Lords Sitting of 9 April 1918

VISCOUNT JELLICOE.
Admiral Sir John Rushworth Jellicoe, G.C.B., O.M., G.C.V.O., having been created Viscount Jellicoe of Scapa in the County of Orkney—Was (in the usual manner) introduced.

LORD MORRIS.
The Right Honourable Sir Edward Patrick Morris, K.C.M.G., having been created Baron Morris of St. John's in the Dominion of Newfoundland and of the City of Waterford—Was (in the usual manner) introduced.
The Lord Grey de Ruthyn—Sat first in Parliament after the death of his brother.

BRIXHAM GAS BILL. [H.L.]
Read 3a and passed, and sent, to the Commons.

THE WAR.
THE MARQUESS OF CREWE: My Lords, you will have observed in the Press a statement that the noble Earl who leads the House will be prepared to give us some information to-day upon the military situation. I trust that the rumour is correct, and that the noble Earl will favour us with a general statement on the military position.
THE LORD PRESIDENT OF THE COUNCIL (EARL CURZON OF KEDLESTON): My Lords, I rise at once, in response to the invitation of the noble Marquess who leads the Opposition, to make the statement of which notice has already been given in the Press. It was on Thursday, March 21, that your Lordships adjourned for the Easter recess. On that very morning the great German offensive was launched on the Western Front which has continued with slight intermission ever since, is still unexhausted, and has invested this stage of the war and this theatre of fighting with a gravity the extent of which no one will be disposed to under-estimate, constituting as it does the most serious peril with which the Allied cause has been confronted since the beginning of the war in August, 1914. Your Lordships will feel, in these circumstances, that I am only doing right in prefacing the re-opening of our proceedings
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this afternoon by a statement of the military situation as it now exists.
Parliament is entitled to as full information on all that has passed or is in contemplation as can be given with due regard to the public interest and without conveying intelligence to the enemy. Your Lordships have all the greater right to this information inasmuch as it is about to be made the basis of an appeal to Parliament and to the nation for a measure of support and self-sacrifice in excess of anything that has been yet demanded, though not, I feel, in excess of what both Parliament and the nation, if treated with candour and if assured of the gravity of the case, will be prepared with good will and alacrity to concede. That appeal in the form of a Bill introduced to-day in another place will reach your Lordships in the course of a week from now; and when it comes here the members of the Government who sit on this bench will be prepared to make as full an explanation of the specific demands which it will contain as may be required. This afternoon I have the simpler task of acquainting your Lordships with the general course of events during the past three weeks which have rendered this appeal necessary, and which constitute the main justification of the steps that are now proposed.
For several months, in fact ever since the commencement of the present year, there has been evidence that the enemy was making preparations for a great offensive in the Western theatre. After the lamentable collapse of Russia and the disastrous peace that was forced upon that country by the enemy Powers, the Germans continued to move troops from the Eastern to the Western Front with as much rapidity as the capacity of their railways permitted. We had evidence that no fewer than thirty-five German divisions had been so transferred in the interval between January 1 and March 21, when the great attack began. Of course, it was not known at what precise point the enemy would attack; in fact, there were some high military authorities who doubted whether he would attack in France at all, and who argued that the concentration on the Western Front was merely a feint, designed to cover some sudden and desperate assault elsewhere. However, as time passed on the indications of an offensive on the French Front accumulated, and it appeared probable that the main theatre of attack would be either the British line between Cambrai and St. Quentin, or the French line in Champagne,

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or possibly both. The French Commander, indeed, continued up till the end to expect an attack upon the second of these fronts, which was held by his own gallant forces. In the third week of March the evidences as to the scene of the offensive became Unmistakable, though obviously it could not be known whether the attack would be concentrated or diffused, whether it would be directed exclusively against the British, or the French, or impartially against both. Thus there was an inevitable element of uncertainty, both as to the exact spot to be selected and the tactics that would be employed. On the other hand, in the larger sense there was no element of surprise in the general strategy of the enemy or in his choice of a broad theatre of action. How broad it was is shown by the fact that for the first time in the war—and this, no doubt, contributed to the initial success— the attack was delivered on a front of as much as fifty miles. Even the date of the projected attack was fairly accurately foreshadowed, since it was expected to be launched in the first quarter of the Easter moon.
Your Lordships may like to know what was the general position of the rival forces at that moment. Along the entire Western Front there was an approximate equality between the combatant strength of the Allies and the Germans in respect of infantry; the enemy were slightly inferior in artillery, and considerably inferior in aircraft. The Germans, however, had so organised their forces as to produce a considerably larger number of divisions out of an equal or a smaller number of men. That, as your Lordships will understand, is a question of organisation, apart from numbers, though it had the consequence of enabling them to constitute a powerful reserve of more than 80 divisions, the greater part of which were concentrated in the rear of the right and centre of their line. Moreover, owing to the position of the Germans on interior lines, they were able to move their reserves from the centre of a great are to the circumference either of the British or of the French front more rapidly than the Allies could do because of the greater distances which the latter had to cover. This is an advantage which the enemy forces have almost consistently enjoyed by reason of the geographical factor alike in the larger and in the local aspects of the entire European campaign. The possibility to which I alluded just now of an attack on the French front in Champagne
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necessitated the retention of a great part of the French reserves in rear of that front, thus rendering it impossible for the Allies, acting on exterior lines, to prevent the enemy from achieving temporary superiority at any one point in the line where he might choose to attack.
My Lords, I have made the above remarks about the approximate numerical equality of the opposing forces along the entire Front because there seems to have been a tendency in some quarters to suppose that, either from a reluctance to tap the available resources of man-power in this country or from a failure to appreciate military advice, the British Army in France had been allowed to decline numerically to a point that was fraught with peril. There is no foundation for such a suspicion; nor were any apprehensions of such a character either entertained or received. Our Commanders were equally satisfied with the numbers, the equipment, and the morale of their forces. Nor is it in any of those respects that fault has been found. Up to the very eve of the battle the Government continued to receive the most confident and gratifying assurances from the Allied military authorities on the spot.
There is another criticism, equally fallacious, which I must note in passing—namely, that the Western Front has been stinted or drained for the more distant campaigns in other parts of Europe or of Asia—campaigns which the Imperial responsibilities of Great Britain or her obligations to her Allies have compelled her to undertake. Such is not the case. Our military commitments in Salonika were made long before the present offensive was so much as dreamed of. They dated from the year 1915; and it will be within your Lordships' recollection that, instead of being blamed for undertaking them, the late Government were reproached both here and elsewhere for not having undertaken them earlier and in greater strength. I have never met anybody who recommended their complete or even their partial abandonment. So far from our forces at Salonika having been increased, it is a matter of common knowledge that they have been considerably reduced for the sake of the Western Front. Equally does everybody know that the Allied Armies there, though operating in a secondary theatre of war, are performing a military service of primary importance, desistence from which would have involved the abandonment of Greece to the Germans,

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the disappearance of our staunch ally and friend M. Venizelos, the restoration of King Constantine, and, still more, the handing over to the enemy of the most formidable group of naval and submarine bases to be found in the Eastern Mediterranean.
Similarly as regards Palestine and Mesopotamia, I do not think that I need enter on this occasion into a defence of either of these campaigns. Those who attack them seem to forget that we are an Eastern as well as a Western Power, and that the pillars of our Dominions are planted at Delhi and Cairo no than in these islands. We were drawn into the Mesopotamian Campaign by the necessities of Imperial defence; and if the East has been kept quiet, I pray your Lordships to believe that it has been much more owing to what has happened on the Tigris than to any fighting on the Somme. Our advance upon Palestine, pursued with a success that still continues, was the alternative—and a very preferable alternative—to the passive defence of Egypt and the locking up of a large number of troops there. In these campaigns we have not only taken two of the capital cities of the Turkish Empire, but we have practically destroyed an entire Turkish Army. We have forced the Turk to withdraw the whole of his fighting forces from Europe, and we have even compelled the Germans to spare not only a German Field-Marshal and German units to assuage by their presence the discomfiture of their Turkish Allies, but even German regiments—an entire German battalion having been discovered only during the past few days in occupation of an important position to the east of the Jordan. I mention these two Eastern campaigns only in order to point out to your Lordships that neither of them has been allowed to affect the fighting strength of the forces in France or in Flanders. No British troops have been taken from France for any Eastern theatre of war. The only British divisions that have left France have been those which were despatched to the defence of Italy in the hour of her danger—a service which not even the strongest partisan of the Western Front would have grudged—and some of these it is known have been returned. There is no question here of Western as against Eastern strategy. The Western Front was well equipped to look after itself; and if it has in any respect failed to do so, the ex-
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planation must be sought elsewhere. It will not he found in denouncing the secondary campaigns of our Armies, the full value of which will, perhaps, be even more visible at the Peace Conference of the future than it is now.
To return, however, from this digression, which I hope has not been altogether irrelevant, to the position in France at the opening of the attack on March 21 last. Though the rival forces were about equal in combatant strength the Germans possessed certain advantages, to some of which I have referred. I have alluded to the formidable reserves concentrated behind their lines and capable of being swiftly directed to this point or to that. I have spoken of the Allied reserves necessarily distributed over a much longer line and less mobile in character. My Lords, it is in my opinion much to be regretted that the measures arranged for at Versailles, which I had an opportunity of explaining in your Lordships' House only a few weeks ago, were not undertaken at an earlier period, and had not had time to assume a more mature and perfected shape before the need for their existence was conclusively proved But so much energy was devoted in Parliament and elsewhere to discussing whether it was desirable to have a unified Army of reserves at all, and so much controversy was expended on the points as to how it should be constituted, under whose orders it should be placed, and where it should go, that valuable time was consumed which might have been more profitably spent in organising the force itself. Had a greater measure of unity been secured at an earlier date, the opportunity of demonstrating its utility afforded by this great offensive might, perhaps, have been more effectively employed.
My Lords, the enemy enjoyed another advantage, which in the fluctuations of the war has sometimes been his and sometimes Ours. I refer to the advantage of the initiative. He could choose exactly where and when he was going to attack, while the Allies could never be positively certain at what point on a long front the spear head would be thrust in. The experiences of war at Verdun, on the Somme, and at Cambrai have shown that a great individual advantage lies with the offensive. The attacking Army, either acting by surprise, as at Cambrai, or advancing after a sustained

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artillery preparation, reaches its objective after a few hours or it may be a few days, takes large numbers of prisoners and guns, and then, when the first victorious rush is spent, is held up or obliged to halt until it has consolidated its position and brought up its artillery and reserves. Such has been the experience of every offensive with scarcely an exception in the present war. The belligerent that can pursue the advantage thus gained, can convert a sudden and successful rush into a sustained advantage and proceed without undue delay from the first to the second phase of operations, is in a position of manifest superiority. It need hardly be added that the advantage of the offensive is greatly increased if it be executed upon a wide as against a confined or narrow front. But, my Lords, the crowning advantage enjoyed by the enemy in these battles, as in almost all the stages of the war, has been unity of command. He could dispose of the Armies of two nations—sometimes more. He could hold his front with an inferior force because he was always in a position to reinforce it. He could move his pieces backwards and forwards on a gigantic chess-board coextensive with the Continent. This advantage has never hitherto been ours. Where there are two Commanders, each has his own Army operating in its own carefully-defined sphere, and however close the contact and however amicable the arrangements between them, there is unity neither in direction nor in aim. There is dissipation of energy, dispersion of force, and very likely dislocation at the moment of danger. Each Commander is naturally and properly interested in his own area. He is convinced that the attack is going to be made upon his own line. Preoccupied with his own risk he cannot fairly balance the two risks, that of his own force and that of his Allies twenty or thirty miles away. He cannot concentrate upon repelling the greater of the two risks because he has no opportunity of measuring their relative magnitude. Only slowly and laboriously have the Allied Armies in France awakened to this great and overmastering necessity. Perhaps the British nation were not the speediest converts, but every one is converted now. The baptism of a great danger has consecrated the conversion, and a Government which a short time ago was almost called upon to apologise for attempting to create unity of command is now almost driven to apologise for not having created it sooner.
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These were the conditions when the battle began on March 21. Although, as I have said, the probable date and locality of the offensive were accurately conjectured in advance, there were certain elements of surprise, because the attack was made in greater force on our extreme right flank than was expected, and included the valley of the Oise as far as La Fere. That portion of the line had been taken over by our troops from the French not long before, and therefore they were not so familiar with it as with other parts of the front. The enemy opened the attack with a numerical preponderance in the sector of the line selected by him of about two to one. Not for the first time in the history of the war the stars in their course appeared to fight not against Sisera but for him. The British were beaten by mud at Paschendale; but for the Germans in St. Quentin the ground was dry underfoot, while overhead heavy fog was lying along the valley of the Oise which hid their movements until they were 50 yards from our outposts, who were in many instances taken by surprise. But the fog had a worse result than this, for it prevented our artillery and machine guns from obtaining targets, a circumstance which placed them at a great disadvantage, since our system of defence depended largely upon the cross fire of our artillery and machine guns.
The defensive organisation of the British Front consisted in a series of zones. The first or forward zone was not intended to be held in case of a really heavy enemy attack. In that event a withdrawal was to be made to the battle zone or main line of resistance a short distance in the rear. Behind this zone, again, were a number of rear lines of defence. The weight of the enemy's attack was thrown mainly against our Fifth Army, north and south of St. Quentin. During the first day of the battle the enemy nowhere penetrated beyond our battle zone, except in the sector between St. Quentin and the Oise, where he drove in our right flank. This necessitated a retirement behind the Crozat Canal, and enabled the enemy to make a converging attack on our positions north and west of St. Quentin. The result of this attack, which took place on the second day of the battle, enabled the enemy to break through our line about Roisel, north-west of St. Quentin, and also north of the Crozat Canal. This necessitated the retirement of the whole of the Fifth Army.

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In view of the dangerous situation which had arisen on the British front, the French at once, with characteristic and chivalrous loyalty, came to our assistance, and throughout the present battle they have afforded us the same unflinching support which they have rendered in the past on every occasion when the need has arisen. The two Armies have fought side by side in the strenuous fortnight that has elapsed since those anxious days, and British troops have on some occasions, in the confusion of the struggle, found themselves fighting under a French Commander. The rest of the battle consisted of a fighting retirement, in which our men behaved with a gallantry and steadiness beyond praise, contesting every yard of ground, making the enemy pay dearly for each successive advance, and exhibiting the characteristic qualities of the British soldier. In this connection special mention must be made of the stubborn resistance of the Third Army against greatly superior enemy numbers—a resistance which completely foiled all the enemy's attempts to penetrate their line, and definitely arrested his advance north of the Somme.
I am reluctant to mention the names of individuals because it is so difficult to select, but, my Lords, I think a word of special praise is due to General Sir Julian Byng, who, when forced to retire in order to establish a connection between the Third and Fifth Armies, conducted that operation with a skill, cool-headedness, and determination that equalled—it could not surpass—the valour and constancy of his men. The magnificent bravery of many of the Divisions of the Fifth Army also, who fought to the last in circumstances of extraordinary difficulty, was no less noteworthy.
In the meantime south of the Somme, as French reinforcements arrived, it had gradually become possible to organise resistance between that river and the Luce, and by this means the enemy's progress was definitely checked in that area. The portion of our Fifth Army which had become mingled with the French troops was gradually withdrawn as the latter came up. General Rawlinson was entrusted with the command of that part— the still fighting part—of the Fifth Army, which had been falling back slowly in good order between the river Somme and the Luce, fighting stubbornly against great odds. It was at this time and on this part of the battle front that a hastily-improvised force of
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labourers, balloonists, machine-gun and other specialists, under Brigadier-General Carey, came to the rescue, and played a most distinguished part at a critical time, recalling the famous story of the cooks at the first battle of Ypres.
Throughout the battle the co-operation between our Air Service and the other arms was a factor of the greatest importance. The devotion of our airmen in dealing with the enemy's machiles, in attacking his columns marching along the roads, and in interfering with his preparations, was of invaluable assistance to our hard-pressed infantry. It greatly impeded the enemy's progress and inflicted serious losses upon his personnel. No fewer than 1,000,000 rounds of ammunition were fired from our aircraft at ground. targets, and in the first twelve clays of the battle 250 enemy aeroplanes were destroyed and 120 driven out of control.
My Lords, I have now given a general conspectus of the events that attended the retreat and break-up of the original Fifth Army. What actually happened at each stage of the struggle is still uncertain. In so large a theatre, and in the peculiar circumstances attending this protracted series of engagements, some little time must necessarily elapse before the various pieces of the mosaic can be fitted into their places. Moreover, the Commanders, from the Field Marshal downwards, have been so busily engaged with the anxieties of a crisis that has not yet abated that there has been little time for the detailed investigation of past events, themselves entangled in much obscurity and confusion. This inquiry has been ordered and. is being undertaken. In the meantime General Gough has been recalled to this country. It would be unfair to blame him until the whole facts have been cleared up. It would have been equally unfair to leave him in command while his conduct is under investigation.
We thus come, my Lords, to the end of the first series of operations, after which there was something of a lull while the enemy was organising his communications, relieving his exhausted divisions, and bringing up his artillery. This was presently succeeded by a series of new attacks, some of them pushed with great fury and attended with minor successes, although accompanied in each case by a reckless sacrifice of life which would be staggering were it not a part the settled policy of the enemy, who is believed to be willing

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to lose a million men in the present offensive if only he can attain his object and bring the war, as he hopes, to an early and triumphant conclusion. His immediate object, as we all know, was to overwhelm the British right wing and to sever completely the British and French Armies. The larger object, which lay and still lies behind, was to capture Amiens, to sever the main lines of railway communication between the Channel and Paris, to cut off the Allied Armies from each other, and to roll back the British Army upon the coast ports. The results of the battle up to the present time have been that the enemy obtained a great initial success at the cost of very heavy sacrifice, but has so far failed in his main object. He has not driven a wedge between the British and French Armies; he has not broken our line between the Somme and Arras; he has not reached Amiens itself.
As to our losses, we have not the information at present to enable us to state with any accuracy how many prisoners we have lost or what casualties we have suffered. They do not, in any case, approach the figures that have been published by the enemy. But; my Lords, do not let us conceal from ourselves that the enemy is uncomfortably and dangerously near to Amiens; that he has captured, and holds, most valuable ground; that his effort is still unexhausted; that he continues on the whole to advance rather than to retreat; and that further and greater exertions on his part may certainly be awaited. I cannot affect to hide from your Lordships that the position is one which, although it contains many encouraging features, is still, and will continue for some time to be, one of grave anxiety. Further opportunities may occur as time goes on to keep your Lordships informed as to the progress of events. I hope I have neither extenuated nor exaggerated in my description of what has happened up to the present date.
In these circumstances your Lordships will want to know what action was taken by His Majesty's Government as soon as the thundercloud broke about our heads. Directly the emergency arose the Cabinet took immediate steps to replace our losses. Reinforcements were at once despatched from this country across the Channel at a maximum rate of over 30,000 in the day. In those proceedings you will be interested to learn that no single life has been lost. We were sorry that this step made it neces-
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sary to cancel the usual leave given to men proceeding to the Front to enable them to say good-bye to their families and friends, and also to curtail the holidays of many thousands of soldiers who were at home upon leave. These sacrifices were received without a murmur by the troops, and I cannot too highly extol the spirit and patriotism with which they hurried to the aid of their comrades in such dire peril and to the support of their country in its hour of trial. The same necessity compelled us to send over to France young men of eighteen and a-half years of age, whom we have always reserved the right to place in the battle line in an hour of national emergency.
As regards the losses in guns and material, which have been considerable, though nothing resembling the figures published by the enemy, the Minister of Munitions informed us that he was more than able to replace at once all our losses. This has been done as rapidly as the capacity of the French ports allowed—with a balance in addition to constitute a powerful reserve. A further step was taken. Your Lordships will have read in the newspapers the appeals that were at once addressed by the Prime Minister on behalf of the War Cabinet to our Overseas Dominions and India, and the glowing and encouraging replies that were received from them. It has always seemed to me to be one of the most glorious experiences of this war that in the distant parts of the Empire, remote from the scene of conflict and exposed to no visible or imminent peril, the youth of the Anglo-Saxon race have rushed to arms, and the sedentary population have been willing to accept sacrifices with an ardour not inferior to that of the people who are almost within sound of the guns and whose homes and subsistence are directly threatened. This feeling has been confirmed and consecrated by the blood that has been shed on the battle-field, and the response that has come from very quarter of the Empire has testified anew that the true nature of the Amiens menace is realised as fully by them as by ourselves, and that no effort will be spa red to lend additional succour to the common cause.
We did not confine our appeal to our own fellow-subjects. We turned to our most powerful Ally, the great English-speaking Republic across the ocean, the anniversary of whose entry into the war we commemorated only two days ago, and whose absorption in the struggle has increased

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with every month that has passed until, like ourselves, they realised that it would be better to perish as a nation than to allow this monstrous tyranny to pervade the earth. America has large numbers of troops in training across the Atlantic to take their place in the American Army that will one day turn the tide of battle in France. The arrival of these forces has taken longer than was contemplated, and if delayed much further they might have forfeited their chance of joining in the present phase of the struggle. In these circumstances we appealed to President Wilson to send his American soldiers at once across the ocean to be brigaded with the troops of the British and French Armies in France. He responded to this appeal with immediate and generous promptitude that warmed our hearts, and in point of numbers promised exceeded our most sanguine expectations. The House will not expect me to give the figures of the expected American arrivals, but the monthly supply of infantry and machine-gun reinforcements on whom we can now reckon in the ensuing months, and for whom it is possible to guarantee shipping, will alone constitute an Army of formidable strength.
Lastly, in conjunction with our Allies, we have taken a great forward step in the control of the Allied forces in the theatre of fighting. I was speaking just now about the advantage enjoyed by the enemy in respect of unity of command. That advantage we have not hitherto shared with hint. Co-ordination of action was the direct object of the Versailles agreement and of the Supreme Councils that have since been held to carry it into effect, but concentration of authority has never been secured for reasons which are too well known to call for recapitulation here. Time itself, and the Germans, have effected a conversion which argument could not secure. A few days after the battle the British and French Commanders themselves, on their own initiative, agreed to the supreme direction of strategy by a single head at the Western Front. A Generalissimo it was not proposed to appoint; a Generalissimo has not been appointed. There was no need to place any individual Commander in supreme charge to look after strategy, tactics, and administration. It would have been unnecessary and impossible to assign to any officer, however éminent, the administrative and tactical control of a foreign Army, the appointment or dismissal of its Com-
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manders, and all the functions that appertain to the supreme command of an Army in the field. But the strategical control ought in such cases as these to be vested in single hands, or—shall I say?—in a single brain. We have suffered grievously from the want of this in the past. Invaluable time has thereby been lost. The enemy was in a position to strike while the two Armies and the Commanders were still acting independently, with a proportionate sacrifice of unity and strength.
If by common consent a single direction was required, such a direction could, in the circumstances of the case, while the struggle is taking place on French soil, while it is French territory that is being overrun, while it is the French capital and French ports that are in jeopardy, only be by a Frenchman, and, if a Frenchman, then he could only be General Foch. This appointment, in the conditions and with the limitations that I have described, has been received with acclamation not only by the British Commanders and by the American Generals, who have always been ahead of our military authorities in pressing for unity of control, but by public opinion in all the Allied countries, and it cannot but be helpful to the common cause.
Such, my Lords, is the situation as it now exists. It is grave in its present aspect. It is not less grave in its probable implications. The enemy realising that the balance of strength in the Western theatre is now more favourable to him than it is likely ever again to be in the future, and that this is therefore his best chance of obtaining a decision in the field, has embarked upon this great battle, or rather series of battles, with the object of achieving a decisive victory over the Allies. He is forced to this endeavour by a number of reasons—by the economic condition of Germany and still mare of Austria, by the exhaustion and war-weariness of his principal Allies, and by the knowledge that with ever' month that passes the trained armies of America will be pressing on to the field of action. He will therefore pursue the military advantage which he has gained with relentless purpose, with a complete disregard of human life, and with the single object of ending the war in the course of the present summer. Day by day, while we are sitting here, the sanguinary encounter goes on. Your Lordships must expect the first phase to be succeeded by a second, and the second by a third. This crisis itself may be prolonged not for weeks

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but for months, and the months will before long take us into the fifth year of the war. Further than that it is unnecessary for me for the moment to look, though I need hardly acid that our forecasts have all along been made for a war that embraces at least the year 1919.
The Government would have ill discharged their duty if they had rested satisfied with the measures that I have already described. These are merely the executive or administrative steps that have been open to them to take under the powers that they enjoy. More than this they could not do without the authority of Parliament, and the approval of the country. Hence the proposals embodied in a Bill which is being explained in another place this afternoon, and which will reach your Lordships in a few days from now. I shall bespeak for those proposals, which it is not my intention and which it would not be becoming for me to dilate upon this afternoon, when they come here the earnest and sympathetic consideration of this House. I shall ask your Lordships to remember that we meet here in this week at a crisis as grave as any that has ever occurred in our history. I shall plead that this crisis may continue to be met as it has already been met, and I shall argue that it may be overcome, as I believe that it can be overcome, in this country by the patriotism of Parliament and the cheerful and unconquerable spirit of our people, and abroad by the armed strength of the Allies, throwing every man and every effort into the common cause, and by the moral and material support of the remainder of the civilised world. My Lords, freedom will not be allowed to perish out of the earth in this terrible encounter, and it is our glorious but perilous lot to be in the front line of those whose mission it will be to save it.
THE MARQUESS OF CREWE: My Lords, I feel certain that the House will desire that something should be said of the nature of thanks to the noble Earl for the very full and lucid statement of the position which he has just made to us. We had, indeed, all hoped that the noble Earl would he able to describe as fully as he has the general situation abroad, although he has not, wisely as I venture to think, touched upon the course which it is intended to take at home, and we have certainly not been in that respect disappointed. I feel also that we ought to be grateful to the noble Earl for having in no way attempted to
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underrate the gravity of the situation in which we now are. The noble Earl's speech was in no sense alarmist, but he did not attempt to minimise the gravity, not merely of the military situation as it is in France at this moment, but the probably long continuance of the situation, becoming as we hope ameliorated as the weeks pass on, but which is bound to remain critical for a considerable time yet to come.
There are only one or two points in the noble Earl's speech upon which I wish to make a few observations. The noble I Earl desired to dispose of what he conceived to be a myth accepted by some that the Western Front had been denuded of part of its strength for the benefit of campaigns which are being conducted in other parts of the world. I confess I did not know that this belief was held by anybody who pretended to any degree of information. What has existed, I believe, in the different Allied countries is a school of thought which has from time to time desired to treat the Western Front rather as one which ought to be held without attempt at further advance there in any circumstances, while believing that there are different parts of the world in which advances might be made to the great advantage of the war as a whole. There have been, as we know, marked differences of opinion in the different countries on this subject, and it is fortunate, I think, that the noble Earl has been able to explain, as he has categorically to us this afternoon, that in fact no divisions have been moved away from the Western Front to any other part of the world, at any rate during the time which it is necessary to consider at this moment. Very few people, I suppose, would have desired to abandon our Eastern campaigns altogether. What the noble Earl said on this subject of the effect on the Eastern world of our enterprises there appears to me to be absolutely true. But there were, no doubt, some who were inclined to deplore what they considered an excessive enterprise in other theatres of war, fearing that our main strength might thereby he somewhat sacrificed.
One other point on which the noble Earl spoke was that of the mobile reserve, which had been, as he thought, called into being at somewhat too late a date, and the earlier existence of which might, as he appeared to believe, at any rate in some degree, have saved the situation in the neighbourhood of St. Quentin. I confess I do not precisely follow the reasoning of

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the noble Earl in that respect. I should have supposed that the utility of a mobile reserve depended entirely upon one thing—namely, upon the means of transport, the strategical railways which have been made in order to transport it from time to time to points at which it was particularly required; and, assuming it to be the case that the Germans possess an advantage over us in that respect in Belgium, it must be due, I take it, to the fact that, either on a larger scale or on more useful lines, they have done more in that encouragement of mobility in the rear of the positions than, for one reason or another, we have been able to do. I confess I cannot see that the mere existence of a mobile reserve, without measures such as I have described, could operate greatly in helping a critical situation such as that which has occurred.
I am sure the whole House heard with interest the clear explanation which the noble Earl gave of the concentration of the supreme direction of strategy in the hands of General Foch. As everybody knows, there is no officer in the French Army more admired and more trusted by the British troops than General Foch, and for these reasons I am quite certain that the concentration of strategical direction in his hands will be not merely accepted but cordially agreed to, as the noble Earl has stated.
At the same time, it is hardly possible, I think, by any unity of direction of that kind to obtain the precise degree of advantage, which the German. Army have all along possessed on the Western Front, of being composed practically, not merely of men under one command, but of men of one nation. You cannot get over the fact that the 40,000,000 of population of France and the 40,000,000 of population of Great Britain cannot, by any unity of command, produce an Army so absolutely homogeneous as that formed out of the 60,000,000 to 70,000,000 Germans. And when the noble Earl said that the diversity of command must lead to a certain dissipation of forces and to a difficulty of balancing the risks which the different Armies might have to encounter, it can hardly be the fact that that particular difficulty of balancing the risks which each Army may have to take can altogether disappear under a single command—even the command of so distinguished a soldier as General Foch, who, however, possesses for this purpose the peculiar advantage of having, from a
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very early date in the war, worked in immediate contact and close concert with the British Army itself.
The noble Earl enthralled the House in describing in the clear and measured terms which he did the episode of which we are all naturally most desirous to hear—namely, the fortunes of the Fifth Army in the neighbourhood of St. Quentin. How far the misfortune which occurred there—because that, I take it, is not by any means too strong a term to use—was due to division of command we may hear later. I entirely agree with the noble Earl that when an inquiry is pending into the whole subject it would be not only futile but altogether improper at this moment to discuss the question of responsibility. We shall all, I hope, trust that it may be proved that the misfortunes that occurred were rather due to circumstances which even valour could not conquer than to the defect of any of the commanders, either principal or subordinate. But there is no advantage in attempting to discuss that question now.
What I think we may discuss, and with satisfaction, is the staunchness which has been shown by the whole country in a period of tension and trial which has certainly not been equalled since the two months from early in September to the middle of November in 1914. The spirit of the people has been altogether admirable. I have heard, from some of those who have seen them, of the manly enthusiasm, even more visible and more audible than ever, shown by the thousands of drafts travelling from different parts of the United Kingdom to take their place at the Front. I believe that the spirit of the civilian population has been equally good. As the noble Earl so truly said, we have all been profoundly heartened and encouraged by the attitude of the American people at this moment of danger; not least, I think, by the great speech which President Wilson delivered at Baltimore last week. I believe that, when the final record of this war comes to be written, the successive speeches made by President Wilson throughout its course will prove to be the most notable milestones in the whole of its history It is no depreciation of any of the statesmen here or in European countries to say that the speeches which President Wilson has made have been altogether unrivalled. The oratory of war all through history, from the days of Demosthenes to those of Lord Chatham, has produced numberless instances of powerful eloquence and of

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heart-stirring appeals to patriotism, but I do not know where in history to find any parallel to such utterances as those which President Wilson has addressed to the whole world—so flawless in their logic, so final in their judgment, and so completely elevated above the ordinary conceptions even of those who love their country and who desire to see their country victorious. The determination which President Wilson expressed in that speech has been heartening to all the Allies here; and I am very glad that the noble Earl did not forget to express the particular thanks of the Government and of the country to the fine act of selfdenial—because it is an act of the most genuine self-denial—in postponing the formation of the great American force into armies, and corps, and divisions, and allowing by no means inconsiderable numbers of troops to be brigaded with the British and French Armies. It is a fine action of the nature of the famous conduct of General Outram at the time of the Indian Mutiny, and it is one which, I am sure, will not be forgotten by England and the English people.
I will not attempt to anticipate in any way the discussion which will take place—as I assume before very long, because the measure is being hurried with all possible speed, as I understand, through another place—on the Bill of which, I believe, the Prime Minister has given an outline there to-day; but I can assure the noble Earl that, reserving, of course, the freedom of everybody in this House to say what he thinks on any particular detail of the measure, I feel certain there will be no noble Lord here who will not wish to give those proposals his most candid, and, indeed, most sympathetic consideration, knowing what the need of the country is.
THE EARL OF DUNDONALD: My Lords, I do not propose to inflict myself upon your Lordships for more than two or three minutes. I listened to the speech of the noble Earl the Leader of the House with the greatest interest, especially to what he said with regard to our responsibilities in the East. But, having regard to those responsibilities, were we right in using up the best men, the men who came forward voluntarily at the commencement of the war, and behind whom there were practically no reserves? We must remember that this country has not passed its population through the ranks as the Central Empires have done. Behind our forces there is nothing. I
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read the report of a speech by no less a person than the Chief of the Staff in which he said, "If you want to kill the Boche, go where the Bache are." Did he realise that not only did we kill the Boche but that the Boche killed us? I have read an account of the enormous and almost irreplaceable losses sustained by our Artillery. Unless one has spoken with officers who have served in the Artillery during bombardments by the Germans one can hardly realise what our men go through. In one battery in two months three men went mad—two remained with the battery under restraint, and the third rushed away into the German lines. My son-in-law, who was commanding this battery, told me those facts. The commitments that we might have in the East all pointed to holding the Western Front, and not to making partial attacks with insufficient forces to thrust through on a front of insufficient breadth. But that is a thing of the past.
With regard to the position on March 21, we are told by the noble Earl that the Germans had a superiority in one or two respects, one being an important one—namely, that they were working on interior lines and could concentrate a larger force than we could, and more rapidly. Did not this imply—the possibility of the concentration of this larger force at any particular point—that we also should not have been content with an equilibrium, but should have had much larger reserves? I did not hear from the noble Earl—perhaps it seemed such a small detail that it was omitted from the information that he had—anything with regard to our wire entanglements. I have heard that the German wire entanglements are far superior to ours, much more difficult to get through, and would hold up men for a longer time. We have had, my Lords, during this war various Commissions of Inquiry into military happenings in different parts of the world. I say this, that the result of every one of those Inquiries has been to prove two important facts—one, that the men are incomparable; the other, that the Staff system was faulty and sometimes the leaders were faulty.
What does this arise from? My own opinion is that a great deal arises from faultiness in our military system. We entrust the great duty of the selection of the Higher Command and such matters which in Germany are in the hands of one

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of their greatest military leaders—we en-trust these things to the supreme control of a civilian, namely, the Secretary of State for War. I am sure that he exercises his powers to the best of his ability, but is it possible for a system such as this to compete with the German system? The German military system is divided into three main portions. The first and most important is the Military Cabinet, which is presided over by one of their greatest Generals. Entrusted to this Cabinet are the duties which we entrust to the Secretary of State for War. The noble Earl shakes his head, but where am I wrong? Well, my Lords, you reap what you sow, and for fourteen years our military system has boon controlled by a civilian, assisted by an Army Council, who look to him for everything. This civilian sometimes makes a good appointment and sometimes makes a very bad one; but if he makes a bad one and appoints an inferior General to a command, that inferior General in his turn selects officers for advancement. A good man will select good men, but an incompetent as a rule selects incompetents, and those that the bad man selects will in future come forward in their turn for preferment. My opinion is that unless we, a free democracy, agree to give up some of our freedom and adopt the sensible portion of the German system, and give over to a professional that which a professional should supervise, we shall never make war with success.
THE SECRETARY OF STATE FOR WAR (THE EARL OF DERBY): My Lords, I must disabuse the mind of the noble Earl of one thing. He seems to think that I make military appointments of my own accord. I do nothing whatever of the kind. There is a Selection Board, there is the advice of the General Officers Commanding in the various fields, and there is the Army Council; and not a single appointment have I ever made, or would I ever make, without consulting and getting the recommendation of those bodies. It is their recommendation, and they do what I think is the right thing to do. They put forward the names of those men who they think are fitted for command, and they eradicate the names of those who they think are of no use for command.
THE EARL OF DUNDONALD: I am going on the system. I am not talking of what the noble Earl does.
THE EARL OF DERBY: The system surely is the same. You have military advisers who put forward recommendations to the civilian head of the War Office, which is a recognised institution in this country. It is, after all, purely nominal consent on his part, and in the case of the Higher Command it is brought before the War Cabinet.
THE EARL OF DUNDONALD: I am perhaps out of order in speaking again, but I ask your Lordships' consideration. When Lord Haldane was in office he specially reserved to himself the selection of officers for commands which Lieutenant-Generals could hold.

TRUSTEE SAVINGS BANKS BILL.
Order of the Day for the Second Reading read.
LORD HYLTON: My Lords, this Bill, to which I ask you to give a Second Reading, is one to amend the Trustee Savings Banks Acts, 1863 to 1904, with respect to special investments. This Bill has passed through all its stages in another place without any opposition and after very little discussion. It is in reality a simple measure. Your Lordships will notice in the first place that it does not deal in any way with the Post Office Savings Bank, nor does it deal with the ordinary, or what is called in the language of Acts of Parliament the general business of the 174 trustee savings banks which are at present operating in England and Scotland. The Bill deals only with the special investments department of a certain number of these savings banks.
I should like to call your Lordships' attention for one moment to the two different kinds of business which are now carried on by trustee savings banks. In the first place there is the ordinary business, which as I say is called in Acts of Parliament general business, which consists in receiving money from depositors and investing it through the National Debt Commissioners in the limited class of securities authorised by Section 19 of the Trustee Savings Banks Act, 1863. In the second place there is the special investments business, which consists in investments by the bank itself—that is, not through the National Debt Commissioners—of sums received from depositors, these sums being

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allowed to he invested not only in the limited class of investments allowed in the case of ordinary deposits but in any security authorised for the investment of trust funds, except the mortgage of land, but not excluding securities under the Local Loans Act and loans on the security of local rates. At the present time there are about forty-five trustee savings banks carrying on in England and Scotland this business of the second class to which I have alluded,
Soon after the outbreak of war it became clear that there was a certain number of trustee savings banks carrying on this special kind of business which would not have been solvent had there been a run upon them. The fact is they were liable to pay out those depositors when called upon, whereas the investments were locked up in securities which were rather long-dated. His Majesty's Government thought that this was far from being a satisfactory state of things, and. the Treasury was approached and a strong Committee set up. I think that in the first instance the Treasury was approached by some of the banks concerned. The chairman of the Committee was a very well-known gentleman, Mr. M. Norman, who may be known to many of your Lordships. He has recently been elected a Deputy Governor of the Bank of England. The whole position with regard to the solvency of this branch of the banks' business was investigated, and the Committee made a Report. The Bill which is now in your Lordships' hands contains most if not all of the recommendations made in that Report. This Bill is in fact a mutual insurance scheme, and its object is to secure that the whole strength of the savings banks should be brought to bear to preserve the solvency of any one of them that may have to be tided over a crisis. The banks that are affected by this measure have been consulted, and I think I am correct in describing the Bill as an agreed measure so far as the banks are concerned.
I will say one or two words about the clauses. As I say, the object of the Bill is to secure that the whole strength of the savings banks should be brought to bear to preserve the solvency of any one of them, and to affect this Clause 1 of the Bill places the special investments department under the control of the National Debt Commissioners, whose consent is required as regards investments, changes of the rate of
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interest allowed to depositors, and management expenses, and the investments are not to be repayable within three years. Clause 2 provides for a guarantee fund against deficiencies, and this guarantee fund is secured by taking power to use the reserve of all the trustee savings banks carrying on a special investments department and certain surplus assets of the banks in the hands of the National Debt Commissioners, and states how in case of deficiency this fund is to be drawn upon. Clause 3 deals with some minor points. Your Lordships will observe that one of them refers to a considerable sum of money, amounting to something like £100,000, which represents a surplus fund that arose before 1880, and this surplus fund has up to now been in the hands of the National Debt Commissioners, who have not been obliged to pay interest. In Clause 3 it is provided that in future this sum shall be chargeable with interest. When this Bill becomes law we hope that the position of all depositors in this special investment department will be made absolutely secure. I am afraid that it is undeniable that at the outbreak of war, owing to causes with which your Lordships are probably familiar, the position of some of these depositors was at all events temporarily not quite so secure as was desirable, but it is hoped that this measure will alter that unfortunate position of affairs. I hope that the House will consent to give the Bill a Second Reading.
Moved. That the Bill be now road 2a.(Lord Hylton.)
LORD BALFOUR OF BURLEIGH: My Lords, I will not detain the House more than a moment, but I want to ask the noble Lord a question regarding the terms of paragraph (d) of subsection (2) of Clause 1 of the Bill. It seems to me a most extraordinary provision, because it says—
"No money received for investment shall be invested except so as to become repayable not later than the expiration of one year, or, if the money is invested in Government securities, three years …"
I want to know what is the precise effect of that. Is it the case that this paragraph will prevent the banks from investing in National War Bonds and other Government securities? These bonds are in most cases not repayable in less than five years. It does seem a most extraordinary provision that at this stage you should prevent

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trustee savings banks from investing in National War Bonds. It surely is obvious that if the banks are prevented from doing it, it must tend to prevent people depositing money with thorn, because the individual cannot get that rate of interest from the bank which he can get in perfect safety by investing in War Bonds. I quite agree with the noble Lord in his reference to the action of the Government in 1914 when war broke out. Undoubtedly the financial values of investments underwent a very considerable change, and when I he Government issued loans, first at 4½ per cent. and then at 5 per cent. and 6 per cent., the effect of these issues was adverse to special investments made before, especially to such classes of trustee investments as the savings banks were obliged to make, awl I think it is greatly to the credit of the Government that they came to the rescue in the way they did. I understand that a regular Committee was appointed, and they found that most of the banks, if there had been a run upon them, would have been unable to meet their liabilities. But assistance was forthcoming, and, speaking generally, the trustee savings banks were placed in a sound position. This Bill is perhaps necessary to place them on a safe and proper footing. During the past year or two a large sum has been lent temporarily by the National Debt Commissioners to the banks whose needs were most urgent, and I should like to know whether it is the intention of the Government that this Bill should prevent trustee savings banks, now and for all time, from investing in National War Loans.
LORD HYLTON: The view of the Government is that people who deposit in these banks must be able to feel, when they come down to the bank and want their money out at once, that the bank will be able to pay. With that object in view the Government do not intend to allow investments to be made in any long-dated security, in any security longer than six months. I think those are the words in the Bill. Therefore I believe I am right in saying, though I should like to investigate the point further, that the banks who deal with this class of business would not be allowed to invest in Government loans which are standing out for more than six months.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

SOLICITORS (ART CLED CLERKS) BILL. [H.L.]
Order of the Day for the Third Reading read.
THE LORD CHANCELLOR (LORD FINLAY): My Lords, on the Second Reading of this Bill I stated its object, which is to deal with cases of hardships that arise from the absence on work connected with the war of those serving as articled clerks. It is intended to provide that the time which is so occupied shall count for their articles. In these circumstances I hope that your Lordships will give a Third Reading to the Bill.
Moved, That the Bill be read 3a.—(The Lord Chancellor.)
On Question, Bill read 3a and passed, and sent to the Commons.

PRIZE MONEY.
LORD BERESFORD LORD BERESFORD had the following Question on the Paper—
To ask His Majesty's Government if it can be stated how much money representing prize money and accrued interest is now in the hands of the Prize Court; how much prize money has been paid under the direction of the Foreign Office Committee either to Messrs. Schroeder or to other persons having similar claims; and how much money represents enemy property which will, under the words of the 6th Hague Convention as quoted by the President of the Prize Court, be restored to the enemy immediately or subsequently; whether it can be stated how much money has been paid in prize bounties; and out of what fund are prize bounties paid; how many enemy vessels were seized in port here or in British Possessions at the beginning of the war; are such vessels still named "Droits of Admiralty "; if so, is the Crown still entitled to them; can the approximate value of these vessels and their cargoes be stated; and to what fund will the money be applied; and to move a Resolution.
The noble and gallant Lord said: My Lords, I have rather a long Question on the Paper, but I will not intrude a long speech on your Lordships, This subject of prize money has evoked great interest among the officers and men of the Fleet. They have had a

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very dull and weary strain, but have proved of enduring energy and shown readiness of resource splendidly all through the war, while their daring cannot be spoken of too often. But they have not got that reward which everybody looks for after a life of zeal and energy.
There have been some remarks made in the Press that the wish for prize money is a sordid wish; that the men ought not to demand it. I do not see why the men should not have this benefit the same as those of any other profession. The commercial classes look for some reward in money and power. All the professional classes do the same; and the politician too. But in this war the only real qualification for promotion, so far as the politicians and other people are concerned, has been failure. I want to ask certain questions. Will the relatives of the men who are killed get some part of the prize money? Will the mercantile marine come in for some part of it?—the patrols, sweepers, and all the men who have done so splendidly for us in the war? Will the Royal Naval Division and the Royal Naval Air Service get any of this money when it is divided? The Secretary of the Admiralty mentioned in another place, in November last, that the appropriation of this fund will not be determined until the end of the war. He gave no reason, and I hope the noble Earl will abrogate that statement this afternoon, or give us some reason why the men should not have this money before the end of the war.
I want to ask also whether the promised Prize Bill will enable the State to give the money before the end of the war. There are many points in this Prize Bill of great importance that are outside the reference altogether of the Prize Claims Committee. I wish Lord Desart was in the House, because he could have given us some information about the Prize Claims Committee. When will the Bill be presented? Can the noble Earl give a date? I think a public statement should be made now as to how much prize money there is; how much interest there is on that prize money; whether this interest is invested, and whether the money is under the control of the Admiralty, the Prize Court, or the Foreign Office Committee that was set up?
There are several other questions I also want to ask. There is a Mr. Schroeder who was naturalised after the war, for which naturalisation amazing reasons were
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given. He claimed £41,000. I want to know whether he got it, or whether he will get it. I should also like to know whether other persons made claims, and for how much. There are many curious facts connected with this prize money. There seems to be a great difference of opinion in legal circles. Sir Samuel Evans the distinguished President of the Prize Court, had his dictum rejected by the Secret Committee of the Foreign Office, who appear to have the power to overrule the decisions of the Prize Court. I think that both in the "Adessa" and the "Progresso" cases the decision was rejected. With regard to the "Progresso," Sir Samuel Evans in giving judgment made an extraordinary statement. Speaking with regard to Article 3 of the Order in Council of March 15, 1915, he said—
"I cannot help thinking that the words must have crept into this Article 3 by mistake. It could not in my opinion have been contemplated that enemy goods could immediately be restored to the person entitled—namely, and enemy alien—or that if sold the proceeds should be restored immediately to an enemy."
What I want to know is, Are these enemy goods, ships, and cargoes coming in under the Prize Court to be restored to the owners after the war? From what the President said it is evidently not clear whether or not that is so. He said that according to his reading he ought to have returned these goods to the owners during the war, but added that there must have been a mistake. The Attorney-General also said that these words in regard to Article 3 must have crept in by mistake. When statements of this sort are made in the Courts is it any wonder if the officers and men of the Fleet are very much amazed and very much in doubt as to the prize money which is their due? We want these mistakes corrected. We want to know how we stand. We want to know how much money there is that should be allocated now, and we want clear and definite reasons given why the men should not get what is their due. As the President of the Court refused to give the property back at once, stating that there was a mistake in the Act, I wish to know whether he will be empowered to give this property back after the war. Another case was the "Odessa." In this the principal partner was a person with a terribly long German name which I will not inflict upon your Lordships. He lived at Hamburg. Will that property be returned to him? Will he be in the same category as Baron Schroeder who made a claim for £41,000?
My noble friend will correct me if I am wrong, but I believe that the prize money now amounts to something like £12,000,000. Dr. Macnamara said that it was impossible ft, state what the amount was, but surely the officers and men of the Fleet should be told approximately what it is. We know that it was something like £7,000,000 a little while ago, but I believe that about £200,000 has been taken front the Prize Court by the Foreign Office Committee. At any rate, that idea is entertained in the Fleet. I hope that it is not true, and that my noble friend will be able to correct it. If it is true, I want to know where the money went to. Was it given to people who are enemies and who made claims, like Baron Schroeder? The Queen Victoria Proclamation made in 1900 was abolished at the beginning of the war, and nothing has been put in its place. That is very hard on the officers and men, and it leaves a great doubt in their minds as to what is to become of the prize money eventually. I do not say that the old system of giving prize money was not a bad one, because under it only cruisers got the money, the rest of the Fleet not receiving any. I believe now that there is to be a scheme by which all the Fleet will share in this enormous sum. That would certainly be more fair, because the destroyers and patrols have done most of the work, even more than the cruisers. It is much fairer that the Fleet generally should share it than that it should go to one portion of the Fleet only.
I wish next to ask my noble friend about the prize bounties. Can he tell me how much money has been paid, and out of what fund it is being paid; how many vessels were seized here and in the British Possessions at the beginning of the war? Where does the money which is called droits of Admiralty "really go? Does it go to the Crown through the Prize Court? Will that money, which must be an enormous sum, form part of the prize which is to go eventually to the men, or is the Crown entitled to the whole of it as in the old days? There was another case in which Sir Samuel Evans was puzzled by the wording of the law. That was the case of the "Chile" and the "Gutenfels." In this case the President also called attention to the contradictions of the Sixth Hague Convention, and to Article 3 of the Order in Council of March 15, 1915. I will not detain your Lordships longer. I have asked some definite questions which I hope
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my noble friend will answer, as he must be quite as well aware as I am of the intense interest taken in the Fleet in this question of prize money.
THE ADDITIONAL PARLIAMENTARY SECRETARY OF THE ADMIRALTY (THE EARL OF LYTTON): My Lords, I think that a discussion on questions dealing with matters of policy connected with the Prize Fund had better be reserved until the introduction of the Naval Prize Bill in which the policy of the Government in this matter will be embodied. The noble Lord asked me when the Bill will be introduced. I cannot give him a date; but it is intended to introduce the Bill this session, and it will no doubt come before your Lordships at an early date. When it does, your Lordships' House will be given an opportunity of discussing many of the questions of policy raised by the noble and gallant Lord in his speech, and we shall be prepared to answer them in full detail.
THE MARQUESS OF CREWE: Will the Bill be introduced here or in another place?
THE EARL OF LYTTON: I am tillable to answer that question, but I imagine it will be introduced first in the House of Commons. The noble and gallant Lord has, however, put certain specific questions to me asking for information, and I will endeavour to give hint an answer to those which he has put on the Paper. With regard to the amount of money in the hands of the Prize Court, I can only give the latest figures relating to the amount held by the Central London Prize Court. There are other Prize Courts in other parts of the Empire, and money in them will be available eventually for the Prize Fund when it conies to be distributed, but I do not know how much is at this moment in the hands of these other Courts. Moreover, even if exact information on this point was available, these amounts would be of no value as a guide to the ultimate amount of the Prize Fund which will be available for distribution, and that is presumably what the noble and gallant Lord wants to know.
LORD BERESFORD: Why not, may I ask?
THE EARL OF LYTTON: Because that Fund will contain a number of items which will not be available for distribution. It will contain droits of Admiralty which will

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not go to the Prize Fund, but to the Treasury; and it will contain also a certain number of items which will go neither to the Treasury nor to the Prize Fund but to the owners of ships—I refer to those classes of vessels which are detained, about which an ultimate decision has vet to be made. All those sums are at the present moment in the hands of the various Prize Courts, and partition of those amounts will have to be made before it can be stated what sum will be available as a Prize Fund for distribution. But the figures, according to the latest information I am able to obtain, show that up to the end of March the sums in the hands of the Supreme Court in London amounted to £9,518,226.
LORD BERESFORD: Does that include "droits"?
THE EARL OF LYTTON: It, of course, includes droits of Admiralty, which will go eventually to the Exchequer, and some sums, as I have pointed out, which will go neither to the Treasury nor to the Prize Fund. Therefore to this sum of £9,000,000 odd must be added the sum, the exact amount of which I do not know, in the hands of the other Prize Courts of the Empire, and from it will have to be deducted droits of Admiralty and certain other charges which I indicated.
With regard to the second Question on the Paper, I am not quite clear what is meant. There is no Foreign Office Committee which paid out money either to Messrs. Schroeder or to any one else, but I presume that the Prize Claims Committee presided over by Lord Desart is the body to which the noble and gallant Lord refers. This Committee was appointed by the Treasury to consider the claims of third parties in respect to cargoes and other matters on enemy ships. The Committee has made no payments to Messrs. Schroeder at present. The sum of £15,770 18 s. 11 d. has been paid to British and Allied pledgees and unpaid vendors.' The claimants, before they receive their money, are required to enter into an agreement to take all possible steps to recover the sums paid them from the enemy debtors after the war, and all rights against the enemy owners and purchasers are preserved. Thirdly, the noble and gallant Lord asks me how much money represents enemy property.
LORD BERESFORD: My noble friend has not quite cleared up the point about Baron Schroeder. Did Baron Schroeder get money under that claim?
THE EARL OF LYTTON: I said that this Committee had paid no money to Baron Schroeder. To return to the third point on the Paper, this information is not available. Even if the total amount in the hands of all the Prize Courts of the Empire were known it would be impossible at this moment to say how much of it is in respect of enemy property which is detained in accordance with the provisions of the Sixth Hague Convention.
The next point is in regard to prize bounty, the figures of which are as follows. The total amount of prize bounty awarded to date is £60,580. The net amount available for distribution after payment of expenses is £55,214. Of this amount £51,650 has been paid to date. Payment of the shares outstanding is being made as the applications are received or the men are traced. Prize bounties are paid from a fund provided by the Treasury out of money voted by Parliament in accordance with Section 44 of the Naval Prize Act, 1864.
Then the noble and gallant Lord asked me certain questions with regard to enemy vessels seized in port at the beginning of the war. Including lighters and dhows, but excluding smaller craft, it is calculated that about 251 enemy vessels were seized in port here or in British Possessions at the beginning of the war. Generally speaking, these vessels have been ordered to be detained under The Hague Convention—that is to say, until after the war. Their ultimate treatment, therefore, is not yet determined. If they had been condemned as droits of the Crown, then the Treasury would be entitled to the amount, and it would not go into the Prize Fund. At this moment they are merely detained.
LORD BERESFORD: Can the noble Earl tell me about their cargoes? Some were perishable.
THE EARL OF LYTTON: The noble and gallant Lord asks me if I can give him the approximate value of ships or cargoes. That I am unable to do. I am told that this information is not available without a great deal of trouble and intricate calcula-

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tion. Most of the ships are being employed on Government service, and they may either be returned to the Prize Court, or, in lieu, their value may be paid into the Court. No payment, however, has yet taken place, and it is not possible at the present moment to form an approximate estimate as to the value of these ships and their cargoes. Such of the cargoes as belong to British, Allied, or neutral owners have, of course, been released.
LORD BERESFORD: I thank my noble friend for the information. With regard to most of the points that I want elucidated—differences of opinion with regard to the legal view of the situation—we shall have an opportunity of clearing them up on the Prize Bill.
THE EARL OF LYTTON: Certainly.

LABOUR AND AGRICULTURE.
THE EARL OF JERSEY THE EARL OF JERSEY rose to call attention to the effects of the system under which labour is obtained in agricultural districts for non-agricultural work carried out by or on behalf of certain Government Departments, and the consequent menace to the food supply of the country; and to ask His Majesty's Government what steps they propose to take in the matter.
The noble Earl said: My Lords, in asking this Question I should like to explain that I do not under-estimate the importance of the work of the Departments to which I refer, and I fully appreciate the vital necessity of that work being completed at the earliest possible moment. But if I state the case from what may appear to he a one-sided point of view, it is because possibly it may not be fully realised to what an extent food production is hampered by the activities of these Departments, and more especially by the method which their agents employ to secure the necessary labour. The Departments to which I propose particularly to refer are those connected with aerodrome construction and the work of the Road Board, but I have heard of others, and I venture to hope that any assurance that may be given will apply equally to the work of all Government Departments in agricultural districts.
The system complained of is that by which labour is withdrawn from agriculture by the very simple process of offering wages at a rate with which no farmer could
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possibly compete. I notice that this subject was touched upon in your Lordships' House in a recent debate, and I will endeavour not to go over the same ground again, more especially as I do not wish to quote any specific instances, but to refer to the effect, not only the immediate but the lasting effect, which this system is likely to have on agriculture. I should like to add that I felt bound to raise this matter because of the great number of letters received by the War Agricultural Executive Committee of which I am chairman, both from individual farmers and from various agricultural bodies in the county; and I understand that the same complaint is being put forward in very many other localities.
We are told that an adequate supply of home-grown food is essential if we ale to continue the present struggle, so much so that men even of military age are not allowed to be taken away from agriculture by the military authorities at a time like this, when all fit men are so urgently needed. I would suggest that it is surely an anomaly, that being so, that other Government Departments should bribe men to leave agriculture by the inducement of extravagant wages at a time when it is so very essential that every man should serve his country in the capacity for which he is most fitted. I shall, perhaps, be told that every aerodrome contractor has received instructions that he is only to take men through the Employment Exchanges, and that the managers of those institutions have been instructed that they are not to put forward men who are engaged in agriculture. I wish that this instruction had extended to work that was to be undertaken on behalf of all Government Departments, and that it had been somewhat more strictly observed. I believe that the managers of the Employment Exchanges observe their instructions, and that the contractors and the resident engineers do their utmost to avoid taking men from agriculture, but I am not sure that the same can be said about all their deputies. However that may be, the fact undoubtedly remains that a great number of men have found their way from agriculture into work undertaken on behalf of Government Departments. I could give instances where men have been refused by aerodrome contractors on the ground that they had come straight from agriculture, yet have been promptly taken on by the Road Board; but, as I said, I will not give particular instances this evening.
It is not within the scope of my Question to criticise the work undertaken by other Departments except in so far as it affects food production; but I would suggest that a system by which a contractor receives a commission on the wages paid, which means that the more men he employs and the higher wages he pays the better it is for him, is not likely to conduce to economy. The men themselves know that these wages are not permanent, and a certain number of them, at any rate, are not inclined to hurry over the job. Such a system as this is likely to prolong the work and to increase the cost. I do not dispute the right of any man to obtain the full market price for his labour, but he should undertake the labour for which he is best fitted and carry it out to the best of his ability. I am told that within the last three weeks an increase of 12½ per cent. has been paid, and this where men who are unskilled are earning up to about 70 s. a week, and skilled men much more; yet the skilled agricultural labourer receives less than half of that amount. How can farmers possibly compete with such a system, and whence are they to obtain their labour at harvest time?
I have often wondered why the German prisoners in this country could not be employed on aerodromes and on the roads instead of civilian labour, When these men are employed on farms the, restrictions as to the size of the gang, the radius within which they go out to work, and also the supervision to be exercised, are rightly strict. These restrictions could be far more easily complied with if they worked on aerodrome construction or on the roads. And if they were paid at the same rate of wages as that received by our men in Germany, there would be no question of competing in the matter of wages in regard to agricultural labour. Consider the feelings of the farmer when he is told by his Committee to break up grass land, and, after cheerfully accepting that decision, goes home and finds that his carter, perhaps, has gone to work on the nearest aerodrome or on the road. Is not such a state of things most discouraging to him in his efforts to increase our food production? Those who serve on Executive Committees know the argument that is put forward on appeal by the farmers to the effect that, if they have to break up more grass land, something else will have to be left undone because of the shortage of labour. If compulsory Orders are issued, the least we can do for the farmer
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is to see that he gets the necessary labour, and to ask His Majesty's Government to take care that various Departments do not deprive the farmer of what little labour be already has.
Farmers are prepared to make any sacrifice and to do any kind of work possible at the present time. The readiness with which they have accepted the various Orders has been remarkable. But they should have an adequate supply of labour to fulfil the demands made upon them, and they should not be subject to the additional insecurity caused by demands for labour in other directions making their position almost impossible. So with the labourers. Is it reasonable to expect a man to stay at one kind of work when other men, who are not doing half the amount of honest work that he is doing, are drawing twice as much in wages? I believe that many of these men, however, have remained in their old employment because they think that they can best serve their country by working on the land, and have not considered their own immediate pecuniary interests.
My excuse for taking up your Lordships' time is that I view with great concern the future of agriculture, and unless steps are taken to remedy matters and to re-adjust the scale as far as the times permit matters will go from bad to worse. In existing circumstances there must be unrest, and the farmers as well as others have to face abnormal difficulties; but I trust that the action of Government Departments will not aggravate those difficulties. We have been told that the farmers can save the country. I believe that the farmers and the labourers together can and will save the country if they can but obtain a fair chance to reap the reward of their labours. The evil which exists is a double one. There is the immediate depletion of agricultural labour from the causes I have mentioned, and the disquieting effect that this has upon those who continue in agriculture. In my view the latter evil is as important as the former. We all wish to see the farmer placed in a position of greater security and given that encouragement which has been too long denied to him. We also wish to see the agricultural labourer receiving a fair share of the improved conditions. But if the revival of agriculture is not to be based on mutual regard, and if the agricultural labourer is to be taught that he is better off in any other industry than agriculture, then the outlook is hopeless. Those who are always desirous of

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fermenting trouble are given opportunities by the existing condition of affairs, and nothing is more calculated to disorganise labour in our country districts than a sense of unequal treatment.
The farmer cannot continue to produce food without labour. At the same time he cannot compete against the rate of wages paid by Government Departments unless the price of food rises still further. The cost of production must naturally govern prices. We have heard a great deal about the importance of agriculture, and we are glad to believe that the farmer is to receive at last proper recognition; but although many appeals have been made to the farmer, when it comes to granting practical assistance, agriculture, being weak, goes to the wall when Government Departments compete amongst themselves. It is all to the credit of the farmer that, despite the way in which he has been treated, he is still determined to do his best; and I hope that the noble Viscount who will reply on behalf of the Government will give us some reassuring statements as to his future prospects.
THE JOINT PARLIAMENTARY SECRETARY OF THE NATIONAL SERVICE DEPARTMENT (VISCOUNT PEEL): My Lords, the noble Earl who has just sat down has presented with much force the difficulties in which agriculture is placed owing to the higher wages offered in other occupations. We sympathise with the difficulties in which the farmer is placed, and also with the patriotic behaviour of many of the labourers who have resisted these temptations.
The first observation I have to make on behalf of my noble friend Lord Rother-mere—because he was to have answered on behalf of the Air Board and the Road Board, and, so far as that portion of the Question is concerned, I am taking my noble friend's place—is that an arrangement was come to with the Air Board, as the noble Earl said, at an interview arranged by the Minister of National Service, that the Air Board, its contractors and subcontractors and all those whom it controls, should take their labour in future only through the Labour Exchanges. That arrangement has been carried out. Instructions have been sent by the Minister of Labour to the Labour Exchanges that they should not send forward men actually engaged or who have recently been engaged
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in agriculture when the Air Board or their contractors require men for building aerodromes.
I think my noble friend was good enough to admit that so far as his observation goes these arrangements have been carried out both in the spirit and the letter of the engagement. He suggested, it is true, that some of their deputies—I suppose he meant some of the sub-contractors—had not been above suspicion. I should like to say this. Of course, these arrangements apply to the contractors and every sub-contractor with whom they deal, and the Air Board is extremely anxious that the arrangements should be strictly adhered to, and if any complaints are sent to the National Service Board or to the Air Board they will he glad to investigate them and see whether the stories are really correct. I am glad to note that my noble friend made no allusion to certain charges which have been brought forward, that vans were going about the country and deliberately recruiting men for aerodromes. Those charges have been investigated and found not to have any foundation in fact. Such vans as were in existence were merely used for conveying men who had agreed to take service in aerodromes to their work.
There is a further point which I should like to make, and this is rather on the part of the National Service Board than on behalf of the Air Board, because what I have just said binds only the Air Board and the Road Board, which of course acts as agent for the Air Board in constructing roads and such work in connection with aerodromes. But the system that I have outlined has been carried still further, and arrangements have been now made for munitions, and only two days ago arrangements were fixed up with the Admiralty that they would similarly only employ for their works of construction persons taken through the Labour Exchanges, and persons who were not engaged or who had not recently been engaged in agriculture. Therefore the whole field of Government construction is coveted, and men will no longer be taken by subterranean methods but only through the Labour Exchanges. If this arrangement is kept, I think that all the Government can do will have been done to see that agriculture is not further depleted.
There were two observations made by my noble friend on which, although they were not strictly relevant to the Question,

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perhaps I ought to add a word. My noble friend will see that there is immense difficulty if you have one industry in the country which must necessarily be less well paid than another. The temptation for a leakage from the less well paid to the higher paid industries is very great, and it is especially great in the case of aerodromes which have to be put down in country districts, and where the contrast between the rates of wages paid is so easily known to the inhabitants. I think my noble friend commented on the high rates of wages. No doubt they are high, but that is not due to the special action of the Air Board or of the contractors. They merely pay the rates of wages which prevail in the particular trade. They cannot pay less, and they do not pay more; but it is obvious, with the longer hours and the overtime, that the wages for unskilled men must reach a high figure. Sunday work, as the noble Earl knows, is now to be stopped.
The noble Earl's second criticism was upon the method of carrying out these contracts by paying a percentage on the amount expended. This system was inherited by the Air Board from the War Office, and I think I am right in saying that far the larger number of the contracts now running for aerodrome construction under the Air Board were fixed by the War Office and were therefore inherited from the War Office. Certain changes have, however, been made under the Air Board. They have a number of accountants going about the country looking into the wages paid and seeing that there is no waste of any kind. The system, obviously, may he objectionable in various ways, but the noble Earl does not, perhaps, realise that the only way in which you can get work done at all—because such is the uncertainty now and the rise in prices that you cannot get aerodromes built at all under ordinary contract conditions—is under this system. It may be open to criticism in some ways, but it had to be adopted; otherwise no aerodromes could have been built.
On the general question, I think I must leave the noble Earl to find what satisfaction he can out of the fact that a system has been devised and is being carried out by which men can only be recruited in one way and through one channel for this work. This last point he might consider. As he knows, men of military age who have been in agriculture since the beginning of June have a special protection. They lose that
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protection when they leave agriculture. Now the age is going to be raised to fifty or nearly fifty-one, as announced by the Prime Minister in another place, and it is quite clear that those under that age who are now in agriculture and who try to go to other occupations will lose their exemption. I know there are some pretty old agricultural labourers, but I think the number above that age must be small who leave their homes to take up other occupations, because above that age the human being becomes a little less flexible for adapting himself to new occupations. Therefore I think on that point agriculture is to some extent safeguarded.
VISCOUNT CHAPLIN: I am sure your Lordships will agree that the noble Earl need have made no apology for introducing this subject or for any length at which he spoke, for as a matter of fact this is a question of supreme importance, and I confess I was a little disappointed when the noble Viscount told us that he had come to the conclusion that the Government had already done practically all that they could do to avoid a further depletion of agricultural labour. Even now agriculture is working under the greatest difficulty as regards labour and the increase in the price of labour to which they are being made subject every day.
We have been told over and over again, with much energy and almost passionate force, that it is vital to the safety of the nation and to its life—that is the language of the Prime Minister—that there should be an enormous increase in the production of home-grown food, and every word of that is absolutely true. Then what is the position with which we are confronted? The noble Earl, with great clearness and force, has told you that if the present difficulties in regard to labour continue they must be absolutely fatal to this production which the whole of the Cabinet are agreed is vital to the very existence of the nation. It is nearly a year since the Leader of the House of Commons, Mr. Bonar Law, in a speech which he made upon this subject, made a statement in which he put the further production of food in this country and the continued progress of increased production side by side in importance with the provision of fighting men at the Front. This is absolutely true. I hope the noble Viscount will take the opportunity of impressing the matter upon the Government.

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Perhaps the noble Earl also will have something to say to some of them on the point.
I am the more anxious about this because I can confirm all that has fallen from the noble Earl from the fact that only last night I was addressing an enormous meeting of agriculturists in the North of England. I learned that the condition of things there was appalling. Not only were statements made at the meeting itself, but had the advantage of meeting half a dozen or more of these gentlemen privately afterwards and having a long talk with them before I caught the train back. What were the facts I arrived at? In the county of Durham they were asking 36 s. per week wages. In the county of Northumberland I was told it was 38 s. In Cheshire not long ago they were asking 45 s. in the dairy district. Everybody knows that the thing began the other day in Norfolk, where they asked for an increase from 25 s. to 30 s. That was taken up in Northamptonshire.
There has followed exactly what I predicted on the Second Reading of the Corn Production Bill would follow after the change of policy which was adopted in that Bill as compared with the clear and definite policy laid down by the Prime Minister in the House of Commons on February 23 last year. What was that policy? A distinct, unqualified, definite pledge that there should be no wages boards set up till after the war, and a further guarantee that there would he no maximum prices fixed, but that the producers of food, in the great task which was urged upon them, would be allowed the free run of the market. As the result of all these changes I state with profound regret my undoubted view that the methods which have been pursued and the whole system for producing an enormous increase of food in this country are as unhappily situated at the present moment both with regard to meat and cereals as can easily be imagined. Something must be done. The Government must take up the question in earnest, and find some way—because it is their business and their duty—to give substantial effect to the policy
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which they have declared to be absolutely vital to the safety and existence of the country.
THE EARL OF JERSEY: My Lords, I thank the noble Viscount (Lord Peel) for the reassuring statement he has made. As regards one of his observations, I should like to say that I did not criticise the fact of the percentage on construction. I was particular to say I only criticised the fact that the percentage on wages was included in the percentage on construction, but I know that Lord Rothermere has explained that no other system was possible.

HOUSE OF LORDS OFFICES.
Moved, That the Earl of Wernyss and Lord Lamington be added to the Select Committee on House of Lords Offices.—(Lord Hylton.)
On Question, Motion agreed to.

BUSINESS OF THE HOUSE.
THE LORD PRIVY SEAL (THE EARL OF CRAWFORD): My Lords, as there is no business on the paper for to-morrow, I suggest that your Lordships should adjourn until Thursday.
Moved, That the House do adjourn until Thursday next.—(The Earl of Crawford.)
THE MARQUESS OF CREWE: Is the noble Earl able to tell us anything about the business for next, week?
THE EARL OF CRAWFORD: If the noble Marquess will raise that point on Thursday, it will then be possible to estimate with some certainty on what day the Man-Power Bill is likely to reach your Lordships from the other House. To-night I am afraid I can give no information.
On Question, Motion agreed to.
House adjourned at fifteen minutes past seven o'clock.