BUSINESS OF THE HOUSE (SUPPLY) (Hansard, 21 July 1964)

§ Mr. Ellis Smith (Stoke-on-Trent, South)
Am I correct in understanding, Mr. Speaker, that in accordance with Standing Order No. 18, this Motion is debatable? If so, I want to ask the Financial Secretary some questions. As finance is involved, I have been wondering where the Financial Secretary is.
I want to make some observations with a view to trying to safeguard for the future House of Commons control of finance, which, in my view, is involved in this matter. I am surprised that the elected representatives of the people in the House were, apparently, prepared to acquiesce in a Motion of this kind without some observations being made upon it. In my view, it raises a very serious issue. Fundamentally, the question of control of finance is involved, and according to my understanding British constitutional rights are involved in House of Commons control of finance.
I believe that in the country the present inflationary trend has been introduced in the main by gigantic Government expenditure, principally on armaments. I have never been a party to that to the extent to which it has gone on. Therefore I can say this. There is a tendency among far too many to blame the inflationary trends on increasing wages, whereas actually wages are only chasing prices. What produces the inflationary situation is gigantic military expenditure. Therefore, as we have three White Papers before us, the fact that the elected people's representatives should acquiesce in this going through takes some understanding.
The logic of the proposal is that virement is now taken from the House itself. In the past, that safeguarded our control of finance, but the logic of the change that has been made is that virement is now vested in the Treasury. Provided 287 that it publishes a Treasury minute which goes before the Public Accounts Committee, it seems that procedure is taken by which it will be only a matter of time before the House loses control of financial expenditure. Had we passed this Motion today without any observation being made upon it, it would have meant that millions of pounds would have changed hands, millions would have been juggled with in surpluses and deficits from one account to another until the Guillotine falls at 9.30 tonight, and that would be the end of the matter.
I have spent a large part of my life among the millions of people who are now working to keep this country going. But for the loyalty of our people in producing exports, the country would not last for very long. In industry, where it is necessary to quote in keen competition, we are not allowed to juggle from surplus to deficit, but have to quote almost the last halfpenny. To allow this to go on nationally is an insult to all who are accepting great responsibility in industry. It should not be allowed.
I have before me the Third Report of the Public Accounts Committee. I shall not read it, because hon. Members can obtain copies from the Vote Office. Involved in this White Paper is the serious issue I am raising. The Third Report refers to Virement Between Votes of Service Departments". I ask the Financial Secretary, or whoever will accept responsibility on behalf of the Prime Minister for this matter, whether I am correct in saying that £6 million has been juggled with—

§ Mr. Speaker
Order. The hon. Member cannot, on this procedural Motion, discuss matters pertaining to the contents of the particular Votes. No doubt he can make his argument about the procedural Motion without doing so, but beyond that point it passes out of order.

§ Mr. Ellis Smith
Thank you, Mr. Speaker. By accepting these White Papers, does it mean that when the Guillotine falls tonight not one word can be said about the way in which these surpluses and deficits have been dealt with? Is it to be taken as a precedent that when a Motion is placed before us in this form we can only pass it when we have been allowed to make observations, provided 288 that we keep in order? Am I correct in understanding—I say this with great respect; I am not trying to score a point—that in future, if a Motion of this character is allowed to go through, when the Guillotine falls at 9.30 p.m., no further word can be said about the way in which the finances of the Navy, the Army and the Air Force have been dealt with as they have been in the past, when we have had a White Paper before us?
I realise that this is a new procedure. That is why I safeguarded myself by asking Mr. Speaker whether the Motion is debateable. As a result of being allowed to debate the Motion, I thought that I should be in order, without going into detail, to raise the issue of the way in which surpluses and deficits have been handled. Is that correct?

§ Mr. Speaker
No. Not the content of the Vote. The hon. Member can deduce arguments for objecting to the Motion in this form, but the point stops there.

§ Mr. Ellis Smith
Does that mean that our only course is to vote against this Motion and that we have now reached a situation, owing to the introduction of this new procedure, in which no matter how the defence authorities handle these deficits and surpluses the House is not allowed to discuss them? Is that the position?

§ Mr. Speaker
The hon. Member is seeking to ask me a question which goes outside my field. All I can say is that this Motion was tendered to the House. He, with respect, would have to make up his own mind whether he wishes to oppose it or no.

§ Mr. Ellis Smith
I am very sorry about that, Mr. Speaker. I understand the position and I do not want to put anyone in difficulties. Far be it from me to do that. I know the difficulties of accepting responsibility. This is a new procedure and we should deal with it in as magnanimous a way as possible, provided that we stay in order.
I ask the Leader of the House whether I am correct in believing that in future, when Motions of this character are put before us, we are not allowed to raise the issue of the way in which the surpluses and deficits are dealt with? If that is so, it makes a farce of the whole business. While safeguarding my right to continue 289 my observations, may I ask the Leader of the House his advice about that, so that it will guide me in what I want to say?

§ The Lord Privy Seal (Mr. Selwyn Lloyd)
I realise the spirit in which the hon. Member for Stoke-on-Trent, South (Mr. Ellis Smith) raises the point. We are acting in accordance within Standing Orders and, therefore, the procedure has been agreed by the House. This is the 25th Allotted Supply Day and there have been all these opportunities of raising questions on Supply. But, by agreement of the House and in accordance with Standing Orders, we are dealing with this subject by the method proposed.
What I can tell the hon. Gentleman, and what may be of some comfort to him, is the Select Committee on Procedure had a series of meetings quite recently on this whole queston of the form in which the Defence Estimates should be published. In a Report to the House we said that one of the very earliest tasks of the new Parliament should be to have a wide-ranging review of the whole of this procedure with regard to the scrutiny of public expenditure, particularly on defence matters. That is a firm recommendaton of the Committee. I think that it is an important job which should be done very quickly during the first days of the new Parliament.

§ Mr. Ellis Smith
Let me make clear that in anything I have said I have not had the slightest desire to create difficulties for the Chair. This is a new procedure. Many hon. Members will remember that I have always been concerned about there being one attitude on the part of the nation towards industry and another to the defence authorities. That is fundamentally wrong and hon. Members have acquiesced in it for far too long.
Now we have had an assurance from the Leader of the House about the future, and as the matter is being considered, so far as I am concerned—not having been a party to acquiescing in the present procedure being continued—I am very satisfied.