§ VISCOUNT CHAPLIN rose to ask for a Return of the cost of the Ministry of Food since its inception, showing the payments made upon the one hand, and all receipts arising from margins on the sale of commodities or otherwise up to the end of February, or as late a date as can be given, on the other; and to move for Papers.
§ The noble Viscount said: My Lords, I rise not so much for the purpose of initiat 769 ing a long debate upon the questions which I am about to raise, but rather in order to elicit information which I have tried to obtain before in respect of the conduct of the Ministry of Food and the gigantic cost at which it is being conducted. When I last obtained information on this subject it was very little short of the rate of £100,000,000 a year; and this, it may be well to bear in mind, is only one. of the numerous Departments that have been created since the present Government came into office. I have made this statement before—on July 10 and July 16, 1918, in the debate, on the Parliament and Local Elections Bill, and during the present year, on February 20, in a debate initiated by Lord Devonport—but so far I have failed altogether in the object which I have had in view for a very long period, and with regard to which I should have moved long-ago but for illness which prevented me from doing so.
§
To make quite clear the case which I desire to submit to the House, I must ask your Lordships to allow me to go back to February 19, 1918. Then you will find this statement from the Controller of Food—
I have no close estimate of what the food consumption would amount to in value for the whole country, but it probably exceeds £700,000,000, or at the rate of over £60,000,000 a month.… It is hoped—and I trust this is not merely the expression of a pious wish—that all direct and indirect administrative costs will be covered by margins received in connection with the sale of commodities.
you will observe that £60,000,000 a month is exactly £720,000,000 per year, and that is the estimate which at the time I mentioned was presented by the Controller of Food, although he stated at the same time that he had no close estimate to offer of what was to be the cost of the Department.
§
I must ask you next to come to July 10, 1918, when I asked two Questions, which, but for the reason I gave just now, I should have asked long before. The first was as follows—
What has been the amount expended during the months of January, February, March, April, May, and June respectively? What has been approximately the total cost of that Department since the end of December, 1917?
§ The reply to this was explicit. It was £185,184,268 for the six months, while the estimate given on February 19, 1918, for the twelve months was £700,000,000. I think that is a very remarkable statement. It. is on record in the volumes of 770 Hansard. That is the information which I have elicited up to the present time.
§ Over and over again—certainly more than once I have asked to be informed how far the pious wish expressed by the Controller of Food when the first estimate was given has been fulfilled, and what there is on the other side in the nature of receipts—and I have put this explicitly in the Questions standing in my name upon the Paper—to show against this amazing expenditure on the part of the Ministry of Food. I began by saying that I have no desire on this occasion to raise a prolonged debate on the subject. What I want is to obtain information; and I may say that, unless the facts which I have put before your Lordships this afternoon can be effectively contradicted, both Parliament and the public generally have a right to know how we stand in this respect, and why it is that we have never been favoured up to the present with information regarding the receipts on the part of the Ministry of Food as against the enormous expenditure upon the other side, which has so greatly exceeded the estimates that were put before us. I do not think it is necessary for me to say anything further at the moment, and I shall be glad to have the information so far as the noble Earl who represents the Ministry of Food in this House is willing and able to give it.
§ THE LORD CHANCELLOR (LORD BIRKENHEAD)I do not understand whether the noble Viscount moved or not.
§ VISCOUNT CHAPLINYes, I move for Papers.
THE CHANCELLOR OF THE DUCHY OF LANCASTER (THE EARL OF CRAWFORD)My Lords, the accounts of the Ministry of Food are closed on March 31 in order to coincide with the Government financial year. The trading account and balance sheet of the Ministry of Food which have been prepared for the year ended March 31, 1918, show a surplus on the trading account—after debiting all expenses of administration, including rationing, rents, rates, taxes, expenses to the Commission in America and financial agents in America—of £133,363. That surplus has been carried forward as a reserve against losses in the liquidation of stocks. The total sales of the Ministry of Food for the period up to March 31, 1918, amounted to £45,564,611, and the stocks held at that date stood in 771 the books at £20,974,116. The administration expenses amounted to £1,249,375, or approximately 2 per cent. on the total transactions, including stocks purchased. The foregoing figures exclude the operations of the Wheat Commission and Sugar Commission, to which I will refer in a moment, but they include a debit of £549,883, rationing expenses, a proportion of which has been incurred in rationing sugar. If, as I think may reasonably be claimed, this outlay upon rationing were deducted as being in the nature of extraordinary expenditure, the percentage as above would be reduced from 2 per cent. to a fraction over I per cent.
With reference to the noble Viscount's request for the position at the end of February, even in the case of the biggest commercial undertaking it would be quite impossible at short notice to submit any exact statement of the undertaking's financial position at an arbitrary date. It would be hopeless to expect them to submit accounts at odd periods. If the Ministry of Food were purely an administrative Department it would be quite possible to submit a fairly accurate statement of the financial position at short notice, but the House must remember that the Ministry of Food is perhaps the largest commercial undertaking in the United Kingdom, and as in the case of every other trading concern the stocks vary constantly from day to day. Account sales are not and cannot be received from its agents immediately, especially considering the fact that accounts are open in every exporting country in the world. The House must also remember that the position of commitments of purchases oversea, and heavy liabilities for outstanding charges, such as freight, storage, rebates to distributors, have to be obtained in order to show an accurate financial position. The same course, therefore, has been adopted as in every other commercial undertaking—namely, accounts are not completely closed and prepared except on a definite date, which in this case is March 31 in order to coincide with the Government financial year. The only result, therefore, which could be given now would be in the nature of estimates and even these estimates, to be fairly accurate, would involve a very great deal of work which, in view of the shortage of staff due to continual resignations following upon changed conditions since the Armistice, it is impossible to undertake except at a serious detriment to current 772 work. The accounts of the Ministry will be prepared as on March 31 next, and I think I can promise a provisional summary of them after the Whitsuntide recess. As regards the sugar—operations, to date they show a margin of profit sufficient to enable the Royal Commission to maintain the present prices, which are substantially below the price that would have to be charged if the sugar now coming in, and to come in during the rest obf this year, were to be sold without loss.
With reference to wheat supplies, I regret that the question as to profit and loss cannot be accurately stated at the present time. There is considerable delay in drawing up these accounts. The cause lies mainly in the impossibility under which the Commission lay of obtaining the necessary clerical and technical assistance to enable them to keep their accounts up to date. This difficulty existed in an increasing degree up to the signing of the Armistice, and to a large extent still continues. During the whole of that time it will be found that the actual staff of the Wheat Commission has been considerably below the establishment authorised by the Treasury. This is one special cause of delay. But even if the Commission had been fully equipped with the necessary staff it would still have proved impossible at the present time to produce accurate accounts even for the first cereal year, and in the case of the Wheat Commission the financial year is the same as the cereal year ending on August 31.
I should like, if I might, to explain to your Lordships the intricacy and complication involved in the work of the Wheat Commission. It is not, as people are apt to believe, a purely domestic matter, but it has allied and international obligations of a very extended nature. The Wheat Commission is the executive body of what is called the Wheat Executive, which purchases grain and breadstuffs and feeding-stuffs for the Allies—for ourselves, for France, and for Italy. It also does the provisioning of our smaller Allies such as Greece, Belgium, and Portugal. It is responsible for victualling various parts of the Empire—Malta. Gibraltar, West Africa, Egypt, Mauritius—and has very largo transactions with India, and I dare say other places also. It is responsible, too, for victualling, within the agreed rations, of a number of neutral countries with whom the Allies have commercial 773 agreements -Sweden, Norway, Iceland, Holland, Switzerland. Occasionally also it is necessary to victual other countries—small countries—who have no official connection with the Allies. Finally it has considerable responsibility with regard to the relief of Rumania, Serbia, and Esthonia, and that particular obligation is increasing and in the future will continue to increase. The scope of its operations is, therefore, very large. It has to buy in every exporting market in the world—twenty or more; it has to deal in eight or ten different currencies, quite apart from domestic matters exclusively concerning ourselves, such as tins Flour Mills Control Committee which manages upwards of 1,300 flour mills in this country for each of which an excess profits standard has to be assessed, and in many cases where the business is mixed the standards in turn have to be split. There is consequently an immensely heavy strain upon the finances of the Accounting Departments of the Royal Commission on Wheat Supplies. I have only referred to a fraction of the commercial procedure and intricacies which are involved. The result is that the accounts are not up to date by any means.
One further reason. I may state that the actual cost to each Ally on cereals winch are within the scope of the Wheat Executive agreement can only be calculated when a definite account has been made between the group of Allies concerned. These accounts will take a considerable time to draw up, even when an agreement: on the accounting method has been arrived at. Unfortunately this agreement is still in futuro, as the method has not yet been agreed between the respective Treasuries, and until the year 1916–17 is out of the way it is clearly impossible that final accounts for the following cereal year can be dealt with. I need not refer to a variety of other outstanding questions—freight, accounts, insurance, arbitration, and so on—which make it impossible to render any exact account at the present stage. Generally speaking, considerable losses will have to be faced on various commodities, such as meat and potatoes. But it is estimated that these and other losses, apart from the wheat subsidy which will be covered by the balance standing to the credit of the existing insurance fund and reserve credit in respect of other commodities, will be covered. In conclusion, I will point out that the operations of the Ministry are 774 already subject to criticism by the Treasury, by the Public Accounts Committee, and by the Controller and Auditor-General.
§ VISCOUNT CHAPLINMy Lords, I am sorry to say that I hear so badly that it is impossible to follow everything that fell from the noble Lord. He has told us that the accounts are by no means complete, and what the excuse or the reason is I did not altogether gather. I do not know whether I am to understand that by March 31 he will undertake to give to the public a complete statement of the accounts of the Department. If he is willing or able to do that I should not move for the Return, but at present I am so much in the dark upon the subject that I really do not know how long we are to wait to obtain the Returns that have been received by this Department which has undertaken this enormous expenditure. I cannot pretend to say that I am satisfied with the reply of the noble Earl, and unless I learn a great deal more than I have learned from his reply to-day I shall certainly hold myself entitled to raise this question again upon another occasion.
I should like to know whether we can count upon ever having anything in the nature of a complete Return of the financial situation of the Department, showing the expenditure upon one side and what they have received on the other. We were told distinctly that they would receive margins arising from the sale of commodities, and that these were to pay the whole of the administrative costs of the Department, direct and indirect. Upon that point I am as completely in the dark at present as I was before I asked the Questions which I have put to the noble Earl. Is there anything that he can tell us further? Can be give us more reasons for this total absence of accounts of receipts? I understand that they have sold an enormous quantity of food, and I suppose there must be receipts. I do not quite understand in these circumstances why the accounts should be so very greatly in arrear.
There is one impression that the reply of the noble Earl has certainly made upon me. He has frankly admitted that the Ministry of Food is a trading Department. He said something of that nature in a debate not more than three weeks or a month ago, and I took the opportunity of taking exception to the view that it was to become the custom for British 775 Governments to enter into commercial and trading occupations. I contend that it is something entirely new. There might possibly be some excuse arising from the fact of the, great war, but it is earnestly to be hoped that this is not to be contemplated in the future as a permanent right or duty on the part of the British Government. I can conceive nothing more injurious than that it should come into competition with private enterprise all over the country—upon which, after all, you must depend for the gradually increased production which is absolutely vital to us. I shall be very glad to hear if the noble Earl can hold out any hope that by March 31 we shall be in a position to judge fairly what the expenditure has been and what the Government have received in return.
THE EARL OF CRAWFORDI have stated, I think pretty clearly, that there is no chance whatever of the accounts of the Wheat Commission up to March 31 of this year being in the hands of the public for many months to come.
§ VISCOUNT CHAPLINBut apart from the Wheat Commission?
THE EARL OF CRAWFORDAs regards the accounts of the Ministry of Food, they will be prepared as at March 31, and I think I can promise a provisional summary of those accounts after the Whitsuntide recess.
§ VISCOUNT CHAPLINAfter that reply, I will not press the Motion. I understand that we are to have the information referred to—I think it was after the Whitsuntide recess?
THE EARL OF CRAWFORDI do not wish to leave the noble Viscount under any misunderstanding. The statement I made was that I think I can promise a provisional summary of the Ministry of Food's figures after the Whitsuntide recess. I am not in a position to give any more concrete pledge than those guarded words contain.
§ VISCOUNT CHAPLINQuite so. But "after the Whitsuntide recess" might mean anything. Are we to understand they mean shortly after?
§ VISCOUNT CHAPLINThen I ask leave to withdraw my Motion.
§ Motion, by leave, withdrawn.