MINISTRY OF WAYS AND COMMUNICA TIONS BILL.

HL Deb 23 July 1919 vol 35 cc928-1004

Debate resumed (according to Order) on the Motion of Lord BUCKMASTER, on the Order for the Second Reading being read, to resolve—

That this House declines to proceed with the Second Reading of this Bill until the Government has stated its policy with regard to the nationalisation of the railways, and has furnished further information with regard to the extent of the financial obligations imposed by the Bill and the measures it is proposed to adopt by which these obligations can be met.

LORD MONTAGU or BEAULIEU

My Lords, I have never risen in this House with a sense of greater responsibility than that which I feel this afternoon. Lord Buckmaster, in a speech which, I think we shall all agree, was most eloquent and, to many of us, very convincing, dealt with the purely national point of view of this question as it affects the finance of the country. I shall endeavour to deal with the Bill as it affects various interests from other points of view than those which engaged the attention of the noble and learned Lord. I perhaps might say, before I enter upon the discussion, that I took my Motion off the Paper in order to facilitate the concentration of the debate upon one Motion. If I had kept my Motion on the Paper, perhaps I should only have produced two debates instead of one on practically the same subject, and, as I did not intend to press that Motion to a Division, I thought the course which I took was the most convenient.

As regards the speech of the noble Earl who introduced this Bill, he described some of the statements that have been made by the critics of the Bill as without foundation, and, referring to certain statements I had made, characterised them as fantasitc. I do not think that they were fantastic, but, if they seemed fantastic, they were nevertheless true. And during the newspaper controversy which lasted for a month not a single one of the main contentions which I put forward in communications to The Times were, to my knowledge, ever controverted.

This is a gigantic Bill. It covers every conceivable form of transport. There are only three forms of locomotion, so far as I can make out, which are not to be under the control of the Minister of Ways and Communications—flying, swimming and walking. With the exception of these three the Bill covers practically everything it is possible to conceive in the way of locomotion. And I am credibly informed that originally, when the Bill was being considered by the Government, the Minister—designate desired to include all commercial aviation and all shipping as well. I shudder to think what would have happened if these two—one an existing and most important department of our national life, the other a department which will become very important in the future—had also been included.

I should like also to say that I am not a member of the Motor Legislation. Committee, which consists chiefly of direct representatives of the motor interest, which was very active and—I beg to think useful—in its efforts in the Lower House. I take a much wider ground than any question of motor traffic. I take the broad ground that all transport should not be the master of the country but the servant of the country, and that, if you make transport more important than trade, trade is bound to suffer. The noble Earl used an illustration two days ago which I thought was singularly unfortunate from his point of view, the illustration of Russia. Later on I shall give you a list of various countries and their various systems of transport and try to prove that whatever country you may look to in the world, wherever you have had State railways other forms of transport have always and inevitably suffered.

The facts about Russia are these. Russia had State railways in the main, and no good roads. When, therefore, the. Revolutionaries had seized the railways there was no possibility of recourse to any other form of transport. When the railway traffic stopped to the smaller towns and to the villages they were starved out and the result was that hundreds of thousands of people died. So that, if there is any argument at all to be founded on Russia, I submit that the only really sound argument is that if Russia had had roads in a separate department from railways, or had not had State railways but built roads, Russia would not have been in the unfortunate position she found herself in owing to the lack of roads.

There were one or two points which the noble Earl made, to some of which I shall have occasion to refer later in my speech. But throughout his speech, which I thought was an able exposition of the Bill from his point of view, he seemed to me to confuse two very essentially different things, that is, Government control and Government management. In many ways for a long period of years this country, to its advantage, has had Government control, but what I and many others object to is widening the extent of Government management. There is no doubt whatever—and I think we must face it—that this Bill has in every line of it the purpose of nationalisation. It breathes nationalisation from the first line to the last. Now, nationalisation may be desirable or undesirable; it may be avoidable or it may be unavoidable. For myself, I think it is unavoidable; I think that if this Second Reading passes it will be impossible, at the end of two years or any other period, to disentangle the railways from the system proposed, and I think it would have been better if the Government had admitted that this was a stage towards nationalisation; if they had said, "This is the scaffold we are erecting, by which we hope to build the house of nationalisation; this is the plinth, the foundation."

I, for one, quite realise that there are many things in the world which are undesirable, and yet at the same time inevitable. There is death and the income tax—both very undesirable, but both inevitable. And the trend of the general policy of the world at the moment is, I will not say inevitably, but very strongly, towards nationalisation of certain things concerning national life. I am not going to express an opinion to-day whether it was wise to bring about the co-operation, perfectly legitimate and natural co-operation, of the Labour Party in the House of Commons by means of this Bill. That is a question of opinion, but I, for one, having read the Bill carefully and studied its provisions, have not the least hesitation in affirming that, in my opinion, the passing of the Second Reading of this Bill, whenever that takes place in this House, practically means the nationalisation of the railways, and (if you put them in) of the other means of transport of this country.

The noble Earl towards the end of his speech rather accused me, I think, of taking what he called "a petty view." I am aware that tu quoque is no answer, but from my point of view this Bill is conceived entirely in a railway sense. There are only four clauses out of twenty-seven that refer to roads or road transport, and some of those only a portion of the clause. If you look at the Bill you will see that it is practically a railway Bill from start to finish, and if it has been brought in frankly as such perhaps it would not have aroused the same amount of alarm or condemnation in the country that it has aroused. We are asked by the Bill to give the Government a monopoly in almost all forms of transport. That is a very big order to ask for all at once, and I submit that it is far too large a demand to make upon our confidence in Government management. We have had a certain amount of experience already of Government monopolies in matters quite insignificant compared with the powers asked for in this Bill. Your Lordships know how the Telephone Com- pany not long ago, and the Telegraphs many years ago, were both taken over from private corporations who were paying adequate dividends to their shareholders and giving the public a reasonable service. I do not think those are very happy instances to think over when we come to consider whether we shall give the Government still farther powers of monopoly. No one can deny that the Telephone service is now worse, even at higher rates, and last year it produced a deficit of nearly £500,000. You cannot get away from facts like that which show not only in this country, but all over the world the trend of affairs when State services get not only under the control but under the management of the State.

The Bill deals with seven kinds or means of transport, or, if you include what was in the original Bill, eight kinds—railways, roads, road transport, tramways (not publicly owned), docks and harbours, railway shipping, canals, and originally electricity supply, which has now been put into another Bill. I read the other day a book which has just come out and which I recommend your Lordships also to read. The book is remarkable from the fact that both Mr. Lloyd George and Mr. Bonar Law write short articles at the beginning of it, besides many other able people. I recommend your Lordships to read especially, if you want to understand this Bill, the last article in that book, written by some one of whom we know very well, Mr. Williams, the Secretary of the National Union of Railwaymen and the National Transport Federation. The article is too long to ready anything more than a very short extract this afternoon, but I will quote one sentence to show its drift. I may remark that when you read the article you will see that in four pages it is practically describing the Bill now before the House. It is somewhat remarkable to me that this Bill and this article should so closely correspond.

THE EARL OF LYTTON

What is the name of the book?

LORD MONTAGU OF BEAULIEU

It is called "The Limit of State Industrial Control," a symposium edited by Mr. Henry Carter. At the end of Mr. Williams's article he says, giving his views about roads:— If the railways are nationalised the State will be faced with the competition of road transport, which competition will be assisted by the activities of the Road Board and the Development Commission, on which private interests are represented. I do not know how he justifies that last sentence because there are no private interests so represented. Now, that is the attitude which many people not interested on the railway side fear under this Bill.

We all recognise the need for greater co-ordination in railway working, and if the Government were content with merely the railway and canal side of this Bill I should imagine that this House, though we might have serious fundamental objections, would probably pass the Bill without criticism tending to defeat it. But the Bill proposes to control all transport and to subordinate it to railway transport. The sub-ordination of non-railway transport to a Ministry which is practically a Railway Ministry is, I think, fundamentally unsound; and when the noble Earl quoted the case of France the other day he omitted to tell your Lordships (no doubt by accident) that in France, besides the State management of railways, there has been in existence for many wears and there is still in existence the Department of Ponts et Chaussées—the great French Road Ministry which made the roads of France up to the beginning of the war famous all over the world. I would have liked to see the Road Board made into a Department of Ponts et Chaussées. In France, as far as I understand, the roads are not under the Railway Ministry but under separate, State control as before.

THE EARL OF LYTTON

They are now under the Transport Minister.

LORD MONTAGU OF BEAULIEU

Yes; but the Department of Roads and Bridges still exists with its own Minister. That is a very different position to the position under this Bill where you have out of nine representatives only one representative of that very important section of transport in this country, road transport. I have been accused in some quarters of, perhaps, anti-railway bias, therefore I may mention that I have no such bias; thirty years ago I had the valuable experience of working in the railway shops at Nine Elms, and I did over 30,000 miles practically on the footplate. I have studied railways not only in the United States but all over the world at various periods since. No one who knows me intimately would ever accuse me of any lack of sympathy for railways, especially the locomotive side in which I have taken great interest since I was at Oxford. But I say that unless we are careful we shall set up by this Bill a Railway Department—because it is nothing less with eight men out of nine railway officials—which must necessarily and can only be expected to control our transport in the interests of but one kind of traction—namely, railways. However, the interests of the country should come even before the interests of railways or any other transport, therefore I agree that the continuance of Government control is in some ways desirable. The Government have guaranteed the earnings of the railway companies on the basis of 1913, and while they have guaranteed this it is only fair that they should ask to have a finger in the pie.

Just now I spoke of nationalisation as being in every line of this Bill. I will give von three reasons—two public reasons and a personal one—why I think it is obvious and inevitable. First of all, at the end of the two-year period railway working and the disposition of traffic will be so mixed up and re-allocated compared with its position to-day that, in my opinion—and I speak in the presence now of many railway directors—it will be almost impossible to disentangle them. I will give you a specific instance. Suppose it is said that ships bringing a certain commodity shall not go in future to Southampton but to Liverpool, and all the offices which deal with this commodity are shifted with their belongings to that port—it may be in the railway interest that that should be done—do you mean to say that at the end of the two years you can transfer the arrangements made for that trade back again to Southampton? Or, alternatively, take London and Bristol. There are some ships which come into Bristol, not because Bristol is the handiest port to discharge goods at for London, but because the return freight of those ships is South Wales coal, and the sending of those ships from Bristol to Cardiff is really a most economical thing to do. If you give a Railway Minister entire control over this he may, for railway reasons, send these goods in future to London, thereby inconveniencing the coal trade of South Wales. Those are the sort of things that may happen, and it will be utterly impossible in my opinion to avoid nationalisation. I have consulted many railway experts who say that at the end of two years nationalisation will be inevitable. That is reason Number 1.

Number 2 reason I ask you now to consider. If railways are not paying at the end of two years—I do not say they will or they will not be, but I assume for the moment they do not pay—how can the companies take them back in the face of the fact that their shareholders will be ruined by so doing? The Minister of Transport will say to the shareholders, and will have the force of circumstances tremendously on his side if he does so, "Accept the price I offer you" (say 5s. in the £) "or take your property back." It is really not a property, but has become a liability. What railway company could possibly take its system back under those conditions? It is obvious that the shareholders will say, "We must get out at the best price we can, otherwise we shall get nothing." If you consider the hundreds of thousands of small shareholders in railways—I do not want to bring in the hackneyed plea of the widows and orphans, but it is the fact that widows and orphans and all kinds of trusteeships have their funds in railways—it is impossible to conceive that the boards of directors or the shareholders can refuse any offer made by the Government under those conditions.

When I first went out to study railway conditions in the United States twenty years ago, there was a saying very well known in the railway world there which was indulged in by the railway "bosses" at that time, "Wreck before capture." This Bill really means to the shareholders, in my opinion, "wreck before capture." The property, if it is depreciated, will be in such a state—and I think it may be in such a state at the end of two years—that the shareholders will be actually and absolutely at the mercy of the Government, and may have to take any price that is offered. If the Government at a later stage likes to assure us that the terms of the Act of 1844, which guarantee the shareholders a definite principle on which their interest shall be redeemed, my objection falls to the ground. I hope we shall hear something as to that from one of the noble Lords on the Front Bench.

There is the third reason that makes me think that nationalisation is considered to be inevitable. I understand that the Minister-designate, under a contract with the North Eastern Railway Company, was to receive £50,000 in certain contingencies. It is true that the word "nationalisation" is not used in that contract, but it contemplates the Government control of railways, which may be called nationalisation or not. When he takes that sum, surely it is evidence that he himself, so far as he is concerned, thinks that nationalisation is not far off. I think it is pretty strong evidence, if the Minister-designate thinks it worth while to cut himself entirely adrift on the assumption that the railways are going to be so Government controlled as to be pretty well nationalised, that he considers nationalisation inevitable.

It is said that at the end of two years it is possible that the railways may be restored to their owners, or a minimum of Government control kept on. The noble Earl who introduced this Bill told us the other day that that was the only alternative to nationalisation. I do not know whether he had in his mind the Railway and Traffic Bill which has been drawn up by a distinguished Member of Parliament. It is a Bill which deals with the railway and canal side without going into all the other forms of transport. I understand that the Government were asked to let that Bill go to a Joint Committee of both Houses with the Government Bill in order that the merits of the two measures might be judged; but the Government refused. There is the alternative, if the Government had chosen to take it, to this most ambitious Bill. It is said that the Minister would always realise his responsibility and act reasonably. In Clause 3 (3) (b) it is stated that the Minister of Ways and Communications is to settle whatever he considers reasonable. That is an enormous power to give in an Act of Parliament—to say that what the Minister thinks, notwithstanding the appeal to various Committees, shall be considered reasonable. Surely it rather stultifies those Advisory Committees of which you have heard so much. There is practically no appeal against the Government monopoly. No country which has Government monopoly of industries can be quoted where you have any effective power of appeal. There are always special interests in Government monopolies and pressure of politicians, and there is always State jobbery rampant more or less. It is inevitable, if you introduce politics into business, that you must always have political and Parliamentary interests considered, and very often considered more than business interests.

The noble Earl was asked the other day—I think it was by Lord Buckmaster, in the terms of his Motion—to formulate a policy and to tell us what was intended, because there is very little in this Bill as to what is intended. In Clause 3 the Bill says there is to be a two-year period for considering and formulating the policy to be pursued as to the future. If there is anything more beautifully indefinite than that, I should like to know what it is. That is largely a camoaflage clause to say that the Government has not really got any policy, and that they want two years to see which way the cat jumps. I do not think that is a very helpful way of looking at it, when your Lordships are asked to pass this Bill which affects every means of transport in this country. At the end of the two-Year period we do not know that the present Government is going to be in office. There may be a Government in office with totally different views. There might be an extreme Labour Government in office who decide that, they are going to nationalise everything in this country. They would have a power at the end of the two years to formulate a policy and to throw aside the policy of their predecessors. I do not think that is at all a sound position.

Perhaps the noble Earl would like some examples of the State ownership of railways, so I propose to detain the House for a few minutes while I give analogies from other countries on the State ownership of railways. The most effective and probably the most successful instance of State ownership of railways is in Germany. Originally that was done from purely military reasons. The German Government was always in a state of preparation for war, as we have reason to know, and to know bitterly. They nationalised their railways almost exclusively originally for military purposes. Then they were used afterwards as part of a system of intensive protection to encourage exports and to reduce imports. In Germany you have bad roads, outside a few main roads, as I know, because I have travelled over the roads myself.

Then you come to Italy, where there are State railways, and any noble Lord who has tried to go through Italy by road knows that, apart from the few roads near the Alps, roads can hardly be said to exist. Then, you have an instance of a State railway monopoly. The Italian Government say frankly, "Why should we encourage traffic on the roads when they bring in nothing, whereas traffic on the railways brings in an income?" It is quite natural, therefore, that they should neglect other forms of transport. Japan has State railways and very few and bad roads. Egypt has State railways and practically no roads at all. Lord Kitchener made a short road out of Cairo, and that is the extent to which roads exist in Egypt. I have already dealt with Russia, where there are almost entirely State railways and practically no roads. That was really the most important reason for the starvation of the population during the recent disturbances there.

Now I come to India, with which I am specially familiar. The railway system in India is a mixed one. Some of the railways are worked by the State, like the North Western, and some of them are guaranteed State railways with still existing shareholders who have agreed to certain financial arrangements. I know from personal experience how the establishment of State railways in India has led to the absolute neglect of nearly all the road systems. I have lately, in several Reports which are confidential—but I should be delighted if the House could see them—pointed out clearly that the advent of a State Railway system, however beneficial it may have been financially to the State, has directly led to the neglect of roads, the falling down of bridge and the neglect of road transport. Now we are in the middle of an Afghan War in which road transport is very vital to the success of operations. It is only because others and myself have pointed out the terrible dangers that might arise on that front from the lack of roads, that we have got the roads which we possess to-day. No one could have studied the transport system of India without seeing that the fact that the State makes money out of railway transport, and cannot make money out of road transport, has led the State to neglect roads very badly indeed for the benefit of railway transport. That is exactly what we are afraid of if you hand over roads and road transport to a Ministry which has only one non-railway man in the whole of its composition. In France, where the State only owns one railway, the Western Railway, and where the others are privately owned, you have splendid roads, and you have a separate Department, but I can foresee the time coming when France will be trying to make more money out of the railways and the result will be that it will neglect its roads.

A good deal has been said about a deficit on our railways, and I suppose it is more or less acknowledged that one of the objects of this Bill is to give power to the Ministry to raise rates. We have got to face that. We have had to face the rise in passenger fares. Now we have to face a rise of, roughly, 50 per cent. in goods rates. It is not a cheerful outlook—coal up 6s. per ton and freight rates on goods up 50 per cent. But if we have to face it, let us face it courageously. I think the Government were perfectly right in raising fares, as they will be right in raising goods rates. That is one of the reasons underlying the desire for this Bill. May I point out that, if it had been desired only to raise rates and to give Sir Eric Geddes—who, I believe, is a capable railway man—control of the railway position, a two-clause Bill, giving the Railway Executive powers to do this and to place Sir Eric Geddes, a Cabinet Minister, at the head, would have achieved that purpose without going in for any other or any more formidable or ambitious scheme? If the Government had done that I do not think that they would have had much opposition from any one.

I and many others are in favour of the stopping of State subsidies in order to produce artificial cheapness, whether it is in respect of bread, or railway travelling, or doles, or whatever you like. We are living in an unreal and artificial atmosphere of prosperity, and the sooner the mass of people are brought to appreciate these things the better it will be for the country and for the people themselves. If this

[COMMAND PAPER 147.]
ANALYSIS OF STATEMENT PREPARED BY SIR ALBERT WYOX AND SIR WILLIAM PLENDER.
Year.	Total Revenue Earned.	Expenditure.	Difference between Revenue and Expenditure.	Provision for Future Expenditure.	Column 2 plus Column 4.	Percentage.	Balance of Revenue Earned over Expenditure Incurred and provided for.
	£	£	£	£	£	Percent.	£
1913	118,700,935	75,127,210	43,573,725	—	75,127,210	63.3	43,573,725
1915	130,358,044	79,566,752	50,791,292	5,461,510	85,028,262	65.2	45,329,782
1916	145,871,085	87,498,403	58,372,682	8,258,303	95,756,706	65.6	50,114,379
1917	164,279,430	98,927,760	65,351,670	9,950,172	108,877,932	66.3	55,401,498
1918	177,584,321	121,514,018	56,070,303	9,812,277	131,326,295	74.0	46,258,026
	—	—	—	33,482,262	—	—	—

country and this Government, in the exercise of their discretion, choose to give railway servants eight hours instead of longer hours—a measure with which I entirely agree, as an old railway man—and then to increase their wages, well and good; but let us face honestly the result of that. Let us tell the public, as Sir Auckland Geddes has told them with regard to coal, "This extra money you pay you ought not to grudge because it is making a better life for the workers in these industries." If people were told that I think that they would not be less chary of sympathy, but they would know exactly what they were doing. I should advise the Government to take that line and to tell the people that the increase is due largely to increases in wages and costs.

We all know, I suppose, the White Paper that Sir William Plender prepared to show the loss on and the financial position of the railways during the time the Government guarantee has been in operation. I have been to some trouble, with a very skilled accountant friend of mine, to prepare a Table which I shall ask your Lordships' leave to hand to the Official Reporter in order that it may be incorporated in Hansard, showing that the statement recently made that the Government would have to face a deficit in 1920 of £100,000,000 does not arise from anything included in that White Paper.

The Analysis handed in by Lord Montagu of Beaulieu was as follows:

COMPARISON OF ESTIMATED VALUE OF GOVERNMENT TRAFFIC IF CHARGED FOR AT AUTHORISED PRE-WAR RATES, AND THE COMPENSATION PAID.
Year.	Estimated value of Government. Traffic at Pre-War authorised Rates.	Compensation paid by the Government.	Amounts by which amounts in Column II are more or less than the corresponding amouuts in Column I.	1913
Receipts.	Expenditure.
£	£
118,000,000	75,600,000
				£169,000,000	to be added for estimated extra expenditure in 1919–1920 Over 1913.
	£	£	£
5th Aug. to 31st Dec., 1914	3,500,000	15,946,839	+2,167,735	75,000,000
1915	10,279,104	—	—	£184,000,000	for 1920.
		13,779,104
1916	20,649,126	14,039,674	-6,609,452	But, if receipts for 1919–1920 be the same as 1918, the total will be:
1917	35,698,554	24,075,768	-11,622,786	£ 177,000,000, or only
1918	41,917,024	41,251,326	-665,698	£7,000,000 deficit.
Total £	112,043,808	95,313,607	-16,730,201	Even allowing for preferential and special rates charged for Government traffic, and without full allowance for extra fares now charged.

LORD MONTAGU OF BEAULIEU proceeded: If I may weary the House for a moment with figures, I would point, out this. I will take only two years. The balance of revenue earned over expenditure in 1913 was £43,000,000. In that year the amount which the Government was paid less than the actual amount they had to provide was £2,167,000. In 1918 the expenditure rose to £121,000,000, but the revenue had gone up to £177,000,000, and the balance of revenue earned over expenditure incurred and provided for was £46,000,000.

We were told the other day by Sir Eric Geddes that the extra expense, not the loss, in 1919–20 would be £109,000,000. If you add to that the expenditure of 1913, £75,000,000, you get a total of £184,000,000 for 1919–20. The revenue last year, before the effect of the rise in fares had altogether taken place and before any rise had taken place in goods rates, was £177,000,000. So on the basis of working last year you could only have £7,000,000 deficit. Therefore, I do not understand what this talk is about £109,000,000 loss or deficit, whatever it is called. I believe Sir Eric Geddes first said it was a loss and then said it was a deficit. I do not see how it is possible on the figures for the Ministry of Ways and Communications, even if they take over all that they take over to-day, without any rise in goods rates, to lose more than £7,000,000 next year, if the figures are correct for next year. In that figure was, I think, £76,000,000 for goods—call it £80,000,000. If £40,000,000 is taken as representing 50 per cent rise, you can get £40,000,000 next year as income after you have given your concessions amounting to £109,000,000. I do not, believe, therefore, that the railways of this country are bankrupt. I do not believe, even if they were returned to their owners to-morrow, that they would be in the desperate state which is represented If my figures are correct, and I have had them prepared with great care, the utmost that the country could lose, even if goods rates are not increased, is between £7,000,000 and £10,000,000. That is not a sufficient argument for handing over all forms of transport to a Government monopoly on the ground that you are losing so much on railways that you have to make it up on other forms of transport. It is an entirely fallacious argument.

We have got, however, to this position The Minister Designate says, and says with truth, "If I take over these railways I must have power to make them pay, and power to increase rates." We all agree that the rates must be put up. What many of us object to is that he takes powers to lay tribute on other forms of transport. Take roads. There is nothing to prevent him, with these complete powers, putting up toll gates. He might persuade the Chancellor of the Exchequer to give him higher taxation of vehicles, and he can place all kinds of restrictions on the use of motor vehicles. The noble Earl in introducing the Bill said that they were not taking these powers. May I remind the noble Earl that he must have over looked the White Paper issued a little time ago, called "A Return of the Powers and Duties to be Transferred to the Ministry of Ways and Communications from the Board of 'Trade and the Local Government Board." He must have forgotten the fact that the Local Government Board, and not the Board of Trade, has the power of dealing with all traffic on the roads.

When the Bill of 1903 was passed, which I had something to do with in framing, and which was the first Motor Car Act, it handed over extensive powers to the Local Government Board. That is a Government Department in which we had complete confidence because it was not interested in any special form of transport. It has been presided over by able Ministers, Mr. John Burns and Mr. Walter Long. But yon are now going to hand over everything to this new Ministry, including control over all heavy motor traffic, the size of wheels, speed limits, restriction of roads to be used. &c. They are most drastic powers. We can trust an independent authority, but can we entrust these enormous powers to a gentlemen who is a born and bred railwayman. You are handing over to a man who is naturally, and cannot help it, a supporter of only one kind of traction these immense powers which a Government Department has hitherto exercised without, any favouritism one way or the other. To hand them over to the Home Office might have been conceivable, but it is absolutely wrong to hand them over to a Ministry, in which eight out of nine officials are railway officials.

There are some very interesting developments taking place in the transport world, with which perhaps your. Lordships are not aware. Broadly speaking all rail transport is increasing in cost. The reason of that is that all traffic on rails is mostly a link in the chain of communication between the point of origin and the point of destination. A railway never takes you to your destination unless you are a stationmaster. It is a link in the chain. There are a few cases in which heavy goods may go direct by rail to their destination; but, broadly speaking, all passengers and general goods carried on the railways, with perhaps a deduction of 10 per cent., has at some stage in transit to go by road. I have got out some rather interesting details of the number of handlings which takes place. When you come to consider that there are twelve handlings of parcels between the Army and Navy Stores and your house in the country as a maximum, and generally about six or seven between the manufactory and the sea port it is obvious why rail transport must continue to increase in cost. The reason why rail transport has been cheaper is that it only takes 15 lbs. tractive force per ton to pull a ton on a clean steel rail. whereas it cost on the roads 45 lbs. tractive force to pull a ton, or three times as much. But power now is so much cheaper than labour that the initial advantage is wiped out, and that is why you can take 2 tons of goods from London to a destination 100 miles away and carry it cheaper by road, even allowing for every possible depreciation. Other advantages are also so much greater that it is incontrovertibly the cheapest way.

We want to develop the cheapest method of communication. If you are going to tie all your other transport up by correlation with the railways that sort of transportation will have a poor chance of success. It is unsound to try and make transport go in any other way but the cheapest and most convenient, and it is scientifically absurd to try and do it. It is bound to fail.

The production of power has undergone an extraordinary change, even in the last six months, for road vehicles. It is not long ago since I drove a motor vehicle, a lorry, with a new form of gas suction plant fitted on it, round Hyde Park and St. James's Park, and the cost of running that lorry was equal to petrol at.½d a gallon, or one-seventieth of the price of petrol to-day. That is going to have an important effect on the increase of road transport, and there is not one single representative of road transport or of scientific knowledge on the Ministry which is proposed. Railways are undoubtedly still the best means of transport for long distances—for heavy goods in large quantities, and for fast traffic. We all admit that. The railways will always exist for this kind of purpose, but if you try and choke your railways with traffic in order to make them pay the result will be that you will make transport bad but make it bad at the cost of the industries involved. No one can say that there is any need for doing that in this country. Then take the ports. The greatest manufacturing district in England is centred round Birmingham. That is only 125 miles from the Port of Tilbury, and there are other ports nearer, like Liverpool. There is a case where I anticipate that with new roads a great deal of the traffic will be taken by road.

As regards roads, some remarks were made by the noble Earl about the Road Board. I do not think there is any particular fault to be found with that Board in regard to what it has done in the past. It has nearly all the power proposed in this Bill, and if it had only been left its revenue it would have this Year three millions of money, and that works out at about £114 per mile main road. As you know we can only contribute to the improvement of the roads, and not to their maintenance. Under this Bill I assume it will be possible to contribute to maintenance. The Road Board is only too anxious to co-operate with railways or any other form of transport. We have, however, always been handicapped by the fact that the Board's Chairman is a gentleman with railwayleanings. Sir George Gibbs has not always shown that energy in the matter of roads which he might have shown, though he has not pursued a professed railway policy. But I may state that at a recent meeting Lord St. Davids, Lord Pirrie and myself passed unanimously what amounted virtually to a vote of censure upon him. Of course he as Chairman dissented. The Road Board has made your roads well in the past. Why then do you want to alter that system? It has worked with local authorities. We have spent a very large amount of money on the roads to t general satisfaction of all concerned, and at the present moment the Joint Roads committee with the Road Board are spending this year something like £10,000,000 on the reconstruction of roads. I suggest to the House that the Road Board ought to be left alone.

There is another point about this Ministry and about this Bill which I should like to make before I sit down, and that is the broad effect of road transport and of railway transport. Railway transport tends to concentrate population in a few places, whereas road transport tends to diffuse the population. Therefore we should do our best to encourage road transport, because our cities are already far too concentrated and we want to spread our population out. That will never be done if you have a Road authority in the grip of a Railway Minister, because his only idea will be to make the railways pay as much as he can, and in so doing he will concentrate the population. Suppose this Bill was cut down to a Railway and Canals Bill. It is said the whole idea of the Bill would then lie lost. May I remark that then the Minister would still be in control of £1,500,000,000 of capital, employ 700,000 men, and control about 30,000 miles of railways and canals. Surely that is enough work for one man for many years to come, and when you consider how important our railways still are, and the necessity of co-ordination, I think in the present state of affairs that would absorb the services of two or three Ministers if it is to be done properly in the two years.

I suggest, my Lords, that it is quite unsafe to go beyond the limited powers of railways and canals in this matter. If yon pass this Bill as it comes up from the Commons you will be creating a Government monopoly, exceeding in power and extent anything which exists in any other country in the world, and I think that is extremely unwise at the present moment. I will say, in conclusion, that we are apt in these times to think of railways as the last word in locomotion. I do not think that they are. It is not many years since railways were created—only eighty years out of many centuries of development of locomotion. It began with tracks through the forest, followed by paths over the hills, and then went on to Wheel-vehicles in later stage. Surely we cannot say that the railways are the last word. When we have roads in their new form, with the cheap locomotion which I have hinted at to-day, so that we shall be able to convey goods with a motive power equal to petrol at ½d. per gallon, the whole position will be altered. I suggest that the proper way in which this House should act with regard to this Bill is to let this Minister have ample powers for the co-ordination of railways and canals, but that his power should stop there. If he comes at the end of two years and is able to prove that by good management he has produced excellent results, then we can safely give him more; but I do honestly think that it would be highly imprudent to tie up all our means of transport in one department, under one Minister, however able.

I can say this that there is nothing which leads me or any non-railway person to have any particular confidence in this proposed Ministry. Four of the gentlemen out of the nine who are proposed are connected with the North Eastern Railway either as officials or ex-officials. Another is Sir P. Nash, who is connected with the Great Northern and East Indian Railways; then there is Lieut.-Colonel Simpson, late of the Buenos Aires and Pacific Railway; Sir John Aspinall, late General Manager Lancashire & Yorkshire Railway and a distinguished engineer; Sir William Marwood, Secretary of the Railway Department of the Board of Trade; and last of all Sir Henry Maybury, who represents Roads; but he is concerned merely with the permanent way and not with the transport on it. Is it fair that such a Ministry should take over the road transport of the country and have no representation on it of any interests except the railways? Eight out of the nine members proposed in the new Ministry are railway officials more or loss. There is no representative of road transport, tramways, harbours or docks, and that I think is a fatal flaw in the Bill.

I must apologise for keeping the House so long, but it has been very difficult even within the limits at which I have spoken to deal with all the aspects of the question. The question is so gigantic that the brain almost reels in contemplating it. I say, as one having had experience all my life of roads, and who has studied transport conditions in many other countries, that it would be in my opinion a disastrous thing to give all the transport of this country over to a Ministry, practically a Railway Ministry, which will be inevitably driven to nationalisation, and therefore in a few years all your forms of transport will be nationalised whether you will or not. I suggest that this House should consider whether it can improve the Railway and Canal parts, and leave the rest out.

I have only this final observation to make. You may describe coal as one leg of the body politic, and shipping as the other leg, Agriculture is the arms, and the brains of this country are the head, but the transport can be described as the life blood circulation, and the man to whom you give control over the heart can cause any part of the body to wither. Sir Eric Geddes will have his hand upon the heart of the body politic. He may be wise or he may not be wise, but you are handing over to him power which if he is not wise may ruin the whole community.

VISCOUNT DEVONPORT

My Lords, the Bill that we are discussing this afternoon, I think the majority of your Lordships will agree, exceeds in importance any single Bill that has ever been introduced in this House dealing with legislation affecting, as this Bill does, the greatest of the commercial undertakings that the country possesses. The Bill is avowedly framed to revolutionise the whole of the transportation system of the country, and in that direction we find provisions of a most drastic and comprehensive character. Before I touch, as I shall do but briefly, upon the details of the Bill, I think it is necessary to consider for a moment or two the provisions that it contained when it was first introduced, because that gives us a very accurate indication as to the mentality of those who conceived this Bill, and enables us to grasp what were the wide ambitions of its authors. It is true that the Bill has become modified in its scope to some extent, but not to a very material extent.

If we consider the Bill as it was first introduced, the first thing I shall say in relation to it would be that it was quite apparent that its authors had the scantiest respect for Parliament. There are provisions in the Bill, which I will refer to in a moment or two, that disregarded the Parliamentary procedure which is customary in dealing with matters of this magnitude. I am referring more especially to what was Clause 4 in the old Bill. That enabled the Government to secure powers of the greatest magnitude by a process of Order in Council—a process which was provided as a means of legislation by Parliament to meet circumstances very different indeed from those sought to be served by this Bill as introduced.

My feeling is that the sole desire of the Government—and here I am going to quote from a speech made by the ex-Prime Minister, because it expresses exactly what I want to convey—is to have carte blanche to wield autocratic and well nigh irresponsible powers, introducing into and interfering with the normal and healthy operations of business. That is the Bill as it was introduced, and much of that spirit remains in it. It will rest with your Lordships in Committee to see how this can be modified in the interests of the country. Your Lordships will remember that for the last five years the Government have been working under what we call D.O.R.A. legislation—Defence of the Realm and other special enactments—and I think probably a good deal of this Bill is to be explained from the fact that during these five years they have become so habituated to gain, without any trouble, powers to do whatsoever they might choose, that the long and continuous use of those methods has infected them, if I may put it in that way, with a virus of autocracy, and that spirit seems to have worked into their veins. Indeed, I might almost add, that it has reached their brains. Hence it is that we have this Bill thrust upon us, containing arbitrary conditions that appear to me to be more characteristic of Prussianism than of the methods of a sane democratic Government.

Let us consider the scope of the Bill. It places in the hands of a single Minister unfettered dominion over all those great undertakings. He could take possession of the whole or any part of them, and he could work them according to his own will and direction. As regards the Boards that have hitherto managed them, they became by the terms of the Bill mere servants of the Minister, obliged and compelled to obey his every direction. Practically the whole of the undertakings that are embraced in Clause 2 of the Bill are working under statutory schedule, and those schedules have been threshed out by Parliament. The persons interested have put their opposition to any proposals that seemed to be excessive, and after considerable discussion in committee those schedules have emerged. But under this Bill as introduced the Minister could destroy at his will all the existing schedules as regards rates, fares, tolls, dues, and charges, and could impose new ones, and no matter how excessive they might be, he is given an immunity. The Government could not gather what his mind would lead him to do, so it is said in advance that whatever he did "is deemed to be reasonable."

That was not the worst part of it. I referred just now to Clause 4 as it was in the Bill as introduced. Clause 4 gave him the power to purchase the whole or any part of these undertakings compulsorily by the method to which I have just referred, the process of an Order in Council. That afforded no real opportunity to Parliament to consider and investigate either the method or the effect of the exercise of the stupendous powers committed to him. Clause 4, to which I have referred, stated the opportunities of criticism that might be taken advantage of—and they are difficult to put into practice—during the thirty days that the Order in Council should have lain on the Table of each House of Parliament. I think that was a most unjustifiable abuse of the machinery of Parliament.

Consider what the financial powers were that were first taken. When the financial Resolutions were in Committee of Ways and Means of the House of Commons it was only by persistent effort, by obstructing the Bill night after night during that stage, that the Government were induced to name any figure at all to which they would be limited absolutely. They asked for unrestricted power to spend millions upon millions without the slightest Parliamentary control of any sort or description. The only control that was suggested and admitted in the Bill is what is called Treasury control. What is Treasury control? We know when we are squandering hundreds and thousands of millions that Treasury control is not worth anything whatever. That was the only control when the Bill was introduced that the Government were prepared to submit to. We must be thankful for small mercies in these days, and I am glad that there has been some curtailment of these arbitrary methods. But it is important to consider how those curtailments have been gained. So far as the most important of them is concerned, the one to which I just now referred, the Order in Council method, that was dropped on Second Reading by the Government, but only after Ministers had received a strong intimation, I am told from 100 members of Parliament, that, if the Government went on with that astonishing procedure in its Bill, it would fail to receive the support of those members.

I come to the concession that has been made affecting docks and harbours. Under Clause 3 it was competent for the Government to take possession of docks and harbours, and there was a great endeavour made in Committee to release docks and harbours from Clause 3. But every argument urged in Committee, and every amendment brought forward during that long stage of the Bill, which I think endured for nineteen days, was scouted and disregarded. There was an effort made on the part of a little coterie of members, who fought most gallantly, to endeavour to modify this Bill. All their arguments were useless and worthless, so far as Ministers were concerned. Finally, this Bill came down and was ready for the Report Stage of the House of Commons. A large gathering of members of Parliament, 200 I believe, felt so strongly that the Bill required amendment in this particular that they sent for Mr. Bonar Law and laid their case before him, and finally went On to the Prime Minister for his view and decision; and it was only by those methods, and not by regular Parliamentary argument that the Government could be convinced; it was only by force majeure that these concessions were made.

That is evidence of the spirit in which this Bill was introduced, and of the endeavour continuously made by the Government to force the Bill through without making any concessions at all. The Home Secretary, Mr. Shortt, who was the active first lieutenant of Sir Erie Geddes, when the first Amendment came before the Committee, said— Let me say at once that we propose to fight for every single item that is included in this Bill. An extraordinary way to conduct the proceedings of a House of Commons Committee! And I am astonished that that should be the method adopted by a member of Mr. Lloyd George's Administration, because I know from personal contact with Mr. Lloyd George at the Board of Trade that there never was a man who understood conciliation better than he. And yet these Ministers who were in charge of the Bill never gave the slightest Consideration to the merits of the Amendments, but simply went rolling on, pushing everything in front of them, and giving no consideration to good argument.

I refer to all this in order to bring before the minds of your Lordships the absolute necessity of our examining this Bill in Committee with the greatest care, because; although it was subjected to all this criticism in the House of Commons at the various stages, it received, as I have said, no consideration whatever, and the concessions that were finally made were made, not as the result of argument, but simply because of fear of the consequences that would follow if the Government did not amend the Bill to some extent.

As regards docks and harbours an Amendment that has been made, although it has released them from the tentacles of Clause 3, is more apparent than real. Whilst the Minister is stopped from taking possession of them, as was originally proposed in the Bill, he still possesses power to interfere with their management, and he can thus mar the success of these great undertakings. He can order the dock boards to make any improvement or extension in facilities or accommodation, or any alteration in the method of working, and the only chance we have of resisting it is to appeal to the Lord Chief Justice, before whom we have to establish a prima facie case, and, if we do so, he appoints an arbitrator to adjudicate upon matters which probably he understands not nearly so well as those who are interested in carrying on these undertakings.

After this concession was made, when the House of Commons went on with its Report State there was a vigorous assault made upon the Minister by the Labour Party, because they accused him of having betrayed them by making these concessions. The Labour Party, in Committee and on Second Reading, backed this Bill on grounds that they never attempted to conceal. They regarded this Bill as a step towards nationalisation, and consequently they supported it to the full of their power. But when this concession was made with regard to docks and harbours Sir Eric Geddes was taunted by the Labour Party for having betrayed them. Sir Eric Geddes in his defence said that the docks were not left completely outside the scope of the Bill; that the docks could receive orders in everything, and would have to carry out the orders in everything unless they could show that it was seriously injurious to the undertaking or trade of a port. Therefore I say that the concession made is more apparent than real, and probably in Committee we shall have to consider whether the Bill cannot be further improved.

Now what is the case of the Government as to the necessity of the Bill? They have justified it on a series of allegations and statements, scarcely one of which is supported by evidence or facts. That is rather a strong statement to make, but I think it is quite true. Some of these were general. For instance, it was said the whole of the transport systems of the country were in a parlous state; that financially they were in a semi-paralysed state (whatever that may mean), and physically they were ill equipped to meet the strain of the demand upon them; that during the five years of war what was termed the "dead hand" had been over them prior to the war there had been a parasitical growth (that was the expression used on the Second Reading) in the development of these great undertakings.

I can speak from the point of vow of some of the great dock undertakings of this kingdom, and certainly in the last five years, or any period prior to that, they have not been financially in a paralysed state; there has been no parasitical growth overwhelming them; they have not been physically ill-equipped—on the contrary they have had money poured into them at, Liverpool, London, Glasgow, and all the great harbour undertakings, and I defy any member of the Government to go round these great ports and point to any deficiency in equipment or in facilities. On the contrary, they would find there they were not only abreast of requirements, but were ahead of the immediate requirements for which they eater. Therefore, I say that all these statements, so easy to make, appear to be nothing more nor less than pure hyperbole: nothing in the nature of proof is given.

In addition to that, it is declared that all these undertakings are being run at the cost of the taxpayer; that they are either being subsided direct by the State—that is what they say is the position of the railways, but that, I say, is not correct, as I will show in a moment—or they are given large additional powers of charging; and that the intention of this Bill is to get them all back to a paying basis. Now as regards the additional charging powers that have been granted to these undertakings. What is it that has brought about that necessity?—the large increase is wages, the enormous enhancement in the cost of all working material, and the growth of overhead expenses; and is it, supposed for a moment that if these undertakings come to the Government for powers to make additional charges it is a sign of their financial paralysis? It amounts to this, that they are bound to cover their outgoings by their charges, therefore the mere operation of getting schedules is no indication at all of financial paralysis. How does the Government propose to get all these things back on to a paying basis? They have told us clearly that in their judgment the only method is for the State to come in and make economies. Sir Eric Geddes, in his Second Reading speech, said it was impossible to economise under present working, and the State must "come in and make economies possible." Well, who ever heard of the State making economies?

Several NOBLE LORDS

Hear, hear.

VISCOUNT DEVONPORT

Whenever the State, takes over a paying undertaking, it is a certainty that it is only a question of time before that undertaking ceases to pay. Telephones, telegraphs, and the railways—when they get them, and I am perfectly certain they are going to have them; you will see such a financial condition of the railways that will appal those who come after us. That is my view. But anyway it is the creed of the Government that the only way you can get these things to pay is for the State to "come in and make economies possible." You have to take over, Sir Eric Geddes said, all means of transportation; put them under one control; leave out nothing; put all into hotch-potch; and by working them generally in conjunction with the railways you will restore the railways to a state of solvency! Who believes it? No one; So, to realise this speculative chance—if it were Parliamentary language I would prefer to call it a gamble—all these great undertakings are to be taken out of the hands of those who have managed them and handed over to State bureaucracy.

Let us consider for a moment the railway position. It is a case of considering truth versus fiction. The fiction is that the railways have had the "dead hand" over them for five years, that even prior to that time they were going along in anything but a satisfactory way. What is the truth? The railways of this country were the best run and the best equipped in the whole world, a standard pattern for the whole world. Where will you find tracks equal to the British tracks—the North-Western, the Great western, and all our great railways were splendidly run, magnificently equipped, and gave the best service with regards to goods and passengers in the whole world. We are asked to believe that all these things have been paralysed for years, and that only the intervention of the Government can give us an effective and efficient railway system.

Then we come to the question of the £100,000,000 loss. If it had not been for that statement I doubt very much whether the Government, would have got their Second Reading with the ease and facility with which they filially got it. It was that statement which frightened the House of Commons. They thought, What an appalling situation! £100,000,000 loss! "Aye, and a growing loss," said Sir Eric Geddes. This is how he put it in February. "The taxpayer is paying to-day £100,000,000 a year"; and he added that it was growing and increasing. That was the voice of February; what does the voice of June say? He had been quite misunderstood, and on further investigation and consideration it had been revealed that there were possibilities of economy and other credit factors which gave an estimated net deficit for the current financial year of £60,000,000. I do not accept that figure of £60,000,000; I am more inclined to accept the figure of my noble friend; but what a drop from £ 100,000,000 to £60,000,000. Probably in these days it does not matter whether you call it £600,000,000,000 or 160,000,000; there is apparently not much difference between the two figures! But I know that in prewar days, and during my House of Commons days, if a Minister made a statement to the effect that the railways were losing £100,000,000 and then a few weeks afterwards said it was nothing of the kind, he would sacrifice his reputation for all time.

We are told now that the country is somehow to make up this £60,000,000, and that each service (this is the latest version of Sir Eric Geddes's speeches) must stand on its own feet; and he adds, "I think it inevitable that freight must go up." That is in direct contradiction to what he said on Second Reading. If we threw all these into hotch-potch we should establish the solvency of the railways, and that was the only possible way. "People ask, Why put up the rates? You would have to advance them 70 per cent, or 80 per cent., and that is unthinkable." Therefore he has pursued ever since a policy of maintaining railway rates at their pre-war figures, with most disastrous consequences to the country. The railways, of course, are losing money, and we are being told that it is a tax upon the country as if there were no other means of getting the railways into a position of solvency.

I am able to give one illustration of the effect of the policy of maintaining prewar freights. I come into contact a great deal in the Port of London with the coastwise trade. I am sure your Lordships will be interested in the figures that I have, and I give them in order that you may grasp what is the effect of this fatal policy of maintaining pre-war freights. In 1914, inwards and outwards in the coast-wise service at the Port of London, there were 126 vessels. That has fallen to-day to fifty-seven vessels a week. The monthly tonnage which was carried in pre-war days was 910,000 tons of goods, and that has fallen to-day to less than a-half. I will talk about the effect of all this in a moment.

Here is another figure. The number of ships for the six months from January to June, 1914, engaged in the coast-wise trade entering and leaving the Port of London was 14,355. The net tonnage of the ships was 4,699,000 odd. During the last six months the number of ships entering and leaving the Port of London in the coast-wise trade was 6,089, and the net tonnage of the ships was 2,308,000, and some odd figures. I am careful to make that clear, but I am aware that the war has had something to do with it. You cannot get away from the fact that this persisting in maintaining the railway rates on a pre-war basis has killed the coast-wise trade. I think the noble Earl admitted it most frankly and candidly. The consequences, however, are far more serious than those not acquainted with the situation realise.

There is a great state of congestion in all the ports and harbours of the United Kingdom. People will say that this is a sign that you want a new management in the ports and harbours; that they do not know how to cope with the position. Those who know, however, and those who come and see, realise that there is an immensity of tonnage of goods of all description being poured into all the ports of the United Kingdom. The railways are trying to cope with getting the goods away, and they cannot do so. Why cannot they cope with that to the fullest possible extent The adjuncts of trade in the way of transport, such as the great coast-wise services, have disappeared to all intents and purposes. Therefore you are intensifying the congestion by this policy of maintaining prewar railway rates. What is to be done? Sir Eric Geddes's policy, declared to the House of Commons, was that for the next two years we should continue some such organisation as existed during the war. As your Lordships are aware, during the war the railways were under Government control, and they were run by an executive committee of general managers. Sir Erie Geddes did not pay any tribute of praise in respect to that management. He said that the control was bad. I think I must quote what he said, if I may be allowed to, because it has a very important bearing. He said— During the war they were worked under an executive committee composed of tile general managers of the principal lines—

THE EARL OF LYTTON

From what are you quoting?

VISCOUNT DEVONPORT

This is Sir Eric Geddes's speech or the Second Reading on Monday, March 17. He continued— I have seen it suggested that the executive committee might go on. Any one who suggests that railways could go on for another two or three years in the position in which they are to-day, working under the executive committee of general managers in the position in which they are to-day, really does not understand the proposition at all. It is quite impossible. That control, which was had during the war, is trebly bad now. It is almost impossible to expect development under it. That is an astounding statement. It is one more of those statements which are not true in fact.

All of as are convinced that the management, of the railways by the executive committee during the war was magnificent. Look at the work they did transporting munitions and all sorts of things. We are now told that the management is bad and that we cannot go on with it. We are going to have some other kind of management, and that in spite of the fact that on another occasion Sir Eric Geddes said we must daring two years continue some such organisation as existed during the war. There is a case undoubtedly for a change of method of control, and the point we have to consider is why should there be any delay in bringing that about? Why should the matter be held up for two more years? Why should riot the Government come here frankly and say, "We have made up our minds that we are going to take over the control of the railways." That might not necessarily mean that they should be nationalised utterly; it might not mean that at all. I can quite imagine what I would call a civil body being formed. I do not think that is a very expressive term, but I mean to draw a dis tinetion between Government control and competent business control or of the method of working by an executive committee.

All of us recognise that the railways cannot go back. First of all, their owners will not take them back. Have your Lordships noticed this feature in this controversy? Not a single railway director, I think, has opened his lips upon this Bill in the house of Commons, either on Second Reading, Committee, Report, or its final stage. There are a great number of railway direct ors among your Lordships. I doubt very much whether we shall be honoured by hearing the voice of any one of them in this debate. What does all that indicate? It indicates that the Government has had negotiations.

VISCOUNT MILNER

No.

VISCOUNT DEVONPORT

I do not think it is possible to deny that negotiations have been going on with the railway people. They are sitting in expectant silence. It is only a question as to what are to be the terms. There ought to be no difficulty in telling us frankly what are to be the terms. There is the Statute of 1844, in which it is clearly laid down what the terms should be. Therefore it is really only trifling with us to say that the Government has not made up its mind what it is going to do about the railways. If I were a blind man and could not read evidence and listened for the voices of the railway directors and found they were not speaking, I should say, "What does this mean?" It means that the thing is settled. So why go on with this foolish pretence? Why should you want two years to make up your mind? You do not want two minutes. You are bound and governed by the Act of 1844. What does it say? The Railway Regulation Act of 1844 enacts that after twenty-one years the Treasury at any time may purchase any railway upon giving three months' notice, and upon payment of a sum equal to twenty-five years' purchase of the annual divisible profits estimated on the average of three years. The Government may be trying for better terms. I do not blame them for doing that. But to keep on saying that you cannot get on until you have settled your policy is really drawing too much upon our credulity, for we know more than the Government apparently give us credit for knowing.

Let us therefore take it as settled, when we get to Committee, that the Government have arrived at some conclusion as to the basis upon which the railways are to be taken over. I think we are entitled to insist upon their telling us how soon they are going to commence operations under this new régime, because this delay is very costly. As Sir Eric Geddes said, as regards the railways themselves naturally they knew what their fate was going to be. These are the economies which the Government are going to effect by the Bill. Therefore, the sooner they take possession and get to work with the organisation that is going to make everything so perfect, the better it will be. But I hope, after this exposé, they will give up entirely pretending that they cannot make up their minds and that they want two more years in which to do so. One would think that the taking over of these railways was a sufficient task in itself, great enough to tax the energies and skill of any Minister or Department, but apparently that is not the Government case. They are not satisfied with that. They ask for more. They must have everything, they say, and you must, leave out nothing. It is only by getting everything under their control that they can bring about these economies.

There is a great responsibility thrown upon us by this Bill. It is our first duty to save the Government from themselves. It is our duty, I submit, to prevent them plunging on with this system of throwing everything into the vortex of their management. There is no justification for it. There is no public demand for it. There has been no inquiry to justify it. It is simply something that has suddenly come, like a bolt from the blue, associating with all these fictions, and the House of Commons seem to have become mesmerised with these statements. But at all events, we are sane here at the moment I hope, and when this Bill comes into Committee it will be our duty to perform a great public work to prevent the Government plunging along and taking steps and action that will inevitably, in the future, bring the country to ruin. This movement on the part of the Government is surely leading up to nationalisation. I would compare it with some growth which, if not extirpated in its early stages, Will become malignant and uncheckable, and filially will tend to destroy the commercial prosperity of this nation.

My Lords, we want to put the knife into this Bill and make a clean cut. I hope that your Lordships will think that way too, and the clean cut should be to allow the Government to go on with 11 their railways and nothing else, associating the canals with the railways, because many of them are railway-owned. To consent to give them these extraordinary powers so that they can have control over these great interests, on the grounds that they themselves have specified—which I think myself are untenable—would be a great mistake and would bring to the country a great disappointment.

LORD BALFOUR OF BURLEIGH

My Lords, if it requires anything to bring to your Lordships' notice the far-reaching importance of this Bill, I am quite sure that the two very able and eloquent speeches to which me have listened this afternoon would succeed in that object. These two speeches, made from different points of view, show without doubt how wide a field is included in this Bill and how great is its importance. I am afraid I shall disappoint the noble Lord who has just spoken, because I am one of a much-abused body and have been for some years a railway director; but, I do not myself shrink for a moment from entering this debate, and I hope to say a few words on the point that concerns the railways. I had intended to speak in any circumstances, before I knew what the noble Lord who has just spoken was going to say, and perhaps your Lordships will allow me to add that., after the very distinct, challenge which he made, it requires some courage immediately to follow him.

I listened with great interest to the speech made in moving the Second Reading of the Bill by the noble Earl who is in charge of it, and, if he will allow me to say so. I was deeply impressed by its eloquence and by the sincerity of conviction which it showed. But I thought at the time—and subsequent consideration and the reading of the speech confirmed me in the view—that the method of stating the present position of the railways did less than justice to the railway companies concerned. I would be the very last person to suggest that this was intentional on the part of the noble Earl. I believe it was largely owing to an extreme desire on his part not to make too long a speech, but I do think that there were some points left out from his speech which it is necessary to state, if the country and this House are to get a really fair idea of the position of the rail ways. Quite early in his speech the noble noble said— With regard to railways and canals, they are both dependent on State subsidies. … The State contribution which is involved in this guarantee is estimated in this year's Budget at £60,000,000. The noble Viscount who has just spoken mentioned that £60,000,000 and compared it with another estimate which was previously made. I am not going into that point, but the point I want to make is this—that this statement as it stands might seem to imply that the railways, ever since 1913, had been dependent for their solvency on the State subsidy. That is not the fact.

The White Paper to which reference has been made by both the previous speakers, was issued by the Board of Trade this year. It shows, first, that the estimated value of Government traffic for the five years of the war, at authorised pre-war rates, was £112,043,808, while the payments made by the Government under the guarantee of August, 1914, amounted to £95,313,607, so that there was a balance in favour of the Government for those five years of £16,730,000. Therefore, for a period covering the whole duration of the war, the Government guarantee not only cost the Government nothing but it saved it £16,700,000, by reason of the arrangement that the Government traffic on the railways should be carried without charge.

The truth of the matter is this—that, up to the end of 1918, the railway companies were the only people who had not been subsidised. Up to that time the taxpayer had been benefited to the tune of nearly £17,000,000. Traders have had great advantages from the fact that their railway charges have not been raised. The difficulty of raising them in war-time would have been very great, but undoubtedly the noble Viscount who has just spoken has shown that the fact that they have not been raised is one of the features and causes of the congestion which now exists. Charges to all other consumers of all commodities other than transport have been raised during the war. Labour has been subsidised by large concessions, and all this at the expense of the railway companies. So much for the period covering the actual hostilities and a few weeks after they had ceased. The solid fact is this, that for a period covering the whole duration of the war the Government have paid under their guarantee £16,750,000 less than the value of the Government traffic carried during that period without charge. Although these figures may be subject to some adjustment on the final settlement of accounts at the end of Government control, they do show that the railways, so far, have not been subsisting on Government charity.

It remains then to deal with the present year. Turning again to the White Paper it will be seen that the estimated increased cost of working the railways for the year ending March, 1920, is from £104,000,000 to £109,000,000. Your Lordships will understand that these are not railway figures, although I am putting them forward as a railway director. They are the figures of the Government Committee appointed to investigate the circumstances. Of that £104,000,000 or £109,000,000 only £27,000,000 are due to extra cost of materials and coal, the balance being war wages and other concessions to Labour, including the eight hours day. This, of course, is only one side of the account necessary to arrive at the estimated deficit, and it is not easy to estimate the probable traffic receipts, which may possibly exceed any estimate that a cautious man would venture upon, and which may reduce this £60,000,000. The noble Earl who introduced the Bill said that he believed it would be £60,000,000. But supposing it is justified, to what will it be mainly due? The White Paper says it is much more than covered by the concessions to Labour, which were made by the Government on their sole responsibility, who also, on their own responsibility, having full power under the Defence of the Realm Acts, abstained from raising charges for merchandise traffic which would have provided some at any rate of the necessary revenue. I am not here arguing the question whether they were right or wrong. I believe on the whole their judgment was a wise one, but I am anxious in the interests of the railways that the facts as they stand should be really understood. These figures are relevant to the argument that railways are dependent on State subsidies which even if true at the moment is only so because the Government are themselves subsidising both trade and labour.

There is one other matter in the noble Earl's speech to which I want to refer. He said that— But the continuance of the State guarantee has acted as an inducement to the railway companies not to incur expense at this moment when prices are high, but to wait until the time when the period of the Government control is approaching its end and they have reasonable expectation that prices will have fallen. Considering the history of the railways for the last five years, these remarks are particularly unfair both in what they include and what they omit. The suggestion is that all energy, courage and enterprise on the part of those responsible for the direction and management of railways is dead, killed in fact by the existence of this State subsidy. Of course there is hesitation on the part of Railway Boards to embark on fresh capital expenditure just now, though it has not entirely ceased as seems to be suggested. But why is this so? It is not on account of the guarantee, for it is part of the arrangements with the Government that the Government should allow interest on capital which has not become productive. The real reason is to be found in the uncertainty of the outlook as to the future of railways, a position for which the Government are responsible. I am not blaming them because I think they are the victims of circumstances, but that position has been aggravated by such Ministerial utterances as that referred to by Lord Buckmaster in his speech the other day, and by the apprehension that, although they have not stated it publicly as a body, there are many members of the Government who are in favour of what is called the nationalisation of railways.

With regard to the point made by the noble Lord who last spoke as to the management during the war, I should like also to see that justice is done to those who were responsible for railway management. A Paper has been presented to Parliament containing the Report, of the Select Committee on Transport, and the Chairman of that Committee, after hearing evidence from Sir Herbert Walker, the Chairman of the Executive Committee, said— I think all of us, having listened to your statement, will agree that it is a very fine record of performances. It is the fact that while the Government was not organised to carry on the administration of railway systems by means of direct control, it had, in Sir Herbert Walker's words— Long prior to the war established an organisation to cope with just such a situation as subsequently arose, under which, while the supreme control on the systems would be taken over by the State, the technical management would remain in the hands of the administrators who were responsible for its working in time of peace, The success that has attended this operation has been superior to that witnessed in any other of the belligerent countries and it affords conclusive proof both of the adequacy of the arrangements which have been made in advance, and of the capacity of those who have been concerned in their execution. The noble Earl also referred to the congestion of traffic on railways. One of the principal causes of this is one for which the Government are responsible; and I should like to give two illustrations. First, with regard to traffic formerly carried in coastwise steamers: this has been forced upon the railways by the maintenance of railway rates at their pre-war figure, while coastwise freights have, of course, risen like the price of all other commodities. The same thing applies to the question of cartage. As is well known, a trader whose goods are carried by rail at a rate which includes collection and delivery by cart, has the option of doing the cartage part of the service himself. Of course, the cost of cartage has increased like everything else, but the inclusive rail charge remains the same, as docs the rebate which the trader gets who does his own cartage. This again has had the effect of throwing back on the railway companies a considerable quantity of cartage which before the war they did not perform. Inasmuch as their cartage staff has been depleted by the war as well as their goods staff, some congestion must necessarily follow. For these things the railways are not responsible, but I can assure your Lordships that the actual traffic on the railways, apart from getting rid at the terminus whether it is a dock or city which requires cartage, is at this moment being efficiently and properly performed.

With regard to the Bill itself, I sympathise with some of the criticisms which have been made. It is impossible, I think, for this House to forget that as deposited in the other House it clearly pointed to nationalisation, and indeed enabled the Government by Orders in Council to nationalise the undertakings. Many of these provisions have been taken out of the Bill, but provisions which seem to my humble judgment to be much more consistent with the principle of nationalisation than otherwise have been allowed to remain. The result therefore is this, that the Bill presents a very clumsy piece of legislation, with many provisions which are quite unnecessary, merely for the purpose of enabling the Government to make up their minds as to the best way of utilising the railways in the interests of the State.

Most of the provisions in the Bill seem to me quite unnecessary for the purpose of enabling the Government to bring forward a proper and comprehensive scheme in regard to railways; and the retention in the Bill of powers for construction of further railways, and making experiment, which would have been all verywell if the railways were to be ultimately acquired, is quite indefensible in view of the fact that the Minister-designate may incur heavy expenditure under the Bill, which might be altogether wasted if his proposals, whether for nationalisation or otherwise, are not subsequently adopted by Parliament. The proposal to authorise heavy expenditure on branch railways, before Parliament has settled the fate or the mode of administering the trunk lines, for instance, teems to me to be entirely wrong, and it may result—I put this hypothetically because I want clearly to understand the intention and the wishes and views of the Governnient—in the country being committed to a policy of nationalisation to which it has not intended to commit itself. There was an article in one of the leading newspapers a few days ago in which the Bill was criticised in the following words: "It follows the amazing course of conferring autocratic powers upon the Minister in order that he may study present conditions."

I go so far as to say that the original objects make the present form of the Bill quite inappropriate. If you are to reorganise British railways, and I know that they do require to be reorganised, you have to get rid in the future of that system of suicidal competition which prevailed too much in the past. I know something about this because thirty years ago, when I was at the Board of Trade, I was responsible for conducting a large inquiry, which lasted about nine months and which resulted in codifying a large number of Acts of Parliament, and for the first time we put in decimal calculations of a 1d. for calculating rates. Ever since that time, whether as a railway director or not, I have followed the course of the railway interest with great care, and have studied it to the best of my ability, and I am certain that enormous economy can be made if a proper system of co-ordination under responsible authority is adopted, if the railways will cease to compete as they have done, sometimes in a suicidal way, and if they are divided perhaps into large districts, which might co-ordinate. I belive there is im- mense economy to be made in that direction, but, my Lords, if you look at Clauses 9, 12 and 16 as they now stand, I think you will be convinced that there is much muse in the mind of some people than is avowed by the Government as a whole.

What some of us are afraid of is that we are giving away one of the most important outposts in the struggle, which must come sooner or later, on the question of national ownership either of transport or of the means of producing wealth. I am not arguing the question on its merits. It is clearly too large and important a matter for a debate of this kind; but what I am afraid of is that if this Bill passes in its present form it will commit us irrevocably, and behind the back of the country, to a policy the importance of which no one can under-estimate. My Lords, I venture to hope that before this debate closes we may have a distinct declaration on this point by some responsible Member of the Government—some one who can speak with the highest authority and whose words Will commit the Government and commit also, if it is possible to commit him, the Minister-Designate. I can assure the Government that their line upon this particular matter of policy will have a most important bearing upon the future course of the Bill in this House.

THE CHANCELLOR OF THE DUCHY OF LANCASTER (THE EARL OF CRAWFORD)

My Lords, my noble friend Lord Balfour said it was difficult for him to speak after certain remarks made by Lord Devonport. It is very much more difficult for me to speak after Lord Balfour than it was for Lord Balfour to speak after Lord Devonport. He, at least, succeeded in evading all the questions put to him as a railway director. I cannot and do not wish to succeed in evading the points which have been put. Although I do not speak with the anthority say, of Sir Eric Geddes, I want to put to your Lordships some general considerations which perhaps have not received sufficient attention from the different speakers. I have listened to all the speeches, except perhaps for about six or ten minutes, with very great interest, and I observe that although criticism, at times rather animated criticism, has come front various quarters, none of your Lordships who has spoken has laid down a definitive alternative to this Bill.

Several NOBLE LORDS

Why should we?

THE EARL OF CRAWFORD

Lord Buckmaster, in his opening remarks, said he saw no necessity to lay down an alternative. Lord Devonport was actuated in his criticism by consideration of the great concern which he and his colleagues have managed with such distinction—namely, the Port of London Authority. Lord Montagu was obviously influenced by his predilection for roads, Lord Balfour by his railway experience and connection, and Lord Buckmaster, it seemed to me, dwelt entirely on the broad question of principle as to whether State management awl control were better than private management and control. So, although the Bill has been attacked from all points of view, I cannot help thinking that those who attacked should produce an alternative policy.

LORD BUCKMASTER

The noble Earl will forgive me, but I did produce an alternative policy. I said: "I do not conceive that we are bound to produce any alternative policy at all, but there is an alternative, and that is that the Government should continue the control that already exists of the undertakings that are in their hands until they have cleared them up."

LORD MONTAGU OF BEAULIEU

I also made a suggestion.

THE EARL OF CRAWFORD

Yes, I know. Lord Buckmaster said "Leave things as they are." Now, there are three broad alternatives. One is complete nationalisation—that is an obvious possibility—immediate, final, and complete. I do not think you want that. In fact, I am sure neither House of Parliament desires that. There is the alternative of returning the railways to their shareholders. I know nothing about the negotiations. Lord Balfour has told us nothing on that subject. But do you think that the railway companies and the railway shareholders are to-day prepared to take back the railways from the State as the State took them from the companies in 1914? Lord Montagu says the deficit, so far from being £1,200,000 a week, is only £6,000,000 or £7,000,000. The railway directors do not take that view.

LORD MONTAGU OF BEAULIEU

I took that from the White Paper.

THE EARL OF CRAWFORD

It is not the view of the Ministry of Transport. As the noble Lord knows, they estimate the loss at £60,000,000 for the coming year. I do not therefore think that the railway shareholders would consent to that alternative. I do not believe that they would be willing to consider the return of their property to them on those terms. The final alternative is, broadly speaking, the continuance of the existing control for a limited period, with power to carry out developments during the next two years, and to co-ordinate one form of transport with others. That is the alternative which is adopted in this Bill. Lord Montagu has criticised it largely from the point of view of roads. What is the effect going to be upon roads?

LORD MONTAGU OF BEAULIEU

Road transport.

THE EARL OF CRAWFORD

Roads and road transport. He says that roads are starved wherever the State has control of railways. I am not quite sure that is true. I think probably that if the history were studied closely it would be found that the State found itself bound to develop railways because in those countries the road system was so bad. It is a case of post hoc and of no other thing in my opinion, and that is the case so far as India is concerned.

LORD MONTAGU OF BEAULIEU

That does not refer to India because the roads existed years before the railways.

THE EARL OF CRAWFORD

That was equally so with the roads in France and Italy. They were inadequate for the purpose, and the State developed the railways. Railways were developed by the State for that very reason, and if they had had that wonderful network of roads which exists in some other countries the obligation upon the State to develop railways would pro tanta, of course, have been reduced. Lord Montagu's love of roads I share, but not to the extent of depreciating the railways. He said in effect that the only person who really got to his destination by railway was the station-master and his clerk. You must not, however, ignore the vast amount of merchandise traffic, estimated quite unduly low by Lord Montagu at 10 per cent., which the railways carry direct to its ultimate destination. There is practically the whole of the coal except household coal, a vast percentage of our grain, and most of our cotton. A vast percentage of our grain goes direct into the mill through the elevator. Practically all the iron-stone goes directly into the smelting furnaces as also do the billets. In nine cases out of ten the same is the case in regard to cotton, and it equally applies to manufactured goods that go by export and are taken direct by the railway to the dock. This great trade never could have been achieved by roadways alone, and it is the very fact of our magnificent railway development that has made this large internal and external trade possible. Railways have contributed more than their full share to that form of transport.

I am myself, therefore, not afraid of the charge that the railways are going to diminish the roads. Our road interest is pretty safe under this Bill. It is no good saving that only one out of nine people is directly concerned in the road problem. Sir Henry Maybury from his knowledge and experience will exercise pretty considerable authority, and beyond Sir Henry Maybury you have the great road-users of the country as a whole, who I think may be trusted to ensure that the railways shall not squeeze out the roads, or that the roads skill be neglected, thereby destroying one of our most valuable agencies of traffic. Moreover, this Bill leaves the bulk of our road legislation intact, and does not in effect extend it. I heard with some apprehension, and I am sure your Lordships shared my concern, that the present Road Board is so unsatisfactory that Lord Montagu and his colleagues have just had to censure the Chairman. I hope that under the new dispensation matters may perhaps improve, and I am sure that Lord Montagu will find that those in the new Transport Department will support him more enthusiastically than he has been assisted up to the present.

LORD MONTAGU OF BEAULIEU

The Road Board is wiped out by this Bill.

THE EARL OF CRAWFORD

Lord Montagu wants a large road development. I cannot speak for the Traffic Board, but I cannot conceive of anybody desiring to limit road development. I cannot conceive that it is being done. It is possible, and the clause which Lord Montagu referred to as an example of what wicked railwaymen would like to do has got a very good explanation, quite apart from any idea that it is to be used for sinister motives, I want large road development. Everybody who has the trading interests of this country at heart must share that view. I hope I am not too dognatic, but that is what I feel. Lord Montagu blames the railways because, he says, they concentrate population—congest population I presume he means. Of course they concentrate population if the population for industrial reasons wants to be concentrated. But do not let us forget that if railroad transport ca a concentrate, it can also distribute and disperse. The whole of the distribution and dispersal of population down the Thames Valley, the whole development of our big seaside resorts, practically the whole great range of outer London in the home counties in which we find the population dispersed, we owe to the railways. That is something which the roads could never have accomplished. Therefore I say that the railways must not be held responsible for all our industrial and social ills, which Lord Montagu seems to think would have been remedied if we had been able to develop our road system much more largely.

This Bill, according to two or three noble Lords, goes too far because it is not limited to railways and canals. I think that has been conceded by almost every speaker except perhaps Lord Buckmaster, who has been the only one of your Lordships to be consistent in his criticism of the Bill from start to finish. Lord Montagu certainly conceded it; Lord Balfour I think has conceded it; Lord Devonport has been extremely near conceding it; but one noble Lord wishes one thing left out, and another wishes another thing left out. This Bill at any rate carries the assent of the public as a whole in continuing control over these two great groups of transport, canals and railways. Your Lordships must remember that the Bill, I think rightly, desires to embrace within its purview all forms of transport. It is a temporary measure; it says so frankly, according to our modern system of putting exposition and exhortation into our Acts of Parliament. The first words of Clause 3 do that, according to our new system. It allows power during that interval to develop the railways. There are certain obvious limitations upon that power of development. Would it be wise, having settled that for another two years railways and canals are to be governed by a central Parliamentary authority, to deny the right to the authority during that interim period to spend money upon development? I can imagine nothing more disastrous than to produce for the next two years a state of complete and paralysing stagnation in the whole of our railway system. Because that is what it involves. The safeguards that, are put in the Bill, I think, are adequate to ensure that nothing of a profligate character will be done. We all know how slow the physical maturity of railway improvements of necessity must be, and I do not think any fair critic can argue, with those limitations in the Bill, that the new Minister of Wave and Communication is going to be in a position to commit any extravagance. If you see that this Ministry has got to come into existence, you must allow it the moderate powers of development which the Bill confers.

Lord Buckmaster, and particularly Lord Montagu, asked a question which I confess is extremely difficult to answer—How, after two years time, perhaps with developments which, though not large or far-reaching in themselves, may in the aggregate be considerable, are you going to be able to disentangle? I do not know. But I am convinced of this, that by setting up a proper authority, directly responsible to Parliament and subject to the Briticism, the control, and the censure of Parliament day by day, instead of the existing system of railway managers which has worked admirably, I think, during the war, and of the managing directors, to whom the very greatest credit is due—I think it will be far easier to disentangle under these conditions two years hence than it would be to throw back these railways upon the hands of their shareholders. That is not a case of disentangling; that is a case of bankruptcy. And I hope, and confidently hope, that during the next two years when the people will really have time to give attention to the policies and to the larger issues—rather than find their time, as they have done throughout the war, devoted hour by hour to fresh and recurring and new crises as these crises arise there will be some chance that we shall be able to find a solution by which these delicate and difficult problems shall be disentangled.

Lord Montagu says that this involves ultimate nationalisation. There is no question of wrecking the railways before they are captured. I do not think Lord Montagu ought to have put that idea into your Lordships' minds; there is no question of it. There is nothing sinister or concealed behind this Bill, I venture most respectfully to assure Lord Balfour of Burleigh. It is not with the object of surrendering an outpost that it has been introduced. Its provisions may be clumsy, as Lord Balfour says; some of them may be superfluous. Well, your Lordships in Committee are very competent to deal with either of those contingencies. But to the Second Reading of the Bill, I submit with great earnestness that no effective alternative can be or has been supplied.

VISCOUNT MIDLETON

My Lords, there is no doubt, from the speech of the noble Earl, that he is a convinced supporter of the Bill. But. I confess I had expected, as I am sure many of your Lordships had expected, rather more from him than the speech we have just heard. He has gone as far as to justify some change in the direction of handing over to the Government the control of railways owing to their present condition. From that he has proceeded to argue that it is a necessary concomitant of putting our transport on a different basis that the Government should assume the control of the whole of our transport. I think it is not unfair to say that the present position of the railways is largely clue to the fact of Government control, and that you have to prove that that control has been admirable and beneficial before you argue for an extension of it.

I think we must all have been disappointed to have heard no allusion made in the speech of the noble Earl, to the speech which fell from the noble and learned Lord (Lord Buckmaster) on the first evening's debate. His proposition was that financially this Bill was to be condemned, because it would make an undue demand on the resources of the country at a moment when we are unable to meet it. He further contended that the policy of nationalisation was in itself wrong, and was likely to lead to serious leases, and he also challenged the efficiency of the conduct of these operations. I do not think we have had one word in the speech of the noble Earl which dealt with any one of these three propositions. I do not think we had one word which dealt with the financial effects of this change, with the policy of nationalisation as a policy, or with the efficiency of a Government monopoly as compared with private enterprise. Those are the three points which have been made, and, quite apart from the three expert speeches to which your Lordships have listened to-night from representatives of the docks, the railways, and the roads, I feel that this measure of reconstruction, which is the least understood of all measures which have been presented to Parliament, will, if those questions cannot be answered and if the contention of the noble and learned Lord is correct, before the two years are out be the most unpopular measure which has ever been passed by this House. I ask the noble Earl, or whoever represents the Government, to grapple with the points on which we are bound to decide the vote which we give on this Bill.

THE EARL OF CRAWFORD

I am extremely sorry if I did not deal with the particular point which Lord Buckmaster raised. In point of fact, I did deal with it, though perhaps summarily. I must excuse myself before your Lordships. My desire is always to speak as shortly as possible, and I have been blaming myself for speaking for twenty minutes, as it was.

VISCOUNT MIDLETON

I know an effort is always made from that. Bench to make a, case, and I do not wish to complain, but I must call attention to this, that the Government are greatly handicapped in the discussion of this Bill by the line which was taken by their representatives in the House of Commons. They did not attempt to make a case. They stated simply that they were going, as the noble Viscount (Lord Devonport) said, to press for every jot and tittle of the Bill, and the Leader of the Opposition actually said in debate on that occasion that it was as easy to talk to a stone wall as to bring arguments before a Minister in charge of this Bill. The financial proposition has to be grappled with, and has not been grappled with, and the question of whether we are to look upon this as a measure of nationalisation or simply of co-ordination and development must be decided.

Allusion has already been made to the statements by Mr. Bonar Law—statements which were not, as far as I know, actually published, but which were made to a large number of Members of Parliament without, as I understand, any stipulation of privacy as td the views of the Government. Let me read one sentence in order to show how it is that the arguments we have heard have gone ahead of the intention of the Leader of the House of Commons. Mr. Bonar Law said— The Government have not in any way committed themselves to the nationalisation of railways, but the Government does not, intend that the railways shall revert to the old system. It is necessary that we should have some form of control of the railways, but we do not want the railways to be run as Government Department, which I should regard as a great evil. We must co-ordinate the docks and roads. What we want is a simple system for advice. I appeal to those who have heard the speeches to which we have listened to say whether what is asked in the text of this Bill, or in the speeches which have supported it is simply, as Mr. Bonar Law says, "a simple system for advice"? It is a system for absolute. control; it is a system from which you cannot turn back if you once begin upon it; it is a system which, after two years if it should be desired to make a, change in it, we should be told—as we were told the other day after the inquiry about Slough—good or bad the thing has gone so far that you have to go through with it. It. is to arrest this that we ask your attention to-night,

Is it, wrong that we should ask you, as we were given no figure with regard to the future, to refer to the past? I will do it as briefly as I can. Earlier in the session, on the Motion of my noble friend Lord Faringdon, we discussed at considerable length the financial position of the country, and it, was pointed out that in all eases where the Government had undertaken a business that business had been a failure. No one can doubt that this statement was fully in accord with the feeling of this House who listened to the cheers which greeted Lord Devonport's utterance on that subject. I do not wait to go into the details, but look at the Telephone service which was paying a large interest and showing a profit, but which now does not pay even the interest, on the money which the Government have embarked in it. Take the Telegraphs, which have not been a paying business for many years past. Take, if you will, the attempts of the Government at shipping during the war. I venture to say that the whole country owes a debt of gratitude to Lord Inchcape for the attitude he has recently taken, without any question of personal profit, in buying from the Government and selling amongst the shipping trade an immense number of ships which the Government had under construction, thus preserving us from a Government monopoly and reconstituting private enterprise in the shipping trade.

Several NOBLE LORDS

Hear, hear.

VISCOUNT MIDLETON

Look at the most recent excursion of the Government into the field of business. Take coal. I am sure that no one in this House at this moment would wish to use any exaggerated language with regard to the coal position, but could the worst enemy of the Government have predicted four months ago that so quickly the Nemesis would fall on an unsound economic policy? The Government were told that the subject could not be discussed within the time they allowed for the Commission. They were told (as happened) that the workers' evidence could not be cross-examined. They were told that if they gave what was asked for they would paralyse the industry—and they have paralysed the industry. They gave what was asked. The consumer at this moment is charged enormously more; half the trades which depend upon coal are at this moment in difficulties and tottering. On the top of that, those to whom they have made all these concessions are as far from being satisfied as they ever were. I believe that in all struggles which have taken place hitherto it has been an unwritten law between employers and employed that the state of the pits themselves should not be damaged, but within the last few days, to the deep regret of the whole country, a departure has been made from that understanding. Who could look back and say in these circumstances that these interpositions of the Government have been satisfactory? The noble Earl himself alluded to another point which touches the question of railways. The moment the Government took them over the whole distribution by coastal traffic, worth £70,000.000 a year, has been destroyed.

THE EARL OF CRAWFORD

No, not in consequence. I think that is carrying it a little too far. My noble friend says that the coastal traffic was destroyed in effect because the Government took over the railways. One of the chief reasons was that the Government took over the coastal boats for war services, and that largely interfered with the coastal traffic.

VISCOUNT MIDLETON

I have not the quotation here from Sir Eric Geddes's speech but, unless my memory very much fails me, in denouncing the fact of the Government continuing to subsidise railroads Sir Eric Geddes said it had bad the effect of destroying £70,000,000 worth of coastal traffic. Now, I am not really suggesting that it is some ill-dealing on the part of the Government which has caused all these catastrophes; but what I contend—and I believe I am right—is that the Government in dealing with all these matters are handicapped by the belief on the part of the workers that there is so big a sum behind them that there is nothing for which they can ask that cannot be conceded if the Government are generous enough to put their hands in their pockets and give it. Therefore these cases bear to some extent on the Bill. Be it remembered that by this Bill you are going to create the most gigantic trust that has ever existed in this country in the hands of one man and of one Ministry. It was bad enough when during the war you had to carry on a business in munitions which amounted to hundreds of millions. You are now going to put the whole of the transport trade, involving hundreds of millions, into the hands of one Minister. That is a very serious matter; and you are doing it in the very department in our British life in which this nation has excelled all other nations—namely, in the activities of distribution and of carrying.

I am going to ask your Lordships to allow me for one moment to discuss a delicate subject quite beyond the big question upon which we are engaged—that is to say, the manner in which the name of Sir Eric Geddes has been used in connection with the whole of this transaction. We have been informed over and over again that if there were no question of so able and so trusted a Minister as Sir Eric Geddes taking this control—his name has been used so frequently as the panacea for all these ills—this enormous conflux of duties would never have been placed on one man. In any case, you must look to a man of the most supreme business powers and not to a politician—according to all present ideas—to carry on this business. What has been the experience of bringing men of business—captains of industry with enormous commitments—from their own business or the commercial life of the country into the Government? We have had a very fair experience, and I am going to trouble your Lordships with the particulars of the length of time that the Government have been able to persuade these business men to serve them in order to suggest that in committing the whole of this to Sir Erie Geddes they cannot ensure any permanency of administration.

I believe that there have been ten of these distinguished men employed in the last few years. I cannot speak with certainty, because the kaleidoscopic character of the changes which have been made in public offices have not been recorded in the books of reference. Lord Cowdray was acting at the Air Board for about ten months in 1917, and was then arable to continue. Lord Devonport, who made a powerful speech a few moments ago, was Food Controller for few months at the end of 1916—four months or so, I think it was—and was then unable to continue. Mr. Neville Chamberlain was Director of National Service for about six months in 1916, and was unable to continue. Lord Northcliffe held four posts from June, 1917, to 1918—I think altogether about sixteen months—and was unable to continue. Lord Rothermere held three posts for about two years—from 1916 to 1918, and resigned. Sir Albert Stanley was at the Board of Trade for two and a-quarter years, and has resigned. Lord Beaverbrook filled two posts for six or seven months in 1918, and resigned. Lord Weir filled five posts in two and a-half years, from June, 1915, and has resigned. Each of these men, therefore, has given a few months' service and has then been claimed by other engrossing duties. The only other case I know is that of Lord Inyerforth, who is not present at this moment. He has served for three years.

Sir Eric Geddes has filled seven posts since 1915. There is no disrespect to Sir Eric Geddes in asking your Lordships to consider the enormous sacrifices which he has made in order to come into the Ministry. Ho was holding a very important post, and a very highly paid one. He was promised a large sum if he had to give it up owing to nationalisation. He gave it up without nationalisation, or without any action of the directors of the North Eastern Railway under whom technically he still was a few months ago. If that sum that was paid to him had been paid by His Majesty's Government it would, of course, have been a thing unexampled in our history; but, the fact that whatever sum was paid to him was not paid by His Majesty's Government leaves him absolutely free to leave the service of the Government at any moment he likes. There is no bargain of any sort or kind that he should remain. He may differ on the policy of this Bill. There may be a change of Government. He may leave for any other reason for which people resign, and he may go. By the precedents of all past experience we may put this power into his hands and before the Bill is many months launched we may lose his services, which I venture to think would be a great calamity. Therefore I think from that point of view alone—the policy being doubtful and the permanence of the Minister who was specially designed to carry it out being doubtful—we ought to consider whether it is possible to give such extended powers as are proposed under the new Bill.

What, then, is the patriotic course for us to take? Lord Devonport made a suggestion which has been considered beforehand by the noble Earl (Lord Lytton), who said that to restrict this Bill to railways alone would be to ignore the whole point and purpose of the Bill. I think that was the expression he used. In the biggest business of this country, surely it is possible for us to reconsider the matter from the point of view of the difficulties which have arisen in various trades and the enormous extra charges which have been made on the public Exchequer since the Bill was first brought forward. My noble and learned friend in his speech, however, pointed out that the future expenditure of the country could not be less than £800,000,000, and the future Income Tax, taking excess profits into consideration, would amount to 9s. 2d. in the £. I think that he under-stated rather than over-stated our liabilities. That being so, surely the first thing we have to prove is that to put the railways under one hand would be au economical and safe arrangement. I think it would be possible to carry out the view of Mr. Bonar Law. Surely it would be possible to place Sir Erie Geddes at the head of a Board who would have a controlling influence over the present position of the railways, who would be able to expend such money as is necessary in improving the sidings, who would be able to take the 700,000 wagons which are at present in private employ on some arrangement and pool them for general use, who would be able to reconsider the rates both for goods and transport generally, and who would be lip a strong position to give the advice which Mr. Bonar Law spoke of to the docks. As I pass, perhaps I Wright. be allowed in one word to say that I cannot imagine a more unwise step than at this hectic period for any Minister to attempt to govern the docks, and to attempt to deflect from one port to which certain business has always gone a large portion of that business in favour of some other port—

THE EARL OF LYTTON

There is no such power in the Bill.

VISCOUNT MIDLETON

If he has not the power under the Bill, he has been relieved of it only in the last few months. I have certainly seen it argued, and I did not know it has been dropped. On the railways alone, at all events, he will have the greatest opportunity of standardising plant. On all those points can anybody say that the energies of the greatest administrator would be clipped and unduly confined in the next two years? For that reason I would urge your Lordships to consider whether you should not divide the Bill—whether you should not give such power as it is necessary to enable the supreme powers of the Government to be brought to bear on the railways to endeavour to show what this loss, now reckoned at £60,000,000 by the Government, at a less figure by Lord Devonport, and at £10,000,000 by Lord Montagu, really is, and what economies can be made by pooling the whole of the working. Such a Minister would be in a position to give invaluable advice with regard to roads and with regard to docks. With regard to the docks, I hope that nothing done in this House will be supposed to be standing in the way of the best improvement that can be made in our traffic and in the coordination of delivery and of production. But with regard to saying that the roads depend on their being taken over by the Government, that is really distrusting British commercial private enterprise. If the Government will only release the large amount of motor transport which they control, I have not the smallest doubt that as, during the war, in America one firm alone has been handling a turnover of £75,000,000, and as British firms have been doing the same, there will be in a more or less degree great competition for it.

Just look at what the difficulties will be with which you saddle the member of the Government who is to take it over. A great commercial man expects to be free to make his own bargain about wages, but the head of this great business will have no freedom on wages whatever. Whatever wages he may fix will be subject to review by the House of Commons and also to demands such as have been made in every trade over which the Government have control. I am sure the question of rates must have occurred to members of the Government. Supposing a private company is running the roads in any district and the Government the railways, the private company can make whatever sum it can get for its transport. What is the ease of the Government? Remember what happened in regard to food. When it was proved the other day that the Government bad made a. loss on some articles of food but were making a gain on some others, they were immediately attacked and accused of being profiteers, as I think most unreasonably. So it would be with regard to these rates. If you can prove to the farmer that the rates by road were making a profit and the rates by rail were making a loss, and that the one was being set against the other, you would have immediate pressure to reduce the one although the net result was only fair to the taxpayer. That is why the commercial man acting for the Government cannot obtain the results which the commercial man can get acting for himself.

Therefore I would urge, while it would be impossible at this stage to give the full powers which are now demanded, that the railway powers should be granted, subject to some Advisory Committee on rates who would represent traders, and subject to some control by the Treasury, which at present has no place whatever in the Bill. The two controls which have appeared in previous Bills in different ways have been either the control of the Treasury or the control of Parliament. At this moment you cannot lay down rates outside your own ground except by the permission of Parliament. That is what we require to restore, except in a very moderate case in which full scope would be left to the Minister. I hope the Government will yet reconsider their determination to ask for the whole Rill and nothing but the Bill. I would urge upon them that the time is not one for large schemes of spending money but for showing how money can be saved and enterprise made satisfactory.

I would urge that the first object we must have is, not to increase but to diminish prices. That they can do if they open the ports a little more freely. Here is really one of the greatest difficulties we are in at the present time. Still more, I would ask that they would have courage in dealing with the workmen whom they employ. That is, not to put up the rates on private business as they are doing throughout the country. That is one of the greatest objections to the Bill. You are going to give the employment of hundreds of thousands of men, on a scale which has never obtained before, into the hands of the Government who cannot be stronger than the Members of Parliament who give them their support. That is putting a temptation in the way of Parliament and a burden on the Government which I do not think any Government ought to be asked to bear. In these circumstances, I really believe that all that is most needed by the Govern-tent may be elected by reducing the scope of this measure. Let us see for two years how it acts. Let us not register any determined opposition to anything which may tend to relieve the great difficulties of which the noble Earl spoke, but let us avoid embarking on a policy from which there is no retreat and committing ourselves to a situation from which we shall be unable to find release.

BRASSEY

My Lords, so much of what I wish to say in this debate has already been better said by previous speakers that I shall not trespass long on your Lordships' attention. But I wish to say that I feel most profoundly that this Bill is one of the most dangerous Bills ever submitted to the Parliament of this country, and for the reason that it gives an autocratic control over our railways, roads, and other means of transport to a single individual. The Minister may take possession of railways or any portions of them; he may commandeer their staffs; and the directors and staffs of railways are bound to act under his orders. To what extent the Minister is going to control our various means of transport is shown by the list of the officers of the proposed Department which was published in The Times a few days ago. I was not in the House during the first hour of this afternoon's debate, as I was attending a Committee upstairs, and I do not know whether Lord Montagu alluded to it, but I think it is worth while calling your Lordships' attention to this point.

This new Transport Department has no less than nine sub-Departments. It has a Department of Civil Engineering, under Sir Alexander Gibb; a Department of Me chanical Engineering, under Lieut.-Colonel Simpson; a Consultant, Mechanical Engineer in Sir John Aspinall; a Traffic Department, under Sir Philip Nash; a Finance and Statistics Department, under Sir George Beharrell; a Development Department, under Rear-Admiral Sir Charles Bartolome; a. Department of Public Safety and Labour, under Sir William Marwood; a Roads Department, under Brigadier-General Sir Henry Maybury; and a Secretarial and Legal Department, under Sir Francis Dunned. Having regard to the number of over-staffed Departments with which the country is burdened now, it is not with equanimity that one contemplates the addition of another Department staffed as this is going to be.

This Bill has been urged as necessary on account of the failure or the breakdown in our railway system. I think it has already been pointed out that if our railway:, are not able to do all that is expected of them to-day, it is due to the fact that a large number of locomotives and a large proportion of the rolling-stock were withdrawn and sent over to France during the war. The railways suffered enormously from the depletion of their stork, and t hen they have also suffered, as others have pointed out, owing to the fact that the Government have interfered between them and their employers by giving advances in wages and a reduction in hours which made it still more difficult to handle traffic.

I agree fully with what was said by Lord Devonport—and I have knocked about the world as much as most, people—that before the war our great railway systems were as well conducted as any railway systems in the world. They were a pattern to other countries. I happen to know that Senator Bianchi, who was Minister of Transport in Italy during the war and did so much to organise the whole of the Italian railways when they were taken over by the Government, receiving a special tribute from General Cadorna in the early days of the war, said he had learned a great deal from our own railway systems and derived many valuable lessons from them.

It may be very well admitted that there is a lack of co-ordination in our railway systems. It may be admitted that there has been costly competition in the past, and it is perfectly true that it is possible to secure great economy by a standardisa- tion of locomotives, rolling stock, and so on. Steps in this direction had already been taken before the war under the Railway Executive, composed of railway managers who were well posted in the needs of their various services. I think it is a great mistake that, instead of using the experience of these men, you are going to put in control of all our railway systems officials to overide them.

In my opinion the Bill, as now drafted, will paralyse the administration of our railway systems; it will prevent initiative, and prevent expenditure most necessary on our railways by those who are most competent to judge how the money should be expended. There is certain to be a large expenditure under this Department. We shall have Chepstow over again, but the Bill itself will prevent expenditure by those who are now responsible for management and who are most competent to judge. A very curious argument was used by the noble Earl who introduced the Bill. He recommended the Bill to your Lordships on the ground that an exactly similar Bill had been introduced in France. That seems to me a most extraordinary ground on which to recommend a Bill to a British assembly. A few years ago every Englishman prided himself on the fact that we were not a bureaucratic ridden country like France.

The general argument in favour of this Bill would be infinitely stronger but for our experience of Government control and management in the past few years. We have had a terrible experience during the war of the way in which our Munitions Department was conducted. The reckless extravagance, the wages paid, and the 12½ per cent., which cost the country millions of money, is responsible very largely for the unrest which is in the country to-day. One noble Lord has alluded to the way in which the Government has handled the coal question. I take it that the Labour Department of the Government is largely responsible for the advice on which the Government acted. I should like to say here and now that in my opinion the miners are by no means wholly to blame for the situation in which the industry is at the present moment. The Government ought never to have made concessions which they knew the industry could not afford. They ought to have told the miners at once, fairly and straight, treated them as reasonable men, and said "you cannot have this advance and reduction in hours without seriously crippling every British industry." Instead of that they give the advance and try to set the whole of the country against the miners by putting on this 6s. per ton. That is not the way to treat intelligent workmen of this country, and the Government are largely to blame for the situation which has arisen.

The noble and learned Lord who moved the Amendment gave us figures showing what the expenditure of the country was at the present time under various heads, and what he believed it must be in the immediate future. I believe every one who followed Lord Buckmaster's speech was deeply impressed by what he said. In my belief the noble and learned Lord did not in the least exaggerate the seriousness of the position in which the country is to-day. I believe that this country is absolutely ruined, ruined now—and when the Mother country is ruined will come the fall of the British Empire and its glorious heritage—if we do not alter, and alter at once, the system of Government which has been built up since the present Prime Minister came into office, and of which this Bill is a most glaring example. It is absolutely essential that the activities of the bureaucracy, who are sucking the life-blood out of this country, paralysing individual effort, and interfering between employers and employed, must be curbed if this country is to be saved.

Instead of creating new Departments, the sooner some of the existing Departments are abolished the better for the country. In this crisis there is a very solemn duty imposed on your Lordships. This Bill gives, as I have said already, despotic power to a single individual over all means of transport in this country, and whoever controls transport controls trade and industry. I submit that it is the duty of your Lordships' House to reject this Bill, or to radically amend it regardless of the consequence. It is the duty of your Lordships to protect the liberties of the people and to see that the British qualities which enabled us to win the war are left free to enable them to repair the damages of war.

LORD FABER

My Lords, I am quite conscious of the fact that I am addressing a tired House, and therefore my remarks will be short. I propose to deal only with the railway point of view, because I know very little about roads or harbours. I would say to your Lordships, Do not throw out this Bill but give it a Second Reading, and then if necessary amend it somewhat drastically later on. Now let us look at the position and the future of railways and canals. Five years ago the Government took over railways and canals. They are going to hold them for another two years, and that will be seven in all. The Government have behaved very well to the railways and canals up to now. They have paid regularly to those companies the earnings that were made by them in the year 1913. Nobody can complain of the treatment meted out to those companies by the Government, and therefore we hope that in future we shall continue to receive the same kind of treatment that we have received in the past. We realise in this House that the capital invested in these undertakings amounts to about £1,250,000,000. We recognise also that the best class investors in the country are in these undertakings. A great deal of trust money is put into railways, and it would be a terrible blow to the country if anything happened to interfere with the financial position of the railways. As I have said, quite the best class of investors are in them. Women and children are provided for by sums invested in the railways, and we must take care that we do not upset that position. The railways also deserve consideration because at the beginning of the war they gave up nearly all that they had, in a commercial sense, to help the Government in the war. They gave up tens of thousands of men and thousands of engines, hundreds of thousands of trucks, and also ships, in fact everything. Now it is complained that the "dead hand" is over the railways. Yet, if there is a "dead hand" over the railways, it is because the railways did more than they ought to have done, if that be possible, to help the nation in time of war.

The next question is as to the Government's action during possession of the railways. They have made one very big move. They have given enormous increases of wages to the men. Probably that was right to a certain extent; certainly as regards the higher grade men I think that too much money was not given to them. With regard to the lower grade men on the railways, I think the increase was too high. Labour is always trying to instil in us the idea that all labour is equal. There is nothing more unequal than labour from my point of view, and therefore to class labour altogether and pay the same rate of wages, up or down the scale, is a very false policy. That is what they have done since they held the railways. Now the Government propose two very drastic changes: Let us see how they will affect the railways. They are going to purchase the free wagons on the railways—700,000 wagons—and that at an average of £100 per wagon means an expenditure of not less than £70,000,000 in buying private wagons. They are probably right in buying them, because it is much easier to deal with wagons under one ownership than under half-a-dozen ownerships.

I say that probably it was the right thing to do, but I do not say it was certainly the right thing to do, because there is the future to look at. It is possible that our trade may go down, and in that case the railways will have 700,000 wagons more than they want. The next new thing is also a very big thing, namely, the raising of freights. Probably that is right too, but there again I do not say that it is certainly right. It is right that the railways should run themselves and not get subsidies from outside, but there is this great point in this great question: If you raise the freights, as you will have to do, to the extent say of 50 per cent., you will make everything you carry very dear indeed. The price of all these goods will go up and you may conceivably smash your foreign trade by it, and then where are the railways? So in both these great endeavours we have not the certainty that they will either of them succeed. We think the Government are wise in making those experiments, but that is not sure.

I would ask, Is it fair to the railways that after having them for seven years and making all these experiments upon them the Government should be in a position, at the end of seven years, to say "These railways have not done well, and we are going to give them back to the companies" or "They have done well, and we are going to keep them." I apprehend that the right and straight course, and the course which the Government have shown themselves willing to take, is to say now and here to the railways what they are going to do. Here is one of the big interests of the country, and for the last five years the stock-holders in that interest have not known the value of what they possessed— they have not known whether to sell their shares or to keep them. Is that right If the Government say that they are not going to take the railways we can then judge what attitude to pursue. I should say that the Government would do well to take over the railways and docks and continue them. That is enough for any one Department to handle. I have told your Lordships that I do not know anything about docks, but I have had the privilege of going down to see, under competent guidance, the docks of the Port of London. I was enormously impressed. They are au imperial work and very well carried out, and the warehouses attached to the docks, where you see £250,000 of ivory and enormous quantities of tea, sugar, rubber, and all such industries combined together and well-looked after, deserve consideration from any business man. I do not give any opinion upon the docks that is worth anything, but I only tell you what I saw there. I am not going to keep your Lordships any longer, but I say that upon the whole the Government have acted very well towards the railways so far, and I hope they will continue to do so by saying if they are going to keep them, and if so what are the terms.

THE EARL OF LYTTON

Perhaps your Lordships will allow me to reply to one or two points raised during the debate. The noble Viscount opposite complained that we had shown unwillingness to grapple with the difficulties of the Bill and the arguments put forward by its opponents. It may be that I cannot at this moment deal with all the questions that have been raised, but I assure the noble Viscount that we have no intention whatever of avoiding any of the arguments raised, or any reluctance to grapple with the difficulties. If I may take the speech of the noble Viscount as illustrating the points upon which a reply is chiefly needed, I will endeavour to direct my reply to those points.

Before I come, however, to those main points of criticism in the speeches of noble Lords who have spoken, there are two small points which I want to clear out of the way. First of all, I wish to reply to Lord Balfour of Burleigh by admitting at once that there were deficiencies in my speech which might have given a false impression. I completely accept the statement he has made to-day, and I hope he will believe that it was only a wish to save time, and to condense what was a rather long story into as short a compass as possible, that led me to make statements without the modifications which, perhaps, were needed. I do not at all want to create the impression that during the whole period of the Government control of the railways the railways have been dependent on a State subsidy. What the noble Lord has pointed out to-day is perfectly true, that down to this year tile Government did not make a bad bargain. With the Government traffic that was carried free, the guarantee of the net receipts of 1913 was not at all a bad arrangement for the Government. The difficulty has arisen only in this year from two causes—partly the great increase in the cost of working the railways, as of working everything else, largely due to the increased cost of labour, and partly to the falling off in the Government traffic.

I want to say one word about a point which was mentioned in two or three speeches—namely, the difference between the estimate of a loss of £100,000,000 and £60,000,000 on working the railways. It was referred to by Lord Devonport, Lord Montagu, and others. These two figures relate to two totally different subjects, and they are not comparable. They are not revised estimates for the same thing. The figure of £100,000,000 was the estimated increased cost of working the railways for 1919–20 over 1913, assuming the same traffic and the same figures for the two periods. The figure of 160.000,000 is quite a different matter. That is an estimate of the deficit—that is to say, the difference between the receipts and the expenditure up to the end, of 1920. The £60,000,00 is an estimated deficit on working; the £100,000,000 is simply an estimated increase of cost and the two are not revised estimates of the same thing, but refer to quite different matters. The first figure of £100,000.000 was given because at that time it was impossible to arrive at an estimate of the deficit. All that could be given was the increase, working on the same figures.

There is one other point raised by Lord Montagu that I would like to deal with. He thought that I had taken exception to statements made either by him or those who work with him in the Press with regard to the effect of this Bill upon the roads, and he suggested that at any rate all the statements he had made were true. Of course I do not suggest for one moment that either he or anybody else is deliberately making false statements, but I must again point out that the suggestion that the Government is going to take over the roads and exercise powers which will enable them to interfere with traffic upon the roads, is completely inaccurate. I stated on the Second Reading of the Bill that no such powers existed in the Bill. Lord Montagu, in answering me this afternoon, referred to powers of the Local Government Board, and said that, those powers existed in the Local Government Board. He did not in mind them being in the bands of the Local Government Board because he trusted it, but he did object to their being transferred to the Minister of Ways and Communication. The Local Government Board to-day has no power to regulates to transfer, or to interfere with traffic upon the road, and the suggestions made in those quotations which I read to your Lordships on the Second Reading that the Minister of Ways and Communications could interfere with a private gig, could remove traffic off the roads, and could only leave the local authorities control of such highways as lie thought fit, ate not justified by anything that is in the Bill. No such powers are exercised by the Local Government Board to-day. No such powers are transferred to the Minister.

I hope that your Lordships will understand that the Minister will enjoy under this Bill no powers other than those which are enjoyed to-day by existing Government Departments. The same remark applies to a point raised by the noble Viscount in the matter of shipping. There is no power in this Hill to enable the Minister to divert shipping traffic, and to say that the trade which has gone hitherto to one port shall in future go to another. It is quite true that argument has been used, and it has been stated over and over again that such powers exist, bat I will challenge any of your Lordships when you get into Committee to point to any clause in this Bill which will give to the Minister power to divert shipping or to interfere with the trade of the country in that way.

Having dealt with minor points, I want to come to what I understand to be the main arguments that have been raised against the Bill. All through this discussion it has been assumed by those who have criticised the Bill that the Government is seeking powers to take over and manage all the transport undertakings. That argument ran through the whole of the speech of Lord Devonport. He said: "You are going to take the management out of the hands of those who have managed hitherto, in order that you may make a thing pay which has hitherto been worked at a loss." And he asked—and the remark received the cheers of your Lordships—"When has a State ever made anything pay?" That is a complete misunderstanding both of the intention of the Government and the, powers for which they are asking in this There is no question here of taking over and managing these undertakings, and taking them out of the hands of those in whose hands they are at the present moment.

I said, in moving the Second Reading, that we did not profess to be able to manage railways better than the railway companies. We do not seek powers to manage the railways. We do not profess to be able to manage dock undertakings better than Lord Devonport and his colleagues on the Port of London Authority. There is nothing in this Bill which will give us power to take over the Port of London or any other authority, and manage it by a Government Department. What we do ask powers for is to see that all these undertakings are managed by their existing directors in, such a way as not to be detrimental to the transport interest of the country as a whole. f will take one illustration which no doubt will appeal especially to Lord Devonport, because it refers to the Port of London of which he is Chairman. Here is an instance of the way in which the transport interests of the country suffer to-day by the detention of wagons in the clocks—a matter which, as the noble Viscount knows, has been the subject of a great deal of discussion between the railways and the docks. These figures refer to the Port of London. In one month—after allowing for the maximum period, which in the case of shipping traffic is four days—14,500 days demurrage were incurred on wagons, and that is equivalent to a permanent loss to the railway companies of from 500 to 600 vehicles. Cases of wagons being unloaded thirty, forty, fifty, and over fifty days can be quoted. On the 12th of January last there were 1,427 unloaded wagons inside the clocks. The latest date for which figures are available shows that there were 2,063 wagons unloaded. We have no intention whatever of going into the Port of London and endeavouring to manage that business. But we do say, "Here is a case where there is competition between the docks and the railway companies leading to great wastage and unnecessary expense." And powers are given to the Minister under this Bill to give directions to dock companies to deal with this difficulty. The method of doing it is still left in their hands, but it will be in the power of the Minister who is instructed to look after the whole of the transport interests to give instructions to the dock company to take steps to prevent this detention.

I mentioned when I was speaking on the Second Reading of the Bill a further instance of the economics that could be made by increasing the size of wagons—again a thing which could not be undertaken unless appliances for handling them were provided in the docks. Those are two instances where very great economies can only be effected if the Minister has power of issuing directions to the dock companies, as well as to the railway companies. And therefore, when your Lordships say that the Government should be confined to managing the railways, I again repeat that it would be impossible for the economies which are necessary to be carried out, even on the railways, if you confined the Minister to the power of issuing instructions to railways alone. The waste to-day, the loss of money and of time, is due to, these causes which occur between these different undertakings, and therefore to give to the Minister the power of control over one of these undertakings will not get rid of the waste, and will not enable the economies to take place.

Now I come to the speech which was made by the noble and learned Lord opposite (Lord Buckmaster) with regard to finance. The noble and learned Lord, it is true, stated that in his opinion there was an alternative to the Bill, that the alternative was to continue the control over the railways which the Government have hitherto exercised. I have already pointed out to your Lordships that the mere continuance of that control over the railways alone will not enable any of the problems and difficulties of our transport system to-day to be met. And therefore the alternative which he suggests is no alternative at all; it will not enable any of the problems with which we have to deal to be solved.

I should also in this connection refer to a remark made by the noble Viscount, Lord Midleton, when he said—"surely you ought to be content if you are left with the control of the railways, you will still have the biggest business in the country to manage." We are not asking to manage these businesses; we do not want to manage the railways, or any of the other businesses. It is not our ambition to control the largest industrial undertaking in this country. I repeat that what we do want to do is to see that. the management, of the railway and the dock companies, and the canals, and the other transport industries in the hands of those who manage them now shall be so conducted as to prevent interference with the general transport interests—that the dock interests shall not be allowed to stand in-the way of the railway interests, the railway interests in i be way of the dock interests, or the road interests. That is the purpose of the Bill, and that purpose can only be carried out if the powers which we ask for in this Bill remain intact.

Now I come to the financial question. The noble and learned Lord drew a very gloomy picture of our financial position. I do not know whether his figures were accurate. I do not question them for a moment, nor do I make any complaint whatever as to the colour of the picture which he drew. I do not believe it is possible at this moment to exaggerate or to draw too black a picture of the financial position of this country. I make no complaint that he should have endeavoured to impress upon your Lordships the intense gravity of that financial outlook. But that argument was only relevant to the discussion of this Bill if it could be proved that this Bill was an attempt to add to the gravity of the situation, and to make our financial outlook still darker.

I repeat what I said on the Second Reading. If I regarded this Bill merely as affording fresh opportunities to the Government of spending money, however beneficial the services on which they would spend it. I should not be standing here to defend it. But I look upon this Bill as a Bill designed to alleviate the very financial position which the noble and learned Lord put before us. And, therefore, the darker the picture which he paints, the stronger the argument for the Bill. The Bill will do two things: it will enable us, first of all, to secure economies which cannot be secured without the Bill. Secondly, the Bill will undoubtedly, if it is successful in helping our distributive system, also help our productivity; and, unless our distribution is remedied and helped, then we cannot reap the benefit of increased production; and without increased production we cannot face that situation which the noble and learned Lord has put before us. And therefore, whilst I fully accept the general purport of his figures, whilst I admit the extreme gravity of our financial position, I say this is a Bill which is designed by the Government to help us to meet that situation, and, by adding to our productivity, to enable us the better to face our financial obligations.

The noble Viscount, Lord Devonport, used a phrase which, I confess, I was very sorry to hear. He said that he hoped your Lordships, when we got into Committee, would put a knife into this Bill, and make a clean cut of it. I sincerely hope that it is not in that spirit that your Lordships are going to deal with this Bill in Committee. I do not want to look upon that as a threat, or to answer it by any counter-threats. I can assure your Lordships that any attempt to improve the structure of this Bill, consistently with the policy which I have endeavoured to put before your Lordships, will receive the most sympathetic consideration of the Government. But we cannot offer any sympathy or any consideration for Amendments which are regarded as in the nature of a surgical operation.

if it is the object of your Lordships to use the knife for the purpose of eviscerating the Bill, I would ask your Lordships to remember that this is a Bill which comes to us with practically the unanimous consent of the House of Commons. Although a Division was challenged on the Third Reading, not one single Member was found to go into the Lobby against the Bill, and it is not often that a Bill of this magnitude, raising (as I admit) such huge controversial questions as this Bill does, comes before your Lordships with so large a measure of assent from the House of Commons. I have often heard the House of Commons spoken of as an entirely docile body. The noble Lord has shown us that, on matters which they consider as of vital importance, they are not so docile as they are generally represented, but that they can secure from the Government that their points shall be met; and those points upon which the House of Commons did feel very strongly have been met whilst the Bill was under discussion in that place. Having been met on those points, I repeat, not one single Member of the House of Commons was found to vote against the Bill on its Third Reading.

Therefore, if you are going to meet the Bill in the spirit of a desire to destroy it, to cut it up, in the words of the noble Lord to "put a knife into it," then you will be Hutting a knife into something much more than this Bill. This is a Bill which comes, as I say, with the almost unanimous support of the House of Commons; it is a Bill which the Government regard as essential to the carrying out of all the other items of their programme; it has been put in the forefront of their programme because the improvement of our system of distribution is necessary in order that our whole policy of reconstruction may be carried out. You will be making a direct challenge against the House of Commons and against the Government. I do not use any threat at all; I only say, if your Lordships decide to do that, do it with your eyes open, and with a knowledge of the gravity of the responsibility you are taking upon yourselves.

Reference has been made in the course of this discussion to the expert qualities of the Minister who will have charge of this Bill. I recommend it to your Lordships without any expert knowledge, without any particular knowledge in that direction. I have looked at the Bill in exactly the same way as your Lordships will have to do, as one responsible for the legislation of this country. I firmly believe that, in the situation in which we find ourselves, this Bill is the only alternative, I repeat is really the only alternative, to complete nationalisation of our railways at this moment; and again I repeat that there is no intention on the part of the Government under this Bill of instituting anything approaching nationalisation. We are not going to manage these systems directly by State management at all; but I regard this Bill as the only way of dealing with the extremely grave position in which we find ourselves, and I hope when we get into Committee your Lordships will do nothing to interfere with or to destroy the main purpose and principle of the measure.

THE MARQUESS OF SALISBURY

My Lords, like all your Lordships I always admire the speeches of my noble friend, and I do not think that his speech to-night is any exception to the rule to which we have become accustomed. The noble Earl showed his usual frankness and courage in dealing with the debate which has taken place this afternoon. Above all things I admired his courage—I should like to underline this—when he announced, in those emphatic words from his place at the Table, that it was impossible to exaggerate the gravity of the financial situation in the country. That is a frankness which I very much admire, and which I wish were imitated by other speakers on behalf of the Government. I do not think that it is possible to emphasise that too much.

But I want to deal, very shortly at this late hour, with a very few points that the noble Earl made. He grappled, as he said he would, with most of them, although he did not grapple with a certain speech made by the present Secretary of State for War when he declared that the policy of the Government was nationalisation. The Government were asked to deal with that point. They were asked to say definitely whether that was still the policy of the Government, and the noble Earl—I think prudently—passed it by. But the noble Earl, I believe, was impressed by the debate. He was impressed by the conviction displayed in all quarters of your Lordships' House of the very extensive powers of control which were granted under this Bill. Those powers are very great. They are extensive in respect of railways, but not only in that respect. All the rates which are to be charged to traders are to be placed under the control of the Minister; extensions of any magnitude are to be subjected to his initiative; and, as I said, this control is extended to other undertakings.

Now, my noble friend said that there was no power given to the Minister under this Bill over the traffic which ran upon the roads. I do not pretend to be a master of this point of the subject, but I confess that I was very much impressed with a passage in the speech of my noble friend Lord Montagu in which he showed that there were great powers now vested in the Local Government Board, which, under Clause 2 of the Bill, will pass to the Minister-designate. Those powers extend to mechanical transport of a heavy description, to motors of every kind, and every one of those will pass with all the other powers in the Bill to the new Ministry. Then my noble friend, feeling as he said the weight of the attack directed against the extensive powers of control under the Bill, made an attempt—I must say, if he will allow me, an unsuccessful attempt—to minimise them. The noble Earl said that there was no desire of the part of the Government to supersede under the Bill the various private enterprises and companies which managed these methods of transport. I confess that I was very much astonished to hear my noble friend say that; for I. look at the Bill, and I find for example in Clause 3 (c), it is stated— The directors and other persons concerned with the management, and' officers and servants of airy undertaking of the whole or part of which, or the plant whereof, possession is retained or taken shall obey the directions of the Minister as to the user thereof … They are absolutely in his power. Then I go to r 4, which is the clause that supposed to save the docks and harbors from the power of the Minister. In that clause I see these words— If at any time …the Minister shall consider that it is desirable … that the transport facilities or accommodation at the harbour, or at any clock or pier of the owners, should be improved or extended, or that the method of working should be altered the Minister may … require the Owners to execute … such alteration in the method of working… Absolute power! Absolute control! This is the Minister whom my noble friend tries to pretend is a most innocent person who does not want to interfere with anything at all. He may not want to interfere, but he takes powers to interfere with every one and everything.

Let us now look at Clause. 9. That clause says, "It shall be lawful for the Minister to establish and work transport services." So far from being an innocent looker-on, he is evidently to be the prime mover, the author, of transport works under Clause 9, and to have the control of everyone else's works under Clauses 2 and 4. That is the Minister as he is designed by His Majesty's Government. Now, what safeguards are there? Certain Advisory Committees are to be formed, whose opinions the Minister may ignore and whose deliberations—under what I may call the most remarkable provision in the Bill—are to be conducted on such a basis that the country and Parliament will never know what they said or what they advised, for everything is to be confidential. I believe that the Minister-designate wished to make it a criminal offence if they revealed anything, but I suppose he thought that this would produce some sort of scandal; at any rate that was abandoned, and now it is only prescribed that everything passes in the Advisory Committee and in regard to its relations with the Minister, is to be confidential. So that Parliament and the country will never know what advice the Committee gives, and the Minister, of course will be at perfect liberty to ignore the advice. Those are the protections upon which such store seems to have been placed in the House of Commons.

I will not go into further detail. I will only say that the money safeguards are of the slightest description. Enormous financial powers are given to the Minister, and, for the first time, the direct power of parliament in respect of large sums of money, provided they do not exceed a very handsome minimum, are to be entirely with drawn from the cognisance of Parliament.

THE EARL OF LYTTON

I beg the noble Marquess's pardon. The powers of Parliament are not withdrawn in respect of any sum under this Bill. What is stated in the Bill is that the Minister may not submit. Estimates for the expenditure of any sum over £1,00,000 without special Resolution passed by the House of Commons. The power of Parliament is exercised through the Estimates with regard to the expenditure of t his Ministry in exactly the same way as it is exercised in regard to any other Government Department.

THE MARQUESS OF SALISBURY

It at any rate is certainly a very remarkable provision as it stands on the face of the Bill, and seems to indicate that provided the Minister does not spend more than £1,000,000 on each job he is not to be under efficient Parliamentary control; but of course if it is otherwise, I entirely accept that from the noble Earl.

THE EARL OF LYTTON

Re can only get his money from Parliament.

THE MARQUESS OF SALISBURY

No doubt that is ultimately true. But your Lordships will be aware that under modern Parliamentary practice by far the larger part of the Estimates are passed through Parliament en bloc without any discussion whatever.

The Bill being as wide as it is, and being a revolutionary Bill, I am sure that my noble friend will commend us if we approach it in a spirit of caution. He urged your Lordships not to deal with this Bill in a, hostile spirit. We must try and obey his behests, and I am quite sure that we shall try and be as moderate as our duty permits us to be. Surely, however, it would be well not only to approach this Bill with caution, but also to take sufficient time to consider it. That is not possible in the present sittings of parliament. There is no time between now and the ordinary period of adjournment, to consider fully all the manifold provisions of this Bill. The question which you Lordships will have to consider, therefore, is how much of this Bill is so urgent that it ought to be passed in the present sitting.

I have tried to address myself to that point, and I have consulted many of my friends upon it. I understand that the condition of the railways is urgent—that is to say, they cannot be returned to the companies, because the companies in the present conditions under which those railways are being worked would not take them. Something, therefore, must be done at once with regard to the railways. I feel the force of that argument, and I do not see how we are to escape from it. We must, of course, consider the particular provisions which apply to the railways to the best of our ability, and put in such moderate safeguards as commend themselves to your Lordships. The rest of the Bill, however, is not, so urgent—I mean the part which has to do with ports and harbours, and the part relating to roads, and so forth. I do not say that all the provisions in those parts of the Bill are bad. Very likely some of them are good; I think some of them are. I venture to suggest, however, that we must have a little time to deal with them. There is no urgent hurry or need for headlong haste. Therefore what seems to be indicated is that we should divide the Bill into two parts not reject either part, but deal with the railways at once, as they ate urgent, and let the rest of the Bill stand over for a few months until we can approach the matter with deliberation and care. I do not see that the public service can suffer in the least if we take such a course, which seems to me a most moderate one; indeed, after the debate which has taken place in your Lordships' House this afternoon I confess I have some difficulty in recommending the House not to reject the Bill altogether, because I never heard a Bill so shattered in debate as this one has been. I prefer, however, following the advice or my noble friend, to take the moderate and friendly course that it would be better to take time over Chat part of the Bill which is not urgent and to deal with the railways at once. I do not know whether such a. suggestion would commend itself to your Lordships, but it is one which we shall certainly venture to submit to the House.

Then when we come to the railway part of the Bill there are, as my noble friend Lord Midleton indicated, certain points which evidently require attention: We want some safeguard for the trading public. At present the celebrated Advisory Committee is merely the nominee of the Government itself. It is Sir Eric Geddes multiplied. He is an admirable man and a great public servant, but still it is not a precaution against Sir Eric Geddes to multiply him five- or six-fold and to make him into a Committee. That point, I think, will require attention. Then probably, if we make that Committee more of a representative body, we should hope to include amongst its members not only representatives of the traders but of labour as well. On that I believe I shall receive the commendation of my noble friend; because I notice that in the case of the second set of Advisory Committees—for in this wonderfully complicated Bill there are two sets of Advisory Committees—that depend upon an elaborate panel which is to be named by the Minister, he is directed by the Bill to include representatives of Labour in the panel. If, therefore, we transfer the same principles to the earlier Advisory Committee we shall no doubt receive the support of His Majesty's Government. Indeed, I should be very glad if the Government take that view and if the House agrees to it; because above everything else it appears to me to be of the greatest importance that we should emphasise the necessity of the participation of labour in the management of all these industrial enterprises. That is the real alternative to nationalisation, and therefore we want to bring that forward.

By all means let labour have its full share, its partnership, in the management not only of these great transport enterprises, but we would like to see the principle extended much further. Here is a great opportunity to mark a step in promoting this great principle, and we hope that when we get into Committee we shall be able to frame Amendments which will command the support of your Lordships with that end in view. All these points are, of course, Committee points. I need not say, therefore, having said as much as that, that I myself do not intend—and I believe none of my friends intend—to vote against the Second Reading of the Bill.

May I venture to make an appeal to the noble and learned Lord who in an admirable speech the other night moved the Amendment which is now under consideration? I think he must realise, as we all do, that it is necessary to have some legislation in respect of the railways. If that is so, it seems to me that the case for the Second Reading is really made out. All his criticisms, well founded and severe as many of them were, fall therefore into the second place I am sure a man of his great ability will help us when we get into Committee. But upon this stage of the Bill I think he will feel the force of the argument that some measure must be passed, and that consequently the Second Reading ought to be agreed to. I have no right, of course, to make an appeal to him. He and I do not belong to the same political Party. But I hope that he will not put the House to the trouble of a Division.

I can assure your Lordships and the Government that we approach this Bill with a profound sense of responsibility. We realise its great importance; we realise the great dangers attaching to it, and we trust with the co-operation of the Government and with the assent of your Lordships when we have finished the Bill in Committee, at any rate to have done something to protect the country from the risks with which the Bill threatens it. For these reasons I shall not vote against the Second Reading of the Bill.

LORD EMMOTT

May I ask a question? I want to ask His Majesty's Government whether they could issue accounts for the half-year that is now passed, from January to June, 1919, in a similar form to those in the White Paper, Command No, 147? I think that would be of great value and interest in the Committee debates.

THE EARL OF LYTTON

I believe a similar request was made in the House of Commons, -and the reply was that the figures were not available. I will make further inquiries, and, if possible, I will produce them in Committee.

LORD BUCKMASTER

My Lords, the fate of the Motion which stands in my name on the Paper lies, of course, in your Lordships' hands, but after the course which this debate has taken, and after the appeal that has been made by the noble Marquess, I Should certainly not propose to press this Motion to a Division. But possibly your Lordships will permit me, even though the hour is drawing late, to say in a few sentences one or two things about the measure as it now stands. It seems to me that during the great part of this debate we have been at cross-purposes. If I understand the reason for the introduction of this Bill aright, it is this—that the Government say that their control of the railways has resulted in such an inflation of expense that it is impossible fur them now to abandon the control and hand the concerns back to their rightful owners; and it is upon that position that the whole of the just ideation for this measure depends.

The figures which have been mentioned by the noble Lord, Lord Montagu, suggest that a good ninny of the statements which lie at the foundation of that request are -based upon a complete misapprehension, that. in truth, the position in which the Government find themselves in regard to the railways is not so embarrassing that it is impossible for them to extricate themselves with a little further period of management and a little of the economy to which the noble Earl has referred. If that were so, then there is no justification for this measure at all, excepting as a step towards a considered policy of the nationalisation of our transport industries, and if that is the real principle that lies behind the measure, I imagine that the great majority of your Lordships will agree with me in thinking that, so far front that being a national advantage, it would be a very great notional danger and expense.

I certainly will not argue that further now, but I merely want to say that when the noble Lord recommends this Bill to us as a Bill that is going to effect economies, I find it a little difficult to understand exactly what he means. If he merely means that, if you will connect together all the. various branches of your transport industry, it might be possible to devise a scheme by which their collective working expenses might be reduced and their efficiency increased, neither I nor anybody else would deny it; but the thing that we dory is that when you have put that scheme under the control of a Government Department, it will be either economically or efficiently worked. In support of our views upon that question we appeal to experience, and we say that the Government which have so utterly failed to work to a profit an industry taken over by them on terms so amazingly profitable as they were in the case of the telephone industry, have no record whatever which entitles them to come to this or to the other House of Parliament and say, "If you now give us another vast industry we will work this at a great profit and with great economy."

In truth, as I say, I think it cannot be disputed that the real heart of this measure is an attempt, by two steps instead of by one, to nationalise our transport industry, and the unanswerable point upon that to my mind is this. This Bill is going to be used for the purpose of expanding transport; new services cam be undertaken by the Government; new lines may be developed; and the noble Earl, Lord Crawford, said, perfectly frankly, that he was utterly unable to understand how, at the expiration of the period of control, you would ever once more cut away the old part from the new and be able to hand back the old part to its -rightful owners and continue the new part under Government control. Your Lordships know that often, in measures relating to tramways and matters of that kind, the Government take powers to acquire these lines after a certain period, but you cannot create any power compelling private owners to take out of the Government's hands the new works that will be created. They must remain in their hands and they must be worked—that which, I understand, will be the growing part of our whole transport system—and I say it is impossible (exactly as the noble Earl has admitted) to conceive how, after the lapse of two years, you will ever be able once more to disintegrate this entire system and cut it up again into the two parts of private property on the one hand and publicly-owned property on the other. In other words, if the Bill be passed in its present form and worked as it is intended to be worked, nationalisation in the end will be complete, and I think it would be far better for this country, and far more courageous for the Government, to say at once that that is what they mean, rather than to attempt to induce us to accept the Bill by saying that it is not what they mean and that all they ask is the acceptance of this measure which does not involve the principle at all.

Finally, I wish to say this. I thank the noble Earl for the courtesy which he has shown in accepting without question my figures. I think I am also entitled to say that, had those figures been wrong, they would have been challenged. It is a very serious matter. Those figures were, all of them, except the ones which in my own words I suggested to you as estimates, taken from the financial statement that was issued with the Budget. They are not doubtful or imaginary figures. I believe every one to be under the mark. They are taken from a Government statement and it is plain that they cannot be answered. Now, in these circumstances, when this Bill is put before us and we are asked to sanction provisions which in one clause alone (as the noble Lord, Lord Faber, has pointed out) might commit us to an expenditure of £60,000,000 by one operation, we are entitled to ask, Where is the money coming, from? How are you going to finance this scheme? How is it going to be done? And, if you pass this measure unrestricted in its present complete form, are you going to help the country out of its difficulties or are you not going to plunge it deeper and deeper into the morass of debt from which at the present moment it seems impossible to extricate it?

VISCOUNT MIDLETON

Before the noble and learned Lord puts the Question, may I say a word of personal explanation? The noble Lord challenged me when I quoted Sir Eric Geddes as having said that the subsidy on railways had killed the coastal traffic. Here are his words, used on July 10— To-day, on account of the subsidy to railways … the coastal traffic is practically dead, and the 70,000,000 tons, or such part of it as under present disturbed industrial conditions it is desired to move—and there are large quantities—cannot be carried coastwise, because consignors cannot afford to pay the rates which the coastal steamers demand, when they can send it at lower subsidised railway rates. A very large proportion of the 70,000000 tons of coastal traffic is to-day waiting to get away on the railways at the lower rate, and all coastal business is dead.… That traffic is dead to-day because the rail ways are subsidised. I think I am justified in saying that the subsidy has killed the coastal traffic.

Amendment, by leave, withdrawn.

On Question, Bill read 2^a, and committed to a Committee of the Whole House.

MARQUESS OF SALISBURY

On what day does the noble Earl propose to take the Committee stage

THE EARL OF CRAWFORD

I suggest that we should put it down for Tuesday next.