the E.F.T.A. proposal to the House, did they mention that they had either overlooked this point or, worse still, had taken the point and done nothing about it? The hon. Gentleman talks as though E.F.T.A. is an act of God. It is an act of Her Majesty's Ministers, together with six of our friends in Europe. It was the duty of Her Majesty's Ministers, because nothing was involved affecting the interests of the other countries, to protect the interests of this industry when they negotiated.

Mr. Barber

The right hon. Gentleman misunderstands the position. He was himself, I thought, concerned to some extent in the debates on the European Free Trade Association. The situation is clearly set out in the Convention.

Mr. Wilson

It is not clearly set out.

Mr. Barber

Perhaps the right hon. Gentleman would like me to read it. In Article 6, paragraph 6, there is a definition of revenue duties, which are defined as meaning customs duties and other similar charges applied primarily for the purpose of raising revenue". Obviously, therefore, it includes this duty.

Paragraph 2 of the same Article states that: Member States shall not introduce new fiscal charges which are inconsistent with paragraph 1 of this Article and shall not vary an existing fiscal charge in such a way as to increase, above the level in force on the date by reference to which the basic duty is determined"— that is, the beginning of this year— in accordance with paragraph 3 of Article 3, any effective protective element in the fiscal charge… It is clear that this does not apply only to shale oil. It applies to any revenue duty which has a protective element. I hope that the Committee will realise that for this reason, quite apart from the others, it would not be possible to accede to the request of the sponsors of the new Clause.

The hon. Member for Midlothian said that there was serious unemployment in his area. From the inquiries I have made, I certainly agree. The hon. Member will know that Bathgate, Broxbourne and the two Calders are scheduled as development districts under the Local Employment Act. One hon. Member mentioned that the British Motor Corporation is to build a factory at Bath-gate which will employ a considerable number of people. I hope that this will go some way to help the area, because I believe that it is in this sort of way, rather than by an artificial fiscal advantage, which, even if it were possible, would not be consistent with our obligations, that we must try to help the area.

Mr. Woodburn

I raised the point that while it might be possible to do this by fiscal methods, being practically the owners of British Petroleum and having other methods by which to assist, the Government could use other methods also. My right hon. Friend the Member for Huyton (Mr. H. Wilson) pointed out that in the previous debate the hon. Member for Wolverhampton, South-West (Mr. Powell) hinted that that would be possible. Would it not be possible for the Government to use some other method to help the industry tick over, even if they cannot use the fiscal one?

Mr. Barber

On reading what my hon. Friend the Member for Wolverhampton, South-West (Mr. Powell) said, I certainly did not think he had indicated what the right hon. Member has deduced from his speech. I will note what the right hon. Gentleman has said and draw it to the attention of my right hon. Friend. Obviously, I could not at this stage commit British Petroleum, which runs as a commercial project, to any particular course of action.

Mr. H. Wilson

I would not have sought to detain the Committee further on this matter tonight, but the speech which we have just heard from the Economic Secretary cannot be allowed to pass without a reply. It is the worst of all the answers we have had in successive debates on the problems of this industry. Even if the Joint Under-Secretary of State for Scotland had replied, he could not have done it worse.

We had it from the hon. Gentleman that the industry is only a small one, that we can knock it on the head and it does not matter. That was the whole burden of his figures. Secondly, he told us that the Government are giving the industry wonderful help and are not treating it as badly as others. His argument was that the tax on this industry is smaller than the remainder of the oil tax. If it were any bigger, of course, it would kill the industry altogether. The hon. Gentleman said that as the Government have not cut off its head but are only slowly strangling it to death they must be regarded as being kind to it.

The hon. Gentleman did not produce a single argument for not helping the industry. He did not compare it with the help which has been given to steel and which is now proposed for Cunard or all the other industries that come along with their begging bowls. The reason is that it is a small industry and has no political influence. It obviously contributes nothing to the fighting funds of the party opposite because otherwise we should have had a crowded Chamber and something would have been done about it long before this. The hon. Gentleman tried to rest his case on the thinnest argument I have heard from Treasury Ministers in four or five years of listening to Finance Bill debates. When I remind the House that that includes the period when the Prime Minister himself was Chancellor of the Exchequer, it can be realised how thin some of the hon. Gentleman's arguments were.

The Economic Secretary said that the E.F.T.A. precludes us from helping the industry. He said it was clear when the E.F.T.A. proposals were presented to the House that shale oil would be harmed. It was not perfectly clear. I challenge the hon. Gentleman to point to one remark or statement by any of the Ministers who commended those proposals to the House and carried the Bill through which suggested that the Government were precluded from all time from giving any fiscal help whatever to the industry.

If that was the Government's interpretation of the E.F.T.A. it was their duty to give the House an honest statement about it when we were asked to approve it.

Mr. Barber

It is not a question of interpretation. It is perfectly apparent to anybody who reads the Convention that it applies to the protective element in any revenue duties. The whole House supported the E.F.T.A. proposal and I assumed that the right hon. Gentleman had read the Convention before he spoke on it. It is not a question of interpretation; it is clearly stated.

Mr. Wilson

I thank the hon. Gentleman for being so forthcoming. He has walked right into it. He has made confession that in negotiating the E.F.T.A. the Government either sacrificed an important though small industry deliberately and knowingly or did it without even realising what they were doing. Perhaps he will tell us which of these two sins—I find it hard to know which is the greater—the Government have committed. Did they know that they were sacrificing their ability to help this industry or did they simply walk into it in the negotiations without realising it?

It is plain that no vital E.F.T.A. interest is involved in shale oil. It is not as though we were negotiating about Danish butter, Swedish woodpulp or some of the problems which already are causing trouble for certain Scottish industries. We did not get anything for it in return. Its being written into the Convention satisfied none of our trading partners. Why did not the Government say that they had a problem with the shale oil industry and might want to alter taxation and that they did not wish to bind themselves about their policy towards shale oil? Not one of our trading partners would have objected.

Instead we had the Government coming back with the agreement. In general, we accepted the principle. We were not committed to every detail, because we had not negotiated it. In the first place, £5 million duty was knocked off port and sherry by the E.F.T.A. Convention and, secondly, it absolutely tied our hands and prevented us from giving any help to the shale oil industry when a matter of £200,000 or so would probably have solved the problem.

We used to hear about our negotiation of the G.A.T.T., but that was nothing like this. The hon. Gentleman, like myself, is a Yorkshireman, but he has not behaved like one on this occasion. In the Yorkshire phrase, when he sat down to negotiate they saw him coming.

The hon. Gentleman has not referred at all to the pledge which was clearly given by the hon. Member for Wolverhampton, South-West (Mr. Powell). He said that he had read that pledge, but did not see anything in it. However, his hon. Friends did three years ago and said that that was the reason why they were not voting. If it did not mean fiscal help—and I read the pledge as not being fiscal help for the reason the hon. Gentleman gave—there must have been some other help and I think that what the hon. Member for Wolverhampton, South-West had in mind was the use of the voting shares, or some other form of persuasion of B.P., to see that this industry would not go under.

It is no good talking about competition. What does the word "competition" mean in the oil world? The oil industry is honeycombed with monopolies and trust agreements. The Government do not know what the word "competition" means in relation to oil. Let hon. Members ask anyone who wants to bring Russian oil into this country when they will find that the Government say "No" even though the price is competitive.

Once again the Government have betrayed their pledges as they did two years ago. What amazes me is that, having had two more years to think out an excuse for doing nothing, the hon. Gentleman should have put up such a thin case as he gave us this evening.

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

The Committee divided: Ayes 176, Noes 240.

Division No. 107. AYES [6.33 p.m.
Abse, Leo Hayman, F. H. Peart, Frederick
Ainsley, William Henderson, Rt. Hn. Arthur (Rwly Regis) Pentland, Norman
Albu, Austen Herbison, Miss Margaret Popplewell, Ernest
Allaun, Frank (Salford, E.) Hill, J. (Midlothian) Prentice, R. E.
Allen, Scholefield (Crewe) Hilton, A. V. Price, J. T. (Westhoughton)
Awbery, Stan Holman, Percy Probert, Arthur
Bacon, Miss Alice Holt, Arthur Proctor, W. T.
Baxter, William (Stirlingshire, W.) Houghton, Douglas Pursey, Cmdr. Harry
Beaney, Alan Howell, Charles A. Randall, Harry
Bellenger, Rt. Hon. F. J. Hoy, James H Rankin, John
Benn, Hn. A. Wedgwood(Brist'l, S. E.) Hughes, Cledwyn (Anglesey) Reid, William
Benson, Sir George Hughes, Hector (Aberdeen, N.) Roberts, Albert (Normanton)
Blackburn, F. Hunter, A. E. Roberts, Goronwy (Caernarvon)
Blyton, William Hynd, H. (Accrington) Robinson, Kenneth (Sir Pancras, N.)
Bowden, Herbert W. (Leics, S.W.) Hynd, John (Attercliffe) Rogers, G. H. R. (Kensington, N.)
Bowles, Frank Irvine, A. J. (Edge Hill) Ross, William
Boyden, James Irving, Sydney (Dartford) Royle, Charles (Salford, West)
Braddock, Mrs. E. M. Jay, Rt. Hon. Douglas Shinwell, Rt. Hon. E.
Brockway, A. Fenner Jeger, George Silverman, Julius (Aston)
Brown, Alan (Tottenham) Jenkins, Roy (Stechford) Silverman, Sydney (Nelson)
Brown, Rt. Hon. George (Belper) Johnson, Carol (Lewisham, S.) Skeffington, Arthur
Brown, Thomas (Ince) Jones, Dan (Burnley) Slater, Mrs. Harriet (Stoke, N.)
Butler, Herbert (Hackney, C.) Jones, Jack (Rotherham) Slater, Joseph (Sedgefield)
Butler, Mrs. Joyce (Wood Green) Jones, J. Idwal (Wrexham) Small, William
Callaghan, James Jones, T W. (Merioneth) Smith, Ellis (Stoke, S.)
Castle, Mrs. Barbara Kelley, Richard Sorensen, R. W.
Chapman, Donald Kenyon, Clifford Soskice, Rt. Hon. Sir Frank
Chetwynd, George Key, Rt. Hon. C. W. Spriggs, Leslie
Cliffe, Michael King, Dr. Horace Steele, Thomas
Craddock, George (Bradford, S.) Lawson, George Stewart, Michael (Fulham)
Cronin, John Lee, Frederick (Newton) Stonehouse, John
Crossman, R. H. S. Lee, Miss Jennie (Cannock) Stones, William
Cullen, Mrs. Alice Lewis, Arthur (West Ham, N) Strachey, Rt. Hon. John
Darling, George Logan, David Summerskill, Dr. Rt. Hon. Edith
Davies, Rt. Hn. Clement(Montgomery) Loughlin, Charles Swain, Thomas
Davies, Ifor (Gower) Mabon, Dr. J. Dickson Swingier, Stephen
Deer, George McCann, John Sylvester, George
de Freitas, Geoffrey MacColl, James Symonds, J. B.
Delargy, Hugh McInnes, James Taylor, Bernard (Mansfield)
Dempsey, James McKay, John (Wallsend) Taylor, John (West Lothian)
Diamond, John Mackie, John Thomson, G. M. (Dundee, E.)
Dodds, Norman Mahon, Simon Thornton, Ernest
Dugdale, Rt. Hon. John Manuel, A. C. Thorpe, Jeremy
Ede, Rt. Hon. Chuter Marsh, Richard Timmons, John
Edwards, Rt. Hon. Ness (Caerphilly) Mason, Roy Tomney, Frank
Edwards, Robert (Bilston) Mayhew, Christopher Wade, Donald
Edwards, Walter (Stepney) Mellish, R. J. Wainwright, Edwin
Evans, Albert Mendelson, J. J. Warbey, William
Fernyhough, E. Millan, Bruce Watkins, Tudor
Foot, Dingle Mitchison, G. R. Weitzman, David
Forman, J. C. Monslow, Walter Wells, Percy (Faversham)
Fraser, Thomas (Hamilton) Moody, A. S. Wheeldon, W. E.
Gaitskell, Rt. Hon. Hugh Morris, John Willey, Frederick
George, Lady Megan Lloyd Mort, D. L. Williams, D. J. (Neath)
Ginsburg, David Moyle, Arthur Williams, Rev. LI. (Abertillery)
Gooch, E. G. Mulley, Frederick Williams, W. R. (Openshaw)
Gordon Walker, Rt. Hon. P. C. Noel-Baker, Francis (Swindon) Willis, E. G. (Edinburgh, E.)
Greenwood, Anthony Oliver, G. H. Wilson, Rt. Hon. Harold (Huyton)
Grey, Charles Oswald, Thomas Winterbottom, R. E.
Griffiths, David (Rother Valley) Owen, Will Woodburn, Rt. Hon. A.
Griffiths, Rt. Hon. James (Llanelly) Padley, W. E. Woof, Robert
Grimond, J. Pannell, Charles (Leeds, W.) Yates, Victor (Ladywood)
Gunter, Ray Pargiter, G. A.
Hale, Leslie (Oldham, W.) Paton, John TELLERS FOR THE AYES:
Hamilton, William (West Fife) Pavitt, Laurence Dr. Broughton and Mr. Redhead.
Hannan, William Pearson, Arthur (Pontypridd)
Hart, Miss Judith
Agnew, Sir Peter Beamish, Col. Tufton Boyle, Sir Edward
Aitken, W. T. Bell, Ronald (S. Bucks.) Braine, Bernard
Allason, James Bennett, F. M. (Torquay) Brewis, John
Alport, Rt. Hon. C. J. M. Bennett, Dr. Reginald(Gos. & Fhm) Brooman-White, R.
Amory, Rt. Hn. D. Heathcoat (Tiv'tn) Bevins, Rt. Hon. Reginald (Toxteth) Browne, Percy (Torrington)
Ashton, Sir Hubert Bidgood, John C. Bryan, Paul
Atkins, Humphrey Biggs-Davison, John Bullard, Denys
Balniel, Lord Bingham, R. M. Butler, Rt. Hn. R. A. (Saffron Walden)
Barber, Anthony Birch, Rt. Hon. Nigel Campbell, Sir David (Belfast, S.)
Barlow, Sir John Bishop, F. P. Campbell, Gordon (Moray & Nairn)
Barter, John Bossom, Clive Carr, Compton (Barons Court)
Batsford, Brian Box, Donald Cary, Sir Robert
Baxter, Sir Beverley (Southgate) Boyd-Carpenter, Rt. Hon. John Clark, Henry (Antrim, N.)
Clark, William (Nottingham, S.) Hollingworth, John Peyton, John
Clarke, Brig. Terence(Portsmth, W.) Hopkins, Alan Pickthorn, Sir Kenneth[...]n
Collard, Richard Hornby, R. P. Pike, Miss Mervyn
Cooke, Robert Howard, Gerald (Cambridgeshire) Pilkington, Capt. Richard
Cooper-Key, Sir Neill Howard, Hon. G. R. (St. Ives) Pott, Percivall
Cordeaux, Lt.-Col. J. K, Howard, John (Southampton, Test) Powell, J. Enoch
Cordle, John Hughes Hallett, Vice-Admiral John Price, David (Eastleigh)
Corfield, F. V. Hughes-Young, Michael Prior-Palmer, Brig. Sir Otho
Costain, A. P. Hulbert, Sir Norman Profumo, Rt. Hon. John
Coulson, J. M. Hurt, Sir Anthony Proudfoot, Wilfred
Courtney, Cdr. Anthony Hutchison, Michael Clark Ramsden, James
Craddock, Sir George Beresford Iremonger, T. L. Rawlinson, Peter
Critchley, Julian Irvine, Bryant Codman (Rye) Redmayne, Rt. Hon. Martin
Cunningham, Knox Jackson, John Rees-Davies, W R.
Curran, Charles James, David Renton, David
Currie, G. B. H. Jenkins, Robert (Dulwich) Ridley, Hon. Nicholas
Dance, James Jennings, J. C. Roberts, Sir Peter (Heeley)
d'Avigdor-Goldsmid, Sir Henry Johnson, Dr. Donald (Carlisle) Robinson, Sir Roland (Blackpool, S.)
Deedes, W. F. Johnson, Eric (Blackley) Roots, William
de Ferranti, Basil Johnson Smith, Geoffrey Ropner, Col. Sir Leonard
Digby, Simon Wingfield Joseph, Sir Keith Royle, Anthony (Richmond, Surrey)
Donaldson, Cmdr, C. E. M. Kerans, Cdr. J. S. Russell, Ronald
Drayson, G. B. Kerby, Capt. Henry Scott-Hopkins, James
du Cann, Edward Kerr, Sir Hamilton Sharples, Richard
Duthie, Sir William Kershaw, Anthony Shaw, M.
Eccles, Rt. Hon. Sir David Kimball, Marcus Shepherd, William
Eden, John Kirk, Peter Simon, Sir Jocelyn
Elliott, R. W. Lancaster, Col. C. G. Smith, Dudley (Br'ntf'rd & Chiswick)
Emery, Peter Leavey, J. A. Spearman, Sir Alexander
Emmet, Hon. Mrs. Evelyn Leburn, Gilmour Speir, Rupert
Errington, Sir Eric Legge-Bourke, Maj. Sir Harry Stanley, Hon. Richard
Erroll, Rt. Hon. F. J, Lewis, Kenneth (Rutland) Stevens, Geoffrey
Farey-Jones, F. W. Lilley, F. J. P. Steward, Harold (Stockport, S.)
Fell, Anthony Linstead, Sir Hugh Stoddart-Scott, Col Sir Malcolm
Finlay, Graeme Litchfield, Capt. Hon. Storey, Sir Samuel
Fisher, Nigel Longden, Gilbert Studholme, Sir Henry
Fletcher-Cooke, Charles Loveys, Walter H. Summers, Sir Spencer (Aylesbury)
Forrest, George Low, Rt. Hon. Sir Toby Sumner, Donald (Orpington)
Fraser, Hn. Hugh (Stafford & Stone) Lucas, Sir Jocelyn (Portsmouth, S) Talbot, John E.
Fraser, Ian (Plymouth, Sutton) Lucas-Tooth, Sir Hugh Teeling, William
Freeth, Denzil McAdden, Stephen Temple, John M.
Gammans, Lady MacArthur, Ian Thatcher, Mrs. Margaret
Gardner, Edward McLaren, Martin Thomas, Leslie (Canterbury)
Glover, Sir Douglas McLaughlin, Mrs. Patricia Thomas, Peter (Conway)
Glyn, Dr. Alan (Clapham) Maclean, Sir Fitzroy (Bute & N. Ayrs.) Thompson, Kenneth (Walton)
Godber, J. B. MacLeod, John (Ross & Cromarty) Thorneycroft, Rt. Hon. Peter
Goodhart, Philip McMaster, Stanley R. Thornton-Kemsley, Sir Colin
Goodhew, Victor Macmillan, Rt. Hn. Harold (Bromley) Tiley, Arthur (Bradford, W.)
Gower, Raymond Macpherson, Niall (Dumfries) Tilney, John (Wavertree)
Grant, Rt. Hon. William (Woodside) Maddan, Martin Turner, Colin
Green, Alan Maginnis, John E Turton, Rt. Hon. R. H.
Gresham Cooke, R. Maitland, Cdr. Sir John van Straubenzee, W. R.
Grosvenor, Lt.-Col. R. G. Markham, Major Sir Frank Vane, W. M. F.
Hall, John (Wycombe) Marples, Rt. Hon. Ernest Vaughan-Morgan, Sir John
Hamilton, Michael (Wellingborough) Marshall, Douglas Vickers, Miss Joan
Harris, Frederic (Croydon, N.W.) Mathew, Robert (Honlton) Vosper, Rt. Hon. Dennis
Harris, Reader (Heston) Matthews, Gordon (Meriden) Wakefield, Edward (Derbyshire, W.)
Harrison, Brian (Maldon) Mawby, Ray Wakefield, Sir Wavell (St. M'lebone)
Harrison, Col. J. H. (Eye) Morgan, William Wall, Patrick
Harvey, Sir Arthur Vere (Macclesf'd) Ward, Dame Irene (Tynemouth)
Harvey, John (Walthamstow, E.) Nabarro, Gerald Watts, dames
Harvie Anderson, Miss Nicholls, Harmar Webster, David
Hay, John Nicholson, Sir Godfrey Wells, John (Maidstone)
Heald, Rt. Hon. Sir Lionel Noble, Michael Williams, Dudley (Exeter)
Heath, Rt. Hon. Edward Nugent, Sir Richard Williams, Paul (Sunderland, S.)
Henderson, John (Cathcart) Oakshott, Sir Hendrie Wills, Sir Gerald (Bridgwater)
Hendry, Forbes Orr, Capt. L. P. S. Wilson, Geoffrey (Truro)
Hicks Beach, Maj. W. Osborn, John (Hallam) Wise, A. R.
Hiley, Joseph Osborne, Cyril (Louth) Woodhouse, CM.
Hill, Mrs. Eveline (Wythenshawe) Page A. J. (Harrow, West) Woodnutt, Mark
Hill, J. E. B. (S. Norfolk) Pannell, Norman (Kirkdale) Worsley, Marcus
Hinohingbrooke, Viscount Partridge, E.
Hirst, Geoffrey Pearson, Frank (Clitheroe) TELLERS FOR THE NOES:
Hobson, John Peel, John Mr. Chichester-Clark and
Holland, Philip Percival, Ian Mr. Whitelaw.
Division No. 108.] AYES [8.13 p.m.
Abse, Leo Hart, Mrs. Judith Pavitt, Laurence
Ainsley, William Hayman, F. H. Pearson, Arthur (Pontypridd)
Allaun, Frank (Salford, E.) Herbison, Miss Margaret Peart, Frederick
Allen, Scholefield (Crewe) Hill, J. (Midlothian) Pentland, Norman
Awbery, Stan Hilton, A. V. Prentice, R. E.
Bacon, Miss Alice Holman, Percy Price, J. T. (Westhoughton)
Baxter, William (Stirlingshire, W.) Holt, Arthur Proctor, W. T.
Beaney, Alan Houghton, Douglas Pursey, Cmdr. Harry
Bellenger, Rt. Hon. F. J. Howell, Charles A. Randall, Harry
Benn, Hn. A. Wedgwood (Brit'I. S. E.) Hoy, James H. Rankin, John
Benson, Sir George Hughes, Cledwyn (Anglesey) Redhead, E. C.
Blackburn, F. Hughes, Hector (Aberdeen, N.) Reid, William
Blyton, William Hunter, A. E. Roberts, Albert (Normanton)
Bowden, Herbert W. (Leics, S.W.) Hynd, H. (Accrington) Roberts, Coronwy (Caernarvon)
Bowles, Frank Hynd, John (Attercliffe) Ross, William
Boyden, James Irvine, A. J. (Edge Hill) Royle, Charles (Salford, West)
Braddock, Mrs. E. M. Irving, Sydney (Dartford) Silverman, Sydney (Nelson)
Brockway, A. Fenner Jay, Rt. Hon. Douglas Skeffington, Arthur
Broughton, Dr. A. D. D. Jones, Dan (Burnley) Slater, Mrs. Harriet (Stoke, N.)
Brown, Alan (Tottenham) Jones, Jack (Rotherham) Slater, Joseph (Sedgefield)
Brown, Thomas (Ince) Jones J. Idwal (Wrexham) Small, William
Butler, Mrs. Joyce (Wood Green) Jones, T. W. (Merioneth) Smith, Ellis (Stoke, S.)
Callaghan, James Kenyon, Clifford Sorensen, R. W.
Chapman, Donald Key, Rt. Hon. C. W. Soskice, Rt. Hon. Sir Frank
Chetwynd, George King, Dr. Horace Spriggs, Leslie
Craddock, George (Bradford, S.) Lawson, George Steele, Thomas
Cullen, Mrs. Alice Lee, Frederick (Newton) Stewart, Michael (Fulham)
Davies, Rt. Hn. Clement (Montgomery) Lee, Miss Jennie (Cannock) Stonehouse, John
Davies, Ifor (Cower) Lewis, Arthur (West Ham, N.) Stones, William
Deer, George Logan, David Strachey, Rt. Hon. John
Delargy, Hugh Loughlin, Charles Summerskill, Dr. Rt. Hon. Edith
Dempsey, James Mabon, Dr. J. Dickson Swain, Thomas
Diamond, John MacColl, James Swingler, Stephen
Dodds, Norman McInnes, James Sylvester, George
Dugdale, Rt. Hon. John McKay, John (Wallsend) Symonds, J. B.
Ede, Rt. Hon. Chuter Mackie, John Taylor, Bernard (Mansfield)
Edwards, Rt. Hon. Ness (Caerphilly) MacPherson, Malcolm (Stirling) Taylor, John (West Lothian)
Edwards, Robert (Bilston) Mahon, Simon Thomson, G. M. (Dundee, E.)
Edwards, Walter (Stepney) Mallalieu, E. L. (Brigg) Thornton, Ernest
Evans, Albert Mallalieu, J. P. W. (Huddersfield, E.) Timmons, John
Fernyhough, E. Manuel, A. C. Wade, Donald
Fitch, Alan Mapp, Charles Wainwright, Edwin
Fletcher, Erie Marquand, Rt. Hon. H. A. Warbey, William
Foot, Dingle Marsh, Richard Watkins, Tudor
Forman, J. C. Mason, Roy Weitzman, David
Fraser, Thomas (Hamilton) Mendelson, J. J. Wheeldon, W. E.
George, Lady Megan Lloyd Millan, Bruce Whitlock, William
Ginsburg, David Mitchison, G. R. Willey, Frederick
Gooch, E. G. Monslow, Waiter Williams, D. J. (Neath)
Gordon Walker, Rt. Hon. P. C. Moody, A. S. Williams, Rev. LI. (Abertillery)
Greenwood, Anthony Morris, John Williams, W. R. (Openshaw)
Grey, Charles Mort, D. L. Willis, E. G. (Edinburgh, E.)
Griffiths, David (Rother Valley) Moyle, Arthur Wilson, Rt. Hon. Harold (Huyton)
Griffiths, Rt. Hon. James (Llanelly) Noel-Baker, Francis (Swindon) Winterbottom, R. E.
Grimond, J. Oliver, G. H. Woof, Robert
Gunter, Ray Oswald, Thomas Yates, Victor (Ladywood)
Hale, Leslie (Oldham, W.) Padley, W. E.
Hall, Rt. Hon. Glenvil (Colne Valley) Paget, R. T. TELLERS FOR THE AYES:
Hamilton, William (West Fife) Panned, Charles (Leeds, W.) Mr. Cronin and Mr. Probert.
Hannan, William Pargiter, G. A.
Agnew, Sir Peter Black, Sir Cyril Clarke, Brig. Terence (Portsmth, W.)
Aitken, W. T. Bossom, Clive Cole, Norman
Allason, James Box, Donald Collard, Richard
Amory, Rt. Hn. D. Heathcoat(Tiv'tn) Boyle, Sir Edward Cooke, Robert
Ashton, Sir Hubert Braine, Bernard Cooper, A. E.
Atkins, Humphrey Brewis, John Cordeaux, Lt.-Col. J. K.
Balniel, Lord Bromley-Davenport, Lt.-Col. W. H. Corfield, F. V.
Barber, Anthony Brooman-White, R. Costain, A. P.
Barlow, Sir John Browne, Percy (Torrington) Courtney, Cdr. Anthony
Barter, John Bryan, Paul Craddock, Sir George Beresford
Batsford, Brian Bullard, Denys Critchley, Julian
Baxter, Sir Beverley (Southgate) Bullus, Wing Commander Eric Crosthwaite-Eyre, Col. O. E.
Bell, Ronald (S. Buoks.) Butcher, Sir Herbert Cunningham, Knox
Bennett, Dr. Reginald (Gos & Fhm) Campbell, Sir David (Belfast, S.) Curran, Charles
Bevins, Rt. Hon. Reginald (Toxteth) Campbell, Gordon (Moray & Nairn) Currie, G. B. H.
Bidgood, John C. Carr, Compton (Barons Court) Dance, James
Biggs-Davison, John Chichester-Clark, R. d'Avigdor-Goldsmid, Sir Henry
Bingham, R. M. Clark, Henry (Antrim, N.) Deedes, W. F.
Bishop, F. P. Clark. William (Nottingham, S.) de Ferranti, Basil