HL Deb 03 December 1919 vol 37 cc549-75

LORD ISLINGTON rose to call attention to recent developments in connection with the industrial situation; and to move for Papers. The noble Lord said: My Lords, my Motion as drafted is somewhat wide in scope, and the reason for this is that I understand there are several of your Lordships who desire to take part in the debate and to offer observations on the general industrial situation, more especially in regard to the far-reaching and critical events which have taken place since the debates in this House on this subject last February and March.

The subject of the industrial situation is a vast one. Many of its aspects are most intricate and difficult; and in making the Motion in the vague manner I have, it may be said by my noble friend who will answer on behalf of the Government that I am placing him at a somewhat unfair disadvantage, as questions may be raised in the course of a debate of this character which he could not have anticipated and would not therefore be in a position to answer adequately. I trust that my noble friend will exonerate me from any malign intention in this respect. I have informed him privately of the trend of my remarks, and I am sure that noble Lords who will speak will fully realise the difficulty under which any one in this House answers on behalf of a Department to which he does not himself belong.

The whole industrial situation continues to be so acute, events have taken place and are taking place so serious and in many respects so disturbing, that no apology is due from any one who ventures to raise a debate again on this subject. It is only by this means that an opportunity can be given to those members of your Lordships' House who are intimately conversant with many branches of the subject to make suggestions and offer observations so that some hope may be held out of arriving at a better understanding as to the evils which exist and the methods that may be employed to mitigate those evils.

Last week an interesting debate was raised in this House by Lord D'Abernon on the present condition of currency. In an able speech he showed the influence of currency on the present high prices, and the intimate relation its condition had on disturbance and unrest throughout the industrial world. I hope that the substance of that debate and some of the proposals which emerged from it have come under the attention of the Government, and that they are giving them their earnest and favourable consideration. It is now manifest that if we are to reach anything in the nature of a stable condition of industry in this country—a condition to realise efficient and effective results in any measure commensurate with our vast and increasing liabilities and burdens—the problem must be approached through many and varied channels, and approached promptly, simultaneously, and courageously.

All these factors are familiar to your Lordships. I have mentioned one—currency, insolubly interwoven with the industrial problem. There are also the reduction of expenditure, the diminution of waste, the stopping of profiteering, effective housing, and the organising of efficient transport by land and sea. I will only say of each and all these factors that there is room for much more to be done than has hitherto been attempted. It is only by so doing that these different factors are able to play their true and effective part in the solution of this great problem.

There is another aspect of the industrial problem which ranks, I venture to say, of equal importance to those I have mentioned. It has a close and intimate bearing on all the disturbing events we have recently witnessed; events such as the great railway strike of last Autumn, and events in regard to the mining situation —the proposals made in connection with that industry and the confusion and conflict of opinion as to its economic condition. In a word, the whole state of industry and of unrest in industry, the suspicion and discontent which are to be found simmering in some parts and almost bursting into flames in others, is in a large measure due to the present system of organisation of our industries—I should rather say to the lack of proper organisation existing within many of our industries. In some industries the machinery for adjusting differences is highly unsatisfactory; in others it is inadequate and incomplete to effect the practical results required. I again quote two of the menacing instances—the railway strike and the mining situation—as illustrations of the disturbances which might have been averted had the organisation been more satisfactory; and in the case of mining, much of the present condition would have been checked if this great undertaking had been equipped with adequate machinery to ensure an equal, unreserved, and accurate discussion of the problems by both branches within the industry.

I turn now to the subject on which I am going to ask your Lordships to allow me to make a few remarks. The most promising form of machinery existing at the present moment capable of realising these essential objects in our industrial welfare is the Joint Industrial Council. The Joint Industrial Council is now quite familiar to all your Lordships, the main principle being to bring together on an equal footing representatives of employers and employed, through their trade association or master federations and through their trade unions. In these councils every kind of question relating to industry is considered and discussed, and in many instances finally agreed upon. Disputes and misunderstandings are thrashed out. Under this scheme the employer is obliged to reason with his men, not to dictate; while on the other hand a workman is obliged to acquiesce in the face of reason, and not make exactions where the industry cannot bear those demands.

There are to-day fifty-three of these Joint Industrial Councils in existence. Fifty-three industries have elected to establish these councils as distinguished from individual businesses, because it is the whole industry which is represented within those councils and not mere businesses within any industry. I venture to say that on the whole this is a satisfactory record for two years, because it is only two years, within a few months, since the Whitley Report was published, and during that period many of these Councils have enjoyed a large measure of success. Relations between the two branches have appreciably improved, and although they are working within somewhat narrow and prescribed limits the experience which has already been gained gives occasion for the most optimistic anticipations, especially in those occupations where the Whitley scheme can be carried out in its entirety. It is not applicable to all industries, but wherever it can be so carried out it has proved specially successful. I mean by this that one has the Joint National Council, below that the District Regional Council, and below that the Works Committee. I have heard from many credible sources that it has been found that many disputes arising in a Works Committee have been settled there and where that has not been the case the question at issue has been referred to the Regional District Council, and where it is necessary to go further the question in dispute has been taken to the Joint National Council. Hundreds of small cases have been settled on amicable lines in this manner. Hundreds of cases which had they been allowed to drift and to become more acute and aggravated would have led to serious disputes, have been checked at the source, and thereby these troubles have been avoided.

The Government, in the letter which was written by Mr. Roberts, the then Minister for Labour, laid down the policy of these Councils as follows— In order that the Councils may be able to fulfil the duties which they will be asked to undertake, and that they may have the requisite status for doing so, the Government desire it to be understood that the Councils will be recognised as the official standing Consultative Committees to the Government on all future questions affecting the industries which they represent, and that they will be the normal channel through which the opinion and experience of an industry will be sought on all questions with which the industry is concerned. It will be seen, therefore, that it is intended that Industrial Councils shall play a definite and permanent part in the economic life of the country, and the Government feels that it can rely on both employers and workmen to cooperate in order to make that part a worthy one. This letter represents a clear and comprehensive statement of policy. It represents, I venture to say, a policy to which these industries that have now furnished themselves with industrial Councils are most desirous of giving effect.

I do not wish to introduce anything in the nature of controversy into my remarks this afternoon, but I would say here that certain action of the Government, since that letter was written would lead one to feel that they have not so faithfully carried out the principles embodied in that letter as one would desire to see, in the cause of encouraging Industrial Councils. Experience has already shown that there is a fundamental weakness in these Councils in that they are entirely voluntary bodies. They have no power or authority to enforce the decisions that they come to. This constitutes a real danger to their future, and I venture to say to their immediate future. After long and elaborate conference a Council comes to a decision as to wages, hours, or conditions of labour. This decision is only binding on employers and operatives who, through their representative associations, are members of the Industrial Council. A single influential manufacturer standing outside these Councils can wreck the whole arrangement. This has already been found to press extremely hard on employers. Often an agreement has been come to in the councils, probably by unanimity on the part of the employers, to a proposal made by the operatives, but a non-associated competitor in the trade cannot be bound, and he refuses from outside. Therefore the employers within the Council are ultimately obliged to oppose the proposal. I am given to understand, and one can quite realise that much bitterness and misunderstanding has ensued among the men in the Councils. Serious trouble has recently arisen in the Saw Milling industrial Council. Again, in another important industry a decision was come to, I believe, with complete unanimity within the council that there should be an annual week's holiday for the men. An outside non-associated manufacturer opposed the proposal, and it has had to be dropped. Therefore to-day it is being openly said on both sides in many of these Councils that unless something is done, and done soon, to make their decisions binding throughout the industry, it will really not be worth the trouble and expense to which they are put to continue their work in the Councils and the Councils will lapse and finally die.

I understand that the Minister of Labour has received many representations in this sense within the last few weeks and months. This is all due to the fact, as I have said, that these Councils are voluntary bodies—that they have no statutory status and cannot therefore enforce the decisions at which they arrive. Let me here, in regard to this point, read to your Lordships Paragraph 21 of the Whitley Report, where it is quite clear that they anticipated exactly what is taking place — It appears to us that it may be desirable at some later stage for the State to give the sanction of law to agreements made by the Councils, but the initiative in this direction should come from the Councils themselves. I am given to understand that there is a growing desire amongst Councils to obtain this statutory power. I understand that an appreciable number of them would quickly avail themselves of such powers if such powers were afforded them.

The question arises, How should these powers be granted? It is quite clear, of course, as the Whitley Report states, that the initiative must come from the Councils themselves. The Government cannot, and I venture to think should not, enforce a power of this character upon trade associations and trade unions, but the Government should give facilities; and in fact unions have approached them to grant such a power. There are two ways in which decisions arrived at by these Councils could be made binding. There is, first of all, the way by which the Minister of Labour would be empowered to grant an Order making decisions binding upon all in an industry when 75 per cent. of the employers and 75 per cent. of the operatives apply together to secure such compulsory powers. I am told in this connection that although there are many trade unionists to-day—I believe an increasing number—in favour of this movement, trade unions as a whole are divided in opinion upon the proposal. It is contended by some that such provision, if established, might prove injurious to their minions because operatives would think that there was no necessity to belong to a union if they were able to secure all that they desired by means of the compulsory power within their Councils. I can quite understand, and I am sure that your Lordships will fully concur, that no movement in this direction could possibly be carried out with any hope of success unless it carried with it the good will of both the employers and the representatives of the trade unions.

There is a second way—and this is the one that I would commend to the serious attention of His Majesty's Government and to my noble friend, who, I hope, will represent it to the Minister of Labour. It is that where 75 per cent. or upwards respectively of employers and employed apply to the Minister of Labour for a Charter of Incorporation of a trade association on the one side and the trade unions on the other of an industry, the Minister of Labour should be empowered to grant such a Charter respectively to both of these branches, and that this Charter should possess certain definite provisions. The first and important provision to which I would ask your Lordships' earnest consideration is this, that every employer engaged in the industry must belong to his trade association, and every operative in that industry must be a member of his trade union; in other words it would be illegal for an employer to be engaged in that industry unless he is a member of his trade association, and it would be equally illegal for a workman to be engaged in that industry unless he is a member of his trade union.

The Labour Congress of 1916, through their Parliamentary Committee, approached the Government to provide that membership of trade unions should be compulsory on all workers, and since that date undoubtedly opinion has greatly strengthened in that direction. I am given credibly to understand that this applies in only a less degree to employers. This provision would effectually ensure that decisions were binding within a Council, because no outside non-associated competitor would any longer exist to upset or wreck a decision, and, of course, if this were carried out it would be binding in both ways and on both branches equally.

Apart from the advantages derived from making the decisions of an Industrial Council obligatory on the trade, there are other reasons, very important in character, why these Councils should possess a statutory status. It is already realised after two years work that these Councils must be clothed with more security. They must have greater security of tenure. If they are to hope to become permanent and valuable organisations within the industry, they should be adequately and efficiently staffed, and you cannot expect any intelligent and experienced man to undertake a position on the staff of one of these Councils unless he is assured of proper remuneration and unless there is a proper status of permanency in his engagement. The work attached to these Councils is intricate in the extreme. Not only is it technical from the point of view of the whole industry, but it is so also from the point of view of the various branches within the same industry; therefore you have to secure the very best man for the purpose. Finally—and this I am told is of the very first importance—it is necessary to have staffs for the purpose of collecting annually in statistical form a Return showing in detail the whole financial position of the industry, the average earnings by the hour, of the skilled, semi-skilled, and unskilled labour, the cost of production, and the profit from the turnover.

I am told that objection is raised to the disclosure of profits within an undertaking. I would point out that those profits are being disclosed in the annual balance sheets of all limited liability companies to-day, and as a matter of fact they are being disclosed in the very worst possible form, because the profits are only shown in relation to the ordinary share capital of the concern, whereas in a successful business with large reserve funds the ordinary share capital of the concern bears no relation to the actual capital employed in the business. The profits thus give an absolutely wrong impression as to the actual fact. What is wanted in order to arrive at an accurate representation of the real position is the disclosure of the profit on the turnover of the whole business, and that will then show whether the profit is excessive or reasonable, and every operative and the community (who are consumers) will be able to judge the results. The United States Government have made such a report certainly for one industry, and possibly for more industries, in America. That. Report has been copied by the pottery industry in this country—an industry which has advanced further and with as great success certainly as any other in connection with Industrial Councils, and I am given to understand that in that industry to-day the scheme for divulging the whole of the profits is in process of being carried out.

In these circumstances, as your Lordships will see, you would have round each of these Council tables men representative in the most democratic way of manufacturers on the one side and of operatives on the other, and the whole facts would be laid bare. The cards would be placed on the table in regard to the industry, and both employers and employees would start their discussions with their interests secured, because the decisions would be based on accurate knowledge of the whole financial and economic situation of the industry.

It is of great importance also in these concerns—and I wish to lay stress upon this point—that the community should have access to these figures as well because they must also be safeguarded. There most be no danger of the community being exploited by a combination of employers and employed, and it is conceivable, unless proper safeguards are introduced, that operatives on the one side might force up the wages, the employers on their side might give way, and, in order to meet the charge, unduly raise the price to the community. Therefore every precaution must be taken to safeguard their interests. If a Return on those lines had been in existence during the past two years in the great mining industry of this country we should not find ourselves to-day enveloped in this economic entanglement.

I am told from various sources, and I cannot fail to be impressed by it, that from a, regular disclosure of all the financial position of an industry results would ensue of immense value in the direction of industrial harmony and the removal of misunderstanding and suspicion, both on the part of the workmen and on the part of the community. Directly the facts are known I think we can leave it with perfect confidence to the common sense of employers and employed to work out their redemption on a fair and sensible basis. It is because the facts are not known that friction arises, and the extremist steps in and leads the agitation within an industry. We must all realise to-day that in industry Capital and Labour must work as partners. They can no longer be regarded as antagonists, and it is a danger to the State so long as that state of things continues. It is through the instrumentality of the Industrial Councils that I believe this aim can best be realised—and it must be the Industrial Council properly clothed with power and organised as an integral part of the industrial machinery of the nation. I venture to press upon His Majesty's Government through my noble friend (Lord Crawford), and especially upon the Minister of Labour, the importance and the urgency of giving this aspect of it his close and earnest attention.

It will be said that if you develop Industrial Councils on these lines you run the risk of two very serious dangers—first an industry may combine to put up prices against the public; and, secondly, it may produce an uneven scale of prices as between the industries and thereby affect the whole commercial and economic situation in the country. I assume in this connection—and time will not allow me this afternoon to develop it as far as I should like—that the Central National Board which, I believe, is either in being or partly in being, will play, and should play, a very important part in relationship to Industrial Councils in the future. I understand that that Board is to consist of 400 members, 200 representing employers and 200 representing operatives. I hope that that Board when it is constituted will assume the position of a confirming authority on decisions by Industrial Councils where those decisions may affect the whole balance of industry, or where it is necessary to bring about the correlation of wages as between one industry and another. There is the machinery available for that purpose and there is no doubt that the more power you give to the Industrial Council the more necessary it becomes that there should be a correlating and co-ordinating authority over those Councils, to deal with these larger subjects which in their decision may affect the whole commercial interests of the country.

All I would say regarding the Central National Board is this. Wherever there be an industry which possesses an Industrial Council in all cases representation on the Central National Board should be drawn from that Industrial Council. It must be obvious that the men who form those Councils, both employers and operatives, must be the men who will every day and every year become more and more skilled and conversant with the whole of the inner details of the economic situation of their industry. And therefore from among them undoubtedly must be found the most valuable representatives for their industry on the Central body. The present Central Board, as I understand it, is completely independent of the Industrial Councils. It is to be appointed by the Minister for Labour, and therefore there is no security and no certainty that those appointments will be made in connection with and relation to the Industrial Councils.

During the past year I have devoted what time I could to the examination of these Councils, and I hear on all hands that their influence is creating quite a new atmosphere between employers and men. Human contact is being introduced really for the first time in many of these industries, and human contact is a very essential factor to-day in every branch of our national life. It is true that some of the most important industries have hitherto refrained from furnishing themselves with these Councils, notably the transport industry, the railways, the mines, the cotton industry and the engineers, and I think this is much to be deprecated. But I would urge upon the Government, without, of course, suggesting anything in the nature of undue interference, to give all the encouragement that lies in their power to induce these industries, which are still standing out, to clothe themselves with the powers of these Councils. I was told only yesterday that an appreciable number of the miners in South Wales are seriously turning their minds towards establishing Industrial Councils. They are already, on examination, coming to regard this system as preferable to State intervention and control, and I am bound to say I have the deepest sympathy with them in the light of recent experiences in this connection. The whole future of this movement now really depends upon the logical development of the Industrial Councils, upon their being properly organised and granted the necessary powers, and the appeal I make to His Majesty's Government this afternoon is that they should seek out and show to these Councils that they are willing, and ready to facilitate that development whenever and wherever they are asked to do so. I beg to move for Papers.


My Lords, some years ago I was general secretary to an attempt to reorganise and to put trade unionism on a better basis by co-operation between the employers and the employed. These Industrial Councils may do a great deal of good, but I agree with the last speaker that they cannot do very much good unless they are backed by some authority. How are you to back them with such authority? When we started with the Arbitra- tion Court in Australia we thought we had a legal authority that could lay down a fixed principle and have an agreement carried out on both sides; but we found that it was impossible to devise any authority to compel a man to work when he did not want to work, and that it was possible to enforce the agreement on one side only. The Court endeavoured to enforce the first agreement come to by imposing a fine of £5 on each of 2,000 miners who had broken the agreement. That is nearly ten years ago, but not one of those fines has been paid up to date.

There are forces at the back of this matter which are very little understood. At that time, with the assistance of the whole Statistical Department of Tasmania (the head of which was very much in favour of what I was doing), I got extra statistics returned. After taking a review of the whole of the statistics from 1870 to 1910, we found that the fluctuation in the increase of production throughout the community amounted to £6 to £7 per annum for ten years, which was counterbalanced by a rise on the population of 1 person in 1,150 in the next ten years; that a drop of £6 or £7 per annum was counter-balanced by an increase in the death rate of 1 in 1,150; and that the total alteration in the wealth of the community in the twenty years did not amount to £12 per annum, although we had the minimum and the maximum of the whole period.

One can live only on that which one has to eat. You can alter the wage of a community, but you cannot alter the wealth by altering the wage. You may increase the remuneration of one class or profession or trade to the detriment of the others; but we found that to pay £100 a year wages, with the purchasing power of the sovereign from 1870 to 1910, necessitated that in every thirty years close upon £3,000 should be subscribed in capital, and that it was necessary to make £250 profit. As the bulk of that saving rested on less than 10 per cent. of the population it became very difficult to legislate for it. I may say that at the time I could have stopped the formation of several trade unions so far as the workers were concerned, but I was met with difficulties on the part of the employers. The employers said, "We are going to pay 25 per cent. extra wages but we are going to make 75 per cent. extra profit," They are now paying 200 per cent. extra wages and making no extra profit; therefore they wish that they had not made that 75 per cent. extra.

Another little statistic will, perhaps, open your eyes. The protective policy carried by the Barton Ministry, which raised the protective duties from 30 per cent. to 55 per cent, put £92,000,000 into the hands of 2,100 manufacturers and importers in ten years, out of which sum they paid to 588,000 employees £23,000,000. On the face of it, without studying what is at the back of it, that looks as if the employers had a good deal the best of matters; but when you came to analyse what became of that money you found that the 2,100 manufacturers carried from £63,000 to £61,000 to a wages fund to keep up wages in the future, and that the 588,000 employees (who ought to have carried £12,000 to the wages fund in savings) contributed only £3,000 to £4,000; so that the workers were a great deal better off by the increase of profits than they would have been if there had been a loss.

These are very serious laws of nature, and laws which you cannot upset. There are two things against it—namely, you cannot legislate against the powers of wealth when they combine, and you cannot legislate against an empty stomach. If you increase output, at the same rate of cost, by 15 per cent., or reduce the cost of production by 12½ per cent. on pre-war rates, you will find that you will have 5,000,000 to 6,000,000 people out of employment in fifteen years time. I ask, How are you going to keep those millions of starving people in order without a revolution? It has not been done in the past, and I very much doubt whether you can do it in the future. The noble Lord said that an agreement come to by 75 per cent. in any given industry should be binding on the whole of that industry; but you must remember that an Englishman as a rule does not like to make himself a slave to any organisation, or if he does at any rate he likes to have a choice as to what organisation he shall join. I think that as long as the world goes on you will find that 75 per cent. of the population do not wish to join a union; they wish to fight their battles on a fair and square ground. We may have different forms of unions organised in the future and so get competition between unions—which to my mind is the only real solution to these problems.

In the meantime, all the advantage that can be gained by the Councils it is worth trying to get, but to look upon them as a legal model that will be able to enforce its, decisions against the clamour of the majority for the moment is not possible When you have starvation before you, it is another thing. A man will work for any thing sooner than die of starvation—and if he cannot work he will steal. You must remember that these laws are laws of nature and not laws of man. You cannot legislate for them. If you over-raise the cost of production you must of necessity reduce the purchasing power of the sovereign. If you reduce the purchasing power of the sovereign too low you increase the exchange with other countries and send the whole of your trade abroad. We are not in a position to do without half our trade. If we did away with a great deal of our trade and returned to an agricultural State we should not be able to keep one man in six for whom we can provide to-day You have to consider that in doing these acts you may to a large extent destroy the power of your people to live—they can live only on what they produce.

The whole of these figures were gone into because, as I pointed out at the beginning, the statistical returns did not show what the real wealth of the community was. Taking the 50 years' distribution of wealth we found that at no time in that fifty years, at the pre-war purchasing power of the sovereign, could you have given the whole community the value of £200 a year. The amount fluctuated in the fifty years from £150 to, £170 a year, if you divided all the wealth equally and did away with all big incomes. That is decided, not by the wealth of your own State but by the wealth of all the States with which you do commerce.

The purchasing power of the sovereign, which gives the wealth to the individual, is decided by the average wage paid throughout all industries, and not by the wage of any one industry. If you raise above the average one trade or profession you must take something off another. That is why the Labour Party had to retire from office. There was a Motion made by one of the unwise members that the agricultural community should be included in the Arbitration Act. The knowing heads at the back saw at once that if they had no agricultural community to foot the bill they could not raise the wage of the artisan. Therefore they resigned. Now many people are beginning to lose sight, of that important fact. In these circumstances we want something more; we want some power that can enforce a decree of the Council in opposition to the will of the unions.


My Lords, I agree with the noble Lord who has just sat down that the question of enforcement is one of considerable and great difficulty. So far as I understood what he said, I think that the instances from Australia which he cited dealt with the interference of a third party in an arbitration concerning two other parties, both of whom might be unwilling to accept it, and then trying to enforce it by law; whereas the noble Lord who made this Motion was dealing with cases where the whole trade, or possibly a very large proportion of the trade, desired a certain thing to be done and had come to an agreement which they wished to apply to the whole of the trade, bringing in the force of law only to make it apply to a few recalcitrant parties. I think I understood the noble Lord who made this Motion to put it, in that way. But I did not very well follow how the questions of the law of supply and demand and of the necessity of production quite came in, so far as the subject, put down for debate is concerned—namely, recent developments in the industrial situation. Perhaps, however, the width of the words of the Motion, which he himself admitted, is such that such subjects might come in.

Recently we have had debates on several occasions in this House on sections of the subject, such as inflation, coal, housing, and other portions of it. To-day the noble Lord has confined himself largely to a eulogium of the Whitley Councils, in which he sees a panacea for much of the industrial trouble that there may be in future. I trust that, he is right, but he admitted that these Whitley Councils were not being followed by the railways, by transport, by cotton, by mining, or by engineering. These trades represent a very large section of the skilled and unskilled workpeople of this country; indeed, very important sections, which are more powerful than any of the smaller trades that carry on the rest of the business of the country. I can give the noble Lord one reason why they are not likely to have Whitley Councils. It is that so long as the Government continue to make sectional settlements or to distribute, by political decisions at the expense of the community, vast sums of money to those who are clever enough to run to Downing-street, there is not much likelihood of Whitley Councils being formed in these trades. The work-people are far more likely to go to that source from which they can get most, and not to endeavour to extract it with great difficulty from the employers of the industry.

But—leaving that, and leaving the point that these Whitley Councils which are put forward by the Government have not been adopted by the greatest industries in the country, nor by those industries which most threaten the peace of the country— I may add a few words upon these Councils themselves. There is no doubt that they have been a great advantage in certain industries. I understand that the Potteries furnish one example where they have been most successful. In other industries they are probably being tried for what they are worth, and if the workpeople find that they cannot get sufficient out of them, or that they get better results by any other methods, you may be sure that the Whitley Councils will be dropped and the other methods will be sought. The noble Lord alluded to the difficulty of getting the decisions of the Councils enforced. He mentioned that there was a possibility of their being extended by the Minister. That principle has been adopted in a recent Act with regard to wages. It was recommended so long ago as 1913 in the Report of the then Industrial Council— a Report which was signed by the heads of the largest associations of employers and of workmen in the country, who unanimously decided that an agreement might be made between workmen and employers whereby enforcement should be asked for by Act of Parliament if a certain large proportion of the industry desired that the agreement should be so enforced, and also if in return for that some little quid pro quo were given, the quid pro quo being that no strike should take place in that industry for thirty days without inquiry—a suggestion which might have done a good deal to solve the question of extension, and a good deal towards the peace of the country. But the Government took no notice of it; it was not a matter which would catch votes, and the opportunity was lost.

The other panacea suggested is that every person should belong either to a union or to a federation or association of employers. That seems to me to be a much better arrangement than the other. The other is an interference by the Minister with trade. It is much better that the employers and employed should make up their minds as to what they really want. It may seem a strong order to say that you should interfere with individual liberty; that you should indicate to a person that he must belong to a union or association if he is to take part in trade. But there are trades in this country where such a rule exists. Nobody may practise at the Bar unless he is a member of one of the Inns of Court. Nobody may practise as a solicitor unless he is on the Rolls. And in one or two of the trades during the war an agreement was arrived at on the basis that men in that trade must belong to a union. I am alluding to an agreement which I managed to effect between the coal owners and miners of South Wales.

At one time the coal owners of South Wales were most bitter in their opposition to any idea that they should bring the slightest influence to bear upon a man to oblige him to enter a union. That was in the days when the employers as a whole absolutely refused to recognise the union. At that time, of course, they were illegal combinations, and it may be said that you should not recognise or have any dealings with au illegal combination. But, as a matter of fact, even if the law was that they were illegal combinations, there was a far stronger reason—namely, that the idea of freedom of contract between individual and individual (what is occasionally called the Manchester School) must be maintained at all costs. That was a doctrine which held force in this country up to the year 1873 with enormous force; now it has almost vanished.

There are trades in which nobody would dream of seeking employment unless he became a member of the union. I allude to the boiler-makers. In South Wales this agreement was entered into between the employers and miners. The employers, recognising the advantage of men belonging to the union, said that, although they did not agree to compel men to belong to the union, they would use their best efforts to ensure that the men were members of the union. Some difficulty arose through the squabbles of the unions as to which union the men should join, but before a fortnight or three weeks were out there was not a non-unionist in South Wales. A hint had only to be given by the managers or the under-officials of the mines that a man had better not come from England to work in the mines unless he became a member of the union; that the whole of the mining industry in that district was not to be disturbed by non-unionists coming in; and that men who were earning high wages could well afford to pay their union subscription. I believe that this agreement did more to maintain the peace of the mining industry in South Wales than almost any agreement made during the war. If that is so, if in a trade like that the men are all members of the union, and if in a trade like the boiler-makers they are all members of the union, and in the cotton trade nearly the whole of the operatives have to be members of the union, it is not going very far to say that in certain other trades—if they so desire, and if the employers come to an agreement with the operatives—one of the conditions should be that the employers on the one hand should belong to a federation and the operatives On the other should belong to a trade union.

The noble Lord went on to speak about the disclosure of costs. That, again, has been a matter which has considerably advanced during the war. The Ministry of Munitions consistently went into the question of costings when they were making their contracts, and at least the average might be disclosed in a manner which would not be unfair to any individual. There does not seem any particular reason why unfairness should creep into the matter. In many cases when big trades are in dispute there is no doubt that there is an immense suspicion on the part of the operatives that the profits of the trade and the amount which could be applicable to wages are being unfairly concealed. It is impossible for anyone who is conciliating or arbitrating, at a time when matters are very hotly in dispute, to find out in a short time what the real facts of the case are; what the real profits and figures are. I have never as a rule known employers object to show the arbitrator or conciliator the books if he asks for them. But if it were more the rule that the statistics of a trade or a particular business should be available and be disclosed where possible, it would do a great deal to erase that suspicion when it is unfounded from the minds of the employees.

I do not know whether Whitley Councils will have much effect in stopping the really serious causes of unrest that threaten, even in the near future, to disturb this country. There are theories of social life, not questions merely of wages, hours, or conditions of employment, which no Whitley Council can possibly stop. They may have to be fought out, or have to be arranged in some manner so as to prevent an upheaval when it is most disastrous to the country. However that may be, you have this to face. You are turning out year by year thousands of young men far better educated than their grandfathers were, ambitious to get on in life, with views of what they can or should attain; and if you give no opening to these young men by which they shall have any chance of rising according to their ability, if they go into sections of industry where they can get no advance or can get on no further, if they are to be put for the whole of their lives into little pigeon-holes, working automatic machines perhaps, with no chance of knowing the whole of the industry or being tried in compartment after compartment, some of them settling down in compartments which they like and others being allowed to advance further, and even get to the top of the tree and become captains of industry themselves—unless also you can manage in each industry and in each shop to get employers and managers to show the educated man some interest in the direct result of his work, some incentive by which he can see how important his work is, not only to himself but to others, and that it is not the whole object of work just to get your daily bread and get out of the works as soon as you possibly can—unless you can give some incentive, some ambition, to a man who is fit to have it, then you will not get rest in this country, but instead of that you will have the best men, those who are best educated, those who are most ambitious, easily taking in preference any official line in their own trade union, easily going in for strong doctrines which their fathers might not even have dreamt of, and ultimately having a career by which they can advance much further, until they become Members of Parliament and perhaps leaders of the nation. The attraction of that is far superior to the commercial or industrial attraction which most industries at present offer. Those two points—direct interest in the result of their work, and openings for young men anxious to get on— are in my view two of the most important things for the peace of this country.


My Lords, I am sure your Lordships must have listened to the speech which has just been delivered with more than the usual attention which your Lordships are good enough to give to those who address you, because the noble Lord who has just sat down speaks with very great authority on these labour questions. I am not quite sure that I fully understood the closing words of his speech. I listened with the greatest interest to, and I am sure all your Lordships must have sympathised with, Lord Askwith's plea that if possible greater interest should be introduced into the workman's life—that some means should be created for gratifying his ambition, for fulfilling his aspirations, and for opening to him a wider horizon, so that in that way the temptations of unrest should be removed. I wondered whether the noble Lord had in his mind definite proposals, other than those which have been submitted by Lord Islington, to carry out this object. I can assure him, and I believe I speak in the name of nearly all of your Lordships, that any proposals with that object would receive most respectful consideration in this House, and I believe amongst any body of Englishmen.

There is nothing we desire more than to give every scope that we can to the talents and energies and aspirations of any part of the community; but at present the only proposals before us are those of the Whitley Committee as developed by the noble Lord who introduced the subject this afternoon. Lord Askwith has spoken of Lord Islington's proposals very favourably. He has made certain criticisms, but in many respects he has spoken of them favourably; and above all he has emphasised what Lord Islington said as to the great necessity, by publication of all the facts and figures and circumstances of the trade, of removing the element of suspicion which is the most formidable of all the symptoms of the industrial situation. It is this suspicion which it is so very difficult to deal with. The men do not believe they are having fair treatment, either from the Government or from Parliament or from their employers, and the more light that can be let in, the more certainty they can have that they know all that there is to be known in respect of the facts and figures and circumstances of the industry, the greater chance there is that they will be satisfied. Therefore I was very glad that Lord Askwith emphasised that part of Lord Islington's speech. But, of course, my noble, friend Lord Islington went further than that. He not only called for publication of all the facts and figures and circumstances of trade; he pleaded that the Whitley Councils should be made universal and be clothed with compulsory powers.


I did not say universal. I laid stress on the point that no Council should be brought into existence unless the industry asked for it.


I apologise to the noble Lord for misquoting him. At any rate he pleaded that the Whitley Councils should have compulsory powers, and he evidently hoped that they would become more general. I certainly agree with him in hoping that they will become general. In a minor degree I was responsible for the presentation of the Whitley Report, and I have not since that Report was presented abated one jot of my interest and belief in that remedy. I should be very glad, speaking for myself, if Whitley Councils became universal in every trade which was the least suited to them. As to whether they should receive compulsory powers, that is, of course, a much stronger measure. I confess that I view the proposal with favour. I should like to see the actual proposals of my noble friend not only formulated but exhibited for public discussion in both Houses of Parliament; but I look forward with a sanguine hope that something in the nature of what he proposed, for giving compulsory powers to 75 per cent, of a trade, employers and employed, might be ultimately granted. Lord Askwith thought that the second part of Lord Islington's proposal was even better than the first. He liked much better that no one should be allowed to work in a trade unless he belonged either to a trade union or to a body of employers. That is a still more drastic remedy, but I certainly shall not at this moment say anything which would lead any one to suppose that that proposal would not at any rate be considered with every desire to arrive at a satisfactory conclusion.

We ought to thank Lord Islington for his Motion, because he has made a definite attempt not merely to state the facts of the case but to propose a remedy. His speech was constructive. He wanted to organise industry in order that if possible the policy which finds favour with His Majesty's Government should be thoroughly deve- loped. His speech was not unfriendly in any sense to the Government, but followed upon the lines which they have already adopted. It was, however, in the nature of urging them to go forward and produce a full and definite policy. Lastly it was in the direction of advocating the raising of the status of the working man. We have often pleaded for that in your Lordships' House, and friends of ours have often pleaded for it in another place. That appears to be above everything else necessary. The workers should be made partners in the industry, and their status raised. I should like to say that in recent developments of the industrial crisis some of us have been very much disappointed that the efforts of the men have turned so much upon the question of raising wages. I am not saying that wages ought not to be high; on the contrary, the higher wages are, so long as the industry can bear it, the better, provided always that the high wages correspond to good work.

But I have been rather sorry that recent industrial struggles have turned so much upon the cash question. I know that it is rather difficult for a member of your Lordships' House to speak freely on a matter of this kind. We are all supposed to be very rich men. We are not nearly so rich as we used to be, but some of us are rich men, and it undoubtedly seems rather absurd for men so well to do as some of ourselves to criticise the working classes because they ask for what, relatively to the income we possess, is a very small sum. That is true, and we are undoubtedly open to great misrepresentation in anything that we say in this respect; but I think we ought to face that misrepresentation, and, if we desire to do our country good, we ought to speak out what we think even at the risk of misrepresentation. Therefore I say that I am sorry that in the recent industrial struggles the fight seems to have been always on a question of money. I would much rather have seen it—if I may say so respectfully to this great body of my fellow-countrymen—a struggle for greater recognition in the control of industry than a fight merely to increase wages. I say that specially at this moment because, in truth, the workers of organised industry are so much better off than a great number of their fellow countrymen. The people who are profoundly to be pitied at the present moment are the poor people with fixed incomes—the small Civil Service pensioners, the small investors, the owners of small house property in a humble way. Those are the people who have really suffered enormously by the war. Their income, so far from being the same as it was before the war, is certainly much less than half what it was. Not only have they to pay directly or indirectly the very heavy taxation of the moment, but, as every one knows who listened to the debate the other night, money is worth less than half its pre-war value. Therefore the people with fixed incomes have suffered enormously by the results of the war. These people afford a great contrast to the organised working class.

I hope that your Lordships will believe, and that other people will believe, that I do not grudge a halfpenny of the sum which has been paid to the organised working classes, but I do wish that they would realise how very much better off they are than those unfortunate people to whom I have referred, because their wages have gone up to correspond with the fall in the value of money and to the heavy taxation. I believe it to be true that except for the splendid effort which they put forward during the war in working and in fighting for their country—in which, of course, they only did what all other classes of the community did—they have not contributed anything to the cost of the war. All has been made good in the wages being raised. In these circumstances, when the workers come to the Government and demand better wages still, I think that they ought to reflect upon the extra burden which thereby they throw upon the community—a burden which disastrously reacts upon a great number of persons who are very much poorer than themselves. I hope, therefore, that the workers will remember the ideals in which they really are interested, and that in the troubles which are before us their efforts will be directed much more to securing greater recognition in the management of industry than merely to questions of extra wages.

The only other observation that I desire to make at this moment is this. We have offered the workers—that is, all men with whom I have the honour to agree have—the most generous measure of increased management in industry. We do it in place of the nationalisation for which they ask. We do not believe in nationalisation, but we do believe in copartnership. I cannot help thinking that recent experience must have convinced—I believe it has convinced—a great number of the working class that nationalisation does not present the great attraction which they thought it did. When they see how the State managed the railway affair and the coal affair I am confident that many of them are beginning to say that they made a mistake in advocating nationalisation. If that be so, no one will be more satisfied than those with whom I have the honour to act, and we shall be able with greater assurance of a general welcome to put forward our proposal for an increased share of the workers in the management of industry, and to anticipate the greatest success when that remedy begins to be applied.


My Lords, the chief concrete topics which have been discussed this afternoon are the relation of the Whitley, Councils to industries as a whole, the extension proposed by Lord Islington, and the general changes which may or may not be necessary in the organisation of industry in the immediate future. I am the last person to disparage the value, or indeed the importance of, organisation in industry, but I cannot help feeling that perhaps a little too much attention is paid to these questions of organisation and rather too little to much larger and much more fundamental subjects which react throughout industry as a whole. I feel that Lord Islington makes a profound error in saying that the whole of our unrest is due to our present lack of organisation.


I did not say "the whole." I went through a list of factors which are causing the unrest.


I wish that organisation could remove those factors. But I am afraid that the really telling factors in what we call unrest are not those which can be removed by organization—in fact, it is not purely technical and purely commercial matters which are causing the existing difficulties. Certainly I very much doubt if Lord Islington is correct in thinking that adequate organisation, as he put it, would have prevented the coal strike—the coal tangle of to-day, as he called it—and the dispute in the railway world.

Here let me refer to a phrase which rather struck me in relation to Whitley Councils, where Lord Islington referred to industries which are standing out. There are certainly large industries which are not within the ambit of Whitley Councils—railways, textiles, engineering, mining, shipbuilding, and, I believe, others. Lord Askwith seemed to indicate that these industries, or some of them, were not within the Whitley Councils because they could go to Downing-street and exact gains at the expense of the community—rather a sinister observation, I thought. And surely Lord Askwith, of all persons, should know how unjust it is to apply that remark to industries which have had organisations analogous to that of the Whitley organisation for twenty-five and thirty years. That is why these industries are not in the Whitley ambit—because for a generation they have had organisations actually equivalent to those conferred by the Whitley Councils, and the most notable examples, of course, are those of the engineering, the shipbuilding, and the mining industries.

Lord Islington made a very interesting and perfectly concrete proposal as to the extension of the I dustrial Councils—extension in two directions: first, as regards the area of their responsibility (extension, that is to say, to industries which are not already within their purview); and, secondly, as regards the extension of their powers. He mentioned that difficulties, notably, I think he said, in the saw-milling trade, had recently occurred owing to the absence of statutory powers on the part of these Councils and their consequent inability to enforce their decisions. It is an interesting proposal. It has been considered, of course, by the Ministry of Labour, and I will refer to the attitude adopted by that Department in a moment. But I must remind Lord Islington that he I think overstated the desire of these Whitley Councils for these increased powers. He gave me the impression that generally speaking these powers were wanted by these people, and he said there was a growing desire on their part to enjoy statutory rights. All I can say is that at the present moment there are fifty-one of these Councils, and only eight of them have agreed that they would like to have statutory powers. Some Councils have refused in the most explicit fashion to ask for an extension of their powers. Others have discussed the matter, and have not yet come to any decision on the subject. One must therefore dismiss the idea that this is a subject upon which the existing Councils are agreed. They are not agreed.

None the less, I should like to refer briefly to the proposals put forward by Lord Islington. I shall not comment upon the first alternative he suggested—namely, that the Minister of Labour should make the decisions obligatory under certain specified conditions—because Lord Islington evidently himself did not wish to press that view. His alternative proposal, however, was much more definite. As I noted it down, it was to the effect that 75 per cent. of the persons employed in an industry should be entitled to apply for incorporation, upon which the Ministry of Labour would grant a Charter. But a condition precedent to that is that every employer and every employee must be forced to join their respective societies. Lord. Islington said that this would make it certain that the decisions wore quickly acted upon. How will that be done? What is the ultimate sanction? What is the ultimate guarantee? Clearly, that the employers who do not implement their undertaking must be subject to punishment of one kind or another, and, per contra, that the employee who does not meet his undertaking shall likewise be subject to penalty—in other words, the repeal of the Trades Disputes Act. That in itself makes Lord Islington's proposal a matter of some controversy, and removes it from the area, which I think he was inclined to think it might occupy, of being a subject of general agreement.

In effect, Lord Islington asks that the Whitley Councils shall become statutory bodies. The Ministry of Labour is not at this juncture prepared to accept that view. Whitley Councils are entirely technical and trade bodies; they are wholly voluntary in their conception, and differ substantially from the Trade Boards to which Lord Islington wishes to assimilate them. Those Boards are statutory as opposed to voluntary bodies, they have public representatives upon them as well as technical and commercial representatives, and they enjoy compulsory powers as to wages. The Whitley Councils are really very modern institutions established during the war to meet the emergencies of the war in particular trades, and, above all, to supply for trades which had no organisations of this character something corresponding to the organisations existing in the larger and more widespread industries. I myself question whether it is advisable at the present juncture to invest these bodies with large statutory powers. They have had, after all, only a year or two of experience during wartime and twelve or fifteen months experience since the Armistice.

I think it would be well that the obstacles I have mentioned should be borne in mind—firstly, that not only is there not unanimity but that there is actual hostility on these very bodies towards receiving these powers; secondly, that the coercion of employers and employed in joining trade societies is a matter likely to raise dispute, while the question of guarantee and of status is clearly a subject of the utmost complexity. I suggest, therefore, that it would be well that these Councils should obtain more experience and a wider influence before acquiring statutory powers. The Government has in no way pledged itself against granting these powers, and I dare say that at some future date a proposal of that character might be welcomed. But in view of the difficulties I have recited, and in view of the really serious controversies which at the present juncture would be involved in such a measure, I submit to my noble friend Lord Islington that the time for legislation on this subject has not yet arrived.


I withdraw my Motion.

Motion, by leave, withdrawn.