Commons Sitting of 15 July 1964

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
ORAL ANSWERS TO QUESTIONS
  MINISTRY OF DEFENCE

    Fishery Protection Vessels
    Mr. Hector Hughesasked the Secretary of State for Defence if he will make a further statement on the number and names of British inspection vessels in the fishing waters of the North Sea; and what incidents have occurred there during the last month.
    The Under-Secretary of State for Defence for the Royal Navy (Mr. John Hay): Her Majesty's ships of the Fishery Protection Squadron do not undertake continuous patrols of the North Sea but make frequent visits to fishing grounds. H.M.S. "Wotton" is at present in the area. No incidents have been reported.
    Mr. Hughes: Does the Under-Secretary agree that the British Fishery Protection vessels in the area are very much fewer in number than those of foreign countries and that this encourages foreign nations to encroach upon British fisheries? Will he see that the British Fishery Protection Squadron is kept up to date in the interest of British fishermen and also in the interest of the fish-eating public?
    Mr. Hay: I am sorry that I cannot agree with the hon. and learned Member on the first two parts of his supplementary question. I am not aware that we are thinner on the ground than other nations, nor am I aware that as a result other nations are persuaded to fish in traditional British waters. We believe that the Fishery Protection Squadron provides adequate protection, and although we are now looking at the whole situation in the light of the Fishery Limits Bill, nevertheless we think that what we are doing is about right.
    Mr. Hughes: Does the hon. Gentleman agree that the Bill increases the need to keep our Fishery Protection Squadron up to date, and will the hon. Gentleman see that it is kept up to date?
    Mr. Hector Hughesasked the Secretary of State for Defence if he will now make a further statement on the working of the system of British inspection ships in the fishing waters near the Faroes, indicating how many and which of these ships are working there and what incidents have occurred.
    Mr. Hay: I would refer the hon. and learned Member to the reply which I gave him on 22nd April last. H. M. ships of the Fishery Protection Squadron have continued to patrol the area. H. M. S. "Keppel", at present on patrol off the Faroes, has been on patrol since 9th July. The duties of these ships have remained as previously stated in my replies to the hon. and learned Member, and I am glad to report that there have been no incidents involving either H. M. ships or British trawlers.
    Mr. Hughes: Will the Under-Secretary agree that it is of the utmost importance to preserve harmony between the various fishing fleets using the relevant waters? Does he agree that if our fishery protection vessels are much smaller in number than those of other nations this encourages those of other nations to encroach upon British fishing grounds? Will he look at the matter also from that angle?
    Mr. Hay: I must confess to a certain degree of confusion as a result of that supplementary question. I thought that this was a Question about the Faroes. As for the British Fishery Protection Squadron, I have nothing to add to the replies which I have previously given to the hon. and learned Member.
    Sir C. Osborne: Have there been any complaints from the British Trawler Federation about the inadequacy of the protection?
    Mr. Hay: No, Sir, not to my knowledge.
    Commander Keransasked the Secretary of State for Defence how many additional fishery protection vessels will be needed when the Fishery Limits Bill comes into force.
    Mr. Hay: I regret that at present I have nothing to add to the reply which I gave to my hon. Friend the Member for Haltemprice (Mr. Wall) on 8th July.
    Commander Kerans: Is there not here an occasion when the Royal Navy could increase the number of its fast patrol boats, especially M. G. B. s, and has my hon. Friend seen the letters in The Times from Peter Scott and the hon. and learned Member for Aberdeen, North (Mr. Hector Hughes) on this subject? Is there not here a great opportunity for the Navy to increase its Coastal Forces, which did so well during the last war?
    Mr. Hay: I have seen those letters. As I said in answer to my hon. Friend the Member for Haltemprice at the beginning of the month, these matters are under urgent consideration. We shall bear in mind the suggestion my hon. and gallant Friend has made, which has been made on a number of occasions previously.
    Mr. Hector Hughes: Does the Minister agree with the argument in my letter to The Times to which the hon. Gentleman referred, and does he agree that the Fishery Limits Bill increases the obligation on Her Majesty's Government to see that our protection forces are kept at full strength?
    Mr. Hay: From time to time there are things in The Times with which I do not entirely agree, and this, I fear, is one of them.

    British Forces, Germany
    Mr. Rankinasked the Secretary of State for Defence whether he will continue to keep British troops in West Germany in view of her Government's decision not to make any financial or other contribution towards their upkeep.
    The Secretary of State for Defence (Mr. Peter Thorneycroft): The Federal German Government have made no decision of the sort to which the hon. Member refers.
    Mr. Rankin: Is not it generally understood that Western Germany has now decided not to pay for the upkeep of British forces in its territory? Is not it also the case that Western Germany is not purchasing any compensatory arms, which it promised to do, but is getting
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    them from America instead? In view of that attitude, is it possible to defend spending £55 million of the British taxpayers' money on keeping an army in a country where it is not wanted?
    Mr. Thorneycroft: Normally I am pressed by the Opposition to put more there. The answer, broadly, is "No, Sir; no such decision has been reached".
    Mr. Fernyhoughasked the Secretary of State for Defence if he will make a statement about his recent talks with the West German Minister for Defence, Herr Uwe von Hassell, in connection with the costs of the British forces in Germany.
    Mr. Thorneycroft: No, Sir; the talks were confidential.
    Mr. Fernyhough: Can the right hon. Gentleman at least assure us that they were a little more successful, even though confidential, than the previous talks which his predecessors, or representatives from the Treasury, had with their opposite numbers in Germany? Can he give the assurance that for this year at least we will get more than two-thirds of the cost, which is all we got from the Germans last year?
    Mr. Thorneycroft: The talks were not even exclusively about costs. They covered the whole range of our defence and were in concert with the normal exchange of staff talks which go on with all our allies.
    Mr. Rankin: As the demand for doubling the British forces in Germany has come from behind the right hon. Gentleman today, can he say what the costs of doubling the Army of the Rhine would be?
    Mr. Thorneycroft: I was not aware of any demand to double the size of our forces in Germany. It would be a very substantial capital cost of about £300 million with running costs of about £100 million, and it would involve conscription.

    Southern Command (Photography Contract)
    6. Mr. F. M. Bennettasked the Secretary of State for Defence whether he will now reconsider his decision not to renew contracts for identity photographs in

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    Southern Command with Mr. Lewis Jones of Glen View, 3 Innerbrook Road, Torquay.
    The Under-Secretary of State for Defence for the Army (Mr. Peter Kirk): No, Sir. The contracts were let as a result of competitive tendering in accordance with the normal procedures and were awarded to the lowest tenderer. On the last tendering, Mr. Jones, having held the contracts for the last two years, failed to gain the contracts on price grounds.
    Mr. Bennett: It may seem a small matter, but is not my hon. Friend aware—I think that he must be—that this individual has been a contracting photographer for the Army for 40 years without a break, that he is a disabled war pensioner from both world wars and this is his only livelihood? Further, is my hon. Friend aware that he has a long and excellent record of security to which the Army has paid tribute over and over again? Will my hon. Friend look at the matter again because, on the face of it, if considerations of saving public money are in Ministers' thoughts, he can take it that the National Assistance on which Mr. Jones now has to live far exceeds the difference on photograph tenders over a period of four or five years?
    Mr. Kirk: I have myself looked into this case with very great care on more than one occasion, as my hon. Friend knows, but, unfortunately, I am not given much latitude on contracts. The only latitude would be if Mr. Jones, as a disabled ex-Service man, were registered on the King's National Roll. Unfortunately, neither he nor any of his competitors are so registered.
    Mr. Bennett: In the circumstances, the only thing I can say, with some regret, is that I shall seek an early opportunity to raise this matter on the Adjournment.

    Admiral Cunningham (Memorial)
    Sir J. Langford-Holtasked the Secretary of State for Defence what memorial it is proposed to erect in Trafalgar Square to Admiral of the Fleet Viscount Cunningham of Hyndhope.
    Mr. Hay: We have decided, in principle, that a memorial to Admiral Cunningham should be erected. I am discussing with my right hon. and hon. Friends what form this would best take.
    Sir J. Langford-Holt: Would my hon. Friend bear in mind the claims of Trafalgar Square, where a memorial such as this would be infinitely preferable to one of a fairly undistinguished monarch sitting on a horse, looking as though he is riding a donkey, without boots, spurs or saddle?
    Mr. Hay: We shall bear in mind the posibility of Trafalgar Square, but no final decision on this has yet been reached.
    Sir R. Thompson: Will my hon. Friend be very unwilling to remove the most distinguished statue in London, the equestrian statue of Charles I by Lesueur in Trafalgar Square?
    Mr. Hay: I am getting into very deep water for a Navy Minister.

    Admiralty Library (Book)
    Mr. Thorpeasked the Secretary of Defence what instructions have been issued to the Admiralty Library with regard to the book "The Fleet that Faced Both Ways", by Anthony Heck-stall Smith.
    Mr. Hay: None, Sir.
    Mr. Thorpe: Is the hon. Gentleman aware that the Admiralty Library, on the publication of this book last autumn, refused to buy a single copy, and will he, therefore, look into the matter again? Does the hon. Gentleman not agree that this is a serious work of naval history, and is he aware that the author was refused permission to read signals by the Admiralty but obtained it immediately and readily from another source? Could it be, perhaps, that there has been some pique on the part of the Admiralty, or is it considered that officers and ratings are not capable of judging reading matter for themselves?
    Mr. Hay: I said in my Answer that we have given no instructions to the Library about this book. Copies have been purchased for the Admiralty Library, another copy for the Royal Naval Staff College at Greenwich, and

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    another for the education centre at Singapore. The question of classified information is an entirely different matter. To answer the Question on the Order Paper, no instructions have been given to the Library.
    Sir Richard Glyn: Will my hon. Friend bear in mind that the whole political future of the Liberal Party depends on the delicate art of facing both ways and give this suggestion such consideration as it is worth?
    Mr. Speaker: The future of the Liberal Party is not to be found in the Admiralty Library.

    R. A. F. Station, Finningley
    Mr. Jegerasked the Secretary of State for Defence whether he will make a statement on the future of the Royal Air Force station at Finningley, Yorkshire.
    The Minister of Defence for the Royal Air Force (Mr. Hugh Fraser): The Royal Air Force will need to retain Finningley as an active flying station for as far ahead as I can see.
    Mr. Jeger: Does that mean that there is no question of the Royal Air Force giving up this base within the near future? Is the right hon. Gentleman aware that there has been some hope of Finningley being transformed into a Yorkshire civil airport?
    Mr. Fraser: No, Sir; there is no chance of our giving up this airfield in the foreseeable future.
    Mr. Bellenger: As Finningley is in my constituency, may I say that I welcome the Minister's answer?

    R. A. F. Stations (Closures)
    Mr. F. Taylorasked the Secretary of State for Defence how many Royal Air Force stations have been closed in the last three years; how many are expected to close in the present year; and what has been the estimated financial saving.
    Mr. H. Fraser: In the period 1961–63 inclusive, 53 Royal Air Force stations have been closed, representing a total saving of £10 million a year. In addition,
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    the sale of land and buildings has so far realised the sum of £4·25 million. During this year, a total of 14 stations will be closed, producing an estimated saving of £4 million. These closures have already been announced locally.
    Mr. Taylor: I am most grateful for that reply, but will my right hon. Friend agree that, before further closures, he should consider carefully the advisability or possibility of a partnership in use with civil aviation, since this would have the effect of more usefully operating some airfields and also, perhaps, proving a financial contribution towards the cost of upkeep while at the same time adding to our much needed civil air travel facilities?
    Mr. Fraser: If my hon. Friend will write to me, I shall be very happy to answer him. It is a very complicated point. The cost of keeping these stations open is very great, and it could not fall normally on the Defence Vote.

    R. A. F. Technical Tradesmen
    Mr. Turnerasked the Secretary of State for Defence what is being done in the Royal Air Force to ensure the most economic use of skilled technical tradesmen.
    Mr. H. Fraser: I have this very much in mind. Special units study all current and new equipments introduced to evolve the easiest and most economical methods of maintaining them. The new trade structure introduced this year is giving technical tradesmen broader trade knowledge and experience so that they can be employed more flexibly. As a result, there has been a saving in the variety of training courses needed and of key manpower.
    Mr. Turner: In view of the growing complexity of modern aircraft, is it not possible for more repairs to be done centrally, say, for the V-bomber force or other commands?
    Mr. Fraser: Yes, Sir: we are doing this in quite a big way. The major servicing of the V-bombers, for instance, has been centralised, and this means quite a large saving running into many thousands of pounds. We are pursuing this policy as far as we can.

    Varsity Navigation Trainer (Replacement)
    14. Mr. K. Lewisasked the Secretary of State for Defence when it is proposed to replace the Varsity as the Royal Air Force's main navigation trainer.
    Mr. H. Fraser: The Dominie, previously known as the DH 125, will succeed the Varsity as the Royal Air Force's main advanced navigation trainer. Deliveries will begin in the middle of next year and be completed early in 1966.

    Borneo Operations
    Mr. Hollandasked the Secretary of State for Defence if he will make a statement on the part the Royal Air Force has played since the beginning of the operations in Borneo.
    Mr. Croninasked the Secretary of State for Defence if he will make a statement on the part played by the Royal Air Force in the military operations that have taken place in Borneo up till the present.
    Mr. II. Fraser: Up to the end of June. Royal Air Force transport aircraft had carried between Singapore and Borneo more than 32,000 men and 2,700 tons of stores as well as many helicopters, light aircraft and more than 350 vehicles and trailers. In the forward areas helicopters and fixed-wing aircraft have given continuous and indeed life giving support to our troops by the transport of men and supplies. The Royal Air Force has also provided fighter protection over Borneo and maritime reconnaissance along the coasts. I feel sure that the House will wish to join me in paying tribute to the high degree of competence and efficiency displayed by all ranks in conditions which are often of testing difficulty.
    Mr. Holland: Is my right hon. Friend satisfied that the Press has every facility for publicising adequately the fine record of the Royal Air Force? Would he agree that very great credit is due to the men who work under these very difficult climatic conditions to keep the aircraft serviceable as well as to those who fly them in danger with great courage, skill and tenacity of purpose?
    Mr. Fraser: I want to do everything I can about Press facilities. If journalists fly out from here, I will see that they are given the full facilities of Transport
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    Command. Secondly, I fully agree with my hon. Friend that the task of maintaining aircraft in these extreme conditions of heat is a formidable one which has been carried out with great cheerfulness by all ranks.
    Mr. Cronin: While I agree about the admirable devotion and efficiency of the Royal Air Force under difficult conditions, may I ask whether it is not the case that it has been grievously handicapped by the lack of helicopters? Is it not the Government's fault that operational requirements were not made for helicopters years ago when this deficiency could easily have been foreseen?
    Mr. Fraser: With respect, I think that this can be greatly exaggerated. Every mission asked for has been carried out either by the Royal Air Force or by the Royal Navy. As the hon. Gentleman must know, by the end of this year the size of our tactical lift force will almost have been doubled. Of course, there is always a demand for helicopters. It is natural that one should ride rather than walk and fly rather than ride, but at the same time I believe that by the better utilisation of these aircraft we are meeting all the military demands from the ground.
    Captain Litchfield: If journalists are being flown out by Transport Command to see the operations in Borneo, can Members of Parliament also get passages?
    Mr. Fraser: Yes. I think there is a group of Parliamentarians going out; but certainly I will ask my right hon. Friend about this. I am sure that it could be arranged.
    Mr. Healey: While wishing to associate the whole Opposition with the tributes paid both to the maintenance staff and flying staff of the Royal Air Force in Borneo, I should like to press the right hon. Gentleman on the question of Air Force Wessexes. Is there any plan for increasing the number of these in Borneo, because it seems to be the agreed view of all the Army personnel involved that they could do with a substantial increase?
    Mr. Fraser: I could not go into detail, but we have made a considerable increase. A considerable number of Scout

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    helicopters is going out to relieve the heavier tactical lift stuff from doing what is really a reconnaissance and officer-carrying rôle. I am sure that the key answer to this is the better utilisation of what we have. We are improving the means of contact—perhaps the hon. Gentleman saw this when he was out there—between remote patrols and the helicopters. This saves an enormous amount of time. Helicopters can go straight down instead of wasting time flying over impenetrable jungle.
    Mr. Rankin: On a point of order. Will the right hon. Gentleman say whether he is also answering Question No. 65?
    Mr. Speaker: No.

    Royal Navy and Coastal Command (Commitments)
    Commander Courtneyasked the Secretary of State for Defence to what extent the Royal Navy and Coastal Command, Royal Air Force, are able to fulfil present North Atlantic Treaty Organisation commitments in case of emergency without the withdrawal of ships and aircraft now operating east of Suez.
    Mr. Thorneycroft: We can fulfil our commitments world-wide, and have, I think, demonstrated this in recent months. I prefer not to enlarge on our dispositions for doing so.
    Commander Courtney: Does my right hon. Friend recollect that seven years ago two British retiring commanders-in-chief in the East Atlantic declared that they had insufficient forces to carry out their N. A. T. O. duties? Is it not time that we had a readjustment of our commitments to N. A. T. O. with slightly more emphasis on the maritime side?
    Mr. Thorneycroft: Whatever they may have declared seven years ago, the Commander-in-Chief Far East is not declaring that today. I think that we have demonstrated to the world our ability to fulfil our commitments.
    Mr. Willis: Will the right hon. Gentleman say how many aircraft carriers are in commission this side of Suez?
    Mr. Thorneycroft: No. I would not declare where our carriers are.

    Long-Distance Weather Forecasts
    Mr. Gresham Cookeasked the Secretary of State for Defence (1) if he will now give an assessment of the results of the operation so far of the long-distance weather forecasts; and if he will make a statement;
    (2) how many subscribers there are now to the long-distance weather forecasts; and what are the main types of user of this service.
    Mr. H. Fraser: The standard of accuracy of the 30-day weather forecasts published since 1st December, 1963, has been in line with my prediction to the House on 13th November, 1963. Nine out of 13 forecasts have been in close or moderate agreement with the weather actually experienced, and four have shown little agreement. None, however, has been wholly misleading. There are 2,800 subscribers to this new service, including some 590 business firms, 338 schools, 92 local authorities and 61 public utilities.
    Mr. Gresham Cooke: Would my right hon. Friend agree that, despite the laughter on the benches opposite, it has been a useful exercise to get these 30-day forecasts started? Is not the amount of information sent out on the charts in connection with these 30-day forecasts of considerable value and interest? Would he say whether the public utilities which are among the 2,800 subscribers have found this useful?
    Mr. Fraser: I thank my hon. Friend for his proper praise of this worthy endeavour. I am sure that it has been right to do this. Now that we have 2,800 subscribers, we propose in the next few weeks to ask them for their views on how useful this service has proved. When I have that information, I shall be very pleased to make a statement to the House.
    Mr. K. Lewis: In view of my right hon. Friend's good forecasting, will he look further ahead and tell us what the weather, political and otherwise, will be like in October.

    Recruiting (Cranwell)
    19. Mr. Goodhewasked the Secretary of State for Defence whether he is satisfied with the recruiting figures for Cranwell; and if he will make a statement.
    Mr. H. Fraser: Recruiting for Cranwell is highly satisfactory. Applications for cadetships have increased steadily over the last three years and there has been no difficulty in filling available places with candidates of high quality.
    Mr. Goodhew: Is my right hon. Friend aware that that reply will give great satisfaction to the House? Will he congratulate the recruiting department in his Ministry on the advertisements which no doubt have played a big part in this response?
    Mr. Fraser: Yes, Sir. I think it is also true that the reason that young men want to go into the Air Force is because it offers them a fine career. This comes perhaps from the aircraft and the chances which we are now able to offer in the Royal Air Force.

    Service Airfields (Private Flying)
    Commander Courtneyasked the Secretary of State for Defence if he will make arrangements for Royal Navy and Royal Air Force air stations, listed in the Air Pilot, other than military aerodromes engaged in special work, to be made available for the use of private and club aircraft at weekends.
    Mr. H. Fraser: I regret that I am unable to extend the current arrangements for the use of service airfields by private civil aircraft.
    Commander Courtney: Does everybody in the Royal Air Force go on leave at weekends? Is my right hon. Friend telling us that he has no Royal Air Force duty officers capable of aiming a red or green Aldis lamp at an incoming aircraft? Is he saying that he has no fire parties capable of going on the runway in case of need? Will he be slightly more imaginative and helpful? Will he look at this matter again?
    Mr. Fraser: Every station commander must be responsible for the safety of aircraft landing on his field, and that means that full and due precautions must be taken and retaining over the weekend men whom I should like otherwise to send on leave. I am always ready to look at the question of specific airfields, but I must warn my hon. and gallant Friend that what he is proposing would be a large expense on the Defence Vote, which is already strained.
    Commander Courtney: Does not my right hon. Friend make allowance for a fire in a hangar at weekends, and cannot the same men who would put out such a fire go on the runway in case of necessity?
    Mr. Fraser: No. They have to be available for various duties on the airfield, and they must not be distracted from those duties.

    Plymouth Army Week (Press Hand-out)
    Mr. Thorpeasked the Secretary of State for Defence whether he is aware that the hand-out issued by the public relations officer, on behalf of Headquarters 43rd Wessex Division/District, Sherford Camp, Taunton, relating to Plymouth Army Week, a copy of which has been sent to him by the hon. Member for North Devon, has caused concern to many people who are opposed to racial prejudice of any sort; and what steps he will take to ensure that this type of propaganda is not repeated.
    The Minister of Defence for the army (Mr. James Ramsden): I regret the expression used, which I can see might cause offence. In the context it was certainly not meant as propaganda.
    Mr. Thorpe: I thank the right hon. Gentleman for that reply, which will do much to correct an unfortunate impression. May I ask him whether any indication has been given which will prevent this sort of thing occurring again?
    Mr. Ramsden: I am sure that this is not the sort of thing which will normally occur. I have not seen fit to take action beyond answering the hon. Gentleman, because it is widely accepted that the conduct of all ranks towards foreigners is invariably correct and, indeed, praiseworthy. I think that actions speak a great deal louder than words.
    Miss Vickers: Does not my right hon. Friend think that this exercise was an extremely good one? In fact, among the "enemy" were a great many people ' from overseas. No offence was taken locally. This arose only because of propaganda outside the area.
    Mr. Ramsden: I am obliged to my hon. Friend.

    Service Integration
    Mr. Dempseyasked the Secretary of State for Defence what progress has been made in the integration of the three Services; and if he will make a statement.
    Mr. Thorneycroft: Our purpose is not to integrate the Services but the work of the Ministry which serves them. I made a progress report on this in the debate on the Estimates Committee Report on 6th May. This work is proceeding.
    Mr. Dempsey: Would the Secretary of State not agree that it was expected that this co-ordination would eliminate wasteful competition and duplication of offices, and, indeed, other inequities in the Services, and stimulate management in the direction of economy and save the taxpayer some money? Can he say whether we have made any progress in those particular directions?
    Mr. Thorneycroft: Yes, very substantial progress in all of them; but as there is a Question on numbers later I think I will wait to give the answer then.

    Mixed-Manned Multilateral Force
    Mr. A. Lewisasked the Secretary of State for Defence what recent approaches he has had for Her Majesty's Government to declare themselves in favour of the United States plan for mixed-manned nuclear force; by whom they were made; and whether he will make a statement.
    Mr. Thorneycroft: None, Sir.
    Mr. Lewis: Can we take it that none of the hon. and right hon. Gentlemen opposite who have put a Motion down on the Paper in favour of this has had the courtesy to make an approach to the right hon. Gentleman and discuss it with him? Is this not a terrible way for back benchers on the other side of the House to behave?
    Mr. Thorneycroft: No. I am not referring to what is said or not said in this House, but I have had no representation from outside this House on the matter.
    Mr. Lewis: That was not the question.
    Mr. Healey: Is the right hon. Gentleman aware that many of us on this side of the House who regard his current proposals as at least preferable to the official American proposals are shocked that so many of his hon. and right hon. Friends should stab him in the back? Can he tell us whether he has yet persuaded the Chief Patronage Secretary to allow those Members of the Government Party who support the Secretary of State for Defence on this matter to express their views in a Motion on the Paper?
    Mr. Thorneycroft: I think that this whole subject is a very—[HON. MEMBERS: "Embarrassing."] No, grave. I think this is a grave and important issue, and I think this raises very large issues not only of defence policy but of foreign policy, too. What I would say is that I do not think that any British Government are going to be rushed into a decision over this subject, which requires very careful examination, and it is receiving that examination.
    Mr. Grimond: Can the right hon. Gentleman say whether the experiments with the mixed-manned force at sea have actually started, or, if not, when they will be started?
    Mr. Thorneycroft: The men are being assembled now; it has just started.
    Sir Richard Glyn: Will my right hon. Friend assure the House that he will make no statement with regard to plans for a mixed-manned force till the current trials have been concluded?
    Mr. Thorneycroft: It depends on what I am asked to say in the House of Commons. Naturally, I shall try to answer hon. Members on either side of the House who ask me Questions, but I can give my hon. Friend the assurance that there is going to be no rushed decision by the Government on an issue of this gravity.
    Mr. Lewis: The Secretary of State said in reply to my Question that he had received no approaches. Then he said that it is a serious matter which ought to be discussed and ought to be considered. Can he say whether he has or has not received any approaches from his hon. and right hon. Friends who put the Motion on the Paper, as was asked

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    in the Question? I ask: "Has there been any approach from any quarter?"
    Mr. Thorneycroft: I have seen the Motion on the Paper.
    Mr. Lewis: But has there been any approach?
    Mr. Healeyasked the Secretary of State for Defence if he will now make a statement on the proposals he has submitted to the North Atlantic Treaty Organisation Study Group for a North Atlantic Treaty Organisation multilateral nuclear force.
    Mr. Critchleyasked the Secretary of State for Defence what progress has been made on the North Atlantic Treaty Organisation working group on the multilateral force in Paris; what was the result of Britain's proposal to extend the multilateral concept to tactical weapons systems; and whether he will make a statement.
    Mr. Thorneycroft: I would refer to the reply which I gave on 2nd July to my hon. Friend the Member for Rochester and Chatham (Mr. Critchley). Our ideas have now been presented to the Paris Working Group by the British Permanent Representative to N. A. T. O., assisted by military experts from the Ministry of Defence, led by an Assistant Chief of the Defence Staff. The Working Group agreed, subject to confirmation by one or two members, that our ideas merited further serious consideration. They will therefore now be examined in detail. I wish to emphasise that Her Majesty's Government is in no way committed to participation in a mixed-manned multilateral force of any kind.
    Mr. Healey: I welcome the fact that the right hon. Gentleman prefers to explore the possibility of controlling existing weapons rather than to set up an entirely new force at very high cost and with dangerous political purposes. Can the right hon. Gentleman tell us whether the Cabinet is now united on these proposals? He will remember that when he last adumbrated them in December they were rejected within 24 hours by a Foreign. Office spokesman. On the question of the mixed-manned test ship, would he not agree that it is highly desirable that the forces serving on this ship should receive the same pay and allowances?
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    Are not people working together in very close quarters like this liable to be under a very serious psychological strain if, as now, there are large gaps between the conditions under which they serve?
    Mr. Thorneycroft: The Cabinet is united on this as on all other matters. I have no doubt that one of the purposes of the experiments in mixed-manning is to throw up this type of problem.
    Mr. Critchley: Is my right hon. Friend aware that if his scheme is to be well received by our allies it must not be thought of as a substitute for a share in the seaborne forces but only as an extension of it?
    Mr. Thorneycroft: My hon. Friend talks about an extension, but no one has agreed at the moment to set up any such forces of any kind. I want to make that absolutely clear. What is being studied here, on exactly equal terms to the seaborne force, is the suggestion of using existing weapons rather than making a massive investment in new weapons. This is being discussed not as a substitute or alternative but in parallel with the other suggestion on exactly the same terms.
    Mr. Frank Allaunasked the Secretary of State for Defence what is his estimate of the total cost to Great Britain of setting up a mixed-manned nuclear fleet, and of the annual cost thereafter.
    Mr. Thorneycroft: No such estimate is at present possible. It has not yet been decided whether or not a mixed-manned nuclear fleet should be created or, if sc, what size it might be. In any case, Britain remains wholly uncommitted to joining a multilateral force. The estimated capital and recurrent cost would, of course, be important factors of which full account would be taken by the Government in deciding whether or not to join and, if so, what size a British contribution might be.
    Mr. Allaun: Does not the Minister think it worth taking seriously the constant Russian warnings that if the M. L. F. is set up it will end the hopes of a peaceful East-West settlement?
    Mr. Thorneycroft: I have already indicated that the whole subject deserves to be taken very seriously indeed.
    Mr. Hastings: Are not these comments superfluous, coming from a party

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    which intends to abandon nuclear power? In view of the latest Republican platform which has been published, is not the Labour Party's defence policy to abandon the deterrent even more absurdly dangerous?
    Mr. Speaker: Order. We are going far from the Question.

    Aircraft, Supplies and Equipment
    Mr. Stonehouseasked the Secretary of State for Defence what defence aircraft have been ordered from firms in the United States; and if he will make a statement.
    Mr. Croninasked the Secretary of State for Defence what military aircraft he has ordered so far from the United States.
    Mr. Thorneycroft: None, Sir.
    Mr. Stonehouseasked the Secretary of State for Defence what is the current total value of orders for military, naval and air force supplies and equipment from firms in the United States and the total value of current commitments.
    Mr. Thorneycroft: In 1963–64 about £9½ million was spent in the United States out of estimated total defence budget expenditure on production and research of £728 million. At 1st April, 1964, the value of outstanding orders, mostly Polaris missiles, with American firms was just over £50 million, spread over the next four years.
    Mr. Stonehouse: Why cannot these orders be placed with firms in the United Kingdom?
    Mr. Thorneycroft: It is a pretty small percentage, £9½ million out of £728 million. Anything less would mean almost cutting trade off completely.
    Sir A. V. Harvey: If in future any orders are placed in the United States, would my right hon. Friend undertake to see that there is a quid pro quo and that in return the United States will undertake to order equipment here?
    Mr. Thorneycroft: My hon. Friend is quite right. These are important considerations. In so far as possible, one wants to try to exchange orders of this kind, so that all of us share in the manufacture
    1192
    of the weapons required by the West as a whole.
    Mr. Healey: While strongly supporting the right hon. Gentleman on the latter point, may I ask him whether he can tell us what happened to the order announced to the House for Phantom aircraft for the Royal Navy? Can he say whether there is any truth in the rumour mat the McDonnell Company are threatening not to go ahead with the order unless it is placed in the next four months?
    Mr. Thorneycroft: No truth whatever, but I hope it will be placed well before then. I am asked here what orders have been placed. The placing of an order is a formal act in the process of production. This has not taken place at the present stage, but I have every hope that it will.
    Mr. Cronin: Bearing in mind that it is probably of very dubious economic value to modernise Phantom aircraft to take Rolls-Royce engines and to be able to operate from British carriers, will the right hon. Gentleman reconsider this order and consider again the idea of giving orders to the British aircraft industry, particularly bearing in mind that he has been supplied with various designs from Hawker Siddeley for the very same purpose?
    Mr. Thorneycroft: I do not find that supplementary question at all complimentary to one of the greatest aero-engine firms in the world.

    Low-FIying Aircraft (Brecon and Radnor)
    Mr. Watkinsasked the Secretary of State for Defence, in view of the continued complaints he has had from the public and authorities in Brecon and Radnor about low-flying aircraft, what action has been taken against pilots who ignore instructions against this undesirable practice.
    Mr. H. Fraser: I understand the hon. Member's difficulties, but there is no evidence that Royal Air Force pilots are disobeying instructions.
    Mr. Watkins: Will the right hon. Gentleman examine this again, because I can give evidence now of how Members of Parliament on a delegation to

    1193
    a forest in my constituency—three from this side of the House and two from the other side—saw low-flying aircraft in my constituency? Surely that is evidence enough, apart from the details I have given the right hon. Gentleman? Each time I send information to the Minister he finds another excuse for getting out of it.
    Mr. Fraser: I will certainly look at this multiplicity of evidence again, but the point is that low flying is part of the Royal Air Force training programme, and inevitably so.

    Service Departments (Day Release Classes)
    Mr. Boydenasked the Secretary of State for Defence what improvement there has been this year in the Service Departments in the percentage of industrial juveniles under 18 years of age attending day release classes.
    Mr. Kirk: About 8 per cent. more juvenile industrials are attending day release classes.
    Mr. Boyden: To put the question better, under the new dispensation will the Minister really take this seriously and at least do as well as the nationalised industries do?
    Mr. Kirk: We do take it very seriously, but we do have difficulties about the places in which these industrials are employed which the nationalised industries, quite often, do not have.

    Staff Reductions
    Mr. Boydenasked the Secretary of State for Defence by what date he expects the extra staff, appointed to effect reductions in staff, to show results.
    Mr. Fernyhoughasked the Secretary of State for Defence why the number of senior officers and their supporting staff in the present Ministry of Defence has increased when compared with the numbers employed in the separate Services before amalgamation.
    Sir A. V. Harveyasked the Secretary of State for Defence how the strength of his Department on 1st April, 1965, is expected to compare with that on 1st April, 1964, at Headquarters and, as
    1194
    regards non-industrial civilian staff, at out-stations.
    Mr. Thorneycroft: The number of staff in my Ministry will be less on 1st April, 1965, than they were when it was inaugurated on 1st April, 1964. This reduction is being achieved in spite of substantial new commitments, an increased burden on operational staff and continuing work on major schemes of reorganisation. A sizeable reduction in non-industrial civilian staff at out-stations is also being achieved. It is almost impossible to centralise any large organisation without some increase in senior staff.
    Mr. Boyden: Did not the Select Committee on Estimates draw attention to a substantial increase of very senior staffs? Is the right hon. Gentleman satisfied that there has not been empire building at the top, as often happens in these circumstances?
    Mr. Thorneycroft: I am, as always, extremely grateful to the Estimates Committee of this House. I find its reports very helpful. I think any Minister does who is trying to economise in staff, but I would point out that it examined my headquarters within weeks or months of its being formed, and I have since then been able to take certain action which ensures that Professor Parkinson is removed from the establishment.
    Mr. Fernyhough: In one part of his Answer the Secretary of State said it would be less in May, 1965, and in another part that a reduction would be substantial. That does not convey anything to us unless we have the figures. First of all, would he give them to us? Secondly, does he not realise that if the ending of the oldest demarcation dispute in the world only means very slight savings it is not a very good thing to put out to the trade unions what demarcation disputes in industry really cost?
    Mr. Thorneycroft: There will be a reduction of about 300 in the headquarters staff. This is despite a very substantial increase of staff coming in for work on Polaris and the like. There is also a reduction of about 800 or 1,000 on out stations. Considering the amount of work on reorganisation, the very heavy burden of operations at the present

    1195
    time and the fact that we are just getting going with the Polaris programme, this is a creditable start on these affairs.
    Sir A. V. Harvey: Is my right hon. Friend aware that the information which he has just given the House will be received with considerable satisfaction, particularly as this has happened within a few months of the integration of the three Services? Will he keep up the good work?
    Mr. Thorneycroft: I am most grateful to my hon. Friend.
    Mr. Healey: We are all happy that it is expected that the numbers of staff will be less next April than last April, but will the right hon. Gentleman' say whether the number of staff next April will be smaller than the number of separate staffs doing the same job before the new Ministry was created, which is the real issue at stake?
    Mr. Thorneycroft: Yes, Sir. I am starting from the point where there was the sum total of all the staffs brought together from the old Ministry of Defence and the three Service Ministries, and there will be a cut in that.

    Bloodhound Missiles
    Mr. Healeyasked the Secretary of State for Defence what proposals he has to scrap the Government's stock of Mark I Bloodhound missiles; what was the total cost of production of that stock, including research and development; and what were the dates between which these missiles were manufactured.
    Mr. Mulleyasked the Secretary of State for Defence if he will make a statement on the decision to withdraw the Bloodhound I missiles from British air defences and on the proposed deployment of Bloodhound II missiles; and what is the estimated cost of procurement of the Bloodhound II missiles.
    Mr. Thorneycroft: Bloodhound Mark I has been withdrawn from service because it has fulfilled its purpose. Some parts of the missiles and some of the associated equipment will continue to be of use to us; apart from minor sales the rest are being scrapped. Research and development expenditure on Bloodhound I and its launching system began in 1949 and totalled £32 million. The production cost
    1196
    of the R.A. F.'s Bloodhound I missiles was £23 million; these operational missiles were manufactured between 1958 and 1962. A proportion of the expenditure on Bloodhound I has, of course, contributed to the development of Bloodhound II which is already coming into service and will be deployed primarily for the defence of our bases and squadrons overseas.
    Mr. Healey: The House will surely be disturbed by the facts which the right hon. Gentleman has just given us, particularly in the light of the unhappy history of the contract. Can he tell us how many years—perhaps he had better tell us in months—Bloodhound I has been in squadron service? Is it true, as widely reported, that Bloodhound was found to be vulnerable to switch jamming even before it was first made operational?
    Mr. Thorneycroft: I do not think that anybody will be disturbed by an announcement of facts already known to most Members. Bloodhound I came into service in 1958. It was the first weapon of its generation and it has been remarkably successful. Bloodhound II will be an even better weapon.
    Mr. Mulley: Can the right hon. Gentleman clear up a question about whether there were any technical defects in Bloodhound I? Can he give us an assurance that Bloodhound II will be able to deal with attacks, even if electronic counter-measures are used by the attacking planes? It has been reported that Bloodhound I could not deal with switch jamming.
    Mr. Thorneycroft: One does not want to believe everything said about British missiles, but I can say that we learned a tremendous lot, as is inevitable and right, from the development of Bloodhound I and a great deal of that has been incorporated in Bloodhound II.
    Mr. Dance: Would not my right hon. Friend agree that the important feature about modern weapons is that their success lies in their never being used except as a deterrent?

    Defence Costs
    Mr. Shinwellasked the Secretary of State for Defence what additional sums have now been included in the cost of defence for 1963.
    Mr. Thorneycroft: None, Sir.
    Mr. Shinwell: Has it not been widely reported that the costs have increased by £128 million? Is this report true? If it is, can the right hon. Gentleman explain this additional cost?
    Mr. Thorneycroft: It has not been reported to me. The right hon. Gentleman may have in mind some associated costs which were referred to by the Chief Secretary, but these were not presented this year, nor last year, and nor will they be presented next year, as part of the defence budget, although for convenience they may be mentioned in the White Paper.
    Mr. Shinwell: Can the right hon. Gentleman translate that for me? Does that mean that there are to be additional costs of £128 million which are associated with our defence costs? Is it true or untrue?
    Mr. Thorneycroft: In a way, the whole of our industrial effort is associated in some way or another with our defence costs.
    Sir C. Osborne: Will my right hon. Friend tell the House what proportion of the gross national product is now spent on defence and what was the figure in 1951?
    Mr. Thorneycroft: It is now about 7 per cent. and there was a time under right hon. Gentlemen opposite when it was higher.

    Egypt (Supply of Arms)
    Mr. M. Footasked the Secretary of State for Defence if he will state the value of all military weapons and munitions sold to Egypt in each year since 1951.
    Mr. Shinwellasked the Secretary of State for Defence if he will publish a White Paper stating the names of those countries not associated with the Commonwealth who have made applications for the purchase of arms from the United Kingdom since 1952, and details of the weapons, vessels and other munitions required.
    Mr. Thorneycroft: No, Sir. It is not the practice to disclose details of Defence equipment supplied to other countries.
    Mr. Foot: Leaving aside the premature disclosure which came about in the other matter, will the right hon. Gentleman look at the matter afresh, because in 1956 exactly these figures were published by the Ministry of Defence which the right hon. Gentleman says are not now publishable? Will he look at the matter again?
    Mr. Thorneycroft: I am always willing to look at anything the hon. Gentleman asks me to, naturally, but nothing that happened then or has happened recently disposes me to alter the Answer to this Question.
    Mr. Shinwell: Is the right hon. Gentleman aware that my Question does not ask for details about arms which have been supplied? All that I am asking him to do is to tell the House what applications have been received. If he is ready to do that, will be give the details of the application received from the Spanish Government?
    Mr. Thorneycroft: My Answer applies both to applications and to sales.
    Brigadier Clarke: Would my right hon. Friend agree that nothing that we did to Egypt stopped her from having frigates repaired and converted in the Portsmouth area, whereas what the Opposition have done with Franco has lost thousands of £s of orders to my constituency?
    Mr. Healey: Leaving aside for the moment the fact that the information provided by the Admiralty spokesman was incorrect, did not the Prime Minister say yesterday that he had been authorised to give details of such a contract if the time arose? How can he square that with the statement that he has just made that it is not the custom to give such details?
    Mr. Thorneycroft: It is always courteous to give details of something which is announced from outside.

    H. M. S. "Valiant"
    Mr. Willisasked the Secretary of State for Defence what progress has been made in overcoming the structural difficulties which have arisen in connection with the nuclear propulsion machinery for H. M. S. "Valiant".
    Mr. Hay: Good progress has been made and work is proceeding to meet the revised completion date.

    Naval Aircraft Artificers
    Mr. Willisasked the Secretary of State for Defence what arrangements are made for the transfer of naval air artificers to the Royal Electrical and Mechanical Engineers.
    Mr. Hay: Applications were recently invited from aircraft artificers who would have completed at least 20 years of their 22 year engagements on 1st May, 1964, and who wished to be considered for a free discharge from the Royal Navy in order to join the Royal Electrical and Mechanical Engineers Branch in the Army. Eligible applications are being considered by the Army authorities.
    Mr. Willis: Is the hon. Gentleman aware that if an aircraft artificer transfers to the R.M.E. he will in a short time become a warrant officer and go on pension with a larger terminal grant and pension than if he stayed in the Navy and became a chief air artificer, first class? Does not the hon. Gentleman think that this demonstrates the anomalies which exist and that we ought again to look at this question of a master rate for the lower deck?
    Mr. Hay: The introduction of a master rate into the Royal Navy is a matter which has pretty wide implications, as I think the hon. Gentleman knows. I have looked into the allegation made in the first part of the hon. Gentleman's supplementary question, and I am advised that that is not so. The position is comparable, although in some respects some of these artificers may have a slightly higher rate in trade pay and in charge pay.

    Polaris Submarines
    Mr. Frank Allaunasked the Secretary of State for Defence what is his latest estimate of the total cost of the proposed Polaris submarine fleet and its nuclear missiles, and of its annual cost of upkeep.
    Mr. Thorneycroft: About £400 million capital and about £25 million operating.
    Mr. Allaun: Would not this money be far better spent from the British point
    1200
    of view and from the peace point of view if it were spent on housing, pensions, health and helping the hungry nations? Can the right hon. Gentleman tell the House of one circumstance in which a Polaris missile could be used against Russia without our country being wiped out in retaliation?
    Mr. Thorneycroft: If the hon. Gentleman reads the Answer, he will see that for a modest insurance of £25 million operating costs in the 'seventies, when the capital has been paid, we can have this deterrent under our own control. I would have thought that this was the cheapest investment that we had ever made.
    Mr. Kershaw: Can my right hon. Friend say what would be the approximate cost of cancelling the Polaris programme at this stage, and what other weapon could take its place?
    Mr. Thorneycroft: No, Sir. I would not like to give such a figure, though it would be substantial; but the losses to this country would be in more than money.
    Mr. McMaster: Can my right hon. Friend say how many men would be unemployed in this country if the Opposition proposals for defence were accepted?

    Spain ("Leander" Class Frigates)
    Mr. Wiggasked the Secretary of State for Defence (1) whether he will make a statement on the premature disclosure of information about the discussions with Her Majesty's Government regarding the Spanish Government's intention to build "Leander" class frigates under licence;
    (2) by what authority a Ministry of Defence spokesman stated that he could confirm that the Spanish Government is to build "Leander" Class frigates under licence.
    Mr. Thorneycroft: The fact that negotiations had been going on with the Spanish Government had been known fairly widely both here and abroad for a number of months. On 8th June the Directorate of Public Relations of my Department was approached by a member of the Press who stated that on information he had received from abroad he had knowledge of these negotiations and was told that it was our intention that

    1201
    these frigates should be built under licence in Spain. In fact the negotiations had not at that time been concluded and as the House already knows subsequent events frustrated them.
    Mr. Wigg: Would the right hon. Gentleman be good enough to look at the Prime Minister's reply yesterday, when he informed the House, or he suggested, that the right hon. Gentleman's Department was misled by a journalist putting a probing question which prompted an official to give information which he ought not to have done? Is the right hon. Gentleman aware that he has today been a little more forthcoming, but has not told the whole truth? Is it not a fact that Mr. Chapman Pincher went to his Department, gave information as to what he had heard, and was told that reference would have to be made to a senior official? Chapman Pincher returned several hours later and was then informed that negotiations had been concluded—the actual words are quoted by him. Is the right hon. Gentleman aware that the record in the Press section of the Admiralty showed that as long ago as 15th May there was a manuscript note which dealt with this as a purely routine matter? Would the right hon. Gentleman be good enough to tell the House why when he found out—whether it was a trick or not—that the information given was incorrect he did not then—
    Sir J. Langford-Holt: On a point of order, Mr. Speaker. Has the House no protection against a lengthy question like this?
    Mr. Speaker: The House knows that I emphasise always, as far as I can, the need to keep supplementary questions as short as can be.
    Mr. Wigg: Mr. Speaker, in giving that reply, you doubtless took into account the fact that I have put down two Questions which have been rolled into one?
    Mr. Speaker: With respect, that is not a good point, because a supplementary question arises from one Answer.
    Mr. Wigg: Whatever that may be, it knocks my bails off, but it does not alter the fact that although I pressed the right hon. Gentleman's Department time and again to confirm whether there had been a retraction or not, it took him until 10th May to write to me to say that no such
    1202
    retraction was issued. If the right hon. Gentleman's story is as it is now, why did he not come clean nearly three weeks ago?
    Mr. Thorneycroft: I have no complaint to make about anybody—certainly not the journalist concerned. He published a perfectly accurate report of what happened this morning. What I cannot understand is the hon. Member. He seems to have got the idea that I leaked this deliberately in the certain knowledge that the Leader of the Opposition would step into it thigh deep. This is an astonishing reflection on the Leader of the Opposition, and I must rise to his defence.
    Mr. A. Royle: Will my right hon. Friend tell the House what approaches have been made to him by hon. Members opposite in favour of going ahead with the sale of frigates to Spain—those hon. Members who have received hospitality from the Spanish Government during the past year?
    Mr. Gordon Walker: Will the Minister tell us why his Department first put out a false statement about this contract and then failed to deny it? This is the essence of the question put to him by my hon. Friend the Member for Dudley (Mr. Wigg)—[Interruption.] It is easy for the right hon. Gentleman to give smart alec answers, but this is a simple question. Why was a false statement put out and then not corrected?
    Mr. Thorneycroft: My right hon. Friend the Prime Minister has explained the circumstances in which this statement was made. I appreciate that the right hon. Gentleman wants to get his right hon. Friend out of a mess.[Interruption.] Subsequently it was stated that this contract had not been signed, but the idea that this was deliberate presupposes a degree of stupidity on the part of the Leader of the Opposition which even I think is unfair.
    Mr. F. M. Bennett: Can my right hon. Friend clarify one other point? I thought the whole point of view of the Opposition was that they disapproved of this deal and wanted to stop it—[HON. MEMBERS: Question."] Is the attitude of the Opposition such that no one took any notice of what the Leader of the Opposition said, or do they still disapprove of the deal?
    Mr. Speaker: It is no part of the duty of the Secretary of State for Defence to describe the attitude of the Opposition.
    Mr. Shinwell: In his reply to my hon. Friend the Member for Dudley (Mr. Wigg), the right hon. Gentleman said that the negotiations were widely known. As I knew nothing about these negotiations, despite the right hon. Gentleman's statement, will he be good enough, in order to elucidate the facts, to make the details of the negotiations known to the House, either by the submission of a White Paper or by circulating a statement in the OFFICIAL REPORT?
    Mr. Thorneycroft: No, Sir. I am anxious that these negotiations may at some stage be resumed and perhaps satisfactorily concluded. They were widely known, because negotiations of this kind cannot be conducted without the knowledge of a wide range of industry which might be concerned about them and a wide range of diplomatic circles. Negotiations of this kind are nearly always widely known. There was no reason why they should not be. It was only when they came to the notice of the Leader of the Opposition and he put both feet into it that things got bad.
    Mr. Biggs-Davison: Is it not extraordinary—indeed hypocritical—on the part of the Opposition to deplore the leak when they have shown themselves determined to try to wreck the deal?
    Mr. M. Foot: Does not the Secretary of State appreciate that his reply today reveals and underlines the fact that the statement made to the House yesterday by the Prime Minister was completely misleading? Does he not appreciate that that is a very important matter? Does not he realise that it was misleading in that the Prime Minister indicated to the House yesterday that the information had been inadvertently elicited from the Ministry of Defence because of the probing of a journalist, whereas the statement of the Minister of Defence today, although not coming clean completely, does not make that same claim? Therefore, what the Prime Minister did yesterday was to try to mislead the House and the country on the central point about the whole of this controversy. Will the Minister tell us whether he thinks misleading the House is or is not an important matter?
    Mr. Thorneycroft: I do not believe that anybody else believes what the hon. Member alleges.
    Mr. Kershaw: In view of the extremely unsatisfactory nature of the Opposition's questions, I beg to give notice that I shall raise this matter on the Adjournment at the earliest possible moment.
    Mr. Healey: Is it not an abuse of the procedure of this House for a back bencher to attempt to rescue a Minister who is on the point of being revealed as having connived at a deliberate misleading of the House?
    Mr. Speaker: I have a discretion in the question of whether or not I receive a notice. There are precedents about it. I had already called the hon. Member for Leeds, East (Mr. Healey).
    Sir H. Butcher: Is it not right that the hon. Member for Leeds, East (Mr. Healey) should withdraw his question directed against my right hon. Friend the Secretary of State for Defence?
    Mr. Speaker: I think that in the midst of all this there was allegation of deliberately misleading. In my view that should be withdrawn.
    Mr. Healey: I unreservedly withdraw this allegation if it proves to be untrue. [Interruption.] I did not make the allegation—
    Mr. Speaker: If the hon. Member did not make it, it is not to be withdrawn by him.
    Brigadier Clarke: On a point of order. The Spanish naval mission—[Interruption.]
    Mr. Speaker: Order. I must have silence so that in the service of the House I can hear the terms of the point of order that is being addressed to me.
    Brigadier Clarke: On a point of order. I can show that what the Minister said is true, because the Spanish naval mission—
    Mr. Speaker: That does not give rise to a point of order. The hon. Member for Leeds, East is asking a question.
    Mr. Healey: May I ask the right hon. Gentleman—[HON. MEMBERS: "With draw."] May I ask the right hon. Gentle man how it came about—
    Dame Irene Ward: On a point of order. Is not a rather unusual procedure being adopted by the hon. Member for Leeds, East (Mr. Healey)? When you instruct him to withdraw, is he not to withdraw?
    Mr. Speaker: What he said to me was that he did not make the allegation. [HON. MEMBERS: "He did."] Now I am in a difficulty which concerns the recollection of the House. If the hon. Member did make it I have told him that he must withdraw it. He says that he did not make it.
    Mr. Healey: May I ask the right hon. Gentleman to confirm—[Interruption.] I am at a loss to know what I am expected to withdraw.
    Mr. Speaker: The matter would be simple to handle if the hon. Member were to say that had he given anybody the impression that he was making the allegation, he did not mean to do so.
    Mr. Healey: I am not quite clear what allegation I am supposed to be withdrawing.
    Mr. Speaker: As I understand it—I have not the shorthand note at the moment—it is the assertion that the Prime Minister was deliberately misleading.
    Mr. Healey: With respect, Mr. Speaker, you will discover on consulting HANSARD that what I said was that the hon. Member opposite had been raising a point of order in order to prevent—[HON. MEMBERS: "No."] He had been raising a point of order when the right hon. Gentleman was on the point of being compelled to reveal a certain fact. Surely this is quite a different matter from the one about which he has complained.
    Mr. Speaker: Order. We must get this sensibly settled. It would help me if the hon. Gentleman would be good enough to say—if that were the fact—that he did not make the allegation and that if he was understood to have made it he unhesitatingly indicates that he did not intend it.
    Mr. Healey: Mr. Speaker, if I was thought to have made an allegation that the right hon. Gentleman deliberately the House, then I certainly wish to
    1206
    correct that impression. Now can I, with respect, get on?
    May I ask the right hon. Gentleman how he can square what he said today, namely, that an official spokesman stated as fact certain things after considerable forewarning by a correspondent, when the Prime Minister yesterday admitted that what was stated as fact was not indeed fact and it was only put out accidentally because the official spokesman was misled by the form in which the journalist put the question? There is here a direct contradiction between the statement made by the right hon. Gentleman the Prime Minister yesterday and the statement made by the right hon. Gentleman the Secretary of State for Defence today, a contradiction which must reflect on the accuracy of one of them. I wonder whether the right hon. Gentleman can say whether the Prime Minister was so misinformed by his own Department as to give the House an impression which is discovered today to be totally misleading, or whether the right hon. Gentleman himself will withdraw what he said and accept the Prime Minister's story?
    Mr. Thorneycroft: I do not see the slightest distinction—not the slightest distinction—between what I said and what was said by the Prime Minister. All I said was that I did not complain about the journalist. I have no complaint even about the right hon. Gentleman, so far as that goes, and what happened—[HON. MEMBERS: "Oh."] I might have had some cause for complaint. What happened was that the official of the public relations department was guilty of a misunderstanding about this. He thought that the contract had been signed when it had not and gave certain answers—the Prime Minister said that earlier. He found out that they were not right and subsequent inquirers were told so.
    Mr. McMaster: On a point of order—
    Mr. Kershaw: Further to my previous point of order. I did give notice that I shall raise this matter, but it was not in order to curtail discussion but because it is obvious that so complicated a matter, in which questions of fact are at issue, cannot easily be discussed at Question Time. Secondly, it is quite clear that the Opposition, out of a guilty conscience, want to prevent—
    Mr. Speaker: Order.
    Mr. Biggs-Davison: On a point of order—
    Mr. Speaker: That is not permissible on a point of order.
    Mr. McMaster: On a point of order—
    Mr. Speaker: No, I think I should rightly take the view that the House may take some opportunity to debate this if it wants to, but it cannot do so by supplementary questions.
    Mr. Biggs-Davison: On a point of order, Mr. Speaker. Since you did direct that the hon. Member for Leeds, East (Mr. Healey) should withdraw such allegations as he may have made that my right hon. Friend the Prime Minister misled the House, should not the hon. Member for Ebbw Vale (Mr. M. Foot), who made a similar allegation earlier, also be directed to withdraw it?
    Mr. Speaker: Yes—
    Mr. Wigg: On a point of order—
    Mr. Speaker: Order. I am dependent on the assistance of the hon. Member for Ebbw Vale (Mr. M. Foot) in checking my recollection about whether it is right that he did make an allegation of deliberate misleading. If it is so, it should be withdrawn. I should be grateful if the hon. Member would confirm my recollection because I have listened to rather a lot since then.
    Mr. M. Foot: I am happy to confirm what happened. I did not accuse the Prime Minister of deliberately misleading the House—though if I had thought about it at the time I might have said it.
    Mr. Speaker: I am glad to be assured by the hon. Gentleman that he did not say it.
    Mr. Wigg: I respectfully submit that a completely new situation has now arisen. The statement made by the Prime Minister yesterday—
    Mr. Speaker: Order. If the hon. Gentleman is rising to a point of order, would he be good enough to inform me what it is? It is very difficult when hon. Members rising to points of order make speeches, and I know that the
    1208
    hon. Gentleman knows that as well as everyone else.
    Mr. Wigg: What I am submitting to you, Mr. Speaker, is that a new situation has arisen, a matter of great urgency, a matter of urgent public importance. Would you consider a Motion under Standing Order No. 9 that this House should be adjourned in order that we may discuss this matter at the earliest possible moment, namely, that the Prime Minister yesterday deliberately misled the House on a major point?
    Mr. Speaker: I cannot accept the Motion because it is out of order. Indeed it makes an allegation which can only be made on a substantive Motion.
    Mr. Wigg: In that case, if you cannot accept it, would you be good enough to grant an Adjournment—
    Mr. Ross: On a point of order, Mr. Speaker. We are discussing a Motion which so far I have not heard.
    Mr. Speaker: I will read it, if the hon. Gentleman wants to know what it says—if I can read it. The words on the bit of paper which I have in my hand are—I hope that I may be corrected if I am wrong: "To call attention to a matter of definite and urgent"—
    Hon. Members: "Public importance".
    Mr. Speaker: "Public importance, namely, the question whether or not"—would the hon. Gentleman be good enough to come and help me?
    Mr. S. Silverman—
    Mr. Speaker: I make no reflection on anybody's handwriting, either in person or by deputy, but perhaps the hon. Member for Nelson and Colne (Mr. S. Silverman) would be good enough to help me.
    Mr. S. Silverman: May I explain that my hon. Friend the Member for Dudley (Mr. Wigg) asked me, because he could not write and speak at the same time —[HON. MEMBERS: "Hear, hear."]— whether I would try to embody the point which he wished to raise in a formal Motion. This I endeavoured to do, and, so far as I can remember it,—
    Mr. Speaker: Would the hon. Gentleman's memory be assisted by looking

    1209
    at what I think is in his handwriting? From the announcement which the hon. Gentleman made of his Motion, there is, unfortunately, a little discrepancy from the written wording, and I will try again: "To call attention to a matter of definite and urgent public importance, namely, the question whether or not there was a contract for frigates for the Spanish Government and how a false impression came to be"—I am not quite sure of the last word, it is "created" or "given".
    I cannot accept that Motion. [HON. MEMBERS: "Why not?"] It does not appear to me to fall within the Standing Order at all.
    Mr. Wigg: On a point of order. As you cannot rule that it falls within Standing Order No. 9, would you consider giving time on the Adjournment next week for this matter to be fully debated?
    Mr. Speaker: I have already dealt with the Adjournments for next week in so far as, with the assistance of a ballot, I could do so. Mr. Robert Cooke.
    Mr. Rankin: On a point of order. Could you guide me on this point? Why was it that in the first place you rejected the Motion before you could read it?
    Mr. Speaker: I understood from what the hon. Member said that it contained a matter which could not with propriety be put in the Motion.

REPRESENTATION OF THE PEOPLE ACT 1949 (AMENDMENT) (No. 3)
3.50 p.m.
Mr. Robert Cooke: I beg to move,
That leave be given to bring in a Bill to enable reference to be made on nomination and ballot papers at parliamentary and local elections to the political activities of candidates; and for purposes connected therewith.
This is a subject which has interested me for a long time. It was brought again to my attention by some events which took place in my constituency recently and at the last General Election. It was heightened by the confusion caused at the Greater London elections recently. It is a subject which interests a large number of hon. Members and candidates for election to this House. There is often considerable confusion and uncertainty when candidates in the same constituency or ward have the same or similar names and where candidates of different political flavours and the same names are standing in adjacent constituencies.
There occurred recently a local election in the Clifton Ward of Bristol, in which I have lived for quite a number of years. I went there on polling day and was greeted by a charming lady who said that she had been to vote for me and hoped very much that I would be elected. I said, "The election is not until October, when you want to vote for me". She said, "Your name was on the ballot paper and I voted for you—for Mr. Cooke."
It was true that the name on the ballot paper was spelled with two o's and without a final e but the name "Cooke" is very much the same however many o's or e's there are in it and a great deal of confusion is caused. Incidentally, the name has nothing to do with the culinary art, but the derivation is from an Anglo-Saxon word Cwic, meaning swift and sure. Therefore, on this occasion a constituent voted as she thought for me, but, in fact, for a Labour Party candidate, another Mr. Cook, who was not elected.
In the Cabot Ward the Labour candidate was a gentleman by the name of Maggs, who had not been heard of in

1211
that ward and had no connection with it, but it so happened that the Conservative chairman in the ward is the head of an ancient furniture store known as Maggs, of Bristol, who is well-known there. So many of the electors who are Conservative supporters went to the poll and, seeing the name Maggs, were much confused because they thought that it was their dear friend Mr. Maggs whereas it was a Mr. Maggs of a different political flavour.
In that ward there is a friend of mine who is an antique dealer who has the good fortune to be married to the very attractive daughter of a Labour peer. Unlike the offspring of many Labour peers, she has the same views as her late father. Her husband went to vote as he thought for a Tory, but he was not clear about what the name of the Tory candidate was. He voted for a Mr. McTaggart, and he happened to be a Liberal candidate. That candidate had no chance in the election and the vote was wasted. He returned home and told his Socialist wife that he had struck a blow for the Right.
Mr. Eric Lubbock: So he did.
Mr. Cooke: That led to more confusion. The wife did not hear her husband very clearly and she thought that he had voted against Mr. Wright, who was a candidate in this election, so she voted for Mr. Wright thinking that she was opposing her husband. He, in fact, was a Tory candidate. This caused the confusion of a Tory voting for a Liberal, a Socialist voting Tory and the Labour candidate collected several votes for the wrong Mr. Maggs.
At the last General Election my Labour opponent was named Cocks which, alphabetically, comes before my name. Many short-sighted people expected to see the name of the sitting Member—I had been in this House for two and a half years at that time—at the top of the ballot paper and they put a cross at the top only to discover that they had voted for Mr. Cocks. This just prevented him from losing his deposit and he saved his money.
At this General Election we have a more confusing case still, because the Labour opponent in my constituency
1212
is called McLaren. As the House will know there is a much loved hon. Member of this House, the hon. Member for Bristol, North-West (Mr. McLaren), who has the same name and sits for an adjoining constituency. We have the spectacle on one side of a McLaren who is in favour of the abandonment of the British deterrent and for an unspecified amount of nationalisation, the abolition of the grammar schools, a wealth tax, and so on, while just across the road a candidate of the same name is against all these things.
I submit that what is most needed is a better identification on the ballot paper. The Bill which I seek to introduce would make a number of provisions. I have no doubt that it would be controversial in some of its suggestions and would perhaps need amendment in Committee, but I believe that the broad principle is satisfactory. Identification on the ballot paper would be a most valuable way of ending confusion. We now have the surname writ large on the ballot paper, but Christian names are in smaller type and the description of the candidate is not often very helpful. Clause 1 would provide that a Christian name should be printed on the ballot paper in as large type as the surname, thus making clear if there are two surnames the same any difference in the Christian names.
Clause 2 would deal with the question of description. This is difficult for some people. A former hon. Member standing for re-election to a constituency is not allowed to mention his former membership of this House and he may not have another. He is not allowed to put "former Member of Parliament" on the description and often has to invent a fictitious occupation. Clause 2(1) would suggest that we might introduce a system of symbols to be used against candidates' names. This has been found useful in other lands and if we are to have majority rule in Southern Rhodesia no doubt symbols will be used there. Surely what is good enough for them is good enough for us.
The choice of symbols could be left to the parties and the candidates. One might suggest for the Tories the oak tree for strength and stability, for the Socialists a flaming torch for light out

1213
of darkness, or perhaps revolutionary fervour and the burning down of everything. I have not consulted the Liberal Party, but perhaps Liberals would like to have as their symbol a footprint, not to indicate a flat-footed approach but to show that they are prepared to march their troops forward in the face of never-ending failure.
The political allegiance of the candidate could thus be shown on the ballot paper. I realise that this might produce considerable difficulties if there were a dispute about who should have the label and the Bill, therefore, would provide that if there were such a dispute, and no agreement could be achieved between the candidates, the returning officer could reject any descriptions of any kind other than those which it appears should be allowed. The Bill would, of course, contain a Schedule which would contain these descriptions and parties and symbols not to be allowed. No doubt the printer, if I am given leave to introduce the Bill, will deal with that problem.
I know that the hon. Member for Southampton, lichen (Dr. King), who sits on the benches opposite, is worried about this matter. He was opposed by
1214
another person of the same name. There is the case, I believe, of a Speaker of the House of Commons who, in a Welsh debate, called Mr. Williams and eight Members were left standing. He then called Mr. G. Williams and four remained standing. I do not know what happened at the end of that confusion, but I submit that I have made a case that confusion exists. My Bill would go some way towards remedying it.
Question put and agreed to.
Bill ordered to be brought in by Mr. Robert Cooke, Mr. Geoffrey Wilson, Mr. Alan Brown, Mr. Graham Page, Mr. John Page, Mr. Philip Goodhart, Mr. Victor Goodhew, Dr. Reginald Bennett, Mr. F. M. Bennett, and Mr. R. Gresham Cooke.

REPRESENTATION OF THE PEOPLE ACT 1949 (AMENDMENT) (NO. 3)
Bill to enable reference to be made on nomination and ballot papers at parliamentary and local elections to the political activities of candidates; and for purposes connected therewith, presented accordingly and read the First time; to be read a Second time Tomorrow and to be printed. [Bill 189.]
ORDERS OF THE DAY

  SHIPPING CONTRACTS AND COMMERCIAL DOCUMENTS BILL
  Order for Second Reading read.
  4.2 p.m.
  The Minister of Transport (Mr. Ernest Marples): I beg to move, That the Bill be now read a Second time.
  In my statement of 8th July, I announced the Government's intention to introduce the Bill. I was grateful for the remarks then made by the right hon. Member for Vauxhall (Mr. Strauss) and also for the support subsequently given by the Chamber of Shipping and the Shippers' Council.
  The object of the Bill is set out in the Long Title. It is to
  "secure Her Majesty's jurisdiction against encroachment by certain foreign requirements".
  It is essentially a Measure relating to international jurisdiction. The legal issues are extremely complicated. It has, therefore, been arranged that my right hon. and learned Friend the Attorney-General will reply to the debate.
  As the House knows, it is the actions of the American Government that have obliged us to introduce the Bill, although it deals with encroachment by any foreign Government. Difficulties now face us as a result of the enforcement of United States shipping legislation and we are of the opinion that this enforcement encroaches upon our jurisdiction. Perhaps the clearest example concerns dual rate contracts. The United States Federal Maritime Commission claims the right to dictate to traders and shipowners in this country the form of contracts between them. The Commission claims this right regardless of who owns the goods being shipped, who owns the ships and where the contract is negotiated.
  Thus, if a British manufacturer makes a contract on British soil with a British shipowner to take goods to the United States of America, the Federal Maritime Commission claims the right to lay down the terms of that contract. Another example is where the Americans have called for the production of documents and information located outside the United States.
  1216
  The Bill has two principal functions. Clause 1 deals with the first and it relates only to shipping. It operates in three stages. The first stage is when the Minister of Transport considers that measures taken by any foreign country concerning contracts for the carriage of goods or passengers by sea constitute an infringement of our jurisdiction. The Minister is then empowered to make an order applying Clause 1 to those measures.
  The second stage is as follows. If the Minister has by order specified a certain measure, any shipowner in the United Kingdom who is required to do something or prohibited from doing something by that measure must—this is mandatory—notify the Minister. The reason for that is that it would be difficult otherwise for the Minister to get the necessary information.
  The third stage is that the Minister may then by direction prohibit the person or persons concerned from complying with the requirement or prohibition. The reason for this will be that he considers such a direction necessary to maintain United Kingdom jurisdiction.
  Clause 2 deals with foreign demands for commercial documents and information. This is not limited to shipping and it will apply generally. The Clause covers the case in which a person is required to produce commercial information compiled from documents, as well as the case in which a person is required to produce an existing document.
  Before the Minister can give a direction under Clause 2, three conditions have to be satisfied. First, it must appear to the Minister that someone in the United Kingdom has been asked, or may be asked, to supply document or information to a foreign court or other authority. Secondly, the documents must be outside the territorial jurisdiction of the country asking for them. Thirdly, it must appear to the Minister that the requirement constitutes an infringement of United Kingdom jurisdiction. The powers conferred are purely permissive. Clause 3 relates to penalties and enforcement, because a Bill of this kind must have teeth if it is to be effective.
  So much for what the Bill will do. I may say at once that it is with a great

  1217
  deal of reluctance that we are introducing it. We have, however, really no option. Three years ago, the Americans passed legislation about international shipping without—let us face it—regard to the fact that there are two ends to any piece of international trade. As the administration of this legislation comes into effect, the Federal Maritime Commission, which is the unfortunate body which has the task of operating it, is increasingly interfering with the affairs of other countries. Instead of acting as an agency of one country amongst others, it is acting as if the United States had the right to regulate the affairs of the world as a whole.
  Moreover, this regulation is being done not according to some generally accepted principle, but quite avowedly in the interests of the commerce of the United States of America. Some hon. Members may find it difficult to believe that this is so, but the provisions which attempt to secure
  "the public interest of the United States"
  or to prevent shipping operations
  "to the detriment of the commerce of the United States"
  appear in Sections 14(b), 15, 18(b)(5) and elsewhere in the United States Shipping Act, 1916.
  The Americans are reasonable people, and they and we are accustomed to speak to each other frankly. We have been trying, not altogether without success, to deal with the situation by discussion and negotiation. However, we have now reached the stage where, unless we take rather more formal action than we have done before, there is a risk of our position being eroded by default.
  Mr. Paul Williams: My right hon. Friend has said that the Americans are reasonable people and, in general, that is true. Certain pieces of information have, however, been given before the Congressional hearings on this matter which lead one to think that that is not true of all Americans. I am told, for example, that Senator Douglas used these words:
  "I don't want to compare the European nations to a child or to juvenile delinquents, because I don't wish to insult our honourable friends. I simply say that so far as child psychology is concerned, sometimes behaviour is improved by the knowledge that there is a woodshed and a switch therein."
  1218
  This does not sound like a very accommodating attitude by the Americans.
  Mr. Marples: As my hon. Friend suggests, there are many people in the United States; some say one thing, some say another. It is true that Senator Douglas said something on the lines which my hon. Friend has indicated, but his countrymen throughout the world must judge whether his utterances are calculated to do what Dale Carnegie, in his great book, set out to do, "to win friends and to influence people". But whatever anybody in the United States, whether a Senator or a Congressman, chooses to say does not give me a reason for being offensive. I refuse to utter offensive words on this occasion, because I want to refrain from utterances which would make it more difficult ultimately to reach a settlement round the conference table. Our object is to be reasonable. Our aim is to negotiate, to get round the table, and not to be rude or offensive, whatever anybody else may say.
  There are several matters over which the question of preserving our jurisdiction against encroachment through American shipping legislation arises. I have mentioned the dual freight rates. Let me make it plain. Many of the contracts the form of which the Federal Maritime Commission is attempting to dictate are between British customers and shipowners based in this country. Can it then be wondered if we object? Moreover, what would the Americans say if we in this country attempted such action in the United States?
  It ought not to be necessary to ask Parliament to legislate so as to place beyond dispute our rights in matters of this kind. Some American lawyers have argued, I understand, that British law is defective inasmuch as it contains no provision for regulating the contracts and freight rates which ship owners negotiate with their customers. Their argument runs that there is thus a vacuum into which the American Government are entitled to move. I know that many hon. and learned Gentlemen will take part in this debate and I would like their views as lawyers.
  Her Majesty's Government do not for a moment accept the view expressed by these American lawyers and the Bill may be said in a sense to protect the alleged

  1219
  vacuum while taking care not to regulate shipping ourselves. The American claim is, in my view, clearly untenable, because it depends on the assumption that America somehow has unique rights.
  It would make nonsense for countries generally to make such claims. Despite arguments raised by Her Majesty's Government and by other Governments, the Americans have not, however, abated their claims and we therefore reached the conclusion that, without legislation of this kind, we should be conducting discussions on this and similar points under a handicap.
  The Federal Maritime Commission has more than once pointed to the United States law as justification for its attempt to assert its authority over foreign commerce. The Bill will help to make it absolutely clear that the United States Congress can legislate effectively only so far as its writ runs.
  Again, I want to make it clear that the Bill is not—I repeat, not—a retaliatory measure. Its sole purpose is to give the Government permissive powers to prevent encroachment on United Kingdom jurisdiction and to protect our interests. I hope that it will not be necessary to use these powers and that our difficulties can be settled by understanding and friendly negotiations. I would like to emphasise that. I am sure that this is also the desire of the American Government.
  What alternatives are there to negotiation other than arbitration or a first-class row? We believe that the whole question of jurisdiction which has been raised by American shipping legislation will have to be thrashed out sooner or later, and, as I have said, discussions to this end are at present proceeding between the Governments concerned.
  I want to say something about the relationship of the Bill to our general policy on shipping. Our shipping policy has the over-riding aim that world shipping should provide its customers with what they want from shipping. We believe in competition and the freedom of the seas, not primarily because they suit Britain as a shipping country but because cheap and efficient sea transport makes for the expansion of world trade. There is a very real threat to world trade in the temptation, to which many Governments
  1220
  are exposed, to interfere with international shipping in pursuit of national interests.
  At a time when most Governments leave international shipping alone, a few Governments can gain some short-term national advantage by directing cargoes to ships of their own lines or by putting pressure on ship owners to lower some freight rates and increase others. If those practices became general, no country would be able to get special advantages by them, and, meanwhile, great damage would be done to world trade.
  Ships would seldom sail fully loaded because Governments would be preventing foreign ships from picking up cargoes. Traders and shipping agents would be put to great expense in money and time in complying with Government quota systems and other regulations. The main objective of British shipping policy, as exemplified in the Bill, is to strive against such a situation coming about.
  In the nature of things, much of what I have had to say from this Box about shipping has been about the protection of our shipping from the actions of foreign Governments. That is why I want to emphasise the positive nature of our policy. Our aim, as I have said, is that the user of shipping should get the service he wants. We believe that the conference system should be allowed to function not because it favours the shipowners of any country, but because no other system of shipping service has been developed which can offer such cheap, efficient and convenient services to traders. Conferences have not always handled their customer relations well.
  Mr. R. J. Mellish: Hear, hear.
  Mr. Marples: I am glad to have the agreement of the hon. Member.
  That is why my European colleagues and I were very glad, last December, when the Committee of European Shipowners was able to report to us the agreement it had reached with organisations representing its customers about machinery for dealing with complaints. Fundamentally, the trader's protection lies in the fact that, if the conference does not give him the treatment he wants, he can take his business elsewhere. Nevertheless, things should not reach that point and the European Ministers had been anxious that

  1221
  regular consultative machinery should exist and be widely known to exist.
  We were satisfied that it would not be in the interests either of shipowners or traders to have Governments coming between them. We think that the efforts of the American Government in this direction not only involve interference with other countries' interests, but are largely ill-conceived and unsuited to their objectives. It is our firm belief that Government regulation of commercial shipping forces up rates and costs and is no substitute for competition and free negotiation between traders and shipowners.
  Our aim must be to create conditions under which international shipping is able to fulfil its potential as the cheapest means of transport in the interests of international trade, of the British consumer and producer and of the consumer and producer throughout the world.
  The Bill is designed to contribute to these objectives and as such I commend it to the House.
  4.18 p.m.
  Mr. R. J. Mellish: The House will echo the Minister's sentiments in saying how regrettable it is that the Bill has had to come before us, because it will, I am sure to our regret, give ammunition to that minority of people in the country who, by the nature of things, are anti-American anyhow. No doubt they will use some of the right hon. Gentleman's own arguments in saying that it is difficult to understand why Britain should be such a close ally of the United States. The vast majority of hon. Members are well disposed to the United States, are anxious to see that friendship continue and endorse the Minister's words that friendship is a two-way affair.
  Some of us on this side are, however, bewildered because the Bill has taken so long to come forward. This situation did not arise suddenly. Those of us who take an interest in shipping know that, for some years, our shipowners and masters have been discriminated against by the Americans. It is not enough now for the right hon. Gentleman to produce a Bill which is rather negative in character and which, in the end, will not solve anything. It throws down a challenge to the Americans, saying, "This is what we shall do to protect our people."
  1222
  That is all very well, but I think that higher and mightier counsel than even the right hon. Gentleman's might have prevailed. My right hon. Friend the Member for Easington (Mr. Shinwell) asked some time ago whether the Prime Minister would raise this matter in discussion with the President of the United States. We were given to understand that he would do so. Did this matter ever reach that level? It should have done. This is a matter for the President and the Prime Minister themselves, because it is by no means a small affair.
  Since the Bill was published, I have had discussions with the Minister and have done some overtime on it—as most of us have had to do on this matter. I have talked to a number of people interested. The truth is that the Americans have grave suspicions about what we call the conference system. I understand that they believe that it brings about certain settled freight rates and conditions which are unfriendly—if that is the right word—to American commerce They demanded under the 1916 Act, later amended by an Act of 1961, greater power to look at freight rates, the private documents of shipping companies, and the like. Since 1961, there has been a great deal of activity in the Federal Maritime Commission.
  The background is American suspicion of our own shipping companies and shipping companies throughout the world ganging up to apply level freight rates which, in themselves, affect the American economy. The Americans want to protect themselves. That is why they strengthened the 1916 Act by passing, in 1961, the Bonner Act, which gave the Federal Maritime Commission certain powers. We should have their reasons clear in our minds.
  I should be the first to oppose any so-called conference system if it was just a question of monopoly and of creating artificially high freight rates for customers here and elsewhere, but when one examines the matter one recognises that the conference system is inevitable. It started about 90 years ago, when sailing ships were going out and steamships were coming in, when there was a great ganging up over rates and deliveries, and such a state of war in the industry that order had to be brought out of chaos.

  1223
  The conference system has been tried and tested again and again. Ironically enough, I find that some of my trade union colleagues in the industry complain that British shipowners do not play a sufficiently strong part. They say that as a country we do not have sufficient say in what is decided at international level.
  There is nothing new about the conference system. It has been inquired into many times. It is not as though this were a gang of people with no one checking on their activities. There was a Royal Commission many years ago, and then a Dominions Royal Commission, which looked at the matter especially from that point of view. The Imperial Shipping Committee in 1920 came down in favour of the principle of this system, and also came down in favour of the individual's right of complaint with regard to certain freight rates, and so on.
  I was glad to hear the Minister say that at his conference with our European friends the rights of traders were looked at, and I should like the Attorney-General to tell us rather more about whether there is to be a genuine effort to deal with individual complaints about freight rates.
  Britain's record in shipping is a classical example to the rest of the world. When one goes into the question with our trade union friends in the shipping world we find a genuine desire to co-operate with shipowners, particularly in the tremendous fight for world trade. The trade union movement is severely criticised for some of the things that it may have said and done— it may be that its public relations side should be looked at—but there can be no doubt that both shipowners and trade unions have the desire to maintain and continue the conference system as a means of maintaining order. Several people on the trade union side have told me that without the conference system there would be chaos as between shipping companies. Our American friends, there fore, need to be told that we will support the system—
  Mr. Marples: I am grateful to the hon. Member for what he has said. The conference system is necessary if we are to have a regular service by sea between point A and point B. It is not
  1224
  necessary, of course, if we are to have an irregular service. There must, therefore, be certain conditions, otherwise those in the industry will not be able to maintain the service and give the quality of service. Every conference we have in relation to the United States trade is open to United States shipping lines. There are American lines in them, and they have their rates settled by unanimous agreement.
  There is the further point that we in this country took the initiative in getting the 10 European countries, plus Japan, together, so that in the conference system, which was previously operated solely by the owners, the customer now comes in, and if he has a grievance there is machinery to deal with it. The result is that the conference system as now constituted is fairer than it has ever been before.
  Mr. Mellish: But, with great respect, there can always be improvement, and I urge all those responsible for this system, especially in this country, to ensure that not only is it fair but that it is seen to be fair.
  Since the Americans passed the Bonner Act, three years ago, there has been a tremendous increase in their activities, and I understand that almost every aspect of day-to-day commercial operation of line services in the American trade is being interfered with. I am told that almost every action of a conference is being questioned—rationalisation of sailings, alteration of freight rates, agreements with stevedores, and even conferences with the shippers themselves. The American Act lays down that the sole test that the Federal Maritime Commission will apply in deciding whether to give approval for any action is whether or not it is in the sole interests of the American people.
  Let me put the alternative to the Americans. What happens in this country? In the matter of access to shipping, Britain compares favourably with all its competitors. Not only are its ports numerous and well placed in relation to its staple export industries, but the national policy of welcoming all ships alike to our ports, without any kind of flag of discrimination, has the effect of putting at the disposal of those who need them all our resources of easy loading

  1225
  and unloading, and the traders of Britain have the full benefit of an open freight market. That is an example which the Americans should copy. America is the land of free enterprise and believes in free competition, but it is now a land which is applying restrictions to countries like this which rely on exports to live.
  As a very good friend of the Americans, I think that it is a tragedy for both countries that the Bill should be necessary. With respect to the Minister, and there is nothing personal in what I now say, I think that this matter is really above his level. I should like to know what has been done by the Prime Minister, and whether anything else is to be done other than bringing forward the Bill. We support the Bill and, of course, we shall help to get it through all its stages by Friday. The Minister has said that there will be more conferences, and I should expect that to be the case, but the saddest thing to be said this afternoon is that the Bill should be necessary. There has been a failure somewhere down the line, and I should like to know exactly where to pin it down.
  Again, without wishing to be personal, I believe that the right hon. Gentleman's Department is so busy looking after roads, traffic, and so many aspects of transport policy and problems that I sometimes wonder whether, in spite of the fact that the right hon. Gentleman has in the hon. and gallant Member a very able Parliamentary Secretary to deal with shipping—though that is a recent appointment—shipping has not not been treated as the poor neighbour in his Department. In future, whatever Government we have, I should like to see shipping made priority No. 1 in the Ministry of Transport, and those who speak for it to speak loudly and well.
  Meantime, as I say, we support the Bill in principle, and will do all we can to facilitate its passage.
  Mr. Marples: The hon. Gentleman was very kind in giving way to me before, and I did not wish to interrupt him again. However, this is important. I can assure him that the fact that the Bill has not come before the House earlier was not because the Department was too busy, because we have a special section dealing with shipping, which
  1226
  does not deal with roads or railways at all. The reason was that we hoped, possibly against hope, that the Americans would sit at the conference table and that we could do a deal. In fact, we found that we could not. They have now extended the deadline to 1st September of this year, which is when the House will be in recess.
  If we did not have this power, and if the Americans applied those sanctions on 1st September, we should be in a mess. Therefore, it would be wrong to let it go at that. I can assure the hon. Gentleman that the Shipping Advisory Panel, which has trade unionists, shipowners and representatives of the British Shippers' Council on it, is wholeheartedly behind me in this effort. They are reluctant to do this. I am reluctant to do it. I would rather do without it. The point is that, having gone so far, I feel that we cannot let our shipowners down. Late though it is, it is necessary.
  Mr. Mellish: I will content myself with saying that the fact that we have the Bill today, and that it has come about after there has been a great deal of discrimination against our people, shows that there has been some negligence somewhere in the Minister of Transport's Department. With great respect to the right hon. Gentleman, I think that there has. I end on this note: the Bill is now before us. We shall support it in principle and we shall facilitate its passing by Friday.
  4.32 p.m.
  Colonel Sir Leonard Ropner: I suppose that all right hon. and hon. Members are fully aware that, although the immediate need for the legislation under discussion arises only from difficulties which have arisen between the United States of America, on the one hand, and other maritime nations, on the other, and only in respect of regular line shipping services, nevertheless, when once any Government start legislating in a way which infringes on the jurisdiction of other nations, no one can say where action of this sort will stop.
  There is no doubt at all that the rules which the United States Federal Maritime Commission is threatening to enforce constitute an infringement of the

  1227
  jurisdiction of the United Kingdom and other maritime nations. As my right hon. Friend the Minister himself has already pointed out, the Commission, even today, rules that contracts entered into between British shippers and British shipowners in the United Kingdom are illegal. The Commission lays down that British shipowners, in their business agreements with British shippers, must use a form of contract drawn up by the Commission itself. Could anything be more preposterous?
  The American Bonner Act of 1961 conferred greatly increased powers on the F.M.C., and at the same time the Commission was told to act more vigorously and with more toughness. I am told that the Commission now employs a staff of about 300, all of whom are feverishly engaged in devising methods of interfering with the business affairs of the shippers and shipowners of other nations. At present, the Commission is devoting its energies to liners. How long will it be, we may ask, before it gets round to tankers and tramps? In parenthesis, I may remark that no nation has done more to upset the traditional freedom of trade among the shipowners and shippers of the world than has America herself, by subsidies, by flag discrimination, by trade reservation, and by the use of flags of convenience.
  There is another consideration which emphasises the importance of the Bill. If the Federal Maritime Commission were to be allowed to get away with it, how many other countries might be tempted to follow its lead? More than one developing country is anxious to discuss such questions as the stabilisation of freight rates and participation in liner conferences. Well—perhaps. But it would seem a bit hard if the financial aid which we are all so ready to give, and are giving, to new nations should be used not only to build ships to run in competition with out own, but that, at the same time, these countries should follow the ill practices which America proposes to enforce.
  American legislation of the sort we have in mind this afternoon dates back to 1916 and culminated in the Bonner Act of 1961. It is extremely involved. That is perhaps why my right hon. and learned Friend
  1228
  the Attorney-General is to wind up the debate. Some time ago the F.M.C. demanded that all member-lines of conferences should produce all sorts of documents relating to business transactions which had been conducted not only in America, but in other countries also. There were to be penalties for noncompliance with this demand. My right hon. Friend the Minister is to be congratulated on forbidding British lines to comply. The edicts of the F.M.C. have not always been enforced, but technical infringements of U.S.A. legislation have been mounting up over the years and I am informed that British and foreign lines are already technically liable to fines amounting perhaps to millions of pounds.
  As the F.M.C. is attempting to exercise world jurisdiction over liner conferences, I should like to add something to what has already been said about the conference system. The House has already been reminded that from time to time the recognised machinery of the conference system has been very closely examined, not only in this country but in other countries. All concerned, including Governments, have, I believe, invariably concluded that the system is one which serves the best interests not only of shippers and shipowners, but, indeed, of world trade.
  The House should also remember that in the North Atlantic trade there is no quarrel of any moment between British shippers and British owners. The shippers—that is to say, the exporters—have their Shippers' Council, which maintains a very close and friendly relationship with the conferences. Perhaps it is a pity that across the Atlantic there is, as far as I know, no such comparable liaison between the two interested parties.
  The Bill, of itself, will not resolve the current difficulties. It is, however, a brave Measure and one which must be recognised in America as a clear assertion by Her Majesty's Government of our determination to defend our judicial rights. Unhappily, five inbound conferences and about the same number of outbound conferences to and from the United States have decided to conform with the demands of the F.M.C. in some respects, particularly in connection with dual rate contracts. I am glad to say, however, that with possibly

  1229
  one exception the British participants in these conferences, usually heavily outvoted, have voted against compliance with the F.M.C.'s demands.
  It is greatly to the credit of the Minister of Transport that in this tussle with the F.M.C. he has done everything possible to encourage the willing cooperation of 10 other European nations and Japan. The Governments of these countries, which, in terms of shipping, represent well over a half of world tonnage, are as determined as we are that there shall be no encroachment of their national jurisdiction.
  On the industrial level, as opposed to Government level, international cooperation has been achieved among shipowners, and British owners have played a prominent part in international discussions, including talks conducted in America. The Shippers' Council is as determined as are the conferences to fully support the Government in defending British judicial rights.
  I have got to the end of what I wanted to say except that before I sit down I am bound, by an honourable custom, to acknowledge a personal interest in shipping. I have done so on many previous occasions. For many years I have been the only shipowner in this House and I have thought it right that sometimes, and to the best of my ability, the voice of the British Merchant Navy should be heard in this Chamber. I have been fearful that, being personally interested, my remarks might be discounted. I have been fortified by the belief that hon. Members have appreciated that at least T knew what I was talking about. The House has been very kind. This is the last time that I shall trespass on its generosity.
  4.44 p.m.
  Mr. E. Shinwell: The hon. and gallant Member for Barkston Ash (Sir L. Ropner) intimated his intention to retire at the next General Election. That is in many ways regrettable, although, naturally, I have political reservations.
  It is true, as the hon. and gallant Member remarked, that for some years he has been the sole shipowner in the House and has frequently represented the views of the shipping industry. I can assure him that his departure will
  1230
  not mean that the views of that industry will not be represented here after the election. Among others, I intend, all being well, to return after the election, and although that might cause some trouble for some hon. Members—although probably not for the Government; we expect a quite different Government next time—from time to time, when matters affecting the shipping industry arise, as undoubtedly they will, I hope to have the opportunity of expressing some constructive opinions.
  I invite the few hon. Members who are present this afternoon to contrast the attendance in the Chamber today with the attendance on Monday. Then, the House was congested. At the beginning of the debate there was hardly any superfluous room to be found. On that occasion hon. Members were discussing accommodation; the need for individual rooms, separate secretarial assistance, and similar kinds of amenities. This afternoon we are discussing the future of the British shipping industry. Note the contrast. If the response from hon. Members opposite is to the effect that I should note the paucity of attendance on this side of the House, I can assure them that I am as deeply shocked by that as I am by the scarcity of hon. Members on the benches opposite.
  For many years the shipping industry has been under a cloud. It remains under one and will probably continue to remain under a cloud unless we make a determined effort to help to solve its problems. Only this afternoon, in the financial notes in the Evening News, we are warned by Sir Nicholas Cayzer, chairman of British and Commonwealth Shipping Co. Ltd., one of the most important services in the United Kingdom, of the dangers which confront the shipping industry of this country. He says, in effect—and I will not weary the House with his exact words—that unless freight rates are substantially increased or the Government provide subsidies, there is very little future for the British shipping industry.
  True, at the end of his remarks, the hon. and gallant Member comments that he expects that his shipping company will, unless there are unforeseen circumstances, do very well next year.
  Mr. Cyril Bence: Will weather the storm?
  Mr. Shinwell: Nevertheless, this situation is far from satisfactory. What are the contributing factors? The lessening of international trade is perhaps the most important factor in the decline in British shipping. I have referred to this before in previous debates and I have said that unless we increase the volume of international trade, particularly in regard to assisting commerce in the developing countries—increasing consumer demand, which would enhance our productive effort—there can be little doubt that our shipbuilding industry and shipping services will suffer and decline. I would regard that as very regrettable.
  We are a great maritime nation, much greater than the United States. Indeed, America has never really been a maritime nation. That country has been confronted with great difficulties, particularly about the selection of crews, both officers and men. I am satisfied that if an analysis were made of the nationalities of crews on American vessels it would be discovered that a very small minority of them are American citizens. They are mainly Scandinavians, Italians, Greeks, and the like; although I make no complaint about that.
  In addition, the Americans have been faced for many years with difficulties caused by demands for high rates of pay. The rates of pay on American vessels are far in excess of the rates paid on British vessels. Indeed, some difficulties have emerged in connection with the mixed-manned missile vessel. The differentiation in the rates of pay have caused some resentment among British personnel. But that is another matter which I must not discuss this afternoon.
  There is another contrast this afternoon to which I draw attention—the contrast between the speech of the Minister and that of the hon. and gallant Member for Barkston Ash. The Minister was apologetic; in fact, his speech was one long apology. He expressed reluctance to introduce the Bill, and he informed us that the last thing that he wanted to do was to be offensive. That surprised me, because we have some experience of the right hon. Gentleman. I have never observed any reluctance on his part to be offensive to hon. Members on this side of the House, even to a right hon. Gentleman
  1232
  like myself; but occasionally we can indulge in the riposte, as he well knows.
  The right hon. Gentleman is a bit of a rascal.[HON. MEMBERS: "Oh."] That is quite Parliamentary, I assure the House. In fact, sometimes, he is as tricky as a bag of monkeys; full of all sorts of tricks, and this Bill is one of them. The right hon. Gentleman has come along almost at the last minute with it, in a kind of death-bed repentance before the election, as a political manœuvre. I shall tell him all about it. I know that he wants straight talk, because he has told us that he likes to indulge in straight talk with the Americans.
  My hon. Friend the Member for Bermondsey (Mr. Mellish) said—many thanks to him for the reference—that some considerable time ago I raised this question, not with the present Prime Minister but with the right hon. Gentleman the Member for Bromley (Mr. H. Macmillan), the previous Prime Minister—it was 18 months or two years ago. I said, "You are going to meet President Kennedy"—the late-lamented President whose passing we all deplore—"and when you are having discussions will you talk to him about the position of British shipping in the context of the action of the United States Federal Maritime Commission in its endeavour to restrict the operations of British shipping?".
  The right hon. Member for Bromley—I must say, with courtesy—assured me that, although the discussions would be confidential, he would take note of what had been said. In fact, the right hon. Member for Bromley—I say this in parenthesis—displayed much more courtesy than the present Prime Minister, who seems to treat hon. Members with contempt, at any rate Members on this side of the House. When the right hon. Member for Bromley returned after his discussions with President Kennedy, I asked him whether he had raised the question of British shipping interests with his opposite number, and he assured me again that, although the discussions were confidential, the point had been noted.
  Thereafter, the right hon. Gentleman the Minister of Transport informed the House that he had been engaged in discussions all along the line. If he

  1233
  was as apologetic in his confrontation with his American opposite number as he has been this afternoon in this House, I am not surprised that we have not made very much progress.
  I have been engaged in discussions with Americans. I have been in Washington and New York. When I was Minister of Defence I had to undertake the task of discussing with the Americans the subject of weapons; but I would not yield to the Americans, although they would not give way. I came to the conclusion at the time that the British weapon that we had under discussion was the best in the world, and I told the Americans this to their faces—there was straight talk. I returned, without success, because we had reached no agreement.
  Some time afterwards the Labour Government went out of office and a Conservative Government came into power with the right hon. Member for Woodford (Sir W. Churchill) as Prime Minister. What did the right hon. Gentleman do? I regret to say anything derogatory of the right hon. Gentleman—that is the last thing that any of us would wish to do—but what did he do? He had to yield to the Americans. That was not a veary patriotic act. Therefore, I understand what it means to have negotiations with the Americans.
  I am bound to say that the Minister of Transport should have stood up to them much more manfully and forth-rightly than he has done. Now he comes along with the Bill. What is the Bill? The hon. and gallant Member for Barkston Ash was right—it will resolve nothing and that, I believe, is the opinion of the Chamber of Shipping. It is a gesture and it is innocuous. I shall tell the right hon. Gentleman about it.
  Let us assume that a British vessel reaches an American port—New York, Philadelphia, Norfolk, Virginia, or any other—and that the master of the vessel refuses to disclose documents. I come to the point with which, no doubt, the Attorney-General will deal later: who is responsible for the disclosure of documents? Let us assume that the vessel arrives at an American port and the master of the vessel is asked by a representative of the Federal Maritime Commission to disclose a document relating to the transaction of some conference line or some arrangement between some
  1234
  shipping line and some shippers in this country who wish their goods to be conveyed to the United States of America. Suppose he declines? I hope that the Attorney-General will take note of this, because I believe it to be a point of substance.
  Suppose the master of the vessel says, "I am empowered by British legislation, introduced by the Minister of Transport, to refuse to disclose the document. I am under penalty of £1,000." What happens? Will the dock authority of the port when this vessel arrives give instructions that the cargo is not to be discharged? Suppose it did? What recourse would the master of the vessel have?
  I know that there is a Treaty of Commerce which was agreed a way back in 1815 or 1816 and that Treaty provides for reciprocal arrangements between the United Kingdom and the United States of America, but that may have gone by the board because of what happened in 1916, and, as my hon. Friend the Member for Bermondsey remarked, in 1961 through the Bonner Act. That Act may have superseded the agreement of the Treaty of Commerce in 1815. I want to know what would happen to the master of the vessel. Will he be ordered to take his vessel back to the United Kingdom port?
  The right hon. Gentleman is smiling, as if this could never happen. It never occurred to him, because he does not know anything about shipping. He may know something about roads, although we are not getting on too well with them, and he knows something about railways, particularly about closing them.
  Mr. Mellish: My right hon. Friend gave the example of the master of a ship refusing to disclose documents. Could the master still be prosecuted by the American authorities, and, if so, what would happen if he were?
  Mr. Shinwell: I am obliged to my hon. Friend for making that point. We have to protect not only our shipowners and shipping companies, but also those who are employed by them. The master of the vessel and all his crew may be arrested at the behest of the Federal Maritime Commission. What would happen then? It would cause a proper row.

  1235
  In the Explanatory Memorandum to the Bill reference is made to the fact that under Clause 3 a fine could be imposed on an individual which
  "is not to exceed £1,000".
  What does that mean? How is an individual defined in the Bill? Is it the master of the vessel? Is it the shipowner? Is it the chairman of the board of directors? Is it the shipping company? We ought to know. We must be clear about this, because our crews must be protected against any untoward act on the part of the American authorities.
  Let us assume that, as a result of their Bill, these difficulties occur. I support the Bill. Any port in a storm, if I may use a nautical expression. Any kind of small mercy thankfully received. Any contribution gratefully received. Better than nothing. Anything to show that, at last, we are standing up to the United States.
  That is straight talk, is it not? I am as anxious as is my hon. Friend the Member for Bermondsey or any other hon. Member to retain all the benefits of Anglo-American co-operation. I believe that in existing circumstances and in the foreseeable future, perhaps for many years to come, Anglo-American co-operation is desirable. Indeed, I believe it to be inevitable if we are to retain any semblance of liberty. There are certain reservations in the United States in that context, but if we are to maintain what is described as the free world Anglo-American co-operation must be retained.
  The hon. and gallant Member for Barkston Ash referred to one point which ought to be emphasised. Let us consider what has happened during the last 15 or 20 years. We have seen the advent of the Panama-Liberia consortium for the purpose of using flags of convenience. That has not been too disadvantageous, and I believe that some British shipowners have to some extent adopted that device, but not to the extent to which it has been adopted in the United States. Next, we have flags of discrimination. Could anything be more obnoxious than that device and anything more dangerous to British shipping?
  We also have the system whereby, when aid is to be provided, to a developing or a foreign country outside the United States,
  1236
  or trade is to be developed, a large part of the cargoes have to be carried in United States tonnage, with no possibility of competition in the international shipping world. We have complained about it many times. My hon. Friend the Member for Bermondsey and others present who represent the shipping constituencies, and who are deeply interested in the future of British shipping, have often referred to this matter and have made adverse comments about the attitude of the Federal Maritime Commission. With what results? Practically none.
  Much more than that has happened. It is about time that some information was furnished by the right hon. Gentleman about the subsidies provided by the United States Government for American ships. I have some experience of this matter for I was associated with the seafaring community back in 1911, which is a long time ago, and I learned something about shipping. Even in those days, before the First World War, I heard about American Government subsidies to the Matson line, which was one of their principal shipping companies. They were giving subsidies even then. We have refrained from this, although shipping companies are inclined to flirt with the idea because of the adverse circumstances which have developed in recent years. But we gave no subsidies then although subsidies were granted by the Americans.
  Not content with that, they seek to weaken British shipping and they adopt restrictive practices, using the excuse that they are opposed to monopolies. Let us examine the facts. Are the conference lines monopolistic undertakings? There is nothing monopolistic about them. There is keen competition among British shipping companies. But if a shipper decides to send a cargo to the United States and feels that it is much better, from his point of view, that the cargo should be conveyed in a vessel or through a shipping company accustomed to dealing with such a cargo, and perhaps knowing the best way of handling it, what is wrong with that?
  There is any amount of competition among British shipowners. There is nothing monopolistic in the conference line method, or in a contract about freight rates. I want to tell the right hon. Gentleman quite frankly that I have come to the conclusion that the American

  1237
  Federal Maritime Commission has no case at all on this ground. All that it is trying to do is to weaken British shipping. I do not like it, and it is about time that the House, also, said that it did not like it.
  Mr. Marples: I did not want to interrupt the right hon. Gentleman, for he is very knowledgeable on shipping matters, but he said that I had not given the House a great deal of information about American subsidies. This is largely because it is not my responsibility. The subsidy from the American taxpayer in 1964–65 to the American shipping industry amounts to 190 million dollars. In this country, we have no subsidy at all. If one considers who would win the day, it is clear that the American shipowners could not compete at all. The same situation arises in shipbuilding, where they have a subsidy of 125 million dollars in the same year. I wanted to give the right hon. Gentleman that information to show the scale of the subsidies which they give to their shipowners. We give none to ours.
  Mr. Shinwell: I am grateful to the right hon. Gentleman for giving hon. Members that information. We shall know exactly where we stand.
  I am not advocating subsidies for British shipping, although it may be necessary to provide some measure of financial assistance—as we have done—shipbuilding. Much more may be required for us to get on to an even keel. That is not a subject which we need to discuss at great length this afternoon.
  I want to put one further point to the Attorney-General. What is the position of other countries? In previous debates and answers to Questions the right hon. Gentleman told us that he was having discussions with the other maritime countries. He said very little about that this afternoon. What has transpired? Will they work with us in promoting the ideas contained in the Bill? We ought to know. What has been the result of those discussions? It is obviously very much better for us and all to the advantage of our shipping lines and the shipping lines of other maritime countries if we work together and if we put up a fight against the United States on this issue.
  1238
  There is much to be said on this issue. I could speak for a long time about it, and I make no apology for having made what may be described as a lengthy speech, although I am coming to my conclusion. I took this matter up with the right hon. Member for Bromley when he was Prime Minister. Is there any reason why, in the next couple of months before the election, the present Prime Minister, in spite of his many preoccupations, should not address himself to this subject? I do not think that we shall get a settlement except on a summit basis. I mean no disrespect to the Minister of Transport—not that I do not want to be disrespectful to him occasionally, but I do not mean that he is incapable of engaging in a discussion; but these matters ought to be settled at a very high level.
  If it cannot be settled by the present Government before the next election, I hope—and I believe that my hopes will have some measure of fulfilment—that the next Government will try to deal with this very important subject, which affects the future of British shipping, at a high level, by the next Prime Minister going to meet the President, who, I believe, will be President Johnson, to try to reach a conclusion.
  Meanwhile, I beg the right hon. Gentleman and hon. Members who are interested in the future of British shipping to stand firm. We want the Anglo-American Alliance. We are not abandoning that very important concept, but let us tell the United States that if there is to be co-operation and partnership, if there is to be an alliance, there must be a fair deal for our shipping industry.
  5.11 p.m.
  Mr. Humphrey Atkins: The right hon. Member for Easington (Mr. Shinwell) started by saying that he confidently expected that after the next election he would be back in his place, unlike my hon. and gallant Friend the Member for Barkston Ash (Sir L. Ropner). We always enjoy listening to the right hon. Gentleman. I, too, hope that he will be back, but I hope very much that he is still in that exact place on the opposite side of the House after the next General Election.
  We always enjoy listening to the right hon. Gentleman because, as usual in his

  1239
  speeches, he asks a great many pertinent questions about the content of the Bill. I have not the slightest intention of attempting to answer him, because my right hon. and learned Friend the Attorney-General will do it very much better and also because the right hon. Gentleman covered a wider range of subjects than might have appeared possible on the Bill, but he has great skill in this matter and we always enjoy listening to him at it.
  Although the right hon. Gentleman supports the Bill—and we are in agreement there—he was less than fair to my right hon. Friend the Minister of Transport in indicating that my right hon. Friend had not stood up to the Americans and had not achieved anything in this field so far. It is less than fair because my right hon. Friend has been negotiating with the Americans for a long period of time. Furthermore, as the House knows, he has gathered together the support of every ship-owning country in the world. It seems to me a considerable achievement for my right hon. Friend to have been able to approach the Americans, knowing that he had the support of countries owning more than half the world's shipping, in an endeavour to persuade the Americans to reconsider some of the demands which the Federal Maritime Commission is making on us and on other nations.
  The right hon. Gentleman has said, as every speaker has and as I shall now say, that the Bill does not solve the problem at all. Of course it does not. It cannot be expected to, because we cannot make the Americans or anyone else do what we want by passing laws in this country. The only possible solution to this difficult problem, which has occupied the attention of Governments for some time now, is that a solution shall be negotiated. I think that the entire House realises this, and I welcome the Bill because it will strengthen the hand of my right hon. Friend and of the shipowners in this country in their dealings with the Americans, but to pretend that by waving a wand or passing a law here we can solve the problem is totally unrealistic.
  I have no doubt whatever that when the Bill becomes an Act there will be a resumption of the negotiations which
  1240
  have been going on for several years, and which resulted in the Federal Maritime Commission postponing the date of operation of its particular and to our minds most objectionable demands until 1st September. I do not know at what level they will be resumed, but I am certain that the answer is any level that is necessary.
  Here now comes a certain difficulty, because my right hon. Friend in introducing the Bill referred, as have other hon. Members, to the "action of the United States Government". As I understand the position, this is not technically so. I think that I am right in saying that the Federal Maritime Commission is not part of the Government of the United States in the way that we understand it. In other words, although it is part of the system by which the United States is governed, it is not part of the Administration. It does not accept orders from the Administration and it is bound solely by the Act which created it and is responsible solely to Congress.
  This seems to me to make the negotiations which have taken place, and which will continue, very much more difficult, because I understand that neither the Chairman of the Commission nor any other member of it has very much leeway. The Commission is bound simply by the terms of the Act which absolutely clearly lays down that its only consideration must be the sole interest of the United States. To discuss and come to a compromise and agreement with Administrations is difficult enough, but to have to try to come to a compromise or agreement with a body which has no latitude and no room for manoeuvre seems to me a great deal more difficult.
  I hope that my right hon. and learned Friend the Attorney-General in winding up the debate will tell me whether I am correct in this supposition and will indicate, if he can, whether he believes that we are able to come to a satisfactory outcome to the negotiations without recourse to the International Court or some such body, or without an alteration of the laws of the United States which, of course, we cannot do here.
  There is a remarkable degree of unanimity about the desirability of the Bill, although some speakers have said that they feel that it is rather late. I do

  1241
  not think that it is late. I think that it has only been introduced now that the negotiations have come to somewhat of a halt in order to strengthen our negotiators' hand. All the speakers so far have welcomed the Bill, and the fact that there are no large numbers of hon. Members in the House, also referred to by the right hon. Member for Easington, cannot possibly be thought to indicate anything other than that as this is not a controversial matter people are not flocking here. The right hon. Gentleman knows better than I do. Compared with him I am a newcomer. He knows that the House is fullest when there is controversy about the matter before it. There is clearly none about the matter which is before us now in its essence. We all agree that it is highly desirable. I shall say no more about it but to wish it well.
  Mr. Shinwell: I have frequently commented on the fact that when we have shipping debates the attendance has been far too small. One tries to provoke hon. Members into taking part in discussion of what I regard as an important matter.
  Mr. Atkins: The right hon. Gentleman is better at provoking hon. Members than is anybody else, and he has managed to have quite a little debate on his own on shipping matters in general although I understood that the Bill is much more restricted than that. As I said earlier, we all enjoyed his contribution but it is not fair to assume that because the House is not full to the doors there is no great unanimity about the necessary for the Bill and about support for the Minister in the efforts which he is making.
  5.18 p.m.
  Mr. Stan Awbery: A few months ago a controversy arose over the decision of the Federal Martime Commission of the United States which disturbed the cordial relationship between America and ourselves. I do not know whether the Bill will solve the problem which arose at that time. I want to ask the Attorney-General whether he thinks that the Bill is satisfactory in the protection which it provides for British shipowners, and I want to deal only with that one aspect.
  It will be recalled that a few months ago Leyland Motors was sending its
  1242
  buses to Cuba. Ships were chartered for this class of work but the Americans said that if British ships took the Leyland buses to Cuba they would be boycotted or black-balled afterwards. That, in my opinion, is interfering in the internal arrangements of this country, and I should like to know whether the Minister is satisfied that the powers he takes under this Bill are sufficient to protect shipowners in such circumstances.
  All I can see in the Bill is a provision that, if a shipowner is proscribed or has to accept conditions for the carrying of a cargo, he must report the matter to the Minister. Reporting to the Minister is nothing unless the Minister is determined to take some action to protect a shipowner who is prevented from carrying a cargo.
  At the same time as the Leyland business to which I have referred, the Americans were selling wheat to Russia, but they stipulated in their agreement that 50 per cent. of the cargo must be carried in American ships. Is the Minister satisfied that the Bill will give the protection necessary in circumstances such as those which arose a few months ago? If it should come again, the problem might be more serious and create delicate relationships between America and ourselves. I hope that the Minister will give us definite assurances on the points which I have raised.
  5.21 p.m.
  Mr. Charles Fletcher-Cooke: This is a brave Bill, but, as the right hon. Member for Easington (Mr. Shinwell) reminded us, it is also a penal Bill. It must be unique in that the potential victims are rather welcoming the chains, but it is none the less, a Bill which imposes penalties and, therefore, it ought, under our rules, to be absolutely clear. I have some questions to put which suggest that it is not absolutely crystal clear.
  The crux of the matter comes in Clauses 1 and 2, under which the Minister may make orders forbidding individuals or companies to obey orders of a foreign Power which
  "constitute an infringement of the jurisdiction which, under international law, belongs to the United Kingdom."
  Those are brave words, but it is the first time, to my knowledge, that our

  1243
  Statute Book has appealed to the standards of international law, by which. presumably, is meant public international law.
  The first difficulty is that public international law is so notoriously ambiguous that to appeal to it as a standard in a penal statute is to ask for trouble. Anyone on trial under it can always appeal, if that be the standard, to a textbook which almost invariably will conflict with previous textbooks or decision. However, that is the way the Bill has been drafted. It seems to me to make it open to anyone prosecuted under it to plead that the order made was ultra vires because either the jurisdiction does not belong to the United Kingdom, or, if it does, it belongs also to the other country, that is to say, there is a concurrent jurisdiction.
  Do the words
  "constitute an infringement of the jurisdiction which, under international law, belongs to the United Kingdom"
  mean belonging exclusively to the United Kingdom or do they mean belonging to the United Kingdom among others? Hon. Members will know that there are many cases in international law where there is concurrent jurisdiction, where one can sue in more than one court or more than one country. For instance, unless there are special conventions or specific exceptions, seamen can sue for their wages in a foreign court. Even though they are sailing under the British flag, if they put into a foreign port and have not been paid their wages, they can sue for them in the courts of the foreign country, although there would equally be concurrent jurisdiction in the courts here. This does not often happen nowadays because there are special conventions limiting it, but it is the basic rule.
  The same thing happens as regards murder or crime. If a ship puts into a foreign port and on board that ship a member of the crew assaults one of the officers, for instance, even though they are both foreigners to that country, the law of the port, in our view of international law, can deal with the matter; and so can the courts of the flag country in a case of murder, for example. There is a concurrent jurisdiction. It is very important, therefore, when we talk about an infringement of the jurisdiction which,
  1244
  under international law, belongs to the United Kingdom, to be perfectly clear whether we mean belonging exclusively to the United Kingdom or merely concurrently belonging.
  In this country we have always held the view that under public international law the law of the port is given very full power. We had a long battle with the French on this very point throughout the nineteenth century. The French always emphasised the law of the flag of the ship, saying that in many cases the law of the port should give way to the law of the flag. We held the contrary view, that the law of the port, however vexatious or however silly it might seem to the visting ship, prevailed.
  I wish to quote from an opinion given by the Law Officers, including the Queen's Advocate, in 1879 on this very point. A British ship had put into a Spanish port—a dangerous place, as we know—and we thought in this country that the Spanish authorities were behaving very vexatiously in that they were visiting various claims and penalties on the ship because, quite accidentally and without doing any harm to anyone, a quite unimportant matter had been omitted from the manifest of the cargo. Yet the Law Officers of the time reported to the Foreign Secretary in these terms:
  "By the Law of Nations every independent Government is the sole judge of the measures which may best suit, promote, or insure its own people their interests and safety; may open or close its territory, waters, and harbours; and altogether refuse to admit, or impose what conditions it may deem fit, upon the admission of foreigners and foreign vessels. These conditions may be absurd, vexatious, inconsistent with and contrary to the usage of all other civilised nations; still the Government has the right to impose them, and a foreign Government can only protest against their being imposed."
  If that is the view of the Law Officers then about what a foreign country can do to our ships when they put into its ports—it can impose what conditions it likes—it seems to me that anyone prosecuted under this Bill will have an easy defence if he is able to say that, for many centuries, and in face of a good deal of contrary opinion, the British Government have always held the view that a foreign port can impose what conditions it likes, however vexatious they may be.
  It is not a view which I like, but it is the view which the British Government

  1245
  have maintained throughout the nineteenth century against the strong opposition of the French, and it is the view which won, which we have succeeded, on the whole, in persuading other nations to accept. It is a little ironic that we should at this time say that foreign ports have no such jurisdiction and they cannot impose these vexatious requirements, that it is legal imperialism, and so on.
  It is idle to say that these are documents made abroad, made here, that is to say between British shippers and shipowners, foreigners to America. Of course they are. But if they go to America, or copies of them go to America, or if secondary evidence must be given by oral examination of witnesses or however it may be, the Americans take the attitude: "If you want to come to our ports, you must observe our rules. We are entitled to compel you to disclose your evidence, oral or documentary, to make sure that you are obeying our rules."
  I am not acting as devil's advocate. All that I am saying is that since we have to make our penal statutes clear beyond a peradventure there is an argument which any defendant could make. This is an ambiguous phrase—"which, according to international law, belongs to the British". It may belong to us in the sense that our courts can also demand to see these documents. But it is very arguable that it also belongs to the Americans and that we have always hitherto held that view of international law. It makes no difference in those circumstances whether the contracts are made outside the United States because the Americans say, "You foreign shippers and shipowners, in your Conference system, are indulging in restrictive trade practices".
  The Maritime Commission is saying—and it is important to get this clear because we must come to an agreement with the Americans about this and therefore we had better understand their view, even if we oppose it—"We will allow you to use our ports only if you observe what we regard as correct methods of competitive trading". We do not regard them as correct methods of competitive trading, but they do. They say that in our domestic legislation we are very fierce against such things as loyalty rebates, double pricing and exclusive
  1246
  trading. Our Monopolies Commission issues reports—one was issued only recently—condemning exclusive trading, loyalty rebates and things of that sort. Therefore, our philosophy, they say, is that these restrictive trade practices of double pricing for loyalty are wrong. Yet, they say, when it comes to foreign commerce we adopt a different philosophy. We allow these practices freely. We commend them. In the case of foreign commerce these things may be perfectly justifiable. But it is understandable and cannot merely be attributed to wickedness of heart that the Americans think that there is something hypocritical in our "double standard".
  The deadlock is complete. I think that it is unwise for the United States Congress to adopt this attitude, although, as I say, I think it arguable under international law that it is entitled to do so. If the American Congress is entitled to do so, this Bill is a brutum fulmen, because any defendant can show that this jurisdiction does not belong exclusively to the British Government.
  But, as we know, this Bill is only a shot across the bows. It is designed to give our shipowners and shippers the opportunity to plead in the American courts, quite rightly, that they may be subjected, albeit perhaps unfairly, to pains and penalties at home if they observe the requirements of the American Federal Maritime Commission. It is right to give them that protection.
  The ultimate solution must surely be an agreement, and I hope that the Bill will make an agreement more rather than less likely. It behoves us, in the glow of satisfaction which we are having this afternoon at fighting back, not to make the rift any wider. We must come to an agreement. There are enough people on both sides of the Atlantic, as both our elections grow nearer, who will try to make the rift wider. Everybody is under a bounden duty to restrain whatever feelings they may have and to try to make the rift narrower.
  It seems to me that there are five possible outcomes. First, I suppose it possible that the Americans may win, in the sense that we and the other European and, indeed, Asiatic nations—because this is not only an Atlantic question but a Pacific question; we sometimes forget that—may give in and may

  1247
  have to submit our documents and contracts to the Federal Maritime Commission if we wish to continue to use American ports. The second possibility is that we should win and the Americans would lose and that the Federal Maritime Commission would, either in dereliction of its duty to Congress or because of an amendment by Congress to the 1916 and 1961 Acts, simply back down. I do not think that either of those outcomes is likely.
  The third possibility—and this is a nasty one—is that both countries will relapse into a form of eighteenth century mercantilism by which we should close our ports to their ships and they would close their ports to ours, that we should insist on our trade being carried in our bottoms and the same with the other countries of the world. That would be even worse.
  Almost as bad would be the fourth possible outcome, which would be a sort of international price ring on the lines of what has happened in the air. It seems to me that the I.A.T.A. agreements in the air are a warning of what might be a possible outcome, because I am sure that price fixing on an international scale for freight rates, with all the Governmental sanctions behind it, would in the end be a disaster to shipping and to world trade because I am sure that those rates would go up rather than down.
  The fifth and, I think, only tolerable solution and the one which I am sure in the end we shall adopt is this. We think that our conference system is a perfectly justifiable method of trading; the Americans, under their extreme anti-trust philosophy, do not. We in this country have a domestic method of justifying things like loyalty rebates and double pricing and exclusive trading arrangements by which we go before a tribunal and have to prove the point. What seems to be happening at the moment is that we are going before an American tribunal. We are going before the Federal Maritime Commission, acting under a very narrow terms of reference, whose freedom of manœuvre is very small. But that is not tolerable. I think that the conference arrangements should be justified to an independent body. I believe that they are
  1248
  justifiable and that eventually the Americans will come to realise that the body to which they have to be justified is not an American court, a British commission or British court, or a European or Asiatic one, but some sort of international restrictive practices court.
  In the end, the fifth solution by which such price-fixing arrangements were permitted by an international restrictive practices court somewhat on the lines of our own would mean that honour was satisfied on all sides, and if, as I believe, our conference arrangements are in the best interests of the shippers and shipowners, we would not fear the outcome of any such recourse. If that be the case, it seems to me that in this matter, where national honour has become so sensitive and prickly and where we are getting into a fighting mood, sooner or later that outcome, which is the only tolerable one of the five which I have suggested, will inevitably have to be accepted.
  5.39 p.m.
  Mr. A. J. Irvine: I shall listen with deep interest to the reply which the right hon. and learned Gentleman the Attorney-General gives to questions put to him by his hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke) about the penal provisions in this Bill in the context to which his hon. and learned Friend referred, and I shall have something to say about that a little later.
  It seems to me that the proceedings of the United States Federal Maritime Commission made some form of action by the British Government entirely necessary. It called for legislation, and although I agree with what my hon. Friend the Member for Bermondsey (Mr. Mellish) had to say about the earlier delays, I am glad that now in the treatment of time in relation to this Measure a degree of urgency and speed is attaching to it. However, though it is right to act urgently I think we must be vigilant about provisions of this kind, and there are some questions I want to ask the Attorney-General to deal with, if he is good enough, in his reply—questions about a Measure like this which is really, to a quite unusual degree, Palmerstonian in character and very unlike the type of legislation in this

  1249
  field to which we are accustomed, and I think there are matters which need watching about it.
  The first point I would raise is that under the Bill the Minister may give directions to a person prohibiting compliance with the requirement of a foreign Power. As my right hon. Friend the Member for Easington (Mr. Shinwell) said in the speech which I think everybody in the House enjoyed to hear, this may have very serious consequences. He asked the question, what is going to occur if non-compliance is the course of action pursued by a British ship's captain? It is quite clear that however basically friendly—there is no need to emphasise this; it stands clearly in the minds of all of us—our relations are with the United States one might have arising a difficult matter of this kind, a situation of considerable delicacy and difficulty. As a consequence of putting into operation the machinery of this Bill, of what is proposed by this Bill, and when a direction has been given by the Minister, a very ticklish and awkward situation might arise which all, on both sides of the Atlantic, would probably regret. So I would emphasise in this connection the seriousness of the matter.
  One has to bear in mind that the foreign authority, in pursuing the course it did pursue in this kind of event, would only be making the requirement it was making because it thought it could lawfully do so on its interpretation of the law. This being so I ask the question, which I know the right hon. Gentleman the Minister of Transport will at once accept from me is without the faintest trace of disrespect, whether it is appropriate to confer this power, designed to maintain the jurisdiction of the United Kingdom in circumstances which could have such important repercussions affecting relations with foreign Powers, upon the Minister of Transport.
  We know very well his responsibilities for shipping and that it is even common form under the Merchant Shipping Acts and other legislation for powers to be conferred upon him relative to our country's maritime and shipping rights and properties, but I think it must be recognised that these existing powers generally relate to matters of pilotage, harbours, and so forth. When one is concerned to the extent that one is here
  1250
  in this Bill with matters affecting relations with foreign Powers, and with a great ally, one asks the question, specially in the context of conflicting opinions being held as to that power to act properly being a matter of law, whether it would not have been more appropriate for the Board of Trade, or for the Foreign Office perhaps, to be the Department of State concerned.
  Apart from other factors arising from the scale and status of importance of the dispute, there is the point that those Departments have officers on shore, commissioners and consuls, people of that kind, who could play a useful part in the development of matters arising under this Bill. It may be that any criticism of the kind I am suggesting in this part of my speech is somewhat late; I acknowledge that it is done in a rather hurried fashion, possibly too late to put into effect, but I venture to think it would be of service to the House if the right hon. and learned Gentleman in his reply would be good enough to indicate the Government's view on this point and perhaps let us know whether there is really any precedent for giving to the Minister of Transport responsibilities in this kind of field which may have consequences of such very great importance in international relations.
  I turn to the matter which was touched upon by the hon. and learned Member for Darwen. I, like him, was greatly concerned at the fact that British shipping companies and British ships, captains might render themselves liable to severe penalties under the Bill, penalties to be imposed if there were a failure to give proper notice of requirement of prohibition given to them, and I felt doubt, as I think he did, as to the propriety of severe penal provisions upon a failure to give notice, if the question whether or not such a notice should be given might raise complex and difficult issues to determine. If we are going to have severe penalties for failure in a statutory duty it is desirable that that duty should be crystal clear and I felt concern and I think that that concern was shared by the hon. and learned Gentleman.
  I am bound to say from inquiries I have made that my understanding is that this anxiety is not shared by shipping companies in this country, and I

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  do not think it is shared by the Chamber of Shipping, because the view they take, as I understand it, is that an order to be made by the Minister under Clause 1(1) will identify the relative measures taken under the law of the foreign country. That is where the crux of the matter, in their view, will be, and they think that it will be clear enough that the requirements of prohibition which are directed to a ship's captain or to the company derive from and are consequences of the measures set out and defined in the Minister's Order. They think that shipping companies and ships' officers will in this way not be confronted by any complicated question as to whether they should give notice because, they say, the Minister's Order will have sufficiently identified the measure and it will be easy enough to judge whether the duty to give notice arises, and they seem to be satisfied upon that point, I think it fair to say.
  I confess I am not entirely convinced myself. I think that if I were them I should feel some anxiety under this head. In saying that I have in mind the circumstance that I have the honour to represent a constituency in a city of great shipping interests and tradition.
  Two points arise in this connection, and I should be grateful to hear the right hon. and learned Gentleman's view about it. First, even accepting the view which I have expressed as being the view of the Chamber of Shipping in this matter, the issue whether the duty imposed by Clause 1(2) is sufficiently clear to justify the severe penalties in Clause 3 depends upon the content of the Minister's Order and whether that Order is compendious and clear. Is it right for Parliament to legislate for a severe penal provision whose appropriateness or fairness depends on the character and content of the Minister's Order which at present we cannot see and whose contents we do not know?
  Of course, it has often occurred that there are penal provisions in a Statute for contravention of requirements in a regulation whose content is not spelled out in the Bill in which only the character of the regulations is adumbrated, but I doubt whether there is readily to be found a precedent for a penal Clause of this degree of severity
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  whose fairness can be judged only when one sees the degree of clarity and definition achieved by the Minister's Order.
  Mr. Fletcher-Cooke: There is another difficulty. Even if the Order is crystal clear, it will still be open to anybody upon whom it is served and who has to obey it to plead that it is ultra vires on the ground that it does not deal with a measure under international law which is within the exclusive jurisdiction of the British Government.
  Mr. Irvine: I would have thought that the answer to that was that that issue arises under the separate question of the effect of the measure introduced by the foreign Power. The Minister takes upon himself the responsibility of deciding with what measures ships' captains and ships' companies need not comply. This is his responsibility as distinct from that of the captain or the company. That is at any rate the line of answer to that question.
  The second point is that if novel steps are taken by the foreign authority, novel and unexpected steps which have not been taken before or which were not contemplated, in other words, if the action of the foreign Power were to be stepped up, so to speak, as it is not far fetched to suppose might be a consequence of this kind of action being taken on this side, it will not be easy to see whether novel steps are taken pursuant to the measures referred to in the Minister's Order. There may be a clear answer to this difficulty and if there is I shall be most grateful to the Attorney-General if he gives it to me.
  My right hon. Friend the Member for Easington has very helpfully and hypothetically suggested the possibility of the imprisonment of the whole crew. Such wholly unanticipated and unforeseen requirements made by the foreign authority might, for all the ship's captain knew, be pursuant to emergency measures which he knew nothing about. In such circumstances, he would be in difficulty, for he would not know whether the requirements or prohibitions with which he was confronted and which were novel in character were pursuant to the measures referred to in the Minister's Order, or were emergency measures passed and made since the Minister' Order was made.
  Mr. Shinwell: This is a very abstruse legal argument which no doubt has a great deal of substance but which I do not follow very well. It occurs to me that if a ship arrives in some American port and the question of the disclosure or production of documents emerges, the authority acting on behalf of the Federal Maritime Commission may demand the production of documents. To whom does it make its demand? Obviously, it can make its demand only to the master of the vessel. Unless some arrangement precedes the sailing of the vessel or its arrival in a American port, an arrangement between the shipowner and the shipper in the United Kingdom which satisfies the Federal Maritime Commission, who is to be responsible? Is it to be a matter to be settled in advance before the ship leaves the United Kingdom and arrives in an American port, or will it be left to the captain?
  Mr. Irvine: If I do not make a point clear to my right hon. Friend in the course of my argument, I know perfectly well that it is my failure.
  Mr. Shinwell: No. it is not.
  Mr. Irvine: I am perfectly sure that it is. Knowing my right hon. Friend as well as I do, I know that the failure is mine. He and I at this stage are on rather different points and I am very glad that he has got his over to the Attorney-General in that interjection.
  What I am concerned with is that a ship's captain might be confronted by a requirement or prohibition by a foreign authority which was made as the result of a recently made or passed emergency regulation. If it was not a measure referred to in the Minister's Order, there is no duty to give any notice; nor would the machinery be available for the Minister to make any direction in that event. I was seeking to clarify what in that set of circumstances would be likely to occur, and I wanted confirmation that the position of the British ship's captain under the Bill in the circumstances would not be affected.
  The final issue which I wish to put before the House is related to that. We want to be quite sure that the Bill does not in any way, by implication or otherwise, derogate from the rights of British
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  shippers and ships' officers under the existing law.
  If as things are without the Bill a British ship is required to do something, and the requirement is an encroachment of the United Kingdom jurisdiction, and the ship's captain refuses to comply with the requirement, I would have thought that in that event the British Government would come to the aid of the ship's captain, or the shipping company, and would adopt his noncompliance with such an Order or requirement as an act of State making the matter thereby justiciable, if so much were needed by the International Court.
  Is it really necessary to have the Bill and the machinery proposed by it to make certain issues justiciable before the International Court which are not at present justiciable? I would have doubted it and I would be interested to have that matter dealt with and the Government's view expressed.
  It would be very undesirable if, a British ship having refused to comply with a requirement of a foreign authority which the British Government thought was unlawful, received any less support or less backing because it failed to give the Clause 1(2) notice. I suggest that it would never do for the British Government to take the line, "No, we are not going to do anything to help you because you never gave us notice of the requirement." The proposed machinery of notices and directions, however desirable it may be on other grounds, is not necessary to identify the British Government with the ship's noncompliance so as to make the matter justiciable before the International Court.
  The procedure proposed by the Bill—and I do not think that the House should be in any doubt about this—will not in the event operate by rule of thumb without difficulty. I think that difficulties and unexpected situations will arise out of this, if the proposals take effect at all. It may work smoothly enough where requirements or prohibitions are threatened to be imposed, which is one of the contingencies explicitly dealt with in Clause 1(2), but where the requirements or prohibitions are imposed suddenly or unexpectedly,

  1255
  it seems that difficulties may arise of a kind to which I have referred in another connection.
  Moreover, as I have indicated, if requirements are made pursuant to a new emergency measure not comprised in the Minister's Order, there will be nothing in the Bill which will immediately affect the matter. We therefore want to be reassured that in the event of circumstances arising which will render the provisions of the Bill not immediately applicable, British ships will receive no less support vis-à-vis a foreign Power or authority than they would have received and would receive under the existing law.
  6.4 p.m.
  Mr. Cyril Bence: When the Bill was first printed, and I read it, I had difficulty in finding out how it would help to protect British shippers on the American routes. I read it many times and wondered how in the name of fortune it would do it.
  During the course of my speech I shall give my interpretation of the Bill, and at the same time point out why I fail to grasp how it will be an effective instrument against the actions of the United States Government, and, indeed, of many other Governments to protect themselves against the high efficiency and high competitive power of British shipbuilding and British merchant fleets.
  Like my right hon. Friend the Member for Easington (Mr. Shinwell) I, too, am shocked that not more Members are taking part in the Second Reading of this important Measure. We are debating the actions of our competitors, not in the normal field of competition, but in cargo and passenger-carrying across the seas. We are debating action to combat the measures taken by other Powers to sustain their own economic activities because they have failed efficiently to compete with our merchant fleet.
  I agree with my hon. Friend the Member for Bermondsey (Mr. Mellish). I regret the reason for the Bill, because I consider that a close relationship and cooperation between the United States and Great Britain are essential in the present decade. It is unfortunate that two maritime Powers, the United States, and this country, with its great traditions, should
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  reach a situation when we have to introduce niggling Measures like this to protect ourselves against the assumed unfair competition of the other.
  I must, in all humility, admit that I fail to grasp the full meaning of the Bill. I have listened to the debate and I have read a good deal of professional material which has been handed to me. I am a professional in one field, but an amateur in all others. Knowing the mystiques which surround the professional, I am suspicious of the professional advice that I get. I examine it and apply my amateur instincts to interpreting it.
  The Minister is laying on the shipping companies in this country a responsibility to provide information to the President of the Board of Trade, to a Secretary of State, and to the Minister of Transport. Such information is to be provided to all three, or to any one of them. The shipping company is to provide information of prohibitions or restrictions which its ships will encounter when they put into a particular port. It may be any port in the world, but as we are thinking particularly in terms of the United States because of the action which has been taken by the Federal Maritime Commission, perhaps I had better stick to the United States.
  If a shipping company charters a ship to carry cargo from a shipper in this country to Newport, or Philadelphia, or New Orleans, or New York, and it is aware that certain documents will be demanded, it must provide the Government with information that it is aware that such a demand will be made. If it fails to provide that information to the Minister, it will be liable to a penalty of £1,000. My hon. Friend made the point that there may be a change of requirement from the time when the information is demanded and the ship arrives at the port. Such a change could be made in an order issued by the American Federal Maritime Commission.
  The Bill says that if a shipping company fails to provide such information, and if one of its ships arrives in a foreign port and is asked for documents of the kind to which reference has been made, it will be liable to a fine of £1,000. That interpretation may be wrong, but that is how I see it. The shipping company can get the required information from reading American documents or by getting the information from the American

  1257
  consul. Such information would, therefore, be available to the Minister without him asking the shipper for it. Surely the Board of Trade, the Minister of Transport and the Secretary of State know what demands have been made by foreign Governments on British shippers without asking shipping companies here what they are.
  When a British ship arrives in a foreign country a demand may be made for certain commercial documents, as set out in the Bill. I presume that this would be listed in an Order laid before this House. The documents having been demanded, the master may refuse to supply them on the ground that his information is that his company, under British legislation, has provided the appropriate Department of State with the appropriate information respecting these types of document. The master says that he has complied with British legislation.
  I presume that the corresponding Departments of State in the United States, with their agencies over here, could get in touch with British Departments and could inquire, "Has this company given you appropriate information regarding the demands made by the Maritime Commission?"' and the Department here could say, "Yes". Who are the people now in conflict—the merchant shippers and the Maritime Commission in the United States, or the Maritime Commission and the British Government, who have provided that the shipper shall hand in certain information to Government Departments, although those Departments probably already have all the information and all the knowledge? Where does the conflict arise then? In case of difficulties the Maritime Commission might impose a fine.
  Mr. Awbery: The Maritime Commission of America would do something more than fine the man. They could put an interdict on his ship and refuse to allow it to trade into America after such an offence. If they did that our Government could provide no protection at all.
  Mr. Bence: That is the point that I am making. The Bill transfers the conflict from the shipping companies to the Minister of Transport here, or the Secretary of State or the President of the Board of Trade. These are the people who have to have the information under
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  Clause 1(2). Shipping companies are under a penalty of £1,000 if they do not provide the information. They know what demands will be made upon them. The Minister is now in a position to know what demands will be made.
  When the Maritime Commission reads the provisions of the Bill, will it say, "The people that we must get at now are not the merchant shippers but the British Government, because they have taken over responsibility"? We understand that the Maritime Commission is not a Government agency, but it is responsible to Congress. In my view, it is a semi-Government agency.
  Sir Frank Soskice: It is a public body.
  Mr. Bence: It is a public body, responsible to Congress. It seems to me that the Bill is providing that this information shall be demanded not from shipping companies but from Her Majesty's Government, who have imposed legislation on shippers which they must obey as subjects of this country.
  What action can the Minister of Transport take if the Americans demand these documents? It is an extraordinary situation. I suppose that an order could be made compelling our shipping companies not merely to give information about documents that will be demanded but also commercial information to the Minister of Transport, so that if he chooses, by the form of the Order that he brings in, he can provide that a merchant shipper shall give that information. The Bill gives him power. It uses the word "may" on several occasions. He may decide to authorise the company, or he may himself give the appropriate information concerning documents that are demanded—or he may refuse them.
  The question of the protection of British shipping and shipbuilding is a very important one for the people of the Clyde. No fewer than 20,000 workers are directly employed in the shipping and shipbuilding industries on the Clyde, and there are probably another 20,000 to 30,000 employed in all sorts of industrial enterprises serving the shipping and shipbuilding industries. A big yard in my constituency is dependent upon a prosperous British mercantile marine. Many people have the idea that this Measure

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  will protect us from discrimination by one of our principal competitors—the United States. I cannot see that that protection will be given to British shipping by the Bill.
  We know the nature of the Maritime Commission, and its powers. I can see perpetual niggling and many difficulties in making contracts. We do not know what action will result from the passing of the Bill. Some shippers want to make long-term contracts with fixed long-term rates. Some have regular cargoes passing back and forth, and they do not want a ship to go into an American harbour with a cargo and get the cargo unloaded and then, because of some argument about documents, have that ship come out in ballast and not come back here with a return cargo.
  All sorts of difficulties will have to be met by British shippers. Those difficulties exist now, and they will remain when the Bill is passed. What sanction can we use to enforce the Americans to accept a ship when our legislation provides that its master shall not disclose certain documents? Are we thinking in terms of the sanction that the British shipper shall not give the information? The Order in Council which will come before the House will have to be accepted in its entirety. It will provide that the Minister and the British Government shall be able to give the information when it is demanded by the Maritime Commission.
  The whole thing savours of tremendous powers of manœuvre by powerful State Departments, both in the United States and here. If these provisions were applied all over the world our mercantile fleet would be subject to a vast superstructure of national fences, and in effect national rings would bind our mercantile fleets, doing a lot of damage to world trade, interfering with the free flow of merchant shipping and with the competition which everyone says is essential to maintain efficiency in the carrying trades of the world. It is a great pity that we have introduced this sort of legislation.
  It would be much better if the Government made stronger efforts, in negotiations with the United States and all the other maritime nations, to reduce the barriers and discriminations which
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  exist between the nations. We have a maritime fleet which has tremendous prestige. We are a great trading nation and our merchant fleet is vital to us. It is as important as our agricultural industry. We are entitled to preserve it against unfair competition.
  We are prepared to face fair competition. We have fought every sort of discrimination by other maritime powers without the aid of subsidies and with very little help from any Government. I am sure that hon. Members regret that it has been thought necessary to pass this legislation at the end of the life of this Parliament in order to cope with a tremendous international problem.
  I hope that this problem will not be forgotten when the Bill becomes an Act and that any British Government will push as hard as possible to break down these frightful nationalistic barriers which have been thrown up by maritime nations and which curb competitive power and frustrate world trade. They prevent the design of new and fast liners and do great harm to world relationships.
  I hope that those hon. Members who come back in the next Parliament—some will not come back, we are sorry to know that the hon. and gallant Member for Barkston Ash (Sir L. Ropner) is retiring, because we shall miss his contributions to shipping debates—will not expect that the Bill will do the job which we as a great maritime nation should be doing to get other nations to give up these discriminatory actions and open their ports as Britain does to the ships of the world.
  I hope that the United States will realise that if she wants to make a great contribution to the development of the under-developed countries and unite the Western civilisation into a great, prosperous and advanced community, she must do the same as Britain, and stop discriminating against British shipping.
  6.23 p.m.
  Mr. E. Fernyhough: It would be true to say that the Bill is merely a demonstration. I do not believe that it will have any practical effect at this stage unless the course on which the American Government—who must be backing their Federal Maritime Commission—are proceeding

  1261
  is changed. I have been amazed at the restraint shown by hon. Members on both sides of the House. If any other nation in the world acted in this manner, opinion would be much stronger and much harder. Her Majesty's Government would have attempted to do something in a much more determined way than they have approached this problem.
  This is not a problem which has sprung up overnight. It did not start last month. It has been developing over the years. It has become more and more obvious that whatever we may say about our military ties, and unity with the Americans, economically we are divided. They want to carry out certain practices. They insist on doing certain things which will damage our economy both now and in the long term.
  British shipping was one of our greatest earners. The receipts from our ships, carrying goods all over the world, have made a great contribution to solving our balance of payments problems. Over the years we have seen that contribution declining. It has declined substantially because of the restrictive practices adopted by other maritime nations; and no nation is more guilty of these restrictive practices than the United States of America.
  Let us remember the wheat which was going to India. Because 50 per cent. of it had to be carried in American ships the Indians either paid the American freight rate, which was twice as high as world rates, or they did not get the wheat. What the Americans gave with one hand, substantially they took away with the other. They insist that this shall be part and parcel of every agreement they make with respect to aid for the backward and developing countries. Other countries are inhibited from taking their share of what, in the past, has been their historic trading.
  For instance, Leyland's secured a valuable contract for British engineering and motor industries which was, I believe, valued at about £11 million. Cuba is a country with which we have traded for many years and Leyland's felt justified in maintaining its contacts with that country. But it was made perfectly clear to British shipowners and shipping lines that the Americans were bitterly opposed to this contract.
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  Because of the threat by America, Leyland's had to go to a Communist country to get its exports carried to an old customer. Several hundred thousand tons of our 22 million tons of merchant shipping were idle, waiting for cargoes, but the company could not find a British ship to take this valuable export order to Cuba and had to go to Eastern Germany. Did ever anyone know anything so fantastic, so ridiculous and indefensible as that a British manufacturer, who ought to have at his disposal the largest merchant navy in the world to carry his goods, could not get: a British ship to carry that valuable contract and had to go, instead, to a Communist country for that purpose?
  The reason was that it had been made perfectly clear that if the company traded with Cuba it would not be allowed to trade in any American port. The Americans ought to realise that this is not a one-sided argument. We give them very generous facilities. Many people in this country are deeply resentful about the facilities which the Americans are given at the Holy Loch. No one has suggested that the facilities that they enjoy there should be withdrawn, but that would be a legitimate argument in these circumstances.
  I should be prepared to say, "If you intend to pursue these policies which are so inimical to one of our oldest established industries, we shall have to look at some of the arrangements that we have made with you." I would rather that did not happen. I feel sure that it would not be necessary if the Minister had pursued this matter as vigorously as he should have done with the representatives of other countries with whom he is supposed to have been in conference.
  Although the negotiations are supposed to be very secret, I should like the Minister to tell us what is happening in relation to other maritime nations and whether they are introducing similar legislation. Will they give to their shipping lines the same kind of instructions? If their shipping lines do not observe those instructions, will they be subject to the same kind of penalties as those to which our people are subjected? I should like the Attorney-General to make clear what is to happen. The points made by my right hon. Friend the Member for Easington (Mr. Shinwell) and my

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  hon. and learned Friend the Member for Liverpool, Edge Hill (Mr. A. J. Irvine) were very pertinent.
  Will the captain be expected to deliver the documents? If he refuses, will he be subject only to a fine? Since the captain will be carrying out the instructions of Her Majesty's Government, will he pay the fine, or will the Government pay it? Will the captain be free, rather than to deliver the papers, to bring the ship out of the port? If the captain is fined, and the Government do not pay the fine, who will pay it—the shipping line by which he is employed? To these very pertinent questions we should have answers. In the long term the only answer is a sensible international agreement.
  The attitude of the Americans towards British shipping and the shipping of other maritime nations arises from the fact that, no matter how competitive they may be in other fields of industry, they are not competitive in this. They cannot build and man ships as cheaply as we can. The actions they take are to protect themselves because of their un-competitiveness. We should make it clear that in those fields in which they are more competitive than we are we do not attempt to impose barriers and restrictions which would be crippling to them.
  If the Americans are our friends and allies, if they have the future well-being of Britain and the rest of the Western world at heart, they should reconsider our position, because when they have killed off this basic industry in Britain and other European nations the day may come when they will very much regret their attitude and actions.
  6.36 p.m.
  Sir Frank Soskice: My hon. Friend the Member for Jarrow (Mr. Fernyhough) indicated that in his view this Bill was a demonstration, and little more. If it is a demonstration it is a very striking demonstration because it underlines, unfortunately underlines, what is a sharp point of conflict with the American Administration. The Commission is a public body. It is the expression of the will of the American Government and the American Administration and it seeks to carry out the purpose of that Administration that there should be control in the terms of the
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  1916 Act of Congress and the 1961 Act of Congress over all foreign shipping. I shall come back to the point my hon. Friend made about this Measure being merely a demonstration because possibly there is a great deal to be said in support of that view. When I say "possibly" it sounds rather complacent and I withdraw the word "possibly"—there is.
  The debate which has been full and, I think everyone would agree, thoroughly well-informed, has ranged over a wide variety of what I might describe as background topics. We have discussed the shipping conference system, we have discussed British shipping policy, American shipping policy and cognate matters such as flags of convenience and a great variety of other similar subjects. A debate of this sort was obviously bound to range wide, but in the ultimate analysis what the Bill raises as the central and focal question upon which I should like to address the House is, in the first place, have circumstances arisen which justify and make necessary the introduction of a Measure of this sort? In the second place, is the Measure so constructed and framed as to be likely to compass the purpose which the Government have in mind?
  Dealing with those two subjects separately, I should have thought that everyone who has spoken in this debate would think it beyond argument that it was necessary to introduce a Bill of this nature. The two United States Acts of Congress are far from being pellucid and in the scope they embrace seem to cover all ships and shipping companies of which it could be predicated that they run on regular routes engaged in the transportation by water of passengers or property between the United States and a foreign country. The crucial word is "engaged". I suppose it means all lines are brought in which as part of their undertaking carry American goods or American passengers.
  If that really is the right interpretation of the definition, the Acts of Congress of 1916 and 1961 are extremely wide—I should have thought quite unjustifiably wide. I should have thought that it would be difficult to conceive any doctrine of international law, uncertain as it may be, as the hon. and learned

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  Member for Darwen (Mr. Fletcher-Cooke) reminded us, that could possibly authorise the American Administation to legislate in the sense, in which they have legislated as affecting British internal domestic matters.
  After all, what have they done? Let us take a British shipping company, registered in London, owning vessels registered on Lloyds' Register, and trading throughout the world. I agree that the definition does not include tramp vessels, if I may say that to the hon. and gallant Member for Barkston Ash (Sir L. Ropner) from whom I am very sorry to learn that I am saying goodbye across the Floor of the House. He asked whether tramp vessels were included, but the definition, in terms, excludes trampers.
  But beyond that, liners, both cargo and passenger, that are British in origin, registered on the British register and owned by a company which, amongst other of its activities, plies to American ports, even if they are plying to New Zealand, Australia or anywhere else are, if the American Acts to which I have referred are interpreted according to their language, apparently brought within their scope.
  I should have thought that quite unjustifiable on any view. How could it be reasonably said in international law that because a British ship-owning company which quotes conference rates to New Zealand for a commodity, and carries to New Zealand cargo or passengers—going through the Panama Canal or somewhere like that—how could it reasonably be said in international law that because the company which owns the liner as part of its activities, sometimes plies to American ports, it should be subject to American jurisdiction?
  I would therefore answer the first question as every hon. and right hon. Member has so far answered it unhesitatingly, by saying that it is utterly unjustifiable for the United States Administration to seek to control matters of internal domestic British shipping in the way they propose to control them in terms of these two Measures. I venture to reiterate what several right hon. and hon. Members have said. I greatly regret that this clash should have arisen. I greatly hope that it will not be made an occasion for anti-American ebullitions.
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  After all, the United States is a very great and very generous country with whom we have lived in terms of closest friendship for many decades, and it is regrettable, whether we talk of Cuba or of any other matters, that we should find ourselves in terms of direct conflict with the express and definite will of the United States. However, it is necessary, as hon. and right hon. Members have repeated, for us to take steps to prevent what is a very real and extensive infringement of the British jurisdiction to legislate for British shipping.
  That is how I would answer the first question. I think, however, that it is very difficult to decide whether the Minister of Transport and the right hon. and learned Gentleman the Attorney-General have chosen the right language in framing their Measure. My right hon. Friend the Member for Easington (Mr. Shinwell) took a point that I should like to press upon the Attorney-General. My right hon. Friend asked: what happens if a British ship sails the Atlantic and docks in New York Harbour, or any other American dock; it goes inside American territorial waters; it ties up alongside the quayside; the gangway is put down; the master of the vessel, and others, land on American soil? What is there to prevent an American Court saying, "You, the British Government, have no more right to legislate inside United States territorial waters, or on American soil, than you say we have to legislate on yours"?
  Suppose the master is called on to produce documents, or suppose the vessel is sailing under the terms of a conference contract which, in point of fact, infringes what is provided for and prohibited by these two American Acts—when the vessel enters United States territorial waters, when those in charge of it embark on to the quayside in New York, or anywhere else on American soil, are they not directly subject to United States jurisdiction?
  Suppose the master is prosecuted in an American court for refusing to disclose documents that he carries with him off his vessel, or suppose that he has them in a portfolio or briefcase on going ashore to visit shipping agents on behalf of his employers—what conceivable defence would he have in the American court? I can quite understand that the right hon. and learned Gentleman the

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  Attorney-General might say that the man would have no defence; that there is no mechanism by which international law could be used to prevent him being liable to penalties on American soil.
  No doubt we can prevent the United States legislating for our soil, but we cannot prevent the United States Administration from legislating that for persons on American soil certain things are obligatory, and that failure to com ply with their requirements must involve them in penalties—
  Mr. Fletcher-Cooke: I suppose that one of the clever answers to that, as a matter of practice, would be to keep the documents off American soil; that is to say, that none of the contracts or rules would be allowed on to American soil. But I do not think that that would be an answer, because I imagine that in those circumstances the American courts would insist on secondary evidence of those documents being given by the master or by the shipping agent in New York, or elsewhere, and that if no such information or answer was forthcoming the ship would be denied the privileges of the port.
  Sir F. Soskice: I have to thank the hon. and learned Member for that inter vention, and I entirely agree with what he says. He suggests that a possible remedy might be to keep the documents outside American jurisdiction, but it would be virtually impossible to do that in practice. The ship is tied up along side in the New York docks, and the documents are in the ship—
  Mr. Fletcher-Cooke: Not necessarily.
  Sir F. Soskice: However, whether or not the documents are there, I should have thought that there was the further difficulty that the ship itself is sailing under the terms of what is, in effect, on American soil, a prohibited contract. I do not see how that situation can be avoided. The right hon. and learned Gentleman says, "No", and I shall be glad to hear that I am wrong, but I should like to put this question now because we should all like to hear the answer. I dare say that I have made a mistake, but I shall be glad to hear of it.
  If British owners cause a vessel to sail under the terms of what I might
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  loosely call a prohibited contract, could they in any American court recover the amount of any freight charge from the American shipper? Would not the contract be unlawful according to American law, and if the American shipper was resident in the United States and subject to United States jurisdiction, would he not have the answer that the contract was unlawful and that he was not bound to pay any freight charges? I know that no reputable shipper would rely on such a defence, but what is the legal position?
  The hon. and gallant Member for Barkston Ash asked about existing penalties to which British shipowners companies have already rendered themselves liable, and he mentioned a figure of about £1 million in penalties that have already been incurred. It may be that the right answer is to let sleeping dogs lie, but they do not always lie down for as long as all that, and I should very much like to hear what the right hon. and learned Gentleman the Attorney-General has to say on that. It may be, again, that his answer must be, "We can only do the best we can with our own internal legislation. We cannot, unfortunately, relieve British shipowners from penalties already incurred in respect of matters with regard to which they are liable to prosecution in the United States courts, and which may be exacted from them by the judgment of the United States courts". If so, it is perfectly understandable that no more can be done and they stand at risk, and one greatly sympathises with them in the position in which they find themselves.
  Those questions—I here revert to what my hon. Friend the Member for Jarrow said—are directly relevant to the question whether this is simply a Bill put forward—I do not say this with any disrespect to Ministers—as a demonstration. As I said before, it is certainly a very striking demonstration. It certainly will have some effect. However, I believe that it is arguable, unless I have misapprehended the position, that in a very vital sphere inside United States territorial waters and when it is made fast alongside American ports and quaysides a British ship owned by a British shipowning company is, perhaps of necessity, left virtually unprotected.

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  Those are the main points I want to put to the Attorney-General. I want to ask him one more question which arises out of the observations made by my hon. and learned Friend the Member for Liverpool, Edge Hill (Mr. A. J. Irvine). My hon. and learned Friend criticised the language in Clause 1. In particular, he wondered whether the penal provisions were too stringent and whether there was uncertainty, which might be hardly fair to the person who risked prosecutions under the Clause. I should have thought that there was a great deal to be said for the view that the captain or members of the company may well not know and have no means of knowing of prohibitions or requirements which have been imposed. They may have been at sea. Equally, they may not know what prohibitions or requirements have been threatened to be imposed.
  I should have thought, merely as a matter of drafting, that one could deal with this difficulty quite easily, as my hon. and learned Friend suggested, by inserting words such as "to his knowledge". There is perhaps a danger that the wording is too drastic in its effect and that persons may be put at risk who in a moral sense are completely innocent and should not be subjected to the possibility of criminal penalties.
  The hon. and learned Member for Darwen posed what he described as five possible solutions. I will not go through them again. One of them, I confess, attracts me and I hope and think that it may well attract the right hon. and learned Gentleman. It is that ultimately this may find its way to the International Court at The Hague. I say that for broader underlying reasons. All of us in the House rejoice when the Court, as the organ of the United Nations, is promoted and raised in status. I do not mean because possibly some people may be instructed to appear before the Court. I speak perfectly seriously when I say that it is in the general world interest that organs of the United Nations should be entrusted with more and more important functions. This, after all, is a great conflict between two great countries—or, rather, to be more accurate, between one great country, the United States, and most of the other countries in the world.
  Mr. Shinwell: If there may be an attempt to reach a solution to promote agreement between the United States and ourselves on this very important matter, is it necessary to have the Bill? Could not the dispute, without the aid of the Bill, be referred to the International Court?
  Sir F. Soskice: Answering off the cuff and with great respect in the presence of the Attorney-General, I should have thought that the answer to that question was, "Yes". There is a conflict of jurisdiction here. It would be argued on behalf of the United Kingdom that the United States Administration has purported to legislate in a manner which in fact infringes what is the proper province and sphere of British legal jurisdiction. I should have thought, as my right hon. Friend suggests, that that might well be a problem which could be adjudicated upon by the International Court at The Hague. Once we have the Bill and once we have a Measure which is likely to precipitate a hearing before the Court, or which at any rate might precipitate it at some time or other, I rejoice—I think that other Members of the House will rejoice—at what I hope will be the calling in aid of the International Court to resolve what is a matter of great importance between sovereign States. I thought it right just to call attention to that, because I think that it is a matter which we should not overlook.
  As my right hon. and hon. Friends have said, we certainly support the Bill in principle. I know that the Government want the Bill as soon as they can. It may be necessary to amend it not inconsiderably in the light of the questions which have been posed and which appear to be primarily of a legal character. If so, we will do our best to cooperate, because the Bill is a necessary one, and I should be glad to hear what the answers of the Attorney-General are to the many questions which have been put to him.
  6.55 p.m.
  The Attorney-General (Sir John Hobson): This has been a very useful and interesting debate, not only on the nature of the problems which have arisen between the Federal Maritime Commission and British shipowners. The debate

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  has also ranged over many of the problems of our shipping industry. It has also had the fascination of raising difficult and interesting questions of international law, questions of American law, and questions of British law.
  I am very grateful to the right hon. Member for Easington (Mr. Shinwell) for applying his practical knowledge of what happens to ships in harbour to the question of what impact the Bill will have and what problems will arise. During the course of my reply I will try to deal with all the problems which have been raised.
  No hon. Member has opposed the Second Reading of the Bill, though some speakers have inferentially done so by damning it with a certain amount of faint praise. On the whole, when explanations have been given, I hope that the House will think that this is a necessary Measure.
  I am grateful to the right hon. and learned Member for Newport (Sir F. Soskice) for saying that he is satisfied that a situation has arisen in which this country ought to do something and in which we ought to legislate. I observed that, although the right hon. and learned Gentleman was perhaps dubious about the Bill itself, he certainly had no alternative proposals or methods by which this problem should be dealt with. Indeed, throughout the whole of the debate nobody has suggested a different form of legislation. I recognise that this is a very difficult problem. It has caused a great deal of thought to be devoted to it, and I hope that, on the whole, we have found the best possible solution to what is a very difficult and awkward situation.
  I am grateful for the expressions of affirmation which there have been of the friendship of this country for our allies in America. I am also grateful that the debate has not turned out in any sense to be an anti-American demonstration. It is obvious that one can always have a dispute with one's best friend, particularly on commercial matters; but, provided that one treats it sensibly and rationally and asserts one's respective rights, no harm can come to the general relationship of people who approach these problems in a civilised and sensible manner.
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  What I think the Bill ought not to do, and what it certainly does not do, is to say that, because the Americans claim an extensive jurisdiction which, in our view, is much wider than anything they are entitled to, we should claim an equally extensive jurisdiction and try to control things that are not within the province of this Parliament. This is certainly not what the Bill does. There is no attempt to say, "If you do this, we shall do the same". We must assert firmly and plainly that there are certain matters which, in international law, are for the British Government and for the British courts and which should be dealt with within British jurisdiction.
  We must make it plain that when these matters come to be considered we claim the right, through the Minister of Transport, to give directions as to what should be done and, if we are right in saying that they are matters which the British Government should control, a foreign court will deal with them at the peril of being accused of having infringed our jurisdiction and of having broken international law, and at the peril, in the ultimate analysis, as the right hon. and learned Gentleman said, of being taken, if it should become necessary, to the International Court.
  It is not only the immediate problems of shipowners with which we are concerned, along with their position in the American courts, but also the possibility that, either by international arbitration or by a decision of the International Court itself, this may become an issue between the two countries which will have to be decided by the ordinary processes of law and by a decision of international law.
  The hon. Member for Bermondsey (Mr. Mellish)The hon. Member for Bermondsey (Mr. Mellish) asked a number of questions, one being why the Bill had taken so long to come forward. It is true that there have been a long series of negotiations and that there is a long history to this matter. It goes back even before the 1961 Act was passed in America. It was and always has been hoped that this could have been dealt with satisfactorily by negotiation. We have not until now come to the point at which it looked as though there would be real difficulties because, so far, they have been avoided either by the F.M.C. withdrawing or postponing measures which it had proposed

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  or, on occasions, by British shipowners complying to the extent they thought reasonable, although they did not particularly want to do so.
  However, we have arrived at the situation when there is a dateline set for 1st September and, as has been pointed out, it is essential that if 1st September came, and no agreement had been reached between either this country and America or between the shipowners and the F.M.C., these powers should be available to the Minister of Transport.
  The hon. Member for Bermondsey also asked whether the matter had been—or, if it had not, whether it could be—taken up at a high level. I can assure him that this has already been done. My right hon. Friend the Member for Bromley (Mr. H. Macmillan) took it up with the former President of the United States and discussed it with him. I can also assure the hon. Member that my right hon. Friend the present Prime Minister has also been in touch with the present President of the United States about these problems. It would be wrong for me to give details of exchanges between heads of State, but I can assure him that this has not been treated merely as a departmental matter but has been dealt with at the very highest level.
  Mr. Fernyhough: Are we not right to infer from that, since the Attorney-General cannot give us an idea of the outcome of those confidential talks, that they have not been fruitful, hence the necessity for the Bill?
  The Attorney-General: It is right to infer that a solution may not have been achieved by 1st September. This is the matter which is in suspense and in doubt and it was thought necessary that, should they turn out not to be fruitful, then, in that unhappy event, these powers should be available, and that is why the Bill is being introduced. There have been continuous discussions—and they are being continued—at every level, both directly between shipowners and the F.M.C. and at the departmental level. Several different Governments are involved in these discussions.
  I am grateful for the support given to the Bill by my hon. and gallant Friend the Member for Barkston Ash (Sir L. Ropner). In his agreeable and eloquent swan song, which was in keeping with all
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  the speeches that he makes in the House on this subject, all hon. Members again realised—and this has been said by others much better than I am able to say it—that no hon. Member can speak with more authority on this subject than my hon. and gallant Friend. I am indeed grateful to him for his support.
  I am glad that my hon. and gallant Friend emphasised the fact that Clause 1 can be applied to many other countries. This is not solely legislation directed against the F.M.C. As he said, it can be used in other circumstances and in relation to other countries if they should endeavour to try to deal with shipping matters which are properly within the jurisdiction of this country. The Clause is directed only at what are called "foreign countries" in the Bill. Certainly, the other possessions and dominions of Her Majesty are not foreign countries, in my view, and it is not intended or expected that it would be necessary—indeed, it would be unthinkable—that the provisions of Clause 1 should need to be used against another country of the Commonwealth.
  I turn to the real problem which was raised by the right hon. Member for Easington and the right hon. and learned Member for Newport: how the Bill will affect the master of a ship who finds himself in an American port. What the F.M.C. is trying to do is not to get at bills of lading. There is no doubt at all that a British ship in a United States port, in accordance with the principles which my hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke) mentioned, would be liable to produce any documents on board her, particularly if they related to her own cargoes; and no one would dispute that it would be well within the jurisdiction of the United States courts, Government and legislation to demand the production of a bill of lading of a boat which was actually in American territorial waters.
  What the F.M.C. has been trying to do is not only to obtain information. It has actually probed contracts and arrangements made between British shipowners in conferences which operated within the United Kingdom, subject to United Kingdom law. An extreme example one gets is that the F.M.C. is going so far as to try to control a contract for the shipment of British goods by a British manufacturer

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  which that British manufacturer has made with a British shipowner for the shipment of those British goods in a British ship sailing under the British flag on a contract made according to British law with the freight payable in the United Kingdom.
  According to international law it cannot be right in those circumstances that the F.M.C. should endeavour to say what should be put into such a contract, or that the F.M.C. should go so far as to endeavour to obtain, as it has, not only the details of the freight charge, but any report, account, record, rate or charge of any memorandum of any owner of any ship which enters the United States in the course of trading. This is the extent to which the F.M.C's claims are going and it is largely in relation to arrangements of British shipping conferences and contracts made in Britain, which are probably in the offices of the British shipping conference and not even in the offices of the British shipper, that the claim of the F.M.C. is made.
  Until now it has, sensibly, never made a claim against the master of a vessel to the effect that he should produce such documents. However, the Americans are entitled under their law—and this shows the width of their law—to call on the agent of any common carrier by water to produce any of the documents they require. As I say, fortunately, they have not charged the master of a British vessel for failing to produce documents which he has probably never had in his possession and which he is not entitled to have.
  Mr. Shinwell: Indeed, the master may know nothing about the arrangement.
  The Attorney-General: That is precisely the position. He may not even know of the existence of the document. This clearly shows the width of claims the American legislation is making. I hope that the Americans would never charge in the American courts the master of a vessel on that basis because they would know that it would not be his responsibility.
  Despite this, suppose that that were to happen. The difference between the situation without the Bill and the situation with it is this; the master of a British vessel as the law now stands may say, ''I do not see why you should legislate
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  like that because I do not know anything about this document", and he would have only that defence against American legislation.
  After the Bill has been passed, if the Minister has given a direction to the shipping company which employs that master to the effect that it should not supply documents or comply with any request for documents which the F.M.C. may make against the master, in such circumstances the master is entitled to say to the American courts not only that they have no jurisdiction, but that it is a matter entirely within the British jurisdiction—a matter in which he is liable to be fined by the British courts—and the American courts would then be trying to enforce, through their courts, a matter which, in international law, is for the British courts. In such circumstances the master would be liable to a penalty in the British courts, which might fine him for doing something which is essentially a British matter and for which he is subject to the British courts.
  The right hon. Gentleman will remember that there was a case not dissimilar; of British Nylon Spinners and I.C.I. when the question of the use of a British patent and the relationship between du Pont and I.C.I. came up for consideration. While the American courts had made an order on the assumption that they were entitled to because British law did not operate, the Court of Appeal in England said that because I.C.I. in this country had assigned a British patent under a British contract to British Nylon Spinners, which was an entirely British company, this was a matter which the English courts would deal with and they would order I.C.I. not to comply with the directions that had been given. I think that the judgment in the American courts had proceeded upon the basis that there was no reason in British law why an American court should not make an order.
  Mr. Shinwell: It seems that there is a gap here that must be filled. My right hon. and learned Friend the Member for Newport (Sir F. Soskice) and I raised the question of the possibility of the master being asked to disclose or produce documents. He may know nothing about them, but surely the gap seems to be this: the Federal Maritime Commission

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  demands that certain documents should be produced which indicate that there is no monopolistic tendency on the part of either British shipowners or British shippers or of collusion.
  What are the means of communication? Does it mean that the Federal Maritime Commission approaches a ship-owning firm in Great Britain and asks whether it will produce documents which indicate that it is not violating United States law? Is that how it is done? If not, what are the means of communication?
  The Attorney-General: The usual course in present circumstances is that the Federal Maritime Commission makes a demand on either members of the conference or shipowners individually to produce not only the individual contracts but a great number of details and even all their books. Suppose the master or the ship came within American jurisdiction and the Federal Maritime Commission charged them before an American court for failure to comply with the direction, with the possibility of a penalty of 1,000 dollars a day.
  The impact of the Bill will enable such a person, when brought before the American court, to say that this is a matter subject to British law, to British jurisdiction, and that it would be contrary to international law for an American court to deal with a matter which is entirely for a British court. The person charged would say "I have an express direction, subject to a criminal penalty, from the Minister of Transport in the United Kingdom which prevents me from obeying you and, therefore, you ought not to enforce this law."
  It is still possible that the American court would do so, and then one would have the only remedy open in a situation where the view is taken that there has been a breach of international law. The first step is diplomatic representation. This is not dissimilar from the sort of situation where an ambassador is arrested and put in prison. One may say that there is nothing that one can do about it. What one does, of course, is to make diplomatic representations first and then try to see whether, in international law, one can agree that the one country or the other is correct, and finally, if one cannot come to an agreement as to the true
  1278
  situation on that basis, one must have by agreement an arbitration or perhaps go to the International Court and have the matter litigated.
  The Bill has two purposes. In the first place, to provide the shipowner who is charged in America with an offence to say that this is British law and he is subject to British penalties and the American court ought not in those circumstances to impose a fine. In the second place, in case, in the ultimate analysis, there is an argument of international law as to which law ought to control it being settled between the two countries by negotiations or by the International Court or by international arbitration. The Bill will in the view of the Government assist on both those aspects and it is for this purpose that the Government have brought the Bill before the House.
  It is perfectly true that we cannot as a Parliament legislate for the courts of America any more than their Congress can legislate for our courts; nor can we as a Parliament make a law which is effective in international law any more than the American Congress can pass legislation which is effective to alter international law. All one can do is to make it quite plain that in certain circumstances there are situations which ought to be dealt with by our Government, our legislation and our courts.
  This gives the Minister of Transport the power to say that certain measures taken by any foreign country seem to go far too wide, are likely to impinge on matters that are within our jurisdiction and ought 1:0 be dealt with by our legislation and our courts, and to make an order against our citizens; and then to hope that the foreign country will see that this is a matter which they should not deal with, but if they do, the Government will be in a stronger position to claim that there has been an infringement of its jurisdiction.
  The right hon. Gentleman also asked what was the position about other countries. We have been acting in conjunction with nine European countries and with Japan which represent together 50 per cent. of the world's shipping. I can assure the right hon. Gentleman that we have informed them of what we are doing and we have in the recent past presented a joint note protesting about

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  American practices, especially the Federal Maritime Commission's activities. Her Majesty's Government will continue to act together with the other Governments, because we shall certainly, as he suggested, negotiate from greater strength if we keep together and all act together in this matter.
  Mr. A. J. Irvine: It would be interesting to know whether, to the right hon. and learned Gentleman's knowledge, these other countries are introducing legislation in their Parliaments to deal with this matter.
  The Attorney-General: I have not at the moment information that new legislation is being introduced, but some have it already. Germany has legislation, not in exactly the same form but to deal with the same problem. I believe that the Netherlands also have legislation of this nature. I hope that some of the other countries will act in conformity with us if they think it convenient and suitable.
  My hon. Friend the Member for Merton and Morden (Mr. Atkins) was quite right when he pointed out that the Federal Maritime Commission is the creature of Congress and is not part of the American Government. Nevertheless, every country is under an obligation to make its laws conform to international law, and, as I have said, if the enforcement and practice of the American legislation is such that it is an infringement of international law and is seen to be so by the judgment of an international body, then there would be an obligation upon the United States to amend that legislation to conform with international law.
  The hon. Member for Bristol, Central (Mr. Awbery) raised the question whether the Bill would assist in the problem of the threat to exclude ships which had, for instance, carried Leyland buses to Cuba. The answer is, "No, it would not". It must always be within the jurisdiction of any country to say which ships it will permit within its ports and which ships it will not permit within its ports.
  The distinction between the two cases is this: had the American legislation endeavoured to impose penalities upon somebody for carrying buses to Cuba,
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  from this country, that would have been an infringement of our jurisdiction and would have been comparable with the present situation. The Americans have not intended to do that. They have merely said that as an act of policy they would exclude certain ships from their ports. This country and any other maritime country claims the right, if it so desires, to exclude any ship from its ports for any reason that it cares to exercise.
  My hon. and learned Friend the Member for Darwen raised what is fundamental to the Bill—what are the basic principles upon which the jurisdictions of the two countries ought to be divided in international law? In our view, a country such as America acts in excess of its own jurisdiction when its measures purport to regulate acts which are done outside its territorial jurisdiction by persons who are not its own nationals and which have no, or no substantial, effect within its territorial jurisdiction.
  If the Americans attempt to do that—and in our view that is what they have been doing—then we consider that they are exceeding their own jurisdiction. We consider that in so far as they endeavour to control the making of contracts or the carrying on of business by persons in this country, that is an infringement of our jurisdiction. If they attempt to control what is done within our jurisdiction or what our nationals do outside the United States, that is an infringement of our jurisdiction.
  The case on which my predecessor gave an opinion in 1879, of the vessel entering a Spanish port, was very different indeed. There it was a question whether that vessel ought to have documents in a certain form relating to the cargo on board. Here we are concerned with something quite different—with what British business people do in the United Kingdom, which may be quite unrelated to what happens within American territorial waters. This is the distinction between the two cases.
  The hon. and learned Member for Liverpool, Edge Hill (Mr. A. J. Irvine) asked why we are conferring these powers on the Minister of Transport. This is certainly an interesting question. The answer is that he is principally concerned with the subject, but he acts

  1281
  on behalf of Her Majesty and on behalf of Her Majesty's Government. It is not to be supposed that the Government are so departmentalised that he would act without the knowledge and consultation of both the Foreign Office and the Law Officers. In those circumstances it is only a question of whose hand should actually make the Order, and since shipping and shipping problems are the responsibility of the Minister of Transport, and since one or other of Her Majesty's Ministers has to act on behalf of Her Majesty, the Minister of Transport is obviously the appropriate person to make these Orders. But, naturally, he will act in conjunction with Her Majesty's other Ministers who have responsibility in these matters.
  The hon. and learned Gentleman also raised the question of penal provisions for failure to give information, and the right hon. and learned Member for Newport also raised the question whether there ought not to be some provision such as "a failure to provide information which is within one's knowledge". I will certainly consider that, and it may be that we ought to amend the Bill in that respect. I will consider, before the Committee stage, whether such an Amendment should be made.
  The hon. and learned Member was quite right in saying that whether a criminal offence has been committed or has not been committed, and its nature, would depend upon the clarity of the Minister's Order. But this is nothing unusual. Under the Agricultural Holdings Act the Labour Government provided penalties as to failure to comply with directions given on behalf of the Minister, and the Exchange Control Act, also passed in the years of the Labour Government, in 1947, provides a penalty for failure to obey directions given. These are quite usual provisions, but I hope and expect that the directions which will be given will be of sufficient clarity to be easily comprehensible.
  Another point raised is whether the Order applying the Bill to particular foreign measures will have sufficient clarity to make shipowners in this country aware of the particular circumstances which they have to report to the Minister. The hon. and learned Gentleman was good enough to point
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  out that shipowners have no anxieties on this head. I think that that is right. In any event, the Order made by the Minister applying the Bill to those foreign measures will be prayable against in the House and will be subject to the control of the House. If it is thought to be insufficiently clear, or if there are fears that it may create diffities, the House will have it within their power by negative Resolution to rescind the Order.
  The difficulty was raised that there may be novel and unexpected steps taken by a foreign authority so that a master of a British vessel or shipowner may be left in a situation in which no directions have been given by the Minister. The effect of the Bill, in the Government's view, does not derogate at all from the present law, and the shipowner or other person affected against whom an Order is made by the foreign authority will be no worse off by reason of the passing of the Bill. It will still be competent for him to argue, and for this; country to argue as against the foreign country, that it is a matter entirely within the jurisdiction of this country and not of that foreign country, and that, therefore, the legislation of that foreign country ought not to have dealt with it.
  A different view on the question has been put forward, particularly by some American lawyers. They have taken the view that if the law of either country could have dealt with a particular problem, and if British law does not deal with it, then American law is entitled to do so. The advantage which will be given by the Bill is that both in the American court and in the International Court no one will be able to say, once the Minister has made a direction, that there is, as it were, a vacuum in British law and therefore American law is entitled to operate.
  The view of the British Government is that there could be three possible situations, as for instance where freight is payable in the United Kingdom under the terms of a contract which is partly to be carried out in America: it may be exclusively a matter for British law, it may be exclusively a matter for American law or it may be a matter of concurrent jurisdiction. Our view is that where it is a matter for concurrent jurisdiction the

  1283
  ordinary rules of international law will look at the substance of the matter and will see which of the two laws ought to be paramount. Then, applying the rules of international law, one can see that it is a matter which our courts or the American courts ought to deal with.
  But lest it be argued anywhere that in the absence of British law the American law can operate in the circumstances in which directions have been made under the Bill, we feel that there should be no doubts left in anybody's mind that there is a direct conflict of jurisdiction, and then the International Court or the international body discussing the matter will have to resolve that conflict, and one will not be left in a position in which it may be said that there is no conflict at all because British law does not deal with the matter.
  Mr. A. J. Irvine: I am grateful to the right hon. and learned Gentleman for the full way in which he has been good enough to deal with the points which I raised, among other matters. Would he care to say something on a point which I brought forward—that we should welcome an assurance that there was nothing in the Measure which could possibly be derogatory of the existing powers and rights of shipping companies and ships' captains under existing law?
  The right hon. and learned Gentleman will recollect the case of the ship's master who perhaps refuses to comply with the prohibition or the requirement but wrongly fails to give the appropriate notice to the Minister. Will the right hon. and learned Gentleman assure the House that in such a case the Government would still back such a shipping company and such a British ship's master vis-à-vis the foreign authority?
  The Attorney-General: Yes, I assure the hon. and learned Gentleman that the British Government certainly would do so. The requirement to give information
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  to the British Government is, of course, an internal one for administrative purposes only within this country, simply so that the Minister of Transport may know what requirements are being placed by foreign authorities on British shippers. The fact that a British shipowner can, either accidentally or even intentionally, fail to communicate such information to the British Government would not alter in any way the status of the British shipowner and the views of the British Government about the necessity of maintaining British jurisdiction if that British owner or British ship were in an American port.
  Finally, the right hon. and learned Member for Newport said that he thought that perhaps these matters could best be settled by the International Court of Justice at The Hague. I hope that it will never be necessary for any such reference to be made. Despite the fact that I am a lawyer, I have never believed in litigation. It is a disaster for those who get involved, though not perhaps for the lawyers, and I hope that our two countries which have a very ancient alliance will be able sensibly to settle these difficult questions without any resort to litigation of an international nature.
  I hope that it will be possible to settle these difficult problems without having to operate the Bill at all. I know that this would be the wish of the House as a whole. I know, also, that the House would like to know that in the event of the worst happening we are in as strong a position as can be, and it is on that basis that I commend the Bill to the House.
  Question put and agreed to.
  Bill accordingly read a Second time.
  Bill committed to a Committee of the whole House.—[Mr. Ian Fraser.]
  Committee Tomorrow.

BRITISH NORTH AMERICA BILL
Order for Second Reading read.
7.33 p.m.
The Under-Secretary of State for Commonwealth Relations and for the Colonies (Mr. R. P. Hornby): I beg to move, That the Bill be now read a Second time.
It may perhaps seem strange for the House to be asked to approve amending legislation to the British North America Acts which in effect form the Constitution of Canada. It may seem even stranger when the point under discussion is one so obviously of domestic concern to Canada as a change in the law relating to pension there. Perhaps I might therefore be allowed to explain the background to the Bill, and I hope not to detain the House too long on the point.
The Bill has been introduced to comply with an Address to Her Majesty the Queen which was adopted by both Houses of the Canadian Parliament. The reason for the Address, and hence for the Bill, is that the British North America Act of 1867 contained no provision, as I understand, for the amendment of the Constitution by Canada herself, and that position was reaffirmed at the specific request of Canada in the Statute of Westminster when it was passed in 1931.
A change was made to some extent in 1949 when the British North America Act No. 2 provided that the Canadian Parliament was able to amend the British North America Acts in virtually all respects except in those matters which touched upon the area reserved for the provincial legislatures, and in those matters where those legislatures were concerned legislation by the United Kingdom Parliament still remains necessary.
The Bill arises out of these conditions. It arises out of a decision of the Canadian Parliament to take further powers in the field of their pensions policies which affect the jurisdiction of the provincial legislatures. The House may like to know that the Canadian Government hope to discuss at the next Federal Provincial Conference ways in which the British North America Acts could be amended, in future, in all
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respects without making reference to this House. It is pending any decision which the Canadian Government may be able to take on this that a Bill of this kind comes before us. I hope that the House will agree that for me to say more than I have said would be to trespass on a subject which is patently the concern of Canada. Therefore, with these words I commend the Bill to the House.
7.36 p.m.
Sir Frank Soskice: Nobody in the House or outside it could possibly question the right of Canada to enact legislation relating to old-age pensions and supplementary benefits. This is perfectly obvious. But it is a bit of a shock, as the Under-Secretary said, to those of us who are so deeply used to the idea of Canada being one of the great sovereign independent countries, to be reminded, as we occasionally are, that the Canadian Parliament has to submit an Address to Her Mjesty praying that Her Majesty may be pleased for a Measure to be laid before this Parliament in the United Kingdom, as in this case for the amendment of the British North America Acts.
I took some steps to research into the history of this and I was most astonished to learn that technically Canadian legislation is still subject to the Colonial Laws Validity Act, 1865. It is one of the most astonishing and absurd historical anomalies that we have now, as we are doing, to accede to the request of the Canadian Parliament that it should be allowed to legislate in regard to old-age pensions.
I believe that I am right in saying that there has been a considerable difference of view in Canada with reference to the proper procedure to be inserted into Canadian legislation with a view to amending the Constitution and that there are some who prefer to leave the matter as it is in statu quo. I would hope that the view would prevail in Canada that the time really has come when Canada in terms should be recognised in her own legislation and in ours as what she is, one of the great sovereign countries of the world, and we should not have to accede to a request addressed to us or rather to Her Majesty by the Canadian Parliament. This is my only observation and, having said that, I greatly

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hope that we would say without the slightest hestitation to Canada, "If you want to legislate you certainly shall, and we hope that in future you will by some means find ways so that you do not need to approach us".
Question put and agreed to.
Bill accordingly read a Second time.
Bill committed to a Committee of the whole House.—[Mr. Ian Fraser.]
Committee Tomorrow.

RESALE PRICES BILL
Lords Amendments considered.

Clause 2.—(PROHIBITION OF OTHER MEASURES FOR MAINTAINING RESALE PRICES.)
Lords Amendment: In page 3, line 1, after "them" insert "in the United Kingdom".
7.39 p.m.
The Secretary of State for Industry, Trade and Regional Development and President of the Board of Trade (Mr. Edward Heath): I beg to move, That this House doth agree with the Lords in the said Amendment.
This is an Amendment for the purpose of clarification. Clause 2(1,b) sets out one of the two grounds on which it is unlawful to withhold supplies from the dealer. The Amendment makes clear that the ground is restricted to a case where the dealer or third party is likely to resell the goods below the recommended price in the United Kingdom. Therefore, "in the United Kingdom" is a clarification of the new Clause.
Mr. Douglas Jay: This was not one of the major issues raised by the Bill, but I think that the Amendment is a little more than a matter of clarification. Before it is made, the words "in the United Kingdom" do not appear, and it is now proposed that we insert them. Presumably, we thereby alter the meaning. I should like to know that I understand aright the sense in which we are altering the meaning of the Bill. It is such a curious Bill in the form it has now reached that the words of the Amendments
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do not always mean precisely what one might suppose at first sight.
As I understand it, the effect of the change is this. Before the Amendment, it would have been open to a dealer to prove that a supplier was withholding supplies in the belief or on the ground that the dealer was likely to sell the goods at below the recommended price somewhere outside the United Kingdom. After the Amendment, he will not be able to prove that and he will have to prove that the motive in the mind of the supplier was the fear that he, the dealer or retailer, might sell them within the United Kingdom at below the recommended price.
It is an extremely small change, but, so far as it does anything at all, the Amendment makes it slightly easier for the supplier to withhold supplies and slightly harder for the retailer to prove that the supplier is unlawfully withholding supplies and, accordingly, compel him to supply the goods to him, the retailer.
The right hon. Gentleman did not make this quite clear. I hope that I have got it correct. We have no objection to the Amendment, I think, and I agree with the right hon. Gentleman that it is more logical, since the words "in the United Kingdom" appear in paragraph (a), that they should appear also in paragraph (b). I hear my right hon. Friend the Member for Smethwick (Mr. Gordon Walker) inquire sotto voce whether the words "in the United Kingdom" include Northern Ireland. I should have supposed that, unless otherwise stated, the United Kingdom in our legislation always included Northern Ireland. I should be grateful if the Minister would confirm that those two suppositions are correct.
Mr. Heath Mr. Heath indicated assent.
Question put and agreed to.

Clause 3.—(EXEMPTION FOR MEASURES AGAINST LOSS LEADERS.)
Lords Amendment: In page 4, line 14, at end insert "or".
The Minister of State, Board of Trade (Mr. Edward do Cann): I beg doth agree with the Lords in the said Amendment.
The right hon. Member for Battersea, North (Mr. Jay) will appreciate that this

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also is an Amendment which is intended to bring clarification to the Bill. It was moved by the Opposition in another place, and I hope, therefore, that he will not think it necessary for me to give the House a long or detailed explanation. I say only that we were grateful to the Opposition for their help in this matter.
Mr. Jay: Will the hon. Gentleman just explain what the Bill would have meant had the Amendment not been made? What is the difference?
Question put and agreed to.

Clause 4.—(CIVIL REMEDIES FOR BREACH OF RESTRICTIONS.)
Lords Amendment: In page 5, line 11, at end insert: "supplied or to be"
7.45 p.m.
Mr. du Cann: I beg to move, That this House doth agree with the Lords in the said Amendment.
In view of the very short discussion that we had on the last Amendment, perhaps it: may be the wish of the House that I should give a slightly more detailed explanation of this one. It is intended purely for clarification. The purpose is to make clear that the proviso to Clause 4(4) relates to goods to be supplied in the future as well as to goods already supplied. That is the point, and I hope that the House will regard it as an improvement.
Again, this was a matter raised by one of their Lordships and we are grateful to him for the attention he gave to the matter.
Mr. Jay: Even that is not quite clear to me. Obviously, the words "to be supplied" introduce the future in some sense, but can the Minister of State tell us what future it is—in relation to what? Does it mean the future as compared with the time at which the requirements were imposed by the supplier, that is to say, goods to be supplied at the time when these requirements or conditions were under negotiation? That is what I suppose it to mean, but unless we know in relation to what it is the future, the Amendment does not make very much sense if one merely says that the future is involved.
Mr. du Cann: By leave of the House, may I say that, if I understood the right
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hon. Gentleman's question aright—and I hope I have—the answer is, "Yes".
Question put and agreed to.

Clause 5.—(POWER OF COURT TO EXEMPT CLASSES OF GOODS.)
Lords Amendment: In page 6, line 20, leave out from "conclusive" to "any" in line 21.
Mr. Heath: I beg to move, That this House doth agree with the Lords in the said Amendment.
The right hon. Gentleman and his hon. Friends will recall that Clause 5(3) was inserted to assist those suppliers who had successfully defended a collective agreement in proceedings brought by the Registrar under the 1956 Act and who wanted to ask for exemption under the Bill. The object of the subsection was, to save them the time, trouble and expense of proving all over again before the same court the facts on which they based their claim for exemption.
It was brought to our notice in another place, and we accepted the Amendment there, that our purpose would not be achieved if the findings were conclusive only against persons such as the Registrar who were parties to the proceedings under the 1956 Act. This Amendment, therefore, deletes the words:
"against any person who was party to the proceedings under the said Part I".
It widens the subsection to bring in persons intervening in the exemption proceedings who were not parties to the proceedings under the 1956 Act, for example, retailers opposing exemption.
If these retailers were not bound by the findings in the same way as the Registrar would have been under the Bill as it left this House, they could defeat the object of the subsection by putting the supplier to the expense and trouble of proving his case all over again. Their Lordships pointed out that this was not meeting the purpose which this House had in mind, and we propose amending the Bill in this respect.
I hope that the right hon. Gentleman will regard this as a valuable Amendment, since it helps those whom the whole House at the time, I think, wanted to help by saving them the trouble and expense of proving their case under the Bill when it became law.
Mr. A. J. Irvine(Liverpool, Edge Hill): I wonder whether the Amendment may have a rather wider effect than the right hon. Gentleman has just indicated. I feel some doubt about it, and I welcome this opportunity of putting the point before the House.
When we considered the subsection earlier—the right hon. Gentleman accurately recalled to our minds the context in which it was previously considered—the main difficulty we felt lay in the argument which we put forward, that it would often not be easy to elicit from judges what were the findings of fact. The Restrictive Practices Court does not in judgment adopt the form of the case stated which is applicable in other contexts, and the question of what facts were found could often be answered only by inferential processes which might give rise to difficulty. That is the kind of matter which we discussed earlier.
The House fully considered this point and came to a decision about it, but I think that none of us at that stage had contemplated that findings of fact would be conclusive in a party's case if they were found in other proceedings with which that party had no concern. I think that the Amendment now before the House may go as wide as that and have that effect. The belief of, I think, both sides of the Committee was that parties should be spared the costs and time involved in reproving facts which had been proved before.
The effect of this Amendment would seem to be that, for example, car manufacturers in what I may call for the purpose of this argument the r.p.m. proceedings might find themselves unable to challenge findings of fact in a case concerning steel suppliers under the 1956 Act. It does not, in my submission, meet the point to say that the issue arises only on a reference in respect of goods of a class. That diminishes the possible mischief, but it does not eliminate it.
I am, therefore, left wondering whether the scope of the Amendment has been fully recognised and whether its consequences are acceptable to the Government. It would be appreciated if the Minister, with leave, could express a view about this. As I say, I think that the consequence of the Amendment would be wider than perhaps was intended and
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wider than the hon. Gentleman indicated. As I say, it may have the effect of confronting parties with findings of fact arrived at in proceedings in which they had played no part and had no connection.
Mr. Heath: May I say, by leave, that I think that the hon. and learned Member for Liverpool, Edge Hill (Mr. A. J. Irvine) has raised an important point. I do not know that I can give him a conclusive answer at this stage. I was advised that the extension was the one which I have described. Because of the point which the hon. and learned Gentleman originally raised about the opening words in the Clause, there was this limitation and that therefore would be the safeguard on this point.
Question put and agreed to.

Clause 6.—(REGISTRATION OF GOODS FOR EXEMPTION.)
Lords Amendment: In page 7, line 9, after second "of" insert:
"a class of goods consisting of or comprising"
Mr. du Cann: I beg to move, That this House doth agree with the Lords in the said Amendment.
It might be convenient to consider, at the same time, the Amendments in page 7, line 10, leave out from "entered" to end of line.
Line 17, leave out "class are included" and insert:
"description are included in a class specified".
Line 20, leave out from "goods" to "shall" in line 21 and insert:
"of any description are not included in any such class".
Mr. Deputy-Speaker: If the House is agreeable.
Mr. William Wells: Speaking for myself, I have no difficulty about the Amendments in lines 9, 10 and 17, but I find it hard to follow the Amendment in line 20. I should be grateful, personally, if the Minister would explain that one in some detail.
Mr. du Cann: I will do my best to do that.
I well remember what the hon. and learned Member for Liverpool, Edge Hill (Mr. A. J. Irvine) had to say about this matter during our earlier discussions. The House is well familiar with the care

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and attention which he devotes to technical matters of this sort. That was well exemplified in the speech which he made a few moments ago. The hon. and learned Gentleman, in Committee, asked a number of questions about the terminology of this Clause, and I gave an undertaking that we would look into the matter, consider very carefully what he said and endeavour to produce better wording which we agreed in principle was required. That is the history of the matter.
All these Amendments are drafting Amendments. They are tidying-up proposals and correct minor inconsistencies in certain provisions of Clause 6, which refers to classes of goods.
The hon. and learned Member for Walsall, North (Mr. W. Wells) was good enough to say that the Amendments in lines 9, 10 and 17 cause him no difficulty. None the less, out of courtesy to the House, I think that I should say a few words about them. The Amendments in lines 9 and 10, which affect subsection (3), cure an inconsistency between that subsection and Clause 5. I am glad that they are satisfactory to the House in general.
The Amendments in lines 17 and 20 express more consistently the idea that "goods" are included in "classes" and "classes" are included in "lists". The matter is as simple as that, or, if hon. Members like, as complicated as that. It is difficult to find words more adequate to describe the purpose of the Amendments. The Amendment in line 20 requires to be considered in the context of the whole.
Our intention is to improve the wording, which I always thought needed improvement. That is why I gave the House an undertaking. The Amendment in line 20 is as important as the other three.
Mr. W. Wells: The undertaking which the Minister gave on Report has not been covered either in these Amendments or, as far as I have been able to follow, in the proceedings in another place. Although they are improvements, and therefore, we accept them, I am no more satisfied now than I was during our earlier debates about the loose use made in the Bill of highly technical terms, such as "description", which I fear will lead to a good deal of confusion, although,
1294
by way of consolation, a good deal of work for the legal profession.
Question put and agreed to.
Subsequent Lords Amendments agreed to.

Clause 7.—(LATE APPLICATIONS TO, AND REVIEW OF DECISIONS BY, THE COURT.)
Lords Amendment: In page 7, line 36, leave out "in accordance with this section" and insert "under this subsection".
Mr. du Cann: I beg to move, That this House doth agree with the Lords in the said Amendment.
It would be convenient to discuss, at the same time, the Amendment in page 7, line 43, leave out "in accordance with this section" and insert "under this subsection".
Mr. Deputy-Speaker: If that is agreeable to the House.
Mr. du Cann: These are purely drafting Amendments and make no change of substance. The Clause makes provision for two distinct types of application—late applications for exemption under subsection (1), and applications for the review of previous decisions of the Court under subsection (2). The Amendments ensure that the proper distinction is drawn between them.
Question put and agreed to.
Lords Amendment: In page 7, line 39, leave out from "class" to end of line 41 and insert:
"not being goods of which particulars are entered in the register kept under the said section 6 or goods in respect of which a previous application has been made under this subsection".
Mr. du Cann: I beg to move, That this House doth agree with the Lords in the said Amendment.
This Amendment makes two minor modifications in the provisions for late applications for exemption. The first is an endeavour to make matters easier for the supplier who wants to know whether he is entitled to make a late application. We think that the easiest way for him to do this is by looking at the lists published by the Registrar. As the Clause is amended, there will be no need for him to concern himself with the form in

1295
which the notice is given. I hope that the House will think that is a real benefit upon those who wish to make late applications.
8.0 p.m.
The second point is to arrange a more logical system. As the Clause stands, if a late application for an exemption order has been turned down the supplier could make further application under Clause 7(1) and would not be required to show a material change in the relevant circumstances since the earlier decision. The only right course would be an application for review of the court's earlier decision under Clause 7(2), for which purpose, of course, it would be necessary for the applicant to begin by showing prima facie evidence of a material change in the relevant circumstances. I hope that the House may think so.
In sum, there are two purposes. The first, I hope, will make life a little easier for the supplier who wants to know if he is entitled to make a late application; the second, to make certain that we are, in fact, applying the right system.
Mr. W. Wells: We agree that this is an improvement, one of several improvements to the Clause.
Question put and agreed to.
Subsequent Lords Amendment agreed to.

Clause 8.—(SUPPLEMENTARY PROVISIONS AS TO REGISTRATION, REFERENCES AND APPLICATIONS.)
Lords Amendment: In page 8, line 32, leave out from "the" to "relates" in line 35 and insert:
"manner in which notice claiming registration in respect of goods is to be given under that section;
(b) for prescribing the particulars to be included in any such claim of the descriptions of goods to which it".
Mr. du Cann: I beg to move, That this House doth agree with the Lords in the said Amendment.
I think that it would be convenient if we were able to take the two following Amendments with this one, in page 8, line 27, at end insert:
"and the documents to be furnished in support of any such particulars"
and in line 38, leave out paragraph (b).
Mr. Deputy-Speaker (Sir Robert Grimston): If the House agrees.
Mr. du Cann: I am very much obliged.
The three Amendments make certain alterations in the Registrar's powers to make regulations for purposes connected with the notice required to be given by suppliers seeking registration for goods under Clause 6. As to the first point, we think that the word "form" is too rigid and restrictive. We believe that the word "manner" to be much better. I am glad to see the hon. and learned Gentleman agreeing with me. We hope that the suggestion we are making here will be helpful to the Registrar and everyone else concerned with these matters.
The second of these Lords Amendments provides that the Registrar may make regulations saying what documents the supplier has to furnish. It is necessary, we think, to give the Registrar express power to prescribe the documents—the form for making price lists, catalogues, matters of that sort. The reason is that the right of the supplier or the trade association to claim registration is limited to goods of any description which are being acquired by the supplier or member of the trade association under arrangements for maintaining minimum resale prices. The Registrar should have power to require such documentation to be furnished to enable him to see whether the supplier or, again, the trade association is entitled to give notice.
The third of the Lords Amendments would delete a provision in the Bill as it stands at present giving the Registrar power to require notice to be advertised. We think that giving the Registrar power to require notice to be advertised would impose an unreasonable burden on suppliers to require them to advertise these goods widely and in detail.
The Amendments taken together would facilitate the operation of the Act—if Parliament in its wisdom sees fit to convert the Bill into an Act. I hope that it will make matters a little simpler for the suppliers concerned.
Mr. W. Wells: We agree that these Lords Amendments constitute a considerable cheapening and simplification

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of the procedure involved, and support them.
Question put and agreed to.
Subsequent Lords Amendments agreed to.

Clause 11.—(INTERPRETATION.)
Lords Amendment: In page 10, line 39, leave out subsection (2) and insert:
"(2) Where the dealer referred to in section 2(1)(a) or section 3(1) of this Act, or the supplier referred to in the said section 2(1)(a), is one of a group of inter-connected bodies corporate within the meaning of the Restrictive Trade Practices Act 1956, the reference shall include a reference to any other dealer or, as the case may be, any other supplier, who is also a member of that group."
Mr. Heath: I beg to move, That this House doth agree with the Lords in the said Amendment.
This Amendment was moved by the Government in another place as a result of an Amendment of a similar kind put forward by a noble Lord who drew attention to the fact that Clause 11(2), as it left this House, was drafted rather widely and, as a result, produced certain anomalies. What the Clause did, as it left this House, was to require a supplier company and a supplier's subsidiary to be treated as one person for all purposes under the Bill. We did have some discussion about this when it was before the House. This meant, as was pointed out in another place, that unlawful conduct by one person was treated as unlawful conduct by another person and rendered a person liable to legal proceedings.
This Amendment narrows this, and I hope that it will be acceptable to the House. It requires suppliers and dealers who are interconnected bodies corporate—or members of the same group, as normally we would say—to be treated as a single dealer or supplier only in relation to the withholding of supplies, and it also applies where this withholding is on account of loss leadering.
We therefore accepted the proposal of the noble Lord in another place and put it into appropriate words and I hope that the House will feel that this is an improvement to the Bill.
Mr. John Stonehouse: I understand the reasons for the Amendment as moved in another place, but I
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would ask the Secretary of State why it does not appear to apply to Clause 2(3, a, b, c). Would it be possible, under the Bill as amended, for a supplier to use one of its subsidiaries in order to bring pressure to bear on one of the firms with which it is in business? If the Secretary of State can give me an assurance on that point I think the House could well agree with the Amendment. If it will be possible for a supplier to use a subsidiary to bring pressure upon one of the firms with which it is in business I should think we should look askance at the Amendment.
Mr. Heath: By leave of the House, I think that the purpose of this is exactly to meet the point which the hon. Member has raised—so that it will not be able lawfully to bring pressure.
Question put and agreed to.

Clause 14.—(SHORT TITLE, COMMENCEMENT AND TRANSITIONAL PROVISIONS.)
Lords Amendment: In page 11, line 23, leave out from "date" to end of line and insert "of the passing of this Act".
Mr. du Cann: I beg to move, That this House doth agree with the Lords in the said Amendment.
I think that this Amendment can almost be described as a purist's Amendment. It is purely a drafting improvement accepted in another place to meet the criticism that words used transitively in Clause 12(2) are used intransitively in Clause 14. We thought that we should put the matter right. What the right hon. Gentleman, in view of what he said about speaking English at an earlier stage of the passage of the Bill, may think of this Amendment in his heart of hearts, I do not know. I hope that he will agree, at any rate, that we are doing our best to get the Bill into proper English.
Mr. Jay: I think that as English it is neither better nor worse than it was before. Can the hon. Gentleman assure me that it means exactly the same as previously?
Mr. du Cann: By leave, I would say without doubt.
Question put and agreed to.

Schedule.—(TRANSITIONAL PROVISIONS.)
Lords Amendment: In page 12, line 11, leave out from "of" to "shall" and insert:
"the said section 1, that section"
Mr. du Cann: I beg to move, That this House doth agree with the Lords in the said Amendment.
The difficulty which I always have when we are considering Amendments which have come to us from another place is to talk English at all. Saying these words, "That this House doth agree with the Lords in the said Amendment", almost makes me feel that I am speaking Spanish with a decided lisp.
I hope that the House will think it convenient to discuss this and the following Amendment together.
Mr. Deputy-Speaker (Sir Robert Grimston): If that is agreeable.
Mr. du Cann: They are purely drafting and have no substantive effect whatsoever. The first reverses the sequence of two references to Clause 1 in paragraph 1(a) of the Schedule and the second substitutes "that section" for "the said section 1", which is consistent with an earlier reference to "that section" in line 15.
Amendment agreed to
Subsequent Lords Amendment agreed to.
Lords Amendment: In page 12, line 23, leave out from "if" to "before" and insert:
"that price was so marked "
Mr. du Cann: I beg to move, That this House doth agree with the Lords in the said Amendment.
This is a very minor matter, just a tidying-up affair. The Amendment alters the wording of paragraph 2 of the Schedule. That paragraph is designed to allow suppliers a period of grace of one year to dispose of stocks of goods or containers already marked with minimum resale prices at the time when Clause 1 comes into operation in relation to the goods in question.
The Bill as drafted makes this concession conditional on the goods having been manufactured or packed before the date on which Clause 1 comes into operation in relation to the goods, instead
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of referring to the time at which the prices were marked. In our opinion, this would produce undesirable anomalies and to rectify the position the Amendment limits the one-year concession to the case where minimum resale prices were marked on goods or the container before the Clause came into operation.
I hope that this will be helpful as a practical matter for those who will be chiefly concerned with the operation of the Bill in this rather limited and somewhat difficult little matter.
Question put and agreed to.
Lords Amendment: In page 12, line 30, leave out "has" and insert "takes".
Mr. Heath: I beg to move, That this House doth agree with the Lords in the said Amendment.
Paragraph 3 of the Schedule refers to the commencement of Clause 1 in relation to goods and refers to the time on which it first comes into operation. This is what it intends to do, but the wording is not entirely clear because of the use of the words "has effect". The intention is that it should be when it first has effect. What the Amendment does is to delete "has" and, with an economy of language, use the expression "takes effect". It makes it absolutely plain that we are referring in this case to when the Bill first has effect.
Question put and agreed to.

WHITE FISH AND HERRING (SUBSIDIES AND GRANTS)
8.14 p.m.
The Minister of Agriculture, Fisheries and Food (Mr. Christopher Soames): I beg to move,
That the White Fish and Herring Subsidies (Aggregate Amount of Grants) Order 1964, dated 24th June 1964, a copy of which was laid before this House on 2nd July, be approved.
There are three other fishery Schemes on the Order Paper and, as it is customary to take the opportunity of the annual subsidy Orders to set them in the framework of the general state of the fishing industry, I suggest that it might be for the convenience of the House if we took all four at the same time.
Mr. Deputy-Speaker (Sir Robert Grimston): If the House is agreeable.
Mr. Soames: I should like, first, to give the House a description of how the economic position of the fishing industry has developed. I remind hon. Members that the Government's policy towards the fishing industry stems from the Fleck Report and decisions on that Report which were announced in the 1961 White Paper and given effect in the Sea Fish Industry Act, 1962.
Essentially, it is a policy of assisting the industry to full viability through measures of constructive aid exemplified by the building grants and the support of programmes of research and development, for which the White Fish Authority is responsible, and through operating subsidies to be phased out over a 10-year period.
At the time the 1962 Act was passed and its subsidy provisions took effect, the fishing industry was going through a lean time, partly due to lower catches and partly to poor market prices. The situation was such that many who had taken building loans from the White Fish Authority were having difficulty in continuing their repayments, and we thought it necessary to provide for a moratorium to help those in difficulties.
Since then there has been a decided improvement in the industry's fortunes. The near and middle fleet first felt the rising tide and was in a much better case throughout 1963. The distant water fleet felt the tide somewhat later, but the trawling fleet as a whole this year has continued so far to experience notably better times. Some ports and some sections of the fleet have fared better than others, but the improvement has been general.
Let me give a few figures in illustration. In 1962, the total catch of the British fishing fleets was 15,600,000 cwt. giving them a return of £48,700,000. In 1963 the comparable figures were 16,100,000 cwt. and £51 million, an increase between the two years of £2,300,000 in proceeds, or about 5 per cent. In the first five months of 1964, the catch was slightly lower than in the same period of 1963, but the value of the catch to the fishermen showed an increase of from £20,200,000 to £21,600,000, a further increase of
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£1,400,000, or about 7 per cent. Those are overall figures covering all sections of the white fish and herring industries.
We must not be complacent about this decided change for the better since 1962. The fishing industry is notoriously subject to ups and downs and is so much at the mercy of a fluctuating natural resource that it can hardly be otherwise. At the root of the long-term problem is the need for intelligent conservation of fish resources in the North Atlantic. This is essentially an international problem and one which, I assure the House, Her Majesty's Government intend to pursue and to continue to pursue energetically and constantly. In this it has the full support and co-operation of the industry. There are also outstanding problems on the marketing side, with the question of the quality of fish very much at the centre.
None the less, there is happily this marked improvement in the returns of nearly all classes of fishing vessels, and it seems to be continuing. It is against this background that we must look at the subsidy orders before us.
I will first take the trawling fleet, comprising white fish vessels of a length of 80 ft. and more. For these there is a basic operating subsidy of so much per day at sea, with additional provision in the 1962 Act for special or supplementary subsidy to meet special difficulties. The Act provides for the reduction of basic subsidies each year by between 7½ per cent. and 12½ per cent. of the initial rates fixed in 1962. As hon. Members will remember, it was agreed at the time with the leaders of the trawler owners that the first two reductions should be at the minimum rate laid down in the Act, that is, 7½ per cent. For this year there falls to be made the second of these reductions, and the basic rates for the year have been fixed accordingly.
Then there are the supplementary subsidies designed to meet particular short-term difficulties. The maximum that can be paid on them under the Act is £350,000 in any one year. We have always fixed these subsidies on the basis of the most recent information available. Last time we fixed rates from 1st February to the end of July of this year on the basis of estimates of profit and

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loss for the nine months ending September, 1963. This time we have taken estimates of profit and loss for the period October, 1963, to March, 1964, and looked at these in setting out and deciding upon the special subsidies for the next six months beginning 1st August.
The figures for that six months show a striking improvement over the previous nine months. Taking the fleet as a whole, average returns per day for that six months compared with the previous nine months have increased for near-water vessels by 13 per cent., for middle-water by 11 per cent. and for distant-water vessels by 5 per cent. These, of course, are average figures. Some sections have done much better, notably in Scotland, and there are small sections in England and Wales which have made losses. But, based on these results we have been able to fix for the following six months minimal rates of special subsidy for a few classes of vessels at a few ports, which are shown in the Schedule to the Order, at a cost of only about £25,000 for the next six months period.
Last year, for the year as a whole, we allowed for £340,000, which was knocking on the limit allowed for in the Act for any one year. But the House will remember that the total provision for special subsidies in that Act is limited to £2½ million over a ten-year period, so that savings made in favourable periods like the present one mean that more funds will be available later if need be. We are only fixing the special subsidy for six months, so that if circumstances change we can look at the position again in the Autumn.
The herring industry had somewhat chequered results in 1963. In the early part of the season catches improved, but prices were lower, and over the year as a whole average proceeds have not changed very much from the previous year, so we have decided to leave the subsidies unaltered.
As regards the inshore side of the industry, here again almost all sections in Scotland did very much better in 1963 than in 1962. The exceptions are the Scottish 70 ft. vessels, known as sputniks, which did worse and indeed made substantial losses. For England and Wales
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the picture is not quite so simple. While the larger vessels and the seiners did better than in 1962, the smaller vessels had less good results. There are always bound to be these fluctuations in a section of the industry with so many units fishing widely separate grounds—I am talking about the inshore side-but we have to look at these matters from the standpoint of Great Britain as a whole and we have decided—I think that the House will agree that this is right in the circumstances—to leave the level of subsidy for the inshore fleet unchanged for the coming year. With the wider fishery limits which the inshore fishermen will shortly begin to enjoy, there should be good prospects of their returns showing further improvement in the future.
To provide the moneys required for all these subsidy proposals for the trawling fleet, the herring fleet and the inshore fishermen, the third Order asks the House to make available an additional £4½ million compared with the £5 million that we had to ask for last year. This will be enough to cover the estimated expenditure for the coming year of up to £2½ million for the trawler fleets, £1½ million for inshore vessels, and about £400,000 for the herring fleet. These subsidies are, of course, made direct by the Fishery Departments, whereas the grants and loans for building vessels are administered by the White Fish Authority.
Members will have had an opportunity of reading the recent annual report of the White Fish Authority, and at this point I would, if I may, pay tribute, in which I know the House will join, to the chairman of the White Fish Authority, Mr. Roy Matthews, who took up that office a year ago. We are very fortunate to have a man of such repute and drive to lead the Authority. Indeed, the fishing industry is being very well served both by Mr. Matthews and by Sir John Carmichael who directs the Herring Industry Board.
When he took over as chairman of the White Fish Authority, Mr. Matthews made a tour of the ports and had talks with all sections of the industry. Fishing results had been poor for some time, and it was against this background that he put forward ideas aimed, as Parliament wishes, and as Parliament

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expressed in the 1962 Act, at ensuring the viability of the trawling industry in the long-term without Government aid. He suggested, however, that as a first step an immediate increase in the level of direct Government subsidy was necessary. In view of the marked improvement which has taken place in the fortunes of the fleet, we have felt that there is today no case for such an increase. Indeed, as I have already said, we have not found it necessary to commit all the money that is available for special subsidy for the coming period, let alone to seek an Amendment to the 1962 Act which would be necessary to increase the basic subsidy.
Others of Mr. Matthews' proposals were designed to secure an improved price at the point of landing and for the better marketing of fish generally. First, there would be measures of quality control to take off the market fish which, although of sufficient quality when seen by the port health inspector, is unlikely to be in good condition when it reaches; the shops. Secondly, he proposed more advertising of fish. Thirdly, under this heading he proposed the promotion of a statutory scheme of minimum port prices under the powers already available in the Sea Fish Industry Act, 1951, accompanied by arrangements for support prices for fish which pass the new quality standards but at the same time fail to fetch the minimum price. The Government are at one with the Authority in wishing to see better standards of quality. The advertising of fish is a matter for the Authority to discuss with the industry and the trade, and the question of Government approval or financing does not arise.
As regards proposals for minimum and support prices, the Secretary of State and I have told the Authority that we are ready for them to discuss with all sections of the fishing industry and trade the possibility of a statutory scheme such as it has in mind. We should, of course, want to know whether such a scheme would be generally acceptable to the industry and trade, and we would need to be satisfied that it would be practicable in operation. We would want from the Authority an assessment of its likely effect on others, and especially on the consumer. We would want to know whether support price arrangements should accompany
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statutory minimum prices, and how the Authority and the industry propose to finance the plan. We have explained that in the meantime the Government do not feel able to give any advance commitments as to their attitude. We must obviously keep an open mind until the Authority has had its consultations and come up with its conclusions.
On the catching side, the Authority has responsibility for administering the grant and loans scheme for new vessels. Early this year the House approved a new Order which for the first time made grants available for freezer trawlers. We did not then feel it necessary to increase the limit of £2 million for grant aiding the building of new vessels up to the end of 1965, which was part of the agreement between the Government and the industry at the time of the 1962 Act. However, things have been moving faster than we or the White Fish Authority expected. We have therefore decided that the review of our present grant policy, which was due to take place at the end of 1965, should be brought forward, and we propose to carry it out with the Authority and the industry towards the end of this year.
We have decided at the same time to make available a further £500,000 for these grants, which is still within our statutory authority, so that the Authority can approve the applications which it already has, or can reasonably expect to have before it, for immediate building and which it wishes to approve.
So much for the new vessels. The Authority also put forward proposals to grant aid the improvement of existing vessels, and out of that has come the Fishing Vessel Improvement Scheme which is the subject of the remaining Statutory Instrument before the House. It is a further Measure for modernising the fleet.
Like Section 3 of the 1962 Act—and it is under this Section that the Scheme is laid—the Scheme itself is drawn in general terms. The basic idea is to assist and encourage the improvement of existing vessels from the point of view of catching, handling, processing and storage on board. Straight renewals and replacements of equipment will not qualify.
At this stage we cannot say precisely what alterations and improvements will

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be included, but to give the House an idea, among the possibilities that we have in mind are the conversion of conventional vessels to freezers or part freezers, the introduction of automatic engine room control, the improvement of fish holds by insulation or refrigeration, the provision of processing equipment on board ship and re-engining to provide increased power or substantially to reduce the costs of fuel.
At the moment most of these developments are still in the experimental stage, and qualify for the grant of up to 50 per cent. which the Authority is authorised to make so that the improvements and innovations can be tried out in practice. But as and when they become established they can be accepted as improvements under the new Scheme, qualifying for grant aid to all owners at the rate of 25 per cent., or 30 per cent. for the under-80 ft. vessels.
We shall agree with the Authority what types of improvement are to be regarded as experimental and what are to be recognised as established improvements, and the Authority will then tell vessel owners the items on which it is prepared to entertain application for grant. Financial provisions for the Scheme are covered by Section 3 of the 1962 Act, but it is likely to take some time for expenditure under the Scheme to build up. Eventually, however, the Authority will be able to grant aid a wide range of alterations, calculated to lead to greater efficiency or economy in the operations of the existing fleet.
I commend the Scheme to the House as something which will be of practical and progressive importance in the equipment of the fishing industry, to meet the competitive conditions of the future. Again, I see it as complementing the valuable work which the Authority is doing under Sir Frederick Brundrett in research and development. The White Fish Authority's report records its research and development expenditure during the current year as being matched pound for pound by the Government, subject to a ceiling of £300,000 a year.
The cost of the Industrial Development Unit, which manages the programme and is, so to speak, its hub, has not hitherto been included in the grant arrangements. We have now
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decided that the Government grant will be extended at the 50 per cent. rate to include expenditure on the Industrial Development Unit and also a programme of economic and market research into the problems of the fishing industry and trade which the Authority wishes to develop. The cost of these additional items will be about £50,000 a year. I believe that these research and development activities of the Authority are making, and will increasingly make, an important contribution to the technical advancement of the industry.
To sum up—I have been able to give the House, this year, a more confident account of the state of the fishing industry which has recently emerged from a run of bad years. At the start of 1963 the near- and middle-water fleets began to do better, and the recovery in their fortunes has gone on and still continues. The distant water fleet did not begin to meet better times until later in 1963, but there is no doubt that overall the fishing fleets are now finding the market much improved.
There might have been some reason for doubt a year or so ago whether the Act of 1962 would do its job within the 10-year term envisaged for the phasing out of the operating subsidies for the trawling fleet. With the uncertainties that inevitably face a hunting industry like fishing, this is perhaps inevitable, but certainly there is less reason—I put it no higher—for such doubts today.
This is a matter for satisfaction not only to this House but also to the industry, and to those who accept its rigours and serve it with courage and with skill. Of these rigours we have been tragically reminded by the news of the loss last night of a Scottish seine net boat through a collision in bad weather with a Polish herring trawler. Full reports are not yet available. The latest information I have is that three of the crew of six were picked up, one of whom has since died. The other three, and a boy of 17 making a holiday trip on the vessel were missing but the search was continuing. I am sure that the House would wish to extend its sympathy to the relatives in their loss and anxiety.
Both sides of the House desire to see a flourishing fishing industry. I believe that the further measures which I have

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outlined tonight will contribute to the strengthening of the industry's future position, and I commend these Orders to the House.
8.36 p.m.
Mr. James H. Hoy: May I, on behalf of my right hon. and hon. Friends associate myself with the remarks of the Minister regarding the tragic loss of this Scottish fishing vessel. I have no doubt that the hon. Member for Banff (Sir W. Duthie)—our hon. Friend I might say—will want to say a word about it. This is part of the price which has to be paid in this industry and it is just as well that, when considering the future of the industry, we should remember the sacrifices which we ask of the people engaged in it and the measure of our contribution to help them. I have no doubt that the House will want to hear the latest news about this tragic occurrence.
The white fish and herring subsidy schemes before us always seem to me to provide a contradiction, and the first thing to do is to get the matter right. We say that what we propose to do is to increase the sum available from £35 million to £393½ million. This conveys an impression to people outside that the fishing industry is getting a little more. We must face the fact that, as a result of the agreement arrived at a year or two ago between the Ministry and the representatives of the fishermen, the industry today is receiving 15 per cent. less in subsidy than two years ago, despite the increase in the sum of money available. I have always argued that it was a bad agreement. I have said in this House that the industry came to a bad agreement, so we should get this matter into proper perspective and remember that we are providing a subsidy which is 15 per cent. less than it was two years ago.
There is a considerable change even in the drafting of these Statutory Instruments which are before us tonight. It is always difficult for an ordinary backbench Member such as myself to make these comparisons. I see some changes which bring the herring industry subsidy more in line with the drafting of the white fish subsidy. There are one or two changes, and I am sure that hon. Members will not mind if I refer to them.
I see that the phrase "period of 24 hours" now replaces what used to be
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referred to as a day. There must be a reason for it. I think I can guess what it is, but it might be a good thing if the Minister explained to the House what is the meaning of these changes. Perhaps the Secretary of State for Scotland will say something about them. He will understand why these changes are necessary. I remember last year that when these Statutory Instruments were presented I came across a sentence which I thought had never appeared before in an Order:
"No grant shal be made payable in respect of a voyage if the appropriate Minister is not satisfied that in the course of such voyage fishing has been diligently and vigorously prosecuted."
I remember raising this matter at the time. The Minister said that it was an innovation. It had been placed in an Order for the first time. Having made acquaintance with this friend last year, I looked in vain for it this year. Did the Minister think that from his own point of view it would be better to leave it out of the Order this year?
I wish to say a few words about the drafting of the Herring Industry Scheme. If my reading is correct I see certain differences between the 1963 and the 1964 Schemes. If one compares paragraph (3) of the 1963 Scheme with paragraph (3) of the 1964 Scheme one sees certain changes of a fairly substantial character. Last year paragraph (3) called for certain returns if firms were to qualify for subsidy, but this year this is spelled out more clearly and more definitely making greater demands on the industry, if I am correct. It says:
"including detailed accounts, for such period and in such form as the appropriate Minister may require, of the financial results of the operation of all such vessels of which he is the owner or charterer".
This demand was not included in any previous Scheme. Comparing the paragraphs in the Schemes of 1963 and 1964, it seems that a change has taken place.
It is also interesting to note that there appears to be a change in the wording in paragraph 8(3). I am a little surprised that the Secretary of State for Scotland should be responsible for this. In the Schemes up to the present time it has always been said that the Minister "may pay", given certain circumstances. Successive Secretaries of State for Scotland

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have argued more often than any Minister in this House the respective merits of "may" and "shall". I am interested to see that in this Statutory Instrument the word "shall" replaces "may". I do not know who has won.
There were certain changes about the size of vessel. Paragraph 8(3) says:
"any grant…shall be paid…unless the appropriate Minister is satisfied that the alteration is likely to be conducive to the increased fishing efficiency of the vessel".
This is a change from the previous Scheme. If such changes are to take place, the Minister should inform us of the reasons for them.
Having made these comments on the Schemes and their drafting, we have to consider whether the new Schemes meet the needs of the fishing industry. That is the reason for them coming before us. I agree with the Minister that certain improvements have taken place, but there have been certain reasons for them outside the industry. I have no doubt that the fishing fleet has been fishing full out. Conditions have changed and have allowed it to do so, but the Minister will not be unaware that the price of meat showed a steady increase over a long period and at one stage reached very nearly an all-time record. That made possible an easier market for the sale of fish. That is one of the influences to be taken into account when making an assessment of the annual out-turn of this industry's product.
This was very helpful to the industry. It is one of the things we should not overlook. Despite all these improvements, what we have to give particular attention to, whether there are improvements in one part of the industry or the other, is the out-turn of the accounts. I join with the Minister in paying tribute to Mr. Roy Matthews of the White Fish Authority. He has done a tremendous job. My one regret is that the Minister was not a little more forthcoming in telling us what Mr. Matthews' complete proposals were. Until we know what the total proposals are, it is quite impossible for us to make any reasonable comment, or even to apply any judgment.
I should have thought that the Minister would have wanted the House to have this information, and that he might even
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have considered publishing Mr. Matthews' proposals. That could have done no harm, and those in the industry should be allowed to see the proposals. I am sure that Mr. Matthews, with his undoubted ability—and we know his record in business and in industry—would not make foolish proposals, but that anything he proposed would be well thought out before it ever reached the Minister. I therefore ask the right hon. Gentleman to be a little more forthcoming about these proposals.
The White Fish Authority says that as a result of failure it has had to assume the rôle of vessel owner. That has resulted in spite of improvements in conditions. The Authority now finds itself the owner of vessels it does not want. It is compelled to accept that responsibility, and has found it rather unprofitable to manage the vessels. That is not one of the jobs for which it was set up, but it results from the economics of the industry.
The Minister might tell us what the Authority is expected to do with the vessels. Quite obviously, it cannot go on perhaps even adding to the number but, that aside, what is to happen to those vessels presently in the hands of the Authority? Is it proposed to sell the vessels to owners in our own country or, perhaps, abroad? If so, we would want to know who is to bear any losses that may be involved, because it would be rather a back-handed compliment to the Authority if, having been asked to dispose of the vessels, it had to carry any loss resulting from that transaction. Perhaps the Minister would tell us what the Government want from the Authority in reference to the disposal of the vessels, and who is to meet any losses that may ensue.
We see from the accounts the hard facts of the situation. Despite what the Minister has said, the accounts for the last complete year of the White Fish Authority, to 1963, show that loan interest and repayments of capital due on 31st March had not, by the end of May, been met to the extent of £1,564,000. That is the amount of the industry's debt to the Authority that has not been met. We cannot describe an industry as being in good heart and good condition when it owes £1½ million to the people who have been lending it money.

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The result of a year's working shows an increase in debt of more than £300,000, over the previous year. The result of the successful year that the Minister has described is that £300,000 more is owed to the Authority than was owed in the previous unsuccessful year. The Authority says that, after taking all this into account, the provision of £255,000 that it made for bad debts will be substantially exceeded. Therefore, despite it all, the Authority expects at least—and I put it very modestly—that bad debts cannot amount to less than £300,000.
This is not indicative of an industry in good condition. This goes on adding debt to debt, because those who borrow from the Authority must pay ½ per cent. to cover bad debts. What will happen as a result of this is that those who are paying their way will find the burden heavier and heavier to meet the losses of the unsuccessful. This is iniquitous. It must be looked at by the Government. The remainder of the industry should not be compelled to go on adding to its payments to clear the debts of others.
Whatever happens, these Measures cannot provide a basic cure for the industry as it stands today. Although we welcome any improvements which are taking place, in my view—and, I am certain, in the view of many hon. Members on both sides—radical changes must take place. Until we can devise a system which will get rid of this debt charge and allow the industry to become viable, we shall fail in our job.
That is why I said at the very beginning that, if we were to do this, we ought to know what the complete proposals of Mr. Roy Matthews and the Authority were. I am certain that when Mr. Matthews carried out his investigations—we know how thorough he was—he wanted not only to give us an efficient industry in all its aspects,—catching, marketing, wholesaling and retailing—but wanted to produce at the end of the day an industry which could stand on its own feet, if those are suitable words to use of the fishing industry. That is the sort of industry he wanted.
This is a much greater and bolder objective than has ever been attempted with the agricultural industry. It is hoped in 10 years to get rid of subsidies for that altogether. If the Minister could say to
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the Chancellor of the Exchequer about the other part of his Department, he would get at least a knighthood in return. This is what we are doing with this industry. That is why it is essential that the complete proposals of Mr. Matthews are given to us to consider so that we can see if they meet the situation. There may even be one or two people in the House who know sufficient about the industry to add their suggestions to those of Mr. Matthews. Until that is done, we cannot make a competent judgment.
I agree with the Minister that in all this consultations will have to take place. As I said in the House not many weeks ago, one of the things we must do is to remember the consuming end of the industry. One can send up prices and subsidies, but eventually somebody must pay for them. If it is not the taxpayer paying through taxation, it will be the consumer paying through increased prices.
This is why we have had this complaint. This is where I think that one section of the industry or one part of the industry has failed. In all the changes which are taking place, each section of the industry apparently meets separately. They never seem to get together to discuss the problems which are common to the industry as a whole. In recent times we have had this complaint from the fish fryers, because they say they are being held up, not perhaps to ransom, but they are arguing that because of action taken by the B.T.F. certain landings have been restricted.
I am told by those in the industry that this is not true. I do not know. I am not competent to judge. I am told by those in the industry that if the Faroese want to export fish to this country at this time we are not keeping them out but that there is some £140,000 to £150,000 worth of business awaiting them if they want to send it to us.
On the other hand, a complaint has been sent to many hon. Members that there has not even been a meeting of the White Fish Industry Advisory Council since the change in the constitution of the White Fish Authority. If we are making these changes and appointing advisory councils, for goodness sake let them be used and let them make a contribution. If we do not intend to use them, we should not set up such bodies.

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I should be interested to hear from the Minister why this Council has not met, because I am sure that, if we could get the various sections of the industry together, they could hammer out many of their problems. I know from a meeting which was held upstairs between the joint Parliamentary fishing groups that even in the matter of advertising we had an offer by other sections of the industry who were prepared to pay cash into a common pool, even under the Authority, to do this job.
I cannot complete my remarks without commenting on the grants for the improvement of fishing vessels. This is a real step in the right direction. To illustrate what I mean, I know, for example, of many vessels which had engines placed in them as an experiment. Those engines have not turned out to be by any means successful, although the poor trawler owner has had to pay for them. If owners are to be efficient, those vessels will have to be re-engined, and I take it that that will be covered by the improvement grants. To that extent I trust that the owners will be better off.
I recall looking at an Order the other day and it seemed to suggest that payments might be made to people who take the trouble to pack fish at sea. I should be delighted if that could be done. At one time the trawler owners in my constituency took the trouble to box the fish at sea and they received special payment for doing so. I have always argued that if anyone goes to the trouble of providing first-class food in a first-class condition, he is entitled to a financial reward.
In welcoming what is being done, we should not forget that other changes are necessary. This applies equally to other parts of the fleet. I think that the grants will be available even to the distant-water fleet and I hope that the Minister will look into the question of making loans available. We give substantial loans to other interests on special terms. Indeed, we encourage industry in some areas by not charging interest for the first year or two. I trust that facilities will be offered to the distant-water fleet, certainly on interest terms in line with those charged by the Public Works Loan Board.
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While we welcome the improvements that are being made, the fishing industry still faces many problems which must be solved if it is to become really solvent. The outturn of the accounts of the White Fish Authority prove that many problems still remain, although I appreciate that these Statutory Instruments may tide the Authority over for another 12 months. During that time anything may happen. We cannot forecast with complete accuracy what will happen. I hope that when the Government have thoroughly examined the proposals of Mr. Roy Matthews, those proposals will be made available to hon. Members. I also hope that substantial amendment of the 1962 Act will be forthcoming. I urge the Minister and the Secretary of State to realise that these additional steps are necessary if the industry is to be placed on a sound footing.
8.58 p.m.
Sir William Duthie: I wish to express my deep appreciation of the sentiments which have been expressed by my right hon. Friend and by the hon. Member for Edinburgh, Leith (Mr. Hoy) concerning the terrible disaster which has befallen the people I represent. These men came from my own native village. Indeed, the crew of the "Sirius", which was run down by the Polish trawler "Zieba" yesterday, are my own kith and kin. I have no further detailed information other than that which I received this morning. I am told that the crew consisted of six men and one boy, who was making a pleasure trip. I am advised that there are only two survivors. That is the only news I have.
This matter raises a point of extreme interest. This Polish vessel ran down an inshore fishing vessel on her home ground. I suggest to my right hon. Friend the Secretary of State that it is absolutely vital that the most searching inquiry should be made into this tragic occurrence. I say this because there is sometimes competition of a very severe kind at sea between visiting foreign fishermen and fishermen from this country. It would be terrible if anything of an untoward nature emanated from this tragedy. I know that the people who suffered bereavement will be grateful for what has been said on the Floor of the House tonight.

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I congratulate my right hon. Friend on his very encouraging survey of the industry and also by the hon. Member for Leith, who opened the debate for the Opposition, on his very informative survey of the industry. It is true that this industry will never remain static. It is developing all the time. It falls to my lot to visit every fishing port in this country at least once a year and sometimes foreign ports. During last year, I visited Hull, Grimsby, Fleetwood, North Shields and all the Scottish ports in addition to visiting Bremerhaven, to look at the new German fleet. Anyone with any knowledge of the industry can see the vast changes taking place from day to day. What is done in a previous year forms little or no basis for computing what will be done in the current year or the years that lie ahead.
Our discussions on subsidies always seem to happen just before the Summer Recess, when a pistol is more or less levelled at our heads in that if we do not accept the proposals that are put forward we shall have to go without subsidy from 1st August or 1st September. This time, I am not cavilling because I think that the subsidies are very good.
I should like to deal with the section of the industry that I represent, the inshore industry, because I know that my hon. Friends the Member for Haltemprice (Mr. Wall) and the hon. Lady the Member for Tynemouth (Dame Irene Ward) will probably speak in detail, from this side of the House, on the trawling industry. These subsidies are of the most life-giving value to the inshore fishing industry. There is talk of their phasing out. I cannot see that happening until the housewives in this country are called upon to pay a viable price for fish. The hon. Member for Leith mentioned the debt that we owe to the White Fish Authority. If that debt is to be paid, it has to come out of the cod end, and that can only be done if equitable prices are secured for the fish when the boats come ashore.
On the question of subsidies, I think that it is true to say that since 1951 something like £41 million has been paid to the fishing industry, and a very considerable portion of that, I gladly own, has gone to the Scottish industry and the inshore fishing industry in particular. I
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can assure the House that that money has been an absolute godsend. It has enabled many boats to keep sea-going which would otherwise have been tied up at the dockside.
My right hon. Friend the Minister talked about the ups and downs of the industry. There are ups and downs all the time. Every new development emphasises the need in this industry for research and yet more research into the type of vessels that we are using, our catching methods, the grounds we are fishing, the gear and marketing. We are looking with very considerable confidence to Mr. Roy Matthews and the White Fish Authority which has opened up new fields hitherto unexplored.
May I touch on a few matters of detail respecting inshore fishing? The first concerns the herring industry and the anomaly which is evident in paragraph 10 of the Herring Subsidy Scheme. No provision is made in respect of the day on which the herring catch is discharged if that is not the day of the vessel's arrival. That is not a restriction applied to the white fishermen, and the herring fisherman seems to be under a disadvantage. The view is held, with a certain amount of justification on account of past experience, that the herrings are caught during the hours of darkness and that the landing should take place the following day, but I should like to point out to my right hon. Friend and the House that seine fishing and trawling are done during the hours of darkness, particularly during the summer, and I cannot see why there should be any disparity in treatment for the two sections of the industry.
I also want to emphasise the importance of the price to be paid for herring for oil and meal. The Scheme twice mentions 25s. per cran. Will the Secretary of State assure me that that will not be for a percentage of landings but for the total landings of herring which are used for oil and meal? We all remember all to poignantly the difficulties which occurred at Ullapool last year, when 15s. per cran was paid for herring for oil and meal. The fishing industry asked for a substantial increase, but that was denied by the Herring Industry Board. It was afterwards found, when the accounts were investigated, that 25s. a cran could have been paid. It is only right that I should say that in my opinion the Herring

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Industry Board was very much at fault in that regard, and I sincerely trust that every step will be taken at the Scottish Office and elsewhere to ensure that there is no repetition of that blunder.
In the white fish industry I can assure the House that there is a new spirit of confidence engendered by Mr. Roy Matthews at the head of the White Fish Authority. I welcome these subsidies, but I ask the Secretary of State to think again about the different provisions for herring fishermen and white fishermen with respect to the day of landing.
For some years we have had no grants or loans for new, small, dual-purpose vessels for white fishing and for herring catching. Our boat-building yards have been virtually idle in the interim. I appeal to my right hon. Friend to ensure that new liberality enters the business here and that grants and loans will again be available for building new vessels so that young men entering an industry which is in their blood will not be held back through lack of new vessels.
The Statutory Instruments are first class, and I am sure that the House will pass them without a Division.
9.9 p.m.
Mr. J. Grimond: I should like to extend my sympathy to the relatives of those fishermen who lost their lives in this tragic accident. This will always be a risky and dangerous way of life, and we have to weigh that against the comparative success to which the Secretary of State was able to point in 1963. It is encouraging that the total income of the industry has gone up by £2·3 million, and that there has been a further increase in the income over the first five months of this year. But it remains a very risky enterprise.
I was also glad to hear that the Government attach the greatest importance to the conservation of stocks, because this is a matter of abiding concern for the whole industry. I was also glad to hear the right hon. Gentleman speak about the importance of marketing. I, too, hope that we shall hear a good deal more about the proposal of the White Fish Authority to improve the marketing of fish. This is of particular interest to my constituency where the industry is
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always short of outlets and where unfortunately, as mentioned in paragraph 56 of the White Fish Authority's Report, the selling scheme which the Authority helped to put into operation came to an end early this year.
There were reasons for that, but I impress upon the Government that, certainly in Shetland, far from the main markets, this question of outlets and marketing is still of great concern. So for that matter are packaging and the presentation of the fish to the consumer and all the related problems of transport and freight.
I should also like to draw attention, in passing, to paragraph 59 of the Report, where it is stated that £75,000 was spent on publicity. This sum was divided between Press advertising, point of sale material and educational activities. It has been pointed out in previous debates on fishing that this sum, though considerable, is quite inconsiderable when compared with the amount which any major firm would spend on advertising. I see the difficulties of the Authority, with its limited budget, but I urge the Secretary of State for Scotland once again to look into this matter. I believe that this appropriation should be greatly increased.
I do not think that this country yet realises what an excellent and cheap food fish is. A great many people in this country have never eaten fresh fish. A great deal of expensive fish is sold in London which, in the fishing ports, would be almost condemned as bad. There is an enormous, untapped market, and especially in view of the rising price of meat there is all the more reason for increasing appropriations for advertising and promotion.
I am also interested, as far as Shetland is concerned, in the possibility of expanding the fishing fleet and in the attempts which we have been making to bring industry into Yell, for instance, and to keep the population of the island. We have had numerous discussions on bringing fishing to that island. This requires piers and it requires facilities, but I believe that fishing is one of the great hopes of the north of Scotland. This is an area where, now that the limit has been extended, we can tackle the question of

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conservation of stock and where, as the hon. Member for Banff (Sir W. Duthie) has said, there is almost a revolution in the fishing industry as a result of the new methods that are being adopted. I regard the industry as one of the more fruitful lines of development we could possibly have in Scotland.
Last year, I raised the question of trawling for herring. I know that this is a matter on which the hon. Member for Banff spent a great deal of time, and that there is an interesting passage on pages 33 and 34 of the Report of the Herring Industry Board about trawling experiments. I was struck by the fact that although these are interesting experiments the Board itself admits that insufficient time was spent in the Shetland—Buchan area to provide thorough tests of the full potentialities of mid-water herring trawling. I know that there are objections to trawling, although it might well be that if everybody behaved in a thoroughly rational way and restrictions were applied it would be acceptable. This is a type of method, however, which is inevitably used by foreign vessels and we have to come to terms with it, and I know that experiments are going on with trawling and other methods of catching herring.
Now, one or two questions about the Measures themselves. As I say, unfortunately the outlets for fish in Shetland are limited, and for one outlet at least we have to rely on sending fish for oil and meal. I see that in the Herring Subsidy Scheme, paragraph 2(2), there is a slight alteration in the wording. The words now are
"if the appropriate Minister is satisfied that the said herring could not have been sold for purposes other than…conversion".
I do not think that these words appeared in the old Scheme, and I wonder why they have been put in here.
There is an alteration also in Schedule 2 to the White Fish Subsidy Scheme in which are listed the rates of grant applicable to various kinds of fish. The first category of fish is all whole gutted fish, and then we have the classes of ungutted fish which among them include the whole range of ungutted fish. The final category is
"all other whole fish of a kind normally sold for human consumption".
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On this category the rate of grant is 6d. per stone, and I think that this is fish sent for oil and meal. In last year's Scheme the phrase
"normally sold for human consumption"
did not appear. Again, I wonder why these words have been put in and what is said to be their effect.
Like other hon. Members, I certainly could not oppose these Schemes. The industry will be most grateful for the help which is being given to it, but there are the long-term problems which I have mentioned—conservation, marketing, transport, promotion, and keeping our fleet up to date in relation to developments in the rest of the world. Whenever I go to my constituency, I am struck again and again by the size and power of the foreign fishing vessels one sees now in our ports, enormous steel vessels of a size and capacity very different from our older inshore vessels, some of them going back almost to the days of the "Fifies".
Sir W. Duthie: And the "Zulu".
Mr. Grimond: Yes, and the "Zulu", which did us very well.
This is a continuing problem. Grateful though we are for the subsidy, let us not think that the industry can now be left to look after itself. It faces great difficulties because of its small units, family crews, and so on, and it has to compete every day with the heavily subsidised very powerful fleets which are coming in fairly close to our coasts and catching enormous quantities of fish in the North Sea.
9.18 p.m.
Sir Cyril Osborne: My only reason for intervening in the debate is that most of the fishermen in the Grimsby area live in my constituency and I wish to put some questions and make one or two remarks on their behalf. First, it should be said that two years ago certain sections of the Grimsby industry felt that they faced bankruptcy, and they have said to me more than once that they are very grateful to the Government for the help and consideration given to them. I feel that this should be put on record. However, like Oliver Twist, they are never satisfied and they wish to warn the Government of what can happen. They have had a

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year and a half of good trading after many years of very bad or disastrous trading—I am speaking particularly for the family businesses—and they do not want the Government to assume that all their troubles are over and that they can be left where they are.
I support the plea made by the hon. Member for Edinburgh, Leith (Mr. Hoy) about the Matthews report. I understand that the Government have had Mr. Roy Matthews' report since October last year, a report covering the total reorganisation of the industry and taking a very broad view. Can it be published in its entirety? So far, the Minister has been good enough to give us a bit here and a bit there from it, but he should realise that if he does this he leaves the impression in the minds of people in the industry that something else has not been revealed and, quite naturally, the fear is aroused that what is left out is rather more important than what is disclosed. The Government may be doing themselves a disservice by not publishing all the proposals. I beg my right hon. Friend to consider this point and to see whether this can be done in the near future.
Secondly, I have been requested to ask questions about the consequences of loans and foreclosures. My right hon. Friend will remember that two years ago a moratorium was given to companies which were almost facing bankruptcy. That moratorium ends in September this year. As the hon. Member for Leith said, the arrears of loans have increased from £1,250,000 to £1,550,000 in a period when the industry is supposed to be doing a lot better. This must mean that certain companies are doing much worse and are losing money.
It is fair to ask—and members of the trawling industry want to know—whether it is the Government's intention to foreclose these vessels which fall in arrear and what they propose to do with them. I understand that already about six from the North-East have been taken over and foreclosed by the Authority and are being run by the Authority at a loss. The industry would like to know how much the Authority is losing on these vessels. If it forecloses and takes over many more of
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these vessels which are in arrears of payment, will it continue to run those at a loss? If it does, this seems quite unfair competition to the industry. Those are the two main points which I have been asked to put.
On the question of capital grants, the section of the industry for which I am speaking is a little concerned about the 50 per cent. grant which will be given for experimental purposes and the 25 per cent. grant for improvements. It wants to know how there will be demarcation between the two. Would it not be better to pay 33⅓ per cent. for the whole lot, which would cost no more money and would stop all sorts of difficulties in the industry?
I have been asked to say this about the supplementary subsidy. The maximum of £½ million for 10 years does not seem a lot. But that is not what is worrying the industry. The maximum for any one year is £350,000. This goes only to vessels which are in financial difficulties. But £350,000 for all the vessels which could be in difficulties in a bad year would be totally inadequate. Therefore, without requesting that the total of £2½ million be increased—although we should like that if it could be done—may I ask whether the £350,000 could be increased in case the industry strikes a very bad period, as it did two years ago?
The loans which were given on favourable terms to the smaller concerns for the smaller vessels have been a godsend, and the owners are very grateful. However, as I understand it, the terms of these loans for the cheaper money exclude the bigger companies, which must borrow, if they can, at commercial rates. Commercial rates can mean almost anything, and the bigger companies could be pushed into paying 8 or 9 per cent. Surely this is not good for the industry and is not what the Government want. Could the loans be made available to the larger as well as the smaller companies?
Lastly, I want to deal with a matter which affects my constituency very closely, namely, the loss of the fishing grounds round the Faroes. The industry in Grimsby has been very badly hit by this, and we want to know whether the Government can do anything to help. As the Minister knows quite well, these

1325
grounds have been lost as a result not of agreement and discussion but of unilateral action.
We had a lot of trouble and disagreement with Iceland years ago, but finally agreement was reached. The Faroes, as I understand it, have acted completely unilaterally, and as a consequence the industry fears that the other nations in the north will follow the example of the Faroes and that the Grimsby trawling industry will lose a good deal more of its best fishing grounds. I am asking the Minister to use his good offices to try to help to solve this very difficult problem and to help this section of the industry for which I am speaking.
The hon. Member for Edinburgh, Leith said that he hoped that the consumers'end would be looked at and he talked about the Faroes and what the fish fryers had to say. This affects my constituents and I appeal to the Minister on this issue. Because of the action of the Faroes there was a committee formed in Grimsby. It consisted of representatives of the trawler owners, the trawler officers, and the Transport and General Workers' Union. They made a mistake, I think, in not including the merchants originally. They discussed with the merchants later, but I think that the committee made a mistake originally in not including the merchants.
I put it to my right hon. Friend that last year fish from the Faroes and landed in this country amounted to £1,200,000 worth. No less than £641,000 worth came to Grimsby. This is, therefore, of vital importance to my constituents, especially when this is compared with the total value of the landings for the whole country, £63 million, of which £13 million came in foreign vessels. The Committee, to safeguard our own fishing position, argued for a cut-down of imports from the Faroes to the average of the last ten years of £850,000 per annum.
It is on this that the Grimsby Trawler owners have been wrongly attacked in the Press from the consumers point of view. It has been said in a leading article in the People that prices were sky high, and that this was an iniquitous thing to do. I put it to hon. Gentlemen opposite that if the products of a man's labour are sold too cheaply he cannot be paid a fair wage. The price of coal
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has been put up in order that the miners may have a better wage. This same argument ought to apply to the men engaged in the fishing industry. If it is fair for coal miners it is fair for the chaps in the fishing industry. It is nonsense for papers like the People to scream their heads off as they have. There was a great article in the People attacking the Grimsby end of the trade and saying that the fish fryers were saying that our section of the industry was holding the fish fryers to ransom. It is just nonsense. It is not right for industrial workers averaging £17 a week to demand cheap food from men earning a good deal less in the fishing industry.
The Minister, I know, when seen by members of the industry, has said that he has no legal responsibility in the matter of the Faroes. I think he has got a moral responsibility. I want my right hon. Friend to help the industry to get the Faroes people to come and discuss with the British industry the various problems which arise and to see whether the ban, if I may call it that, on the imports into our country cannot be ended as a package deal against our having better rights in their fishing grounds.
Those are the comments which I have been asked to make. People in my constituency are grateful for what has been done for them, but they do not want the Minister to run away with the idea that everything is all right for the future and that he can leave them alone.
9.30 p.m.
Mr. Patrick Wall: I join with those hon. Members who have expressed their condolences with the families of those who lost their lives in yesterday's disaster. I understand that the vessel concerned came not only from the constituency of my hon. Friend the Member for Banff (Sir W. Duthie), but from his own village, and that some of those who lost their lives were distantly related to him. I hope that he will convey to those concerned the personal condolences of the whole House when he next visits his constituency.
When my right hon. Friend introduced these Schemes, he referred in some detail to the background against which they should be discussed. I think that we should consider the background in some detail. When I was doing a little research this morning for this speech, I happened

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to come across the British Trawler Federation's Report for 1958. I will quote the first two paragraphs:
"The year 1958 was one of continual anxiety for the British Distant Water fleets sailing out of Fleetwood, Grimsby and Hull. The Conference on the Law of the Sea and the subsequent action of Iceland in endeavouring to take for her own exclusive use large areas of the high seas laid a shadow over the industry which has not yet been dispelled.
Large investments in trawlers and the well-being of countless fishermen and their families are threatened; indeed, the threat goes much further than this, the livelihood of whole communities is in jeopardy."
What a great contrast there is between that report of 1958 and the whole industry's position in 1964!
There has been a gradual improvement in all the past years. In 1959 we were at the height of what was called the cod war with Iceland and in that year the E.F.T.A. agreement was signed. In the following year we had a relapse, as it were, in the failure of the Geneva Conference, but at least the Geneva Conference showed that most nations would agree to a fisheries limit of about 12 miles. Then came the truce with Iceland and the agreement with Norway and the introduction of subsidies for the distant-water vessels. In the same year, the concept of a Western European fisheries convention was outlined.
In 1961 came the Fleck Committee's Report, which committee, the House will recall, was set up in 1957. The Government accepted that Report and it has been the agreed foundation for the reconstruction of the industry. It is of interest to note that the Fleck Report was published completely and that the Government then published a White Paper giving their proposals on its implementation. I think that the House would be grateful if the Government would do the same thing, in a less ambitious way, for the proposals recently submitted by the Chairman of the White Fish Authority. If we could have these proposals produced rather like the Fleck Report was produced, with the Government's views on those proposals set out in a White Paper, the House and the country would be able to judge exactly what was proposed for the immediate future. I believe that the Government would do themselves and the White Fish Authority a good service
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by following the example of what was done with the Fleck Report.
In 1961 there came the final agreement with Iceland and the extremely important concession that any future possibility of extending limits must be referred to The Hague Court.
In the following year, the House passed the Sea Fish Industries Act which gave full effect to the Fleck Report. Last year we were faced with the failure of the Common Market negotiations. Whatever one may have thought about that personally, it was a blow to the fishing industry.
Mr. Frederick Peart: Did the hon. Gentleman say that if we had gone into the Common Market the industry would have gained thereby?
Mr. Wall: I did. Without debating the pros and cons of going into the Common Market, it would have been a gain to the fishing industry. The industry itself openly admitted this during the long discussions on the matter. The industry would have gained because there would have been a common agreement for fish to enter Europe, and we would have had a fusion of catching agreements.
This year we had the Western European Fisheries Convention which flowed from many of the developments about which I have just reminded the House. From that conference came a convention and a code. This code was to be decided at a meeting of technicians from the various nations concerned. I do not know whether the Minister can tell us what has happened about that meeting. Has it taken place, and with what result?
Then, only a few weeks ago, we had the Fishing Limits Bill which has done so much to improve the lot of the inshore fishermen. Six months ago we contributed to what the White Fish Authority called a revolution in the catching side of the distant water part of the industry by making available a grant of £110,000 for freezer trawlers. Now we have an extension of that in the grant Scheme before us.
This is an excellent record and I think that I am right in saying—perhaps my right hon. Friend can confirm this—that since 1951 about £40 million has been

1329
given in subsidies—not in loans—to the industry. I congratulate my right hon. Friend and his immediate predecessors on all that they have done to modernise the industry and to change the picture from the rather dreary one reported in 1958.
As the hon. Member for Edinburgh, Leith (Mr. Hoy) pointed out, these Schemes not only reduce the subsidies by 7½ per cent., but give a total reduction of 15 per cent. I was not clear whether he thought that that was good or bad. It is true that this can be done. Every hon. Member who has spoken so far has accepted that this reduction in subsidies is justified. Indeed, it has been agreed to by the industry. The fact that we can reduce subsidies by 15 per cent. and that the industry accepts it, surely must be a considerable move towards the end that we all have in mind, namely, an efficient, prosperous industry that is not subsidised.
Mr. Hoy: I had better put the hon. Gentleman right. I made it quite clear that I did not agree. If he wants further support for my point of view, he should read the speech of his hon. Friend the Member for Banff (Sir W. Duthie) who said that to talk about phasing this out was nonsense. That is what I think about it, too.
Mr. Wall: My point is that the industry is assisted by subsidies, and the fact that this year we have managed to reduce subsidies by 15 per cent. with the agreement of the industry must be satisfactory to all concerned. I agree with the hon. Gentleman and others who have said that it is far too early to tell whether we can tail off the subsidies as planned. We have done so this year, and the industry has accepted it, but it is too early yet to say whether this can continue year after year.
What has happened is that we have had a good catching season after two bad ones which necessitated a moratorium. That is why the firm referred to by my hon. Friend the Member for Louth (Sir C. Osborne) is still in debt. One hopes that if it prospers this year and next it will be able to pay off the arrears and we will get an efficient, prosperous industry without the shackle of subsidies.
The distant-water section of the industry based on Hull never wanted
1330
subsidies. It accepted them largely because of the effect of external happenings, such as the closing of traditional fishing grounds by unilateral action of foreign countries. I believe that the grants which supplement the increased grants given for new freezer trawlers only six months ago will do a great deal to improve the efficiency of the industry. The fact that they are extended to cover increases in economy and efficiency of operation, and such matters as handling, processing and storage of fish, will be of great assistance and will lead the industry to experiment and improvise.
I understand that this covers the conversion of traditional trawlers to freezer trawlers and is obviously a useful supplement to previous legislation. I am also pleased that my right hon. Friend managed to announce today that a further £500,000 is available to supplement the £2 million for these grants and that a whole review of the whole grants policy will be brought forward to the latter part of this year. This will be of considerable interest to the owners, who obviously have to plan their rebuilding programmes years ahead. I ask my right hon. Friend to give me this information, off the cuff, if possible. Can he tell me what is the total estimated cost, in this financial year, of the grants which are designed to assist in the building and modernisation of vessels?
I now turn to the question of loans which was dealt with by my hon. Friend the Member for Louth. I have two points to underline. The first concerns the arrears—now £1½ million—on loans from the White Fish Authority, which is an increase of £250,000 on last year. What is to happen about the moratorium? Will it continue? What is the policy about foreclosure? Does foreclosure mean the sale of trawlers, possibly at a loss, or that the White Fish Authority must continue to be vessel operators. I note that in paragraph 15 of its Annual Report it says:
"we have also found ourselves involved in the unwanted and unwonted rôle of vessel owners."
I am glad to see that the hon. Member for Leith appears to disapprove of this. I am sure that we would all agree that it would be a pity if the White Fish Authority became operators or owners. It might mean the first step along the

1331
road to the nationalisation of the industry, which is so dear to certain of his hon. Friends.
The other point also mentioned by my hon. Friend the Member for Louth is the question of loans by the Authority which at the moment are confined to those who cannot borrow at commercial rates of interest. It means that these loans are restricted to the smaller companies. I would remind my right hon. Friend that in paragraph 17 of the White Fish Authority's Annual Report it says:
"The rule would seem to operate unfairly as regards large companies, since it puts them at a competitive disadvantage with their smaller rivals and furthermore it forbids loans of public money from being made where the security is safest."
I hope that my right hon. Friend will consider this in some detail and will be able to accept proposals which have been made to him, which were that the phrase
"unable to raise loans at commercial rates of interest"
should be replaced by something like "cannot borrow on the open market at rates of interest not more than 1 per cent. above White Fish Authority rates." That would bring into effect what Parliament had in mind when it last discussed these matters, and it would be approved both by the industry and the Authority.
I now come to the new proposals of the Authority. Paragraph 4 of its Report talks about the emphasis being laid on the encouragement of enterprise and innovation and flexibility in the administration of aid to the industry. I am sure that we all support it in this idea. I join with many other hon. Members in congratulating Mr. Roy Matthews on his leadership. His ears must be burning if he has been listening to this debate. I believe that he has already produced new ideas and that he is now the recognised leader of an industry which is keen to obtain greater co-operation under his leadership. Now that his Report has been made to the Government who have in broad outline discussed it and, so far as one can see broadly approved it, one hopes that the industry will be able to get ahead with planning better coordination and co-operation.
It is clear from what has been said in this debate that there is at present no case for greater Government support for the industry. It is also clear that there
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are several pros and cons about a minimum price scheme which in any case already covers something like 80 per cent. of the industry. Obviously better quality is needed particularly by the consumer and by the distributive side of the industry. Equally, one does not want to see the price to the housewife go up. The Government are taking a rather neutral attitude on this and we hope soon to hear from the White Fish Authority and from the industry detailed proposals about the possible future introduction of a statutory minimum price scheme.
My final point on the question of coordination of the industry relates to the Faroese quota. This has been referred to by my hon. Friend the Member for Louth. I do not want to labour the matter, but I wish to underline that the reason for the imposition of a quota was the unilateral action of the Faroese. The Committee which was set up included all major sections of the producing side of the industry including the trade unions, and not only the B.T.F. It has done its best to obtain co-operation from the Faroese. It asked for observers and for further talks, but has received no reply from the Faroese industry or Government. It is obvious that eventually there must be talks and eventually there must be some agreement both over the quota and over fishing rights. Obviously, both sides must come together as, finally, we had to do with Iceland. Let us hope that this will not take a period of four or five years as was the case in respect of the negotiations with Iceland. The more the various sections of British industry remain together on this issue the more likelihood there is that we may reach agreement with the Faroese.
Sir C. Osborne: Would my hon. Friend agree that this should include the merchants as well as the producers?
Mr. Wall: Yes, I agree with that. I think that the merchants should be included. That is why I say that now that the White Fish Authority proposals have been got out of the way, or perhaps I should say brought into the open, Mr. Roy Matthews will be able to go ahead with talks with all sections of the industry. This may lead to disagreements, but basically I think that such talks would do a lot of good. I think that a lot of good came out of talks held

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by the Joint Parliamentary Fisheries Committee last year to which reference was made by the hon. Member for Leith.
This is probably the last debate on the fishing industry that we shall have in this Parliament. The Government have an excellent record on fishing matters. I believe that these Schemes will assist the completion of a modern and efficient fishing industry. They have the support of the House and the enthusiastic support of hon. Members on this side as they represent the completion of a job really well done.
9.48 p.m.
Mr. Frederick Peart: We on this side of the House support these orders. I am not sure about the hon. Member for Haltemprice (Mr. Wall). When we had a brief debate on sea fishing limits I was able to congratulate the hon. Member on having made an effective speech. Tonight, he has made a most ineffective speech. I have never heard such nonsense talked in a fishing debate, especially when he referred to the Common Market.
What the hon. Member said is all very problematical. Nothing was agreed by the Community about a policy. We cannot have an efficient policy unless we consider other countries including the Scandinavian countries, and the hon. Member for Haltemprice referred to the Faroese. It is a matter which we must look at again. Consultations must take place. We cannot consider a policy in terms of "little Europe". I will not pursue the matter. The hon. Gentleman has made his point and I think that it will be rejected.
Mr. Wall: I do not think that the hon. Member understood the point which I made. He said that we should consider these things on a European basis. We must consider them on the Common Market basis and markets for fish together with access to fishing grounds.
Mr. Peart: The hon. Member obviously did not understand the point he himself made, because he has now altered his argument and taken up the point I made. We cannot think in terms of a Common Market approach, but the fishing industry has to consider E.F.T.A. and other countries not in E.F.T.A., Poland and the Soviet Union. The right
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hon. Member for Orkney and Shetland (Mr. Grimond) mentioned in a previous debate the importance of the Soviet fishing fleet in relation to entry to this country.
However, I shall not pursue the argument. The hon. Member made a stupid remark when he said that subsidies shackle the industry. That was the phrase he used—the shackles of subsidies. His right hon. Friend—not the Minister of Agriculture who is a crypto-Socialist, but his right hon. Friend the Member for Wolverhampton, South-West (Mr. Powell)—has a new recruit. Carry on with this extravagant language and I am sure it will be welcomed in certain right-wing Tory circles, but they would not dare to do this in the agricultural industry.
The hon. Member for Banff (Sir W. Duthie)—who spoke sensibly because he knows the industry and we all listened with care to his contribution—mentioned that subsidies from 1951 had amounted to £41 million. They have not been large in relation to the importance of the industry. Let us keep this in its right proportion. To talk about shackles of subsidies is nonsense. We are anxious to have subsidies properly used in the industry. When we had the major debate on the Bill which has created these Orders, I remember making a speech. I have it here with me, but I shall not weary the House with quotations from my speech.
Dame Irene Ward: Thank goodness.
Mr. Peart: I am glad to say to the hon. Lady that it was a better speech than that made by the hon. Member for Haltemprice, who had a strange brief this evening.
My hon. Friend the Member for Edinburgh, Leith (Mr. Hoy), who spoke first from this side of the House in this debate, and I time and again on the Committee stage of that Bill argued that the Government can be too optimistic about creating a viable industry over a 10-year period. Even the Fleck Report suggested this. The hon. Lady the Member for Tynemouth (Dame Irene Ward), who represents a very important fishing area on the North-East Coast, would I think agree that we should not be dogmatic. While we may argue about the

1335
phasing of subsidies it would be very wrong to be dogmatic. I am glad to have support in this connection of the hon. Member for Louth (Sir C. Osborne) in saying that these subsidies are an attempt to provide a springboard for the industry. They are not there to shackle the industry. This is a combination of public good will on the part of a Government which has had to be prodded from time to time and various public authorities in the industry such as the White Fish Authority to inject capital into the industry so that proper structural arrangements could be made.
When the hon. Member for Haltemprice talks about nationalisation in the industry he is being silly. Here we have a desire on the part of every hon. Member who cares for the industry to have proper State aid for the industry. The White Fish Authority is a vital part in this development. It is a public authortiy which, in partnership with the industry, seeks to provide a prosperous industry. Let us not be doctrinaire about this; let us be pragmatic and not make silly pronouncements. We do not oppose these Orders. We are anxious to give the aid and see that it works well. We are anxious to see the industry prosperous.
I know it is a cliché, but it is true to say that this is a very important food producing industry. It is vital to the nation. It provides a livelihood of those engaged in catching fish, for those engaged in processing fish, and for those in the distributive trades. It is also very important from the point of view of defence. It provides the basis of a school of seamanship from which we can draw recruits for the Royal Navy and for the lifeboat service. We do not want to be dogmatic, but we are anxious to see that aid is rightly used, and that the industry becomes more viable. We wish it well.
I should like further explanation of the £50,000 mentioned by the Minister. I understand that this is to cover research into marketing, etc., but perhaps the Secretary of State will elaborate on this point. It may be that I have a bee in my bonnet about scientific research. I know that during the Committee stage of the Bill I tried to move a Clause to create a new research council, and I
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still think such a council to be fundamental to the industry. We need more research and more co-ordination. What the Fleck Committee reported on this I believe to be still true. I agree with the right hon. Member for Orkney and Shetland that £75,000 for publicity is not enough in view of the importance of the industry.
I want to stress the importance of the report submitted to the Government by Mr. Matthews, Chairman of the White Fish Authority. I pay tribute to Mr. Matthews. He has been brought into the industry, and I am certain that a man of his vigour and outlook will inject new life, not only into the industry but into the Government.
Hon. Members on both sides have expressed the desire to know more about Mr. Matthews' proposals. The Minister has told us of some of them, but we want the whole story. An isolated proposal, often taken out of context, does not give a clear picture. If possible, hon. Members would like to look at all the proposals that have been made, which could well form a new charter for the industry. Does the Joint Parliamentary Secretary wish to intervene? Apparently not. I thought that he was dissenting from this point of view. If the hon. Gentleman is speaking in his sleep, I do not mind, but he should realise that hon. Members on both sides feel deeply about this important matter. They want to know what proposals have been made by the chairman of a very important public authority. There may be difficulties about publishing the proposals as a White Paper or in some other form but, if it can be arranged, publication will be for the good of all.
We on this side support the industry on the question of import control on which the trade unions and the employers have agreed because of the unilateral action taken by the Faroese. I agree with the hon. Member for Louth that the consultations should have been much wider. When we will get a solution of the problem, I do not know, but it must come. We cannot be xenophobic about it. We need an agreement, and there must be negotiation. At the same time, we support the attitude of the trade in this matter.
As I say, we on this side are not dogmatic, we hope that the industry will

1337
be viable, we are anxious to know the details of the memorandum that has been submitted, and I have mentioned the marketing and research that are very vital to the industry. On all these matters, perhaps the Minister will be able to give me a satisfactory reply.
10.0 p.m.
The Secretary of State for Scotland (Mr. Michael Noble): As usual, tonight's debate on fishing Measures has ranged fairly widely. I will try to wind up as quickly as possible, because, though we started some hours earlier tonight than I can remember other debates of this sort taking place, I know that the House does not want me to make a long speech.
My right hon. Friend the Minister of Agriculture, in referring to the results experienced by the industry in the United Kingdom as a whole, mentioned that in Scotland the figures for the last period had been particularly good. He talked about an increase of 7 per cent. The corresponding figure for Scotland was 101/2 per cent. This includes both white fish and herring. Though herring fishermen have not been doing as well this year in Scotland—I know that one or two of the herring fishermen in my own constituency have not been getting very rich in the last month or two—leaving herrings out of this, the increase in the white fish returns has been 14 per cent., twice as good as the U.K. figure, and the value of the Scottish trawler catch was up by 23 per cent.
I know full well that one cannot say that this is bound to continue. It was not for nothing that my first public meeting in Argyll, was addressed by, I imagine, a very distinguished expert from the Department of Agriculture and Fisheries, who came to tell us that for certain reasons there never could be any more herring in Loch Fyne. The next summer one could walk across Loch Fyne on the herring—they were absolutely solid. Therefore, I realise the dangers involved in either experts or Ministers trying to forecast. I also realise that when figures are given of increased catches attention should also be paid to the increasing costs in the industry, which have an effect on profits.
I turn to some of the points raised during the debate. The hon. Member for Edinburgh, Leith (Mr. Hoy) is right in thinking that the changes in the
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phraseology of these Statutory Instruments have been made to try to bring the two Statutory Instruments more closely together. The change in the 24-hour rule was made because fishermen, like some other people, were aware that if one happened to go out a few minutes before midnight on one day and stay out until a few minutes after midnight on the following night, one was able to get more subsidy out of the Statutory Instruments than Parliament ever intended.
I agree with the hon. Gentleman that the phrase to which he took some exception last year in relation to fishing diligently was unnecessary; it has been removed. If the fishing at a given moment in any area is dull and there are no fish there, it is difficult to tell whether the man who is casting his net there is fishing diligently or not.
I do not want to start a debate on the importance of "may" and "shall", though we have had many such arguments in Scottish debates, particularly in Standing Committee. The detailed change in the Herring Scheme was made to bring it into line with the White Fish Scheme and there is no more sinister purpose than that. The question of the length of vessels is also one on which I receive a number of letters from my constituency saying, "Because my boat is 39 ft. 6 ins. it is subject to different rules and regulations than if it were 40 ft." Therefore, this provision is in, so that it is not possible merely to add on a piece of wood and then say that the boat is of a different size.
The hon. Gentleman asked me, as did one or two of my hon. Friends, whether the White Fish Authority was likely to find itself owning a large number of vessels because of foreclosures; whether, if the Authority was not going to own them and operate them itself, it would want to sell them either at home or abroad; and, if so, who would pay if the Authority sold at a loss? The brief answer is that if the White Fish Authority became unwillingly—I say "unwillingly" because the Authority does not want to take over vessels under these conditions—the owner of a vessel it should have the power to discuss with my right hon. Friend and myself, in each case, whether it is better to sell

1339
the boat to a buyer at once, or whether, if the market is slack, it should be allowed to fish for a short time and sell the boat later for a better price—perhaps a month or two later.
Sir C. Osborne: When my right hon. Friend says that the Authority should fish with the vessel for a short time, can he say what he means by "a short time", because if the Authority can run vessels even at a loss, with the taxpayers' purse behind it, that will be unfair competition against the people in the industry who are running vessels at their own expense. It is important, therefore, to know how long this competition will last.
Mr. Noble: It is difficult to answer with certainty, but it must be left to the judgment of the Authority, my right hon. Friend and myself to say for how long this should take place, because if the Authority sells the boat—and we must remember that we are talking about a very small number of boats; from memory, I think only two or three out of 500 or 600 in the fleet—at a loss, the taxpayer will lose a considerable amount of money that way.
The hon. Member for Leith and several other hon. Members suggested that because the amount of the debt to the Authority went up last year by £300,000, that must indicate that the industry was worse off than a year ago. That is not true, because we gave the industry a two-year moratorium, and if people have decided not to pay back their debts this year—for good reason, no doubt—that is the reason for the increased debt. I am told, however, by the White Fish Authority that the indications are that a considerable number of people will pay their debts and it is certain that the results this year will mean that a great many more debts will be paid in the autumn and the spring.
Mr. Hoy: What about the bad debts?
Mr. Noble: I do not have the figures for bad debts, but I think that the hon. Member also asked whether, if there were any bad debts, the Government would pay them or whether they would have to come from the industry. The answer is that if they exceed the amount the industry is making available for bad
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debts, then I believe that they will fall on the Government.
The hon. Member for Leith also asked whether payments would be made for boxing fish at sea. This, he said, was a problem which had arisen in or near his constituency in the old days and he wondered whether it would come within the extra money we are making available to the industry for improvements. The answer is, "Yes".
The hon. Member then asked a question which was asked by almost all hon. Members: whether my right hon. Friend would publish the Report which Mr. Roy Matthews made some months ago. There seems to be a misconception about that Report. It was not a report like the Fleck Report, made after years of consideration. I would like, if Mr. Matthews will not consider that his blushes are being brought too readily to his face, to say how frequently we have met and how very much I have appreciated his vigour and the ideas that he has produced. His Report was made after a quick tour of the ports and it covered a wide variety of subjects, almost all of which my right hon. Friend dealt with. I would consider it entirely wrong if the Chairman of the White Fish Authority felt that he could not send reports to my right hon. Friend and myself at regular intervals without there being demands in Parliament for them to be published. This Report was made specifically for us and—
Mr. Hoy: Not a single hon. Member has made that request. We understand that Mr. Roy Matthews, on behalf of the White Fish Authority, made certain proposals. If he had said, "I do not want the House of Commons to know about these," that would be a different matter. Perhaps the right hon. Gentleman will clear up this matter with Mr. Matthews. I take it that if Mr. Matthews says that he has no objection, the Minister will make the proposals available to us.
Mr. Noble: I am certain that the hon. Member, who I am sure knows Mr. Roy Matthews very well, will be able to take him out to dinner and to find out all he wants to know about it. There is nothing secret about it, but it is entirely wrong that suggestions of this sort, whether in the form of proposals

1341
or in any other form, should be the subject of publication as a White Paper.
My hon. Friend the Member for Banff (Sir W. Duthie), whom we always enjoy hearing in fishing debates, has taken a particular interest in the subject for many years. He brought to what is perhaps his last fishing industry debate in the House the story of the tragedy of the seine netter "Sirius". I join with what has been said in the House, and I hope that he will convey my sympathy, as well as that of the rest of the House, to the fishermen and their relatives.
I was not surprised to hear that he has visited practically every English port and has even been to Germany to see whether there is anything new, because he has always been very keen on research and on finding out more and more about the problems which the fishing industry encounters. He asked me specifically about the price of herring for oil and meal and whether the price would be for the whole catch. I am sorry to have to disappoint him, but it cannot be for the whole catch; as last year, it is for 20 per cent of the whole catch only. It may be some slight comfort to him to know that by some curious method—I should not like to try to find out too accurately how it happened—out of 59,000 crans which were sent for oil and meal from Scotland, 40,000 crans seemed to attract subsidy.
My hon. Friend referred to the Ullapool blunder, and we have spoken about that in the House before. I have complete confidence that Sir John Carmichael has taken the necessary action to make certain that this will not happen again.
The right hon. Member for Orkney and Shetland (Mr. Grimond) spoke of the importance which my right hon. Friend and I and Mr. Roy Matthews all certainly attach to marketing, packaging, transport and freight. He said that he did not think that the total sum of £75,000 for publicity in the White Fish Authority accounts was enough. My right hon. Friend and I entirely agree with him. Where we find some difficulty is that in every industry of this nature—wool or any other product—the money for advertising comes from the
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industry and not from the Government. If the results which we are recording this evening, which are getting steadily better, continue in the future, I very much hope that the catchers of fish will be prepared to give a more adequate amount to the White Fish Authority for this purpose, because in modern terms any major scheme of promotion costs several times the amount which has been mentioned.
The right hon. Gentleman referred to the phrase in the Schemes that the Minister must be satisfied that herring sent for meal could not have been sold for other purposes. This is a proper safeguard in a Scheme of this sort to ensure that fishermen do not send to the oil and meal factories herring which could be sold more profitably for some other purpose. He also asked me about the phrase
"fish normally sold for human consumption."
This is to cover some industrial fishing. Not a great deal of it is taking place yet in Scotland, although it is beginning, but it is becoming very important in Europe where they are catching large quantities of sand eels and something called gobbets, which they find profitable. In our view, these should not get the subsidy.
My hon. Friend the Member for Louth (Sir C. Osborne) asked a great number of important questions and I will try to deal with them as quickly as possible. He asked about the 50 per cent. experimental grant and the 25 per cent. improvement grant and whether we could have a 33⅓ per cent. grant on each. Our view, and I am sure that it is shared by the White Fish Authority, is that 50 per cent. grant should be given for experimental purposes to specific vessels, and that only when the experiment is proved successful should that feature be incorporated in other vessels and get the 25 per cent. improvement grant there.
My hon. Friend asked about Supplementary Estimates. We all hope that we shall not have to exceed the maximum of £350,000, and, indeed, it could not be increased without specific authority from the House. My hon. Friend also asked about loans for smaller vessels and whether they could not be given to the large firms. I do

1343
not think that that is desirable. If a large firm is in a development district it may qualify for a loan but this is essentially something provided for the small firm which has not the access to the facilities for loans which most of the big companies possess.
I think that the House would agree with him that it would be very pleasing if we could make arrangements over the Faroes which would prevent ill-feeling and difficulties which not only Grimsby has suffered but also particularly Scottish trawlers from Aberdeen and Granton. This is not easily done and my right hon. Friend did his best with very tough negotiations not long ago.
Sir C. Osborne: This is important to Grimsby. If there is a chance to do something over the Faroes will my right hon. Friend promise to take it?
Mr. Noble: I absolutely promise that my right hon. Friend or myself will miss no opportunity of getting our foot in the door if it is at all possible.
My hon. Friend the Member for Haltemprice (Mr. Wall) was right, in spite of the comments made by the hon. Member for Workington (Mr. Peart), about the position over subsidies. I have lived a great part of my life with people in the fishing industry. They are tremendously independent and I do not believe that they want subsidies as such.
Mr. Hoy: Nobody said that they did.
Mr. Noble: There was a certain amount of banter which was getting confusing, but the hon. Member for Workington seemed to think that subsidies in themselves were necessary and good.
Mr. Peart: All I said was that I did not regard the subsidies provided by means of these Statutory Instruments as shackles, but as a springboard for further action to make the industry more viable.
Mr. Noble: I am glad that the hon. Member has said that they are to be used as a springboard to make the industry more viable.
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I am glad that my hon. Friend the Member for Haltemprice welcomed the extra money for freezer trawlers. I think that this will be useful and perhaps will help to provide a new and better form of catching and marketing of fish. My hon. Friend also asked about the total figure for grants this year. Roughly speaking, it will be £800,000 for building vessels because the extra money will not be spent during this year. My hon. Friend was right in his estimate of about £40 million as the amount of money which has been given in subsidies.
In commending these Statutory Instruments to the House I would add that it is very easy to pick out 1961 and 1962 as two very bad years out of the last three. Looking back over the period to 1955, when we began to modernise our trawlers in Scotland with the new diesel trawlers, the years 1961 and 1962 are the worst two years in the whole of that time when the trawling fleet did not cover its depreciation and make a profit.
I am quite certain that, if we continue to have the advice of Mr. Roy Matthews, and if he is able, as my right hon. Friend said, to negotiate with the industry, with the trade and consumers satisfactory schemes for support prices and minimum prices, the industry may well be viable, as Mr. Matthews himself feels, within the period which the Fleck Report suggested.
Question put and agreed to.
Resolved,
That the White Fish and Herring Subsidies (Aggregate Amount of Grants) Order 1964, dated 24th June, 1964, a copy of which was laid before this House on 2nd July, be approved.
White Fish Subsidy (United Kingdom) Scheme 1964, dated 2nd July 1964 [copy laid before the House 8th July], approved.—[Mr. Soames.]
Herring Subsidy (United Kingdom) Scheme 1964, dated 2nd July 1964 [copy laid before the House 8th July], approved.—[Mr. Noble.]
White Fish Industry (Grants for Improvement of Fishing Vessels) Scheme 1964, dated 6th July 1964 [copy laid before the House 8th July], approved.—[Mr. Soames.]

GREENWICH HOSPITAL AND TRAVERS' FOUNDATION
10.21 p.m.
The Under-Secretary of State for Defence for the Royal Navy (Mr. John Hay): I beg to move,
That the Statement of the Estimated Income and Expenditure of Greenwich Hospital and Travers' Foundation for the year ending on 31st March, 1965, which was laid before this House on 2nd June, be approved.
The House will note that for the first time this hallowed Motion is in the name of the Secretary of State for Defence. The reason is that the property of Greenwich Hospital, by virtue of the Defence (Transfer of Functions) Act, 1964, is now vested in him. Hon. Members will recall, however, that on 21st November last year my right hon. Friend gave an undertaking to Parliament that the day-to-day management and affairs of Greenwich Hospital would be discharged in future by the new Admiralty Board although the Board of Admiralty was, by the reorganisation of the defence Departments being wound up. I can assure the House that my right hon. Friend's undertaking is being honoured in practice.
To turn to the financial estimates, we expect that for the current financial year our estimated income at a figure of £440,850 will be £11,395 more than last year. The difference is made up principally of higher revenue from our estates and property and £2,300 more in receipts from the Royal Hospital School, that is, mainly fees. The estimated expenditure in the current year, £439,850, will be about £5,000 less than revenue, which is very satisfactory, and we propose to carry the surplus to capital account in accordance with our customary policy of providing something in the nature of a sinking fund for major repairs and material commitments at the Royal Hospital School. We do not propose—this appears at pages 3 and 5 of the estimate—to increase the amounts which we earmark for pensions to officers and seamen. In fact, there will be a very slight reduction if we take account of the rounding down adjustment shown against the Rotely Bequest.
The reason why we do not propose any increase for pensions is that there
1346
is very little likelihood that the existing provision we are making will be fully spent. For some time, as my predecessors have told the House, expenditure has been about one-third on pensions and benefits and two-thirds on the Royal Hospital School. I think that the time might well be approaching when we should have a reappraisal in this field. In education expenditure, costs do not stand still and we must expect that if the school is to remain one of which we can be proud it will need more money.
There are two ways of getting more money for the school. One is to divert more of the Hospital's income to it. The other is to raise the income received from fees. There is obviously a limit to what can be done by each of these methods. It may be that they should be used in combination. But what is clear is that with the very high level of prosperity in this country, and with the Welfare State extended as far as it is today, the demands which are made on the funds which we allocate for pensions and allowances tend to become much less strong. There is comparatively little real poverty, and I think that it is quite possible that the ratio of one-third to two-thirds which I have mentioned may have to be adjusted.
On the other hand, the school fees, which have now been fixed at a level of £100 a year for over three years, must be bringing in a smaller proportion of contributions to the increasing costs of running the school as the wider range of educational facilities is developed. As I think hon. Members know, we charge fees only to those who can afford them.
Before I pass to some comments on the principal activities of the Hospital and the Foundation, the House will be interested to know that there has recently been a change in the Director of Greenwich Hospital. Mr. H. D. Samuel retired earlier this year from this post, and I am sure that hon. Members on both sides of the House will join me in wishing him a happy retirement and in expressing our appreciation of his services to Greenwich Hospital over a number of years during a period which has seen the introduction of many improvements at the Royal Hospital School.
No doubt the interest of the House is centred mainly on the school to which,

1347
as I have said, the bulk of the Hospital's income is now devoted. I therefore wish to talk about the school. I know that the small group of Members of the House who recently took advantage of the opportunity offered to pay a visit to the school were impressed by what they saw, and I think quite rightly. In the course of the last three or four years we have been carrying through a modernisation programme at Holbrook at a cost of £150,000. Much of the work has now been completed and facilities at the school have been very greatly improved.
Among the major jobs which have been undertaken have been the modification of the stage in the assembly hall, including the improvement of the defective acoustics; improvement of the cinema equipment and redecoration of the hall; a new boathouse has been built; a group of additional classrooms have been provided—and very fine ones they are—and a new games pavilion has been brought into use this summer. Part of the cost of that building was subscribed by parents, old boys and friends of the school, and we benefited from the very handsome donation from Lloyds.
But one of the most important ambitions of the improvements which we are making at Holbrook is the scheme for providing new housemasters' flats and adapting the outdated flats to be vacated to provide studies for the older boys whose numbers are now increasing. At the same time, this will provide much needed improved accommodation for the house matron and a room for the use of the assistant housemaster. In view of the success of the pilot scheme and the importance of the conversions to the life of the school, we have now decided to proceed at once with the conversion of the remaining houses.
Other work which is in hand or projected includes provision of a new physics laboratory and modernisation of the chemistry laboratory. Earlier this year it was discovered that the swimming bath roof was very badly in need of repair, and work to put it right will be starting this summer. I am afraid that it will be a rather expensive undertaking, but it is undoubtedly necessary, and we should take the opportunity of ensuring
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that the condensation, which has been the principal cause of the present defects, is avoided as much as possible in future according to the best technical advice that we can get.
If I may now turn to the boys at the school, the high academic record has been maintained in the past year. During the last year no fewer than 38 boys who took the G.C.E. passed at A level, and many of them were highly graded. Eight boys gained places at universities or colleges of advanced technology and five gained Service cadetships, four in the Royal Navy and one in the Royal Air Force. Eleven boys in the school hold either cadetships, Royal Navy scholarships or Reserve cadetships. Of the boys who left the school last year to take up careers, 31 per cent. joined the Royal Navy and another 11 per cent. joined the Merchant Navy. Seven per cent. went to Her Majesty's Dockyards and 15 per cent. to the Army and the Royal Air Force.
We have every reason to be satisfied—indeed, more than satisfied—with the academic record that is maintained at the school, and I should like to pay a tribute to the talented and enthusiastic staff that we have at Holbrook. I think that all hon. Members who have visited the school recently will agree with me that such a tribute is well deserved.
At the beginning of the present summer term, the number of boys at the school was 681. An interesting thing to note is that heights and weights bear highly favouable comparison, I am told, with those of boys at other schools. All who have visited the school will agree that the boys are in very good heart.
Before I pass from the boys, I should say a word or two about their athletic and games prowess. At both rugby and soccer, we have had very good seasons. The first teams were defeated only twice at rugby and once at soccer. The under-17 and under-16 teams both won the Suffolk Schools Championships for cross-country running and the under-16 team also won the Eastern Counties Championship. Boxing has always been a feature of the school and two boys won National Schoolboy Championships in their age and weight groups. In shooting, which is also a major activity at the school, the first team won the

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East Anglian District Ozanne Shield. The school team won the Country Life "B" competition for schools' second eights. The House will, I am sure, be delighted to know that three of the boys of the school have won gold awards under the Duke of Edinburgh Scheme. They will be going to the Palace next week to receive them.
I must now tell the House of a change that was decided by the Board of Admiralty in the closing days of its corporate existence relating to the admission policy to the school. Since 1949, when the sons of officers were first admitted to the Royal Hospital School at Holbrook, the proportion of sons of officers has inevitably increased as knowledge of eligibility has spread. Fears have sometimes been expressed in some quarters that the school might be catering for sons of officers at the expense of sons of ratings. Hon. Members will wish to know that this question has been the subject of extremely careful examination, first, by the committee of management of the school, which includes two or three hon. Members of this House, and, later, by the Board of Admiralty.
Earlier this year, the Board, after taking account of all the factors involved, decided that the time had come to modify past practice somewhat to ensure that account should be taken of the changes which have taken place over the years in officer entry arrangements to the Royal Navy. Up to now, we have made an attempt to impose a somewhat arbitrary limit of 25 per cent. on the number of sons of officers admitted to the school. Experience has, however, shown that this restriction is quite unwarranted and, indeed, it is becoming increasingly difficult, if not impossible, to operate.
The reason for this, which I will put as clearly and simply as I can, is that today the proportion of commissioned officers in the Royal Navy who have been promoted from rating is around 33 per cent. The figure is rising every year and we plan to increase the proportion materially. The effect is that the present system of admission to Holbrook penalises the rating who has been promoted to officer, and he is often no more able than the senior rating to put his son into a boarding school other than the Royal Hospital School.
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Taking account of these and other factors, the Board decided that with effect from the September entry this year, there should be equality of opportunity as between ratings, on the one hand, and officers who have four years' service as ratings, on the other hand. Sons of officers who have less than four years' service as ratings—and this includes the direct-entry officers—will be admitted only within a maximum of 10 per cent. of the entry. I have to stress that these arrangements will in no way interfere with the other arrangements which we have whereby separate and special consideration is given to orphans No orphan who has the physical and mental capability of benefiting from a boarding school education would fail to get a place.
Mr. E. G. Willis: Would the hon. Gentleman explain what he means by equality of opportunity?
Mr. Hay: Words mean, I hope, what they say. When I said that there is equality of opportunity I meant that we want to make sure that everyone has an equal chance of going to the school.
I was going to say that in recent years there has been no shortage of applicants for places at the school, but competition is always extremely healthy, and any publicity which hon. Members are able to give will, of course, be very greatly appreciated.
At this time of night I do not want to take too long a time introducing these estimates because we customarily have a short debate—I say "short": but we do have a debate—and it is customary also for the Minister who moves the Motion to have the opportunity of replying at the end of the debate.
Commander Harry Pursey: Is the Admiralty authorised to make this change off its own bat, so to speak, or should this come before the House by Order in Council subject to the usual Prayer for annulment?
Mr. Hay: No. I looked at this, and we are entitled to make this change without the necessity of coming to Parliament about it. If it had been necessary to come to Parliament about it we should have done so.
All I want to say in conclusion is that I think that; we have had a very good

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year at Holbrook and the Hospital as a whole is going on with the work which it has been doing so long, even better, I think, in these rather more enlightened days. I hope the House will give us these estimates tonight. I will try to answer any questions and points which hon. Members wish to raise if I am allowed to do so, but I hope they will agree with me that the work which is being done by the Foundation and the Hospital warmly deserves commendation and praise.
10.38 p.m.
Mr. E. G. Willis: Two years ago when I opened from this side of the House the debate on the Greenwich Hospital and Travers' Foundation it was at five o'clock in the morning.
Mr. Hay: We are doing better tonight.
Mr. Willis: We are doing better tonight, but it is a usual feature of this debate that it nearly always takes place round about midnight, and I would lodge a protest against this practice of having this debate always at midnight. I do not know why the Government do this, unless, despite their protestations, they are cowed by the heavy broadsides which my hon. and gallant Friend the Member for Kingston upon Hull, East (Commander Pursey) fires against them.
I should like to associate myself and my hon. Friends with the appreciation which has been expressed by the hon. Gentleman of Mr. Samuel and the services he has rendered to the Greenwich Hospital Trust, and I am sure that everybody will wish him well in his retirement and hope that he has many happy years.
I wish to raise one or two points before speaking about the school. The first concerns the statement of income and the revenue from the estates in the north of England. I understand that some of those estates are at present being sold. I wonder whether this is allowed for in this estimate. Why are they being sold? Do they include the forestry estates which some years ago we were told by the then Civil Lord were estates which, as the years went by, would give us an increasing income? I forget the exact amounts, but we were told of substantial sums which we could expect
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from the sale of timber. In the 1962–63 accounts for the Hospital, sales of timber increased from about £3,500 to almost £6,000 in one year, and I should have thought that that amount would have steadily increased to £8,000, £10,000, or even £20,000 as the years went by. It would be interesting to know exactly what is happening to these estates and why they are being sold.
The revenue from the property in Greenwich shows an increase of about £2,000. In a very interesting speech last year, my hon. Friend the Member for Islington, North (Mr. Reynolds) suggested that the income from the buildings lent to the Royal Naval College should be about £30,000 rather than the £18,000 in the Estimates and he expected the figure to go up rather than down. Why has it gone down? Has the Admiralty played fair with the Hospital, or has it used its powers to get these premises for what it likes? My hon. Friend said that the Admiralty could pay nothing if it liked. What my hon. Friend said last year merits the suggestion that the figures should be higher than they are.
The hon. Gentleman confirmed that pensions have not increased. Two years ago, in a speech in which he praised what had been done under the pensions scheme, a former Civil Lord went to some length to show what had been done since 1951—a favourite theme song for hon. and right hon. Gentlemen opposite. But they have not increased at all since that famous speech and the hon. Gentleman said that they are now to be decreased.
The Government have emphasised the pensions of the widows as against the others. For widows these pensions can make a considerable difference and we should be told more about why there has been a decrease. Is it simply to provide more for the Royal Hospital School, or are there fewer widows? The hon. Gentleman suggested the proportion paid in pensions, roughly one-third, should be decreased. What are his grounds for that suggestion? If there is money to spare as a result of improvements, I should have thought that there was a case for giving rather more to the widows.
I was one of those who visited Holbrook School, for the second time, last

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week. On behalf of those who had the opportunity to do so, I should like to say how much we appreciated the kindness and generous hospitality shown to us by Mr. and Mrs. York in particular. We should also like to express our appreciation of the kindness of the other people who went to considerable pains to make our visit both enjoyable and interesting. I was pleased to see the many changes which had taken place since I visited the place on a former occasion, together with other hon. Members.
The hon. Gentleman knows our fears about Holbrook School. We do not hide them. We are quite frank about the matter. We fear that this school will go the way of many other schools which have been started to help those in lower circumstances in life. In the old days people talked about poor students. This school was started for that reason, in the main, so let us not make any bones about it. In spite of the academic arguments that take place between Ministers at the Dispatch Box and my hon. and gallant Friend the Member for Kingston upon Hull, East, the fact is that in the main this school was started for the children of lower deck ratings. It was started to meet the needs of seamen and others in that category.
We fear that as a result of the developments which have taken place since the war this school will become a pucka public school, with very few of those for whom it was originally intended receiving the benefits of it. My fears are strengthened by the hon. Gentleman's remarks. He said that the 25 per cent. limit on the number of officers' children entering the school is to be removed.
I had some doubts about what this 25 per cent. limit meant, because in the classification of applicants for admission that I was sent I noticed that the term "seamen" included officers with four years' service as ratings. It seems, therefore, that when we talk about seamen, and about the classification for entrance to Holbrook, we are dealing not only with ratings, but with officers with four years' service as ratings. Since receiving this classification, I have wondered whether some of the previous figures have been based on this definition of seamen as against officers. If so, the number of officers'
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children at the school must already be considerable.
The hon. Gentleman says that there will be equality of opportunity. What this really means is that there is nothing to prevent this school from becoming the preserve of officers' children. That is what it means in practice. There is nothing to prevent that happening. On the other hand, of course, there is nothing to prevent it from becoming the preserve of ratings' children. I appreciate that that is the other side of the coin, but, so far as I can see, there is no limit on the children coming to the school, or on the families from which they come, and it means that we have removed a barrier, not laid down by this House, but fixed by the Board, as to the number of children who should be allowed to enter the school. This seems to be a rather dangerous innovation.
I cannot help thinking that much more ought to have been done to attract ratings' children. I do not know what has been done. The hon. Gentleman did not say anything about that. I have been told of certain talks which have been given in certain places to inform men on the lower deck of the opportunities available at this school. Other forms of publicity are used by the Admiralty in order to spread knowledge about this school. But I cannot help wondering whether we have done all that we can to publicise the facilities available here. It seems passing strange that with a Vote A of 100,000—and that means about 90,000 ratings—we cannot get a sufficient number of boys for entrance to this very fine school.
There must be reasons for this. I should have thought that the Admiralty would have gone to rather more trouble than it seemingly has done first to find out what some of these reasons were and then to see whether it was possible to remove them. As the school improves in character, and as the fees increase—as I understood from the hon. Gentlman's speech might be the case—many men on the lower deck will think to themselves, "This is one of those pucka public schools. This is not for my boy. He would not be happy there". That is quite understandable.
Further, many of them do not know sufficient about it. They do not know

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the opportunities that exist. What steps have the Admiralty taken to try to find out why the facilities are not used by between 80,000 and 90,000 lower deck men? I appreciate the arguments about officers and the fact that the families of men being commissioned from the lower deck and serving in the Navy probably form a larger proportion than is at first apparent, but I am still not satisfied that everything possible has been done to try to run this school on the lines on which it was originally intended it should be run.
At the school itself I was greatly impressed by what had been done in the past few years. I was greatly impressed with the kitchens, the assembly hall, the new boat house, and all the other new buildings and alterations. It was most satisfying to see the boys sailing their boats and canoeing on the Stour. I was impressed by practically all the improvements. I was impressed by the reconstruction work and the new building taking place in most of the residential blocks, the provision of studies for the elder boys and the construction of houses for housemasters. I congratulate the Board of Management on the work that it is doing in this respect. I hope that the work done at the science laboratories will also produce some excellent results.
There appeared to be one or two things upon which I should make a few remarks. As I talked to the boys it seemed to me that the number who were staying until the age of 17 or 18 had increased. That is a good thing. But if the general age of the boys is to increase and we are to get a far higher proportion of older boys there. I wonder whether sufficient is being done to meet what must be rather different needs. Boys of 16, 17 and 18 have rather different needs from those of 12, 13 and 14. As the balance between them changes, attention should be given to the needs of the older boys. Studies are being provided. I think there are about two in each block. I wonder if that is sufficient. I think that this matter should be receiving a great deal more attention.
Associated with that was the feeling that the infirmary, as it is called—a proper Victorian word—seems quite out of date. The purpose for which it was
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intended seemed long past. I cannot imagine any great call being made on it for the purpose of accommodating the sick. It also seemed a badly designed building where one has to walk along very long corridors before getting anywhere. It seemed wasteful both in space and design and did not seem to serve a particularly useful purpose. There is a small church, but that does not occupy much space.
Apart from this, I was greatly impressed by the improvements and I congratulate all concerned. I am sure that my hon. Friends would wish to congratulate the headmaster and staff on the way in which the school is run. They would like to congratulate the staff and the boys themselves on the achievements of the school. The boys do exceedingly well and are to be congratulated. I wish them well. With those few remarks about the school, I return to the doubt I have about the course followed at the school at present. Fears about this will be expressed, no doubt far more forcibly, by my hon. and gallant Friend the Member for Kingston upon Hull, East. There is necessity to watch this process very carefully. It is a process which I think would be deplored by anyone who has had connection with the school and been concerned about its welfare.
10.58 p.m.
Miss Joan Vickers: I am very pleased to follow the hon. Member for Edinburgh, East (Mr. Willis) in this debate. I agree with him in thinking it a mistake to debate this question so late at night, because this is an organisation of which we are justly proud.
My hon. Friend the Under-Secretary gave the percentages very clearly and concisely and they should have reassured the hon. Member. He should be particularly proud that so many ratings now become officers in a comparatively short time and that their sons have a special opportunity to attend the school. One of the main difficulties in getting people to go to this type of school has been that families have not been in the habit of sending children to boarding school. It takes a long time to get over that prejudice. Now they have greater opportunities of going to good local schools and grammar schools, which they did not have before. There is a

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temptation for mothers to prefer to keep their children at home when they have not been accustomed to sending them away to school. This is a question of further propaganda and understanding of the great benefits of the school.
One of those great benefits, as I hope the hon. Member will agree, is that officers and ratings sons can mix together as their fathers do on board ship. I would follow what the hon. Gentleman said about improvements. I said in a debate a few years ago that I was particularly anxious that the dormitories should be improved, and that there should be more privacy for the older boys. If the boys are to be kept at the school longer, they should be granted this extra privacy—
Mr. Willis: The boys are staying there themselves. As far as I can gather, there is a greater wish amongst the boys themselves to stay longer at the school.
Miss Vickers: They are to be congratulated on that but, as they grow, so they need more privacy.
I think it advisable that the infirmary should be at the end of a passage, and away from the rest of the school. We got rid of the operating theatre, but I still think that it is entirely desirable to keep the infirmary away from the main building.
I want to ask my hon. Friend about the future of this school. I notice that in last year's debate it was stated that the school was originally built for 860 boys. It was then decided to fix the number at 600. I understand that the figure is now about 664, and that it has been up to 681. Are we to finalise the figure at 600, or are we to increase the number? Is there need to enlarge the school and take in the number for which it was, I understand, originally built?
Commander Pursey: Is not the hon Lady aware that the original plan for this school was for 1,200 boys, but that instead of building the two missing hostels, those in charge built a lavish church or chapel, and spent the money in other ways? Over £1 million was spent originally.
Miss Vickers: That is why I should like to know about the future of the school as regards numbers. If the boys are to stay there longer it means that
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there will be fewer boys coming into the school over a period of time. Is it the intention to enlarge the school to take the 860 boys previously mentioned? I should also like to know the average number of boys in a class; one wants to know whether there are sufficient classrooms and teachers for the numbers being taught.
There is also the question of pensions. I notice that income is up by over £11,000. Last year it was said that a lot of money was being put into a sinking fund, particularly for the purchase of expensive machinery. What is happening to this estimated £11,000 this year? It is also said that pensions were awarded on the basis of need and compassion, and I should very much like to know what is the difference. I believe that last year there were 510 widows in receipt of a pension—are the same number receiving pensions now?
I have written to my hon. Friend on a number of occasions on this subject and have been told that people are not eligible because there is a waiting list and they have to wait their turn. Apparently, they are not so much in need, or the amount of compassion felt for them is not as great as it is for the others. What machinery is there for deciding whether these widows qualify? Is there a committee? Is a welfare officer sent round to get details of need, or is the work done through the Royal Naval Benevolent Trust? I am sure that some of the cases I have put forward could have been helped, particularly since they concerned some widows who are not eligible for the retirement pension because they did not come under the scheme. That will not happen in future and, for this reason, the more we can do to help these widows the better.
In view of the excellent report which the Under-Secretary of State has been able to give us tonight, I hope that when this document is presented to hon. Members next year, we might also be supplied with a sort of school report—a report about the number of boys with A levels, the matches they have won and other details—because if we are to publicise this school and get it better known among the people we are anxious to attract to it, we must be given more facts.
Commander Pursey: We want the right type of boy there.
Miss Vickers: Indeed we do, but most people do not read HANSARD and do not know what the Under-Secretary of State said about the record of the school. For this reason, I hope that next year we will be supplied with the sort of school report I have described so that we will have something concrete to take round to people in local education authorities to show them what is being done by this school, thereby encouraging more people to go there.
I, too, wish to pay tribute to the retiring head, Mr. Samuel, and to wish the new principal every success. I hope that the school will continue to provide for the boys for whom it was originally established.
11.7 p.m.
Commander Harry Pursey: Of all the statements made by various Ministers this century, none will have been received with greater consternation than the statement to the effect that the original objects of this orphanage, the Royal Hospital School, are to be thrown overboard by a half, but I will come to that later.
The Statement of the Estimated Income and Expenditure of Greenwich Hospital and of Travers' Foundation provides hon. Members with an annual exercise. This year we must consider two matters of great importance for the welfare of naval personnel, particularly ratings; first, the payment of extra, special pensions to the disabled, widows and orphans from the Greenwich Hospital charitable funds and, secondly, the education and maintenance of the sons of naval personnel, preferably of ratings—and preferably orphans—at the Navy's orphanage, the Royal Hospital School at Holbrook. I do not think that the Under-Secretary of State will disagree that this is a fair summary of the main objectives.
Before proceeding, I should like to join in the tribute which has been paid to Mr. Samuel, the retiring Director of Greenwich Hospital. Whatever I have had to say in criticism of the school over the years, I have never attacked any of the civil servants concerned with it or any of the staff of the hospital. I have attacked policy only.
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Over the years there have been House of Commons Motions, inquiries and, from time to time, we have debated the Greenwich Hospital. This has been going on for over two centuries. In 1763, for example, an application was made by Greenwich Hospital for the Government to pay pensions to "worn out" seamen. The Admiralty did not become responsible for the Hospital until later. It was originally the Chelsea Hospital of the Navy. Indeed, naval pensioners should still be there. However, a century later, when seamen pensioners were removed from the Hospital, it became the Royal Naval College, Greenwich, under the Greenwich Hospital Act, 1865.
Perhaps the Minister in his reply will state the first occasion on which this Greenwich Hospital estimate was laid before the House of Commons. Presumably it was 100 years ago. That should be a simple question for him to answer; these documents have a number on them and it is only a question of checking the reference number. The reason I ask is that last year the Minister toyed with the idea of abolishing this annual debate and so presumably making secret what was over the centuries an open book to public information about both pensions and the orphanage. The details of pensions and of the orphanage were always carried either in the Navy List or in the Appendix to the Navy List and the award of pensions to officers was given as a Press hand-out in the Press publicity. Everybody knew what was happening. Now nobody knows. Everybody thinks that it is a first-class racket and they are not far short in their thinking.
The Admiralty administration is governed by Act of Parliament and the procedure is by Order in Council. As long as that is so, it behoves hon. Members on both sides of the House to ensure that public accounts and public debates continue, and there should be no question of a Tory Government deciding that there should be no more public accounts and no more debates.
In this connection I would ask about the sentence
"The Admiralty's intention is to seek amendment of Section 40 of the 1865 Act at the next convenient opportunity."

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That is stated by the Comptroller and Auditor General in his Report dated 18th March, 1964—in other words, quite recently. What is this amendment? How is it to be dealt with and when? Is it to be by Order in Council, with a Prayer for annulment, or not? Presumably the Minister can also give that answer when he replies. We on this side of the House will be very concerned about this and any other Amendment made to the Regulations now that the Minister has stated that the Admiralty have authority to act without coming to the House to get approval by Order in Council.
My intention this evening is to limit my time—"Hear, hear", and I say that myself to save anybody else saying it—and to deal with the Navy's Orphanage, the Royal Hospital School. Last year, mistakenly supposing that the debate would be the last in this Parliament and his last opportunity of thrashing about in shallow water like a whale, as this debate will be, in his reply the Minister violently attacked me personally by putting up skittles which I had never used in order to knock them down to his own self-satisfaction. He flagrantly took advantage of the fact that I could not reply and he thought that he had scored a bullpoint in saying:
"I take notice, as I think the House does, that the hon. and gallant Member retires in a cloud of smoke on this point."—[OFFICIAL REPORT, 12th July, 1963; Vol. 680, c. 1595.]
The Minister was quite wrong in his argument, and also I did not retire. Anyhow, I am here tonight in the forefront of the battle, if there is to be one, and I would not like to miss it for all the tea in China.
I am the son of a seaman and, as an orphan, was educated at this orphanage. But it was the old school at Greenwich with its 200 years of good record and not this new school at Holbrook with only a 30 years' record of dealing in the wrong entrants, namely, the sons of well-to-do people instead of taking in orphans and the sons of poor fathers. I am in a much stronger position than the Under-Secretary of State who has to rely on a prepared brief, because I have my own actual experience at the orphanage and half a century's knowledge—and doucments—of its development as well as of 20 annual debates in this House.
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My concern has been, is and will continue to be the sons of seamen and, particularly, orphans for whom this orphanage was intended to provide free—and I emphasise free—education and maintenance as it did for over 200 years, Where we differ is that most of the hon. Members who take part in these debates, certainly hon. Members opposite—the hon. Lady the Member for Plymouth, Devonport (Miss Vickers) just did it—including the Minister, argue for the school to be a fee-paying one and to take in, as the Admiralty is taking in, officers' sons, and more and more of them.
This is contrary to the original charter of 1694 and the history of the orphanage until only 15 years ago. The object is patently obvious. What the Admiralty wishes to do is to produce another early entry cadet system and a closed preserve for boys from private preparatory schools, as at Dartmouth College until after the last war.
In order to have a more tidy and, if I may suggest to the Minister, sensible debate than last year, and possibly to prevent him from starting more false hares and drawing more red herrings across the tracks, I will state briefly (1) what I have not said and (2) where we are on common ground on the facts of the case. I have not argued that this orphanage is not a good school. It ought to be when over £1 million was spent on it for 1,200 boys. It has the largest swimming bath—now in trouble like everything down there—church and organ of any school in Britain if not in the world. Yet it accommodates less than 700 boys, or only half the originally intended number. So it is largely a white elephant, because the main buildings are not fully used.
The explanation is mismanagement from the first. It is lousy with money and always short of money because of spending it in the wrong directions and thinking that it can get it like cherries from a tree.
I have not argued that the education is not good. It should be, seeing the money that is spent on it. There have been several large windfalls from the donor of the free site, the late Mr. G. S Reid, from the Naval Prize Fund and from other sources. I have argued that the school was and should now be the

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Navy's orphanage with firstly consideration for the orphans and, secondly, for the free education and maintenance of the sons of seamen.
Unfortunately, although this was the accepted position for two centuries at the old school, until 1933, during the last 30 years the Admiralty has made the new school so "posh" and has taken in such posh boys as the sons of officers that boys of my standing cannot now enter. Will the Under-Secretary please inform me how many of the boys now at the school are the sons of able seamen, are there by virtue of being sons of Royal Naval Reserve able seamen, or thirdly because they are the sons of fishermen? All these are categories which have entitlement to enter.
Mr. Hay: I cannot give detailed figures at the moment, but I will try to obtain them before the end of the debate. It might help if I give the termly intake. In January, 1963, there were 19 sons of officers, 26 sons of ratings and four sons of lifeboatmen officers, and one merchant seaman, making a total of 50. In May the figures respectively were seven, 31, and one. In September there were 17 sons of Royal Navy officers, 55 sons of Royal Navy ratings, two sons of merchant navy officers and one son of a merchant navy rating, making a total of 75.
Commander Pursey: I am grateful for those figures. In earlier years it has been possible to obtain these but in recent years Questions put down have received the reply that these figures are not available. But even now the hon. Gentleman has not taken the categories about which I asked him. How many of the boys now at the Navy's orphanage were the sons of able seamen, the sons of Royal Naval Reserve able seamen, or the sons of fishermen, all of which categories are entitled to enter the orphanage?
Last year the hon. Gentleman agreed with me about the 1694 Charter when he said:
"… one of the purposes of the Foundation is: ' the maintenance and education of the children of seamen happening to be slain or disabled in sea service'."—[OFFICIAL REPORT, 11th July, 1963; Vol. 680, c. 1593.]
What were the sons of the slain but orphans?
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I can now jump 245 years to bring us nearly up to date, to the last Navy List published before the war, in 1939. This official document stated:
"cases are considered by a Committee of Selection according to the length, nature and merit of the father's services in the following order:"
There were seven categories, but, as I gave them in detail from an earlier record last year—the passage is to be found in HANSARD at column 1578—I need not repeat them now.
The short point is that the first four of the seven categories were as follows: (1) total orphans; (2) orphans, with father killed on duty and mother living; (3) orphans, with father dead and mother living; (4) orphans, with mother dead and father living. Those were the regulations six years after this new orphanage was opened at Holbrook and for many years afterwards, and they are supposed to be in force today. Unfortunately, as part of the secrecy plot, these regulations are no longer printed in the Navy List. Why not print them in the Navy List so that people can get further information about the school and know who are entitled to enter?
In the face of those regulations, how can the Admiralty and the Minister attempt to disown the school as the Navy's orphanage for practically its 250 years of history? Does the hon. Gentleman now accept that the school has always been, and still is, the Navy's orphanage, or does he still wish to argue to the contrary, as he did last year?
Mr. Hay Mr. Hay indicated dissent.
Commander Pursey: He shakes his head. If he wishes to make a statement, I will give way.
Mr. Hay: I can say very little more than I did last year. The hon. and gallant Gentleman has quoted extensively from HANSARD. If he will look at the foot of column 1594—
Commander Pursey: I have got it in my notes.
Mr. Hay:—he will see that I explained that, whatever had been the position up to 1948, on 22nd December of that year the Board of Admiralty brought in fresh regulations changing the

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policy of admission to the school, making clear that officers' sons could be admitted. If up to that time it had been correct—I do not believe that it really was—to call this continuously an orphanage, from that time onwards it was no longer right to call it exclusively an orphanage. It has not been an orphanage since the last war and it certainly is not an orphanage today.
Commander Pursey: I am very grateful for that. The Minister has fallen for my hook. It was very good bait for me to carry on with. Last year, the hon. Gentleman took me up on this argument in an intervention. He argued in this way:
"I have looked very carefully at all the documents on this point, because it is not the first time that the hon. and gallant Gentleman has made this observation. I can find no trace whatever of this institution ever having been set up as an orphanage".—[OFFICIAL REPORT, 11th July, 1963; Vol. 680, c 1568.]
I assume that he wishes to stand by that statement. Indeed, he has confirmed it. All right. He has access to all the documents and he has a staff to help him. The House would, therefore, expect to be able to accept his statement as fact. In truth, it is nonsense. I ask the House to listen to this. I shall give it at dictation speed in the hope that it will register with the Minister. The heading is "Royal Hospital School". I assume that this is the school we are talking about and there is not another one. The document goes on:
"The buildings now forming the east and west wings of this National Maritime Museum were begun in 1807 to accommodate the Naval Orphanage founded in 1798. The Greenwich Hospital School established in 1712"—
I believe that this is the same school—
"for sons of seamen was joined to this in 1821"
to form the Royal Hospital School, which remained there until 1933. If there is any doubt about the school, it is now confirmed, because it goes on to say
"when it moved to its present home at Holbrook, in Suffolk."
So, presumably, this is the orphanage which we are discussing on the estimate tonight.
Where did this quotation come from? It is not from one of my documents or
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one of my speeches. It is an official statement issued as Admiralty Press release No. 156/62 and dated 17th December of that year. That was only seven months before the Minister's last year's speech, so it is bang up to date. Here it is. I show it to the Minister. It is on Admiralty blue paper, with the Admiralty sign of the foul anchor. Will the Minister accept that evidence as concluding this argument that the Royal Hospital School was, and is, an orphanage?
Mr. Hay: No.
Commander Pursey: What can one do with a man like that? I produce a quotation and a statement to the Under-Secretary of State for Defence for the Royal Navy, issued on his own paper, with the Admiralty crest of the foul anchor, but he obviously has his wires crossed and he does not accept it.
This is more interesting as time goes on. This statement is on a tablet erected at the old school at Greenwich as part of the two hundred and fiftieth anniversary celebrations of the new school at Holbrook. Moreover, it refers to its present home at Holbrook. This tablet was unveiled by the headmaster in the presence of the late Director, Mr. Samuel. So, presumably, it was an official ceremony.
What does the Under-Secretary do now? Does he apologise to me for his uncalled-for and false attack last year, or does he go down to Greenwich and take down the tablet at the National Maritime Museum to alter it to suit his argument and falsify history? It is incredible that the hon. Gentleman should go on with this nonsense that the school was never an orphanage when there is the tablet for everyone who visits the old school to view. So much for that argument about orphanage.
Now, as regards the orphanage being for the sons of seamen and not officers. Again, I take the Under-Secretary a long way with me. I have given his last year's extract from the original Charter, "sons of seamen". Actually, the school started with the sons of pensioners in the Hospital—that is, the present Royal Naval College, Greenwich. I could rest my case on the 1962 Admiralty Press release and the tablet at the old school, which, I repeat, states "sons of seamen".

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Last year, however, the Under-Secretary tried to blast me out of court and to silence me for all time. He said, "Oh, no, some."
He said:
"I hope I have got on record in the Official Report what is the truth."
But it was not true at all. He said:
"I sincerely hope that when we next debate the estimates of the Royal Hospital School and the Greenwich Hospital as a whole it will be realised that the allegations that have frequently been made by the hon. and gallant Gentleman are completely unfounded."—
what utter nonsense—
"And I hope that he will think again before he inflicts a further speech of that length and inaccuracy upon the House."—[OFFICIAL REPORT, 11th July, 1963; Vol. 680, c. 1596.]
The inaccuracy was not mine. The inaccuracy was the Minister's. It is therefore necessary for me to get the facts on the record. There can be little doubt that for over a century, from 1712 to 1828, only the sons of seamen were admitted, because in that year it was necessary to have an Order in Council—and there is a copy of it in the Library—for approval to enter officers' sons. Obviously, if officers' sons had been entitled, there would have been no reason for the Order in Council, but their sons had to be certified as proper objects for the charity. Are the present officers who are getting their sons into Holbrook being certified as proper objects for the charity in this affluent age of high rates of pay and high pensions for officers? Of course not.
After the school had been transferred to the orphanage, at present the National Maritime Museum, for some years entry of officers' sons may have gone on in the early days of the century, for some two or three decades, but then it stopped for another century. The hon. Gentleman last year quoted Section 20 of the 1865 Act, which is the authority for the Admiralty today, under which the Admiralty became responsible for Greenwich Hospital and the orphanage and had the authority to make regulations by Order in Council. This change has not been done by Order in Council, and that is a matter for some investigation.
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The hon. Gentleman said:
"There is not a word in the Act about sons of officers being excluded."—[OFFICIAL REPORT, 11th July, 1963; Vol. 680, c. 1593.]
Presumably there was nothing in the Act about officers' sons being included. Otherwise he would have said so. So what was there in that argument? He should have known, with his Parliamentary experience, that this was only a slick debating point, because the Act does not carry regulations: they are dealt with separately. In this case of the Order in Council, he mentioned no Order in Council. One would assume that either he or his staff had done their homework. Therefore, it can be assumed there was no Order in Council at that time, and that some of the Regulations for entry continued as before, namely, for the sons of seamen.
The hon. Gentleman then attempted to make another bull point but again he missed. He referred to the 1883 Order in Council and claimed that it made a breach in the tradition that the school was for the sons of ratings and, on approval, the sons of warrant officers. Again he was wrong, as he was all along the line, because warrant officers' sons had been eligible from the earliest times. Way down to 1850 warrant officers who desired to enjoy the benefits of the Hospital were compelled to abrogate their rank and enter as seamen only. So the sons of warrant officers were already eligible for some 150 years before the hon. Gentleman said. What nonsense!
I now jump 60 years to modern times and the Bruntisfield Committee of 1943, by which the hon. Gentleman set such store. He quoted the Committee's conclusion that:
"The Royal Hospital School should remain a School for the sons of seamen, but the sons of Commissioned Officers promoted from Warrant rank should also be eligible for entry."
These officers were rating entries and so that recommendation would not have breached the sons of seamen entry.
Nothing was done until 1948—I am getting up to date—only 16 years ago, when the Admiralty decided to exceed the Bruntisfield Report and approve the entry of sons of commissioned officers. That was when the citadel of sons of

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seamen was breached—after another 100 years—because the entry of sons of cadet officers was then approved. Admittedly, the Admiralty made this breach under a Labour Government, but the main period of this development has been during the 13 years of Tory Government, and the latest development, as we have heard today, is that the proportion of officers' sons entries is to be increased from one-third to 50 per cent.
What is my argument? The old school at Greenwich for many decades provided for 1,000 boys, the sons of seamen entries, and there was never any difficulty about keeping the school full. There was always a surplus of applications. The new school at Holbrook was intended to provide for 1,200 boys—and the original plans were based on that and on the sons of seamen entries—and would have done so but for mismanagement, which I will not detail tonight.
The Admiralty found that it did not have £1 million in the kitty and so it was a question of cutting down the plans. It cut out two hostels and the church. More money then became available and the Admiralty had the option of building two hostels for another couple of hundred boys, but it wanted not the hostels, but the church, even though church services were being conducted quite admirably in the gymnasium.
The present number at Holbrook, as the hon. Gentleman said, is 681. He also gave me that figure in reply to a Question. This is not many more than half the intended number and of the 681 nearly one-third—206—are the sons of officers. This means that 206 sons of seamen have been kept out to enable 206 sons of officers to enter.
Mr. Hay Mr. Hay indicated dissent.
Commander Pursey: If the hon. Gentleman wants to dispute that, I will way and allow him to interrupt now.
Mr. Hay: If the hon. Gentleman wants me to dispute what he is saying it may be easier if I do so when I speak again, rather than that I should be constantly jumping up and interrupting his speech.
Commander Pursey: It will not put me off, but the hon. Gentleman keeps shaking his head like a flashing windmill in a storm.
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The hon. Gentleman's argument is that there is an even number of applications from officers and seamen and that no seamen's sons entry is being refused admission if he reaches certain medical and educational standards.
Of course that does not end the argument. The Admiralty does not want the sons of seamen, and consequently it does not go out of its way to get them. The standard has been increased continually so that now the school is open to those who have obtained a standard of education which bears no relation to that required for the old school.
I shall probably be told that I do not want to improve the standard of education at the school. Of course I do, but the first requirement is to provide opportunities for the sons of poor seamen who cannot find opportunities elsewhere, instead of taking in officers' sons for whom Greenwich Hospital has fee-paying facilities. They should leave this orphanage to be used by the sons of seamen.
Only 76 out of this figure of 681, or about one-ninth, are orphans, namely, 13 officers' sons and 63 ratings' sons. We then heard the argument that orphans are not available, candidates are not available, and applicants are not available. How were the applications obtained for 1,000 to be continually accommodated at Greenwich? Obviously that argument does not make sense.
At the beginning of the summer term, 27 new boys were entered. Of these, nine were the sons of officers, and 18 were the sons of ratings. There we see the ratio of one-third to two-thirds, which has now been thrown overboard. Only four of the new entrants were orphans—two officers' sons and two ratings' sons.
As regards the fees of £100 per annum, 25 had their fees fully paid from naval funds, presumably as serving ratings, or by the local education authority, presumably as they were retired. One parent has to pay £12 per quarter, and one a reduced fee of £5. What pettifogging nonsense this is when this charitable institution at Greenwich has a capital of £4 million, and an income to which the Minister referred.
Admittedly the officers whose sons were entered were promoted ratings, but

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what were their ranks? In answer to a Question the Minister said that one was a commander, retired, two were lieutenant - commanders, four were lieutenants, one was a sub-lieutenant, deceased, and one was a first officer, Merchant Navy, and he added that in all nine cases the officers were promoted ratings. But surely when officers reach the rank of lieutenant-commander and commander they do not expect to be pinching places in the Navy's orphanage at the expense of sons of able-seamen? This is the greatest charitable scandal of the century, but it will never dawn on a Tory Government that that is so.
Last year the Minister asked me whether I objected to an officer's son at Holbrook if he was a rating when his son entered. Of course I do not. I did not say anything about that. If a rating gets his son into Holbrook, and then becomes an officer, that is a different story.
How many officers of cadet entry have been able to get their sons in there on the nod? I am informed, rightly or wrongly, that one of the captains of the Royal Naval College at Greenwich was able to get his son in there. That officer's salary is £2,500. He will receive a pension of £1,500. Is his son an object of charity who should be at the orphanage at the expense of the son of a seaman?
The Minister paid tribute to the achievements of the boys. Everyone agrees with that, but it is the wrong boy that is taken in at the beginning. It is the posh boy, well educated, instead of the poor boy, ill-educated. I know that the argument will be put forward, "Do you want to keep the school down to the standards of 150 or 200 years ago?" That is arrant nonsense. Of the poor boys who were my contemporaries no fewer than four became admirals, and two of them flew their flags at sea as vice-admirals. The present boys cannot do any better than that, with all this vast expenditure, and with all the question of taking the cream of the applicants and of refusing bona fide applicants who should be in the orphanage.
Now I take up a point made by the Minister that the proportion of one-third will be increased to 25 per cent. There is no question: if the Admiralty wanted the applications from seamen entrants for
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their sons they could get them. How long will it be before there are no ratings at all? The Minister has said that the Admiralty is free to decide. How long will it be before this becomes the new Dartmouth entry? Why not have more rating entries?
My hon. Friend the Member for Edinburgh, East (Mr. Willis) pointed out that the sons of all naval ratings are eligible. I would add that the sons of all merchant navy ratings are eligible, because, in the old days, charity was started by sixpences taken from merchant seamen, who were in the majority, and naval ratings, for the Chatham Chest, which is in the maritime museum at Greenwich. In addition, all the fishermen round the country are eligible, as are members of the lifeboat service. In other words, the son of every father who comes within the category of seafarer is eligible.
What has the Minister done—what have the two hon. Members who are on the board of governors done—to get seamen ratings to apply? Can they say, "Oh. yes, I am responsible for six", or "I found two in my constituency"? Not on your life ! They talk nonsense. They are in favour of increasing the officer entry in order to produce another class preserve, which we thought we had thrown out with the abolition of the old Dartmouth entry since the war. Yet we were able to get 1,000 at Greenwich.
It is obvious that the Admiralty do not want the sons of ratings. It is also obvious that the greater the proportion of officers' sons the fewer will be the number of ratings' sons making application to go there. The son of an able seaman does not want to be next door to the son of a captain. This argument that it is a good thing to mix officers' sons and ratings' sons is stupid. The hon. Member for Devonport said that they do it in the Navy. Is she trying to tell us that the officers in the Navy mess with the lower deck ratings and eat their food with them? Of course not. It is a case of the lower deck and the quarter deck. The only time they are together is when they are in action or in a boat together, with an officer coxswain and ratings pulling the oars—in other words, doing the donkey work. That is just sheer baloney and eyewash.

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As to limited pocket money, the able seaman's son has practically no pocket money and the captain's son has a ton-up motor bike and everything he wants. Of course they do not want to be at an orphanage like that. In my time we were all poor together and understood one another. When we got a parcel from home we shared it with one another. There were boys with no parents and no home. Will the Under-Secretary tell the House how many sons of seamen there are there now with no parents and no home? In those days the school sent boys with no parents and no home to the seaside homes for their holidays. Do Greenwich Hospital and the Admiralty still do that? I very much doubt it.
The Admiralty has thrown down the challenge; 50 per cent. of the entries are to be officers' sons instead of ratings' sons. We must take up the challenge and fight it whenever and wherever possible. The main object of William and Mary when they started this charity and eventually gave the Queen's House to the orphanage was for the sons of seamen and particularly orphans to be educated there. This has been thrown overboard by a half. We must fight to the end for the other half before a notice is put up on the school saying "No ratings' entries; no orphans. The Charter of William and Mary has been scrubbed out never to be used again
11.52 p.m.
Mr. Hay: I speak again by leave of the House. I should like to reply, somewhat briefly, at this late hour, to many of the comments and requests for further information which have been made during the debate.
Perhaps I may begin with an apology. I understand that the three boys who received the Duke of Edinburgh's Award went to Buckingham Palace today; they are not going next week. I thought I should put that right on the record. I am much obliged to most hon. Members who have spoken for the friendly way in which they have discussed the problems—
Commander Pursey: I was not unfriendly.
Mr. Hay: I should hate to hear the the hon. and gallant Member when he was really hostile.
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I am much obliged to most hon. Members—I will say all hon. Members if that will please the hon. and gallant Member for Kingston upon Hull, East (Commander Pursey)—for the friendly way in which they have discussed the problems of the school. It is right that we should devote a great deal of time to the debate on the school because, important though the pensions and benefits are, as I explained in opening the debate, the fact is that with the general increase in prosperity throughout the country the type of person for whom those pensions and benefits were originally designed—I will not say no longer exists—is in far fewer numbers than used to be the case.
That is the answer to the question which the hon. Member for Edinburgh, East (Mr. Willis) asked, why we are apparently decreasing the pensions? We are not actually decreasing pensions—the amount being spent is much the same, but the numbers who are eligible and measure up to the test of need and compassion are now comparatively small.
There have been complaints from time to time about the fact that we take this debate in July and often it has to be at the end of a Parliamentary day. There are a number of reasons why this should be so. It always happens that the earlier part of the year is full of national financial business and it has been felt for some time that it might be desirable to have our debate on Greenwich Hospital at a time of the year when there is a little more leisure and perhaps a little more opportunity for hon. Members to spread themselves in debate. It is not very often that we have the chance of debating the affairs of an individual school. This is often given as a reason why we should continue to have these debates. I think that it is a good idea to have the debate at the end of the parliamentary day when, perhaps, the Standing Order is suspended and there is not the same pressure on Parliamentary time as there otherwise would be.
The hon. Member for Edinburgh, East said that he had heard that, of the estates in the north of England, our Alston estate is being sold, and asked why. I have to confirm that it is our plan to sell this estate. I would prefer not to go into details at the moment, as the matter is not yet in a completed

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form. As to the revenue, these estimates were drawn up and presented before the end of the last financial year, when the prospect of this estate being sold—for what we consider to be a very satisfactory price, in all the circumstances—was not current. So the answer is that the revenue shown in the Estimates does not reflect the fact that we are selling this estate.
I turn particularly to what the hon. Gentleman said about the school. I realise that he, and perhaps other hon. Members, might have some fear about its future, having regard to the change in admission policy that I mentioned. I would, however, like to make it absolutely clear, lest there be any misunderstanding about what that change is, that we have said that it is quite wrong in these modern days, and with the type of person we have in the Navy very different from what they were many years ago, to maintain a quite arbitrary proportion as between the sons of ratings and the sons of officers. The main link that should join the men who are able to send their sons to the school should be the sea; it should not be whether they are ratings or officers.
We believe that the best education we can provide should be made available, irrespective of whether the boy concerned happens to have a rating as a father, or an officer. With all due respect to the hon. and gallant Member for Kingston upon Hull, East, the distinction in the Navy nowadays is very different from what it used to be. The hon. and gallant Gentleman spoke of the quarterdeck and the lower deck. In his day—indeed, with all respect, in my day when, for a temporary period, I served in the Navy—there was a substantial distinction, but the more I have seen of the Royal Navy of today the more I have become convinced that this distinction between quarterdeck and lower deck is changing very rapidly. This is bound to be so when we have at least one-third of the officers in the Navy now starting their careers as ratings—a process which, as I have said, we intend to develop and intensify.
For this reason we eliminate this arbitrary distinction, and we get rid of proportions. The only restriction we place is that the son of a man who
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is a naval officer cannot go there unless that officer has already served four years as a rating; in other words, that he has been promoted from the lower deck. That is the principle we now intend to adopt. I do not think that it would justify the fears and anxieties expressed by the hon. Member for Edinburgh, East that this will, in the course of time, become, as he put it, a "pucka public school." There is something quite distinctive about Holbrook. It has in many ways the advantages of a public school, but, I am glad to say, it has, or appears to me, at any rate, to have avoided a great many, if not all, of the disadvantages that public schools sometimes have.
The hon. Member also asked about the publicity we give to the school, and how many men in the naval service know about Holbrook. I can only say, as I have said on a number of occasions, that we do our best to publicise the school, and make it as widely known as possible throughout the Service that it exists, and that sons of serving naval personnel can go to it provided that they qualify under the conditions that we make relative to educational and physical standards, and so on.
Commander Pursey: And pensioners.
Mr. Hay: If the hon. and gallant Gentleman wants to dot the i's and cross the t's—and pensioners.
On publicity, we concentrate a great deal on letting the Fleet itself know about it. There is an Admiralty Fleet Order in existence, copies of which are circulated regularly to the lower deck. Navy News frequently contains references to Holbrook and explains to those who may be interested what the conditions of entry are and who is eligible.
The Soldiers', Sailors' and Airmen's Families Association is an important means of advertising Holbrook and we particularly inform wives of naval personnel of the facts. The headmaster and his wife have started a series of visits to commands, which, I hope, will be useful, and local education authorities are made fully aware of Holbrook and who can go there.
We find that we can take up all the places which are available and there is no question of boys being kept out; that

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is, unless they do not measure up to the intelligence and physical standards we lay down.
Mr. Willis: To what extent are efforts made to publicise the school in the merchant navy.
Mr. Hay: I cannot answer that offhand, I am sure that that is done, but I will inquire. I can assure the hon. Gentleman that if there is anything we can do to improve the publicity, we will be only too glad to do it.
My hon. Friend the Member for Plymouth, Devonport (Miss Vickers) asked about the future of the school from the point of view of numbers. The provision of proper educational facilities for the numbers we have is undoubtedly making quite heavy demands on the resources of the hospital. The content of the education provided is increasing apace and, much as I would like to tell my hon. Friend in detail what our plans about numbers will be, I can only say that she will have to wait a little longer. We try to get the numbers in direct proportion to the amount of education and the capabilities of the buildings.
In other words, we try not to have too great an intake of boys into the school and overload the teaching staff and accommodation. On the other hand, we try to see that the school has an adequate number of pupils. I can best sum the position up by saying that we like to keep what can be given in education in balance with the number of boys who can be accommodation.
My hon. Friend asked about the average number of pupils we have per class. I understand that the size of class varies according to the academic level, but a guide is the staffing ratio for the whole school, which is about one master to 15 or 16 boys.
My hon. Friend asked about pensions and the meaning of the ancient expression "need and compassion". I can only tell her that we try not to be rigid. Each case is decided on its merits but, speaking generally, a widow who has a net income—that is, after deducting an amount for rent and other essential outgoings—of about £5 a week would be outside the scope of those words and, therefore, outside the scope of the hospital's benefits.
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My hon. Friend also asked how many widows were on the waiting list for pensions.
Mr. Denis Howell: Dreadful.
Mr. Hay: What does the hon. Member mean?
Mr. Howell: The people responsible should be ashamed of themselves if that is the standard they set in 1964.
Mr. Hay: I think that the hon. Member could not have understood me. I should have thought that that was a reasonable standard to set; and I trust that he will reconsider his remarks.
Commander Pursey: For the Tories.
Mr. Hay: I am trying to keep party politics out of it.
I said a widow with a net income of £5, after the payment of essential outgoings such as rent. That is reasonable. It must not be forgotten that in this country there is a vast range of social services of all kinds. We no longer have these people in acute poverty as we had many years ago, particularly when this charity was set up. These are supplements made to the National Insurance and similar benefits that people get.
Mr. Denis Howell: We see the Tory mentality here. Any woman left with £5 after she has paid her rent is in a state of affluence and prosperity, according to the Tories. This is disgraceful. I should like to see the Minister try to live on it.
Mr. Hay: I did not say that. The test is whether a person is in "need and compassion". That is the rule under which the charity has to work. I have explained how we interpret it in the light of the tremendous range of social benefits in this country today.
My hon. Friend asked me how the needs are investigated. Here, the Soldiers', Sailors' and Airmen's Families Association comes to our assistance. It carries out these investigations with humanity and with great efficiency. My hon. Friend asked me how many widows are waiting for pensions. Our practice has been to make awards to widows of 67 years of age or over. There are about 75 applicants between the ages of 65

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and 67 waiting to be considered, and we expect to deal with them all during the course of the current financial year.
Mr. G. W. Reynolds: Is the Minister serious about this?
Mr. Hay: Of course I am. I should not be standing at the Box and saying these things if I were not serious.
Mr. Reynolds: Is the hon. Gentleman telling the House that he believes that widows who are over 67 years of age and who, after they have paid their rent and other things which he has mentioned but not specified, have an income of £5 should not be regarded as in need? They are not considered to be worthy of any further help from the Foundation. I can only imagine that hon. Members opposite are speechless at this. On this side of the House we find it impossible to understand.
Mr. Hay: I am sorry if the hon. Member finds it astonishing. I can only repeat what I said to the hon. Member for Birmingham, Small Heath (Mr. Denis Howell). We live in an entirely different age from the age when these charities were set up. It must be remembered that this is often not the sole income of these people. This is a charity which has only a certain sum of money, and we carry out the two main tasks—the provision of pensions and benefits, and the provision of the school. I think that our record of humanity and treatment of pensioners bears favourable comparison with that of any other charity in the country.
Mr. Willis: Does not what the hon. Member said suggest that when he talks of reducing the one-third of the Greenwich Fund available for pensions he is out of keeping with present-day conditions?
Mr. Hay: The trouble is that we are having increasing difficulty in disposing of the money which we have available for pensions if we keep within the terms of the charter, which is a matter always in our minds.
My hon. Friend asked whether it would be possible in future years to include in the Estimates a report on the year in the school. I will consider that. The
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difficulty is that we are obliged to lay the Estimates and not necessarily a report on the school. However, the matter will certainly be considered.
I turn briefly to the remarks of the hon. and gallant Member for Kingston upon Hull, East. He asked a number of questions and he took the opportunity of his speech this year to try to carry on the debate which he had with me last year. I have looked very carefully through what I said last year, in which I endeavoured to explain as simply and concisely as I could the historical background to many of his complaints concerning the orphans, on the one hand, and the admission of sons of officers, on the other.
I do not think that there is anything that I can really add. I thought, if I may say so, that what the hon. Member for Huddersfield, East (Mr. J. P. W. Mallelieu) had to say last year—I am sorry that he is not here tonight, but he apologised for not being able to be here—bears repeating. It was that he thought that a diamond drill was needed to get an idea into the hon. and gallant Gentleman's head, but he came to the conclusion that a nuclear device was necessary.
Commander Pursey: There is no question of a diamond drill or anything else. It is not a matter of my opinion or of my intelligence. I may be lacking in intelligence, but all I have done is to state the facts, read the documents and show that, by and large, last year the Minister was talking nonsense. Even when I quote his own Admiralty document to him he still refuses to accept that this school has always been an orphanage.
Mr. Hay: I am sorry, but the hon. and gallant Gentleman and I will have to differ about all this. I do not accept what he has said.
Commander Pursey: The hon. Gentleman did not accept the document.
Mr. Hay: I cannot really add anything to the long explanation which I gave last year and which I had hoped, perhaps wrongly, might have put the matter clearly.
The hon. and gallant Gentleman asked me one or two specific questions. He asked what was the first occasion when

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the Estimate was laid before Parliament. My answer must be that I cannot, at short notice, tell him tonight. I will try to find out whether it is on record and, if it is, I will let him know.
Commander Pursey: I can tell the hon. Gentleman.
Mr. Hay: If the hon. and gallant Gentleman knows it, then it seems odd that he should ask me to tell him.
Commander Pursey: I ask for confirmation.
Mr. Hay: I will try to get confirmation if the hon. and gallant Gentleman will tell me the year.
As far as the entry of officers' sons being contrary to the charter, officers' sons have been permitted entry by Act of Parliament since the Charter was first issued. The hon. and gallant Gentleman asked if we would return to the prewar practice of printing the regulations in the Navy List. I will look into this and see whether it is possible. It would again give us a marginal advantage in the publicity field to do so.
Finally, the hon. and gallant Gentleman said that it was necessary to provide better facilities for the sons of poor ratings at this school because they could not find such facilities elsewhere. I must join issue with him about that. It is not the case that there is a large number of poor ratings in the Navy whose sons cannot get proper education. There is an enormous national effort in the education field. The fact is that this school provides a particular type of boarding school education which is not always terribly easy to get in some parts of the country.
I believe that our policy of admission, our policy of maintenance and our policy of grants and assistance to the cost of education are enlightened and sensible ones. It does not mean that boys are kept out because we have some class-conscious rule. I hope that in future years the hon. and gallant Gentleman will realise that the world has changed a lot since the days when he went to that school. Things are different now not only in the Navy but also in the world outside. It is because we realise the difference that we take pride, justifiably, in the record of the Greenwich Hospital as we move into somewhat different but still challenging years.
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I am obliged to the House for the reception that it has given to the Estimates and hope that we may now have them.
Question put and agreed to.
Resolved,
That the Statement of the Estimated Income and Expenditure of Greenwich Hospital and Travers' Foundation for the year ending on 31st March 1965, which was laid before this House on 2nd June, be approved.

SPAIN ("LEANDER" CLASS FRIGATES)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. MacArthur.]
12.19 p.m.
Mr. George Wigg: I want to raise an aspect of the question concerned with the sale of equipment in the form of frigates to the Spanish Government. During this controversy I must say that the years have slipped away, and they slipped again this afternoon when I listened to the right hon. Gentleman the Secretary of State for Defence, because "this is where I came in."
I remember 1938, when I had just come out of the Army and the first by-election in which I could actually join was the Stafford by-election. The right hon. Gentleman had his spurs to win and he fought an election campaign based on an admiration for Franco, Hitler, Mussolini and Mr. Chamberlain. He is the archetype of a Municheer. As I listened this afternoon something clicked in my mind and I went back to The Times and there, sure enough, I found it. On 11th June, 1938, there was the result of the Stafford by-election. The right hon. Gentleman was elected by an increased majority.
In the same issue of The Times, indeed, on the same page, there is an account of British ships being bombed by Franco planes, British sailors being killed by being machine-gunned from the air. Indeed, there is even a report of a British non-intervention officer being killed as a result of a Franco attack. I do not want to exacerbate old sores, but when the right hon. Gentleman talks about the supply of equipment to Spain—and this applies to the Prime

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Minister, too—and in the same breath they talk about friendship between the British and the Spanish people, it makes me have a queasy feeling in the pit of my stomach. On this side of the House we can in all sincerity talk about freedom for and friendship with the Spanish people, but not friendship with Franco and we look forward to the time when a free Spain will once again, under the rule of democracy, have friendship with the British people.
I do not want, however, to dwell on that aspect. I want to deal with the announcements with which the Government are concerned, because I think that if this is to be a subject of controversy at least we ought to try to get the facts straight. We were told one thing by the Prime Minister yesterday and something different by the Secretary of State for Defence today, but let us start with the statement by the right hon. Gentleman the Foreign Secretary on 15th June, when he told the House:
"There was a premature disclosure."—[OFFICIAL REPORT, 15th June 1964; Vol. 696. c. 929.]
Something about the negotiations which were going on had been prematurely disclosed. We have endeavoured, through the use of the Order Paper, to elicit the facts, and yesterday the Prime Minister told the House that there was a brief. He said:
"The brief was a purely internal document…The public relations officer knew that agreement was imminent and understood from the trend of questions put to him by certain correspondents that agreement had been reached."
The right hon. Gentleman went on and, by way of explanation, said:
"This officer simply made a mistake."
He was referring to the officer in the Press department. The right hon. Gentleman then spoke in the plural and said:
"Correspondents put questions to him in a certain way which is not unknown to right hon. and hon Members."—[OFFICIAL REPORT, 14th July, 1964; Vol. 698, c. 1028.]
It may be just a slip. There was no plural here. There were no correspondents. There was one correspondent. It is a slander, intentional or not, on Mr. Chapman Pincher to suggest that he put questions in a certain way to elicit information or in an attempt to trap the Press officer into indiscretion.
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Moreover, it seems very odd, and it is an indication of the pressure which the Prime Minister feels himself to be under, that the right hon. Gentleman, the head of the Government, should come to the House and put the blame for what is, after all, a political mistake on a very junior Press officer. It seems to me to be contrary to our traditions. But that is what he did; he put the blame on the Press officer.
Today, in Answer to a Question which I put to the Secretary of State for Defence, there was a slight change of tune. The Secretary of State said:
"The fact that negotiations had been going on with the Spanish Government had been known fairly widely both here and abroad for a number of months. On 8th June, the Directorate of Public Relations of my Department was approached by a member of the Press who stated that information had been received from abroad…"
This is not in accord with the facts. What happened was that Mr. Chapman Pincher, on 8th June, approached the head of the Press department of the Ministry of Defence and said that he had information about this deal. What we are not told is where he got the information from. I say frankly that I do not believe that he got it from abroad.
Commander J. S. Kerans: I am personally acquainted with the P.R.O. to the Ministry of Defence, who has seen me over a number of days and who is quite clear that he gave no information whatever which was "leaked" on this deal. I can assure the House of his integrity, and I am certain that my right hon. Friend the Secretary of State for Defence will guarantee it, too. What I object to is the way he has been impugned and his integrity has been impugned by the questions of hon. Members opposite. It is quite wrong.
Mr. Wigg: No. The hon. and gallant Gentleman could not have listened. It was the Prime Minister who referred to a Press officer and said that he "simply made a mistake". All I am saying is that Mr. Chapman Pincher went to the head of the Press department and said, "I have heard a story", and asked that Press officer, the person the hon. and gallant Gentleman is referring to—this is no attack upon him—a question. The Press officer behaved perfectly

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properly. He said to Mr. Chapman Pincher, "I know nothing about it, but come back again". The idea that he was asked any questions, or that he was trapped into an admission, whether the Prime Minister says it or not, is, therefore, absolutely untrue.
Several hours later, Mr. Chapman Pincher went back again and was then told not by the first officer, but by a junior officer—here I quote Mr. Chapman Pincher's report, the part which appeared in quotation marks—
"I can confirm that the Spanish Government is to build 'Leander' class frigates under licence. The announcement will be made in Madrid".
It was not made in Madrid. After the statement appeared, what one could not then establish was whether it had been contradicted or not.
I find this fascinating. I telephoned the office of the Secretary of State for Defence on several occasions to establish this simple fact. If there had been a misstatement in the Ministry of Defence, what steps did the right hon. Gentleman take to put it right? In other words, if the Prime Minister's account is right, that there was a simple mistake, when the mistake was discovered and the next day, 10th June, there appeared in the Daily Express the story headed:
"Spain angry over British arms leak"
what steps were then taken? And I repeat that the Foreign Secretary said that there had been a premature disclosure. After a great deal of effort on my part, I got a statement from the Secretary of State for Defence in a letter on 10th July, in which he said:
"No such retraction was issued."
Thus, no attempt was made to put right the mistake.
This afternoon, the Secretary of State for Defence made great play, and he was received with hilarious laughter from the other side of the House, with the suggestion I was in some difficulties because I was suggesting that there was a process of leak, which then led up to the disclosure, that this must have been known to my right hon. Friend the Leader of the Opposition and that my right hon. Friend's speech in the House in the foreign affairs debate subsequently led to the cancellation of the order. That is not my interpretation of events.
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I want to be as objective and as accurate as I can. My first point is that negotiations about these frigates had been going on for a quite considerable time. The point was made that negotiations were going on in other countries, and that is true. A Spanish naval mission had visited other countries besides this country. The mission came here twice last year and was here from 23rd October to 1st November, 1963
Stories have appeared in the Press here of astronomical sums being spent. The Sunday Express, last Sunday, suggested a ship worth £30 million. The Daily Telegraph, yesterday, suggested that the frigates would cost £5 million apiece. The Minister of Defence was much more modest. On 8th July, he said that we would get £2 million to £3 million for design. As to the Prime Minister's statement that loss of the order would cost British workers their jobs, if the ships were to be built in Spain, how would British workers be deprived of jobs? That is a bogus sort of story.
The Spaniards had been after the "Leander" and, above all, the Seacat because they were cheap and because the Seacat was unsophisticated and was cheap—costing about £5,000 each. This approach, however, had been on, off, on and off again. The Spaniards, for their own reasons, never clinched the deal.
I go back again to the statements which have been made by the Press department of the Ministry of Defence. When Mr. Chapman Pincher pursued his inquiries as recently as yesterday, he was informed that the entry in the log book of documents which are received from senior officials giving guidance for use when inquiries are received, was dated 15th May last. In other words, it was a long time ago and it was not treated as an exalted deal that would save the country's economy and win the election for the Tories. It was dealt with as something which was purely routine. The whole thing was routine and unimportant.
The Spanish military attaché had visited the School of Artillery in the early part of May. The Spaniards had been making inquiries over a period of years, but they had placed no orders. In my judgment, that was for the one simple reason that they were short of the lucre; otherwise, the deal might have been on,

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but the truth is known only to Franco. It must be said, in fairness, that we do not know—indeed, it might be on at some time in the future.
What is absolutely certain is that when the Secretary of State for Defence suggested, as he did on 8th July, that this vessel and the Seacat could be bought from either French or American sources, either he was a very stupid and ignorant man, of which there is a high probability, or he was making suggestions which he well knew to be untrue. The French are getting their seaborne short-range surface to air missile, the Tartar and the Terrier, from the Americans. The American ships which are comparable to our frigates are extremely expensive. The cheapest of them costs about 25 to 30 million dollars, which is far beyond the ability of the Spaniards to pay.
My view about this is that, for some reason, after 15th May the Spaniards changed their minds. I can hazard a guess as to the reason. I think that the Americans came along and offered them the chance of buying supersonic aircraft and that the deal might well have gone through except that the American officer who was flying the aircraft and the Spanish observer were killed. They were flying a Starfighter, and the proposal which was put to the Spaniards was to have one squadron of American Starfighters and four squadrons of F5s on favourable terms.
I believe this is what happened, that the Government were hoping against hope that they would get a deal; not the deal which has been described in terms of £14 million, £18 million, £30 million, even £50 million, and even, in one case, £200 million; but a modest deal involving the sale of the design of a ship, not very modern, and of a missile, which is very unsophisticated and tending to be obsolescent, and to get a small sum in return. What I think Franco did was this: he double-crossed the Government. He led them to believe that the conclusion of negotiations was imminent.
I think that Mr. Chapman Pincher, in the exercise—the proper exercise—of his calling, got information about this, and went to the Ministry of Defence; the story leaked out, the Spaniards were
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very cross, and took the opportunity to climb out, and our Government then seized what they regarded as a political initiative and blamed my right hon. Friend and my hon. Friends on this side of the House.
Let me make it perfectly clear, in all honesty, that as far as I am concerned I would stop any equipment to Franco. So far as the peace of Europe and the well-being of the Spanish people are concerned, the quicker the Franco régime goes the better. When the time comes when there is a democratic régime in Spain, then, if the Spaniards want arms and equipment, if only for psychological reasons, I would hold my hand up in favour.
What the Government here have done, in their sheer desperation, is to trot out an inflated suggestion that the British economy depended upon this deal going through. There is one thing which hon. Gentlemen on the other side of the House do not understand about this case or, indeed, about any other matter concerning defence and defence deals. The Government can come here and deceive their own supporters, and they may also put it across the Lobby correspondents and the Press, but there is one thing certain, and that is that the Chancelleries of the world, Washington, the Kremlin. Peking, know the truth.
Their intelligence services are right up with the facts, and up to knowing just what the chances were of this deal going through, and what happened that made the Spaniards decided to call it off, as I believe they did.
It is about time the Government dropped this cock and bull story. It is time they stopped blaming junior officers in the Ministry's Press department for v/hat may have been a calculated political leak. I do not know how Mr. Chapman Pincher originally got the tip off. The best of good luck to him. But I believe that he got the original story from the Government. Then the Prime Minister came here on Tuesday and the Secretary of State came today, and they told completely different stories, which do not add up to the truth. It is about time the Government stopped this. For surely, even in the dying days of a Government and a Parliament, it is better always to tell the truth.
12.38 a.m.
The Under-Secretary of State for Defence for the Royal Navy (Mr. John Hay): Although time is short I welcome the opportunity which this Adjournment debate gives to set out in detail and in proper order the events which preceded the decision of the Spanish Government to break off these negotiations. This is the first time in this House that there has been full opportunity to dispel many of the untruths and mischievous allegations emanating from the benches opposite.
From 1961 onwards it became apparent to us that the Spanish Government were seriously interested in modernising their navy. Informal talks and discussions at all levels began to take place over ship designs, weapons and equipments, and eventually, during the next two years, missions were exchanged, as the hon. Member for Dudley (Mr. Wigg) has said, which went into these matters in greater detail.
From an early stage anti-submarine frigates featured in the Spanish programme, and by 1963 it was apparent that the "Leander" design was what they really wanted. We were certainly prepared to sell this type of design to them. Of course, while we were discussing the matter with them, they were also having preliminary discussions with other countries, but in early May of this year it looked very much as though negotiations were reaching their final stages.
On 13th May—not 15th May—the appropriate Department of the Ministry of Defence passed this information to the Navy's public relations organisation. We expected on that day that the Spanish Cabinet would award us the contract very shortly. As the House knows, it is customary for the public relations staff of a Government Department to be alerted in advance to deal with any Press inquiries which may be foreseen. We expected an announcement from Madrid very shortly, and a form of words was given to the Press department to confirm the announcement here when the announcement had been made in Madrid. The form of words was entered in a log which is kept in the Press department at the Ministry of Defence. That was on 13th May.
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In fact, the decision was delayed by the Spanish Government. On the morning of 8th June, which was a Monday, Mr. Chapman Pincher, of the Daily Express, telephoned the Director of Public Relations at the Ministry of Defence, I understand, and inquired about the deal, which it appears he had heard about, as he subsequently said twice in his newspaper, from an American source. He was told that the Director of Public Relations would refer the inquiry to the Director of Public Relations (Navy), as we call him, the D.P.R.(N), who would ring him back.
An officer in the D.P.R.(N) office, who had no prior knowledge of the progress of the negotiations, consulted the log and the text of the reply that had been tabled there for use in answer to Press inquiries. He tried to get hold of Mr. Chapman Pincher on the telephone, but without success, but that afternoon he was told that Mr. Pincher had called to see him, and, in fact, they met in the Ministry of Defence Press office.
I understand that Mr. Pincher spoke to the officer in a confident manner about the warships for Spain deal and—I think that the House will take it from me and this is certainly what my right hon. Friend the Prime Minister had in mind in answering Questions in the House yesterday—he was making use, quite legitimately, of a technique with which we are all familiar when an experienced journalist wishes to obtain confirmation of a story which up to that moment has not, in fact, been confirmed. The officer to whom he spoke thought that he was free to give him confirmation of the story and he told him that he could confirm that the Spanish Government was to build "Leander" class frigates under licence and that an announcement would be made in Madrid. He told him nothing further.
It is absolutely clear that this was, in fact, an error. I have myself asked the officer about it and I have examined the entry in the log book. I think that there is a certain ambiguity in that entry which might clearly have misled someone who was not completely au fait with the progress of the negotiations. Certainly, as my right hon. Friend the Secretary of State said this afternoon,

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no blame can attach to Mr. Chapman Pincher. He quite properly carried out his professional duties and sought confirmation from us of a story which had been given to him from outside.
The following morning, 9th June, the story broke in the Daily Express and the error was discovered. My noble Friend the Minister of Defence for the Royal Navy was out of London and on my own responsibility I sent for the Spanish naval attaché. I conveyed to him our apology for a wrong confirmation that we had given final approval, and I asked him if he would please pass this apology on to his Government. I tell the House frankly that I was anxious lest it be thought in Madrid that we had deliberately taken this action somehow to put pressure on the Spanish Government to hurry up and complete these negotiations, and my own anxiety was to ensure that the deal was completed. I also sent a signal to the British naval attaché in Madrid to convey a similar apology at that end.
I waited with bated breath for the next 24 hours to see what would happen. I then heard from the naval attaché in Madrid that he had delivered our apology, that he had been most cordially received, and that the apology had been accepted. The naval attaché added that work was continuing, and that he hoped to have the Spanish draft of the joint letter of agreement that week.
There was no question whatever of a Spanish protest at a leakage having taken place. We made a mistake, and for that my right hon. Friend takes the responsibility. We apologised for its consequence, our apology was accepted, and the negotiations went on. As the hon. Gentleman has been told by letter, no retraction was issued. Anyone who rang up or otherwise inquired about the truth of the story was told that the negotiations had not, in fact, been completed.
Eight days passed, and then, on 17th June, we had the foreign affairs debate in this House. We had the speech of the Leader of the Opposition, the gratuitous insults to the Spanish Government, and the reopening of quarrels more than 25 years old. There is no doubt whatever
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that it was this, and this alone, which put an end to the negotiations.
The Spanish Government announced on 29th June that the negotiations were suspended, and this was finally confirmed by the Spanish Minister of Marine on 1st July. In a statement made then to the Press in Madrid he used these words:
"I am not prepared to accept the interference of the honourable Mr. Wilson, Leader of the Labour Opposition, in the internal affairs of a country such as Spain which maintains the most friendly and normal relations with Great Britain. I hope to be able to continue to maintain our cordial collaboration with the British Admiralty but political prudence makes it advisable for us to break off a transaction which has been the subject, on the part of the honourable Mr. Wilson, of a misplaced and unjustified intervention."
That is what the Spanish Minister of Marine said. That is the true account of what happened in this matter. There was no plot, and it would have been an extremely clumsy plot if it had been tried, to embroil the Opposition in this matter, because no one who did not know him could have expected that the right hon. Gentleman the Leader of the Opposition could have been so irresponsible as to make the statement that he did.
The disgraceful suggestion made by the hon. Member for Leeds, East (Mr. Healey) is equally not true, that we caused one of our officials to make a false statement. What happened was that there was a premature announcement of the conclusion of the negotiations which had not happened. That was followed by an apology. The negotiations then went on for eight days, and then came the speech of the right hon. Gentleman the Leader of the Opposition and the suspension of the negotiations by the Spanish Government.
What can we do now? I still hope that despite their natural anger at the right hon. Gentleman's attack the Spanish Government will reconsider the matter and reopen the negotiations. We are still ready and willing to do so. So far as this country is concerned, the best that we can do is to see that the right hon. Gentleman does not become responsible for our foreign and commercial affairs after the next election. Heaven help us if he does.
Mr. Wigg: I take it that the last part of the on. Gentleman's speech specifically repudiates the statement made by the Secretary of State for Defence that there is a possibility of this order being placed in France or America?
Mr. Hay: Not at all, because the fact is that these negotiations have been suspended. It is still very likely, on the face of it, that the Spanish Government will go elsewhere, and speeches like that of the hon. Gentleman himself tonight will not make the prospects of them coming back here any better.
12.48 p.m.
Mr. Denis Howell: It is time that somebody said that 400,000 British service men and civilians lost their lives in the last war because, to use the Prime Minister's
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language, they made the appalling mistake of fighting Fascism.
That the memory of these people should be betrayed by this Government conducting negotiations in this way without first coming to the House is a matter which some of us who still have some national pride should denounce, and we do denounce it.
As my hon. Friend the Member for Dudley (Mr. Wigg) said, this is not to make a condemnation—
The Question having been proposed after Ten o'clock on Wednesday evening and the debate having continued for half an hour, MR. DEPUTY-SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
Adjourned at eleven minutes to One o'clock.