Lords Sitting of 29 July 1924

Preamble
The House met at a quarter past three of the clock, The LORD CHANCELLOR on the Woolsack.
STAFFORDSHIRE POTTERIES WATER BOARD BILL.
Read 3a, with the Amendments, and passed, and returned to the Commons.
ROTHERHAM CORPORATION BILL.
Read 3a, with the Amendments, and passed, and returned to the Commons.
HALIFAX CORPORATION BILL.
Read 3a, with the Amendments, and passed, and returned to the Commons.
AGRICULTURAL WAGES BILL.
Brought from the Commons, read la: and to be printed.

BUSINESS OF THE HOUSE.
THE LORD PRESIDENT OF THE COUNCIL (LORD PARMOOR):My Lords, before I mention a date for the Second
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Reading of the Agricultural Wages Bill I ought, perhaps, to confer with the representatives of the Opposition. I may put it down temporarily for Thursday, but it may have to be altered.
THE MARQUESS OF SALISBURY:Probably it will be found more convenient not to take this Bill on Thursday, but if the Government put it down only provisionally then, perhaps, on the adjournment we might decide.
LORD PARMOOR:I think that that was the arrangement. I notice that the Leader of the Opposition is not here. I was very much pressed to put the Bill down for to-morrow, but I hope it will be possible to take it on Thursday. I agree that that must be a matter of arrangement.
EARL BEAUCHAMP:My Lords, may I enter acaveat against putting down measures provisionally for a certain date? I notice that, apparently, the discussion on India is to be continued to-day, although I had understood that it was to be taken at a later date. It is extremely inconvenient if the Government makes mistakes of this kind, because a noble friend of mine who moved the adjournment expected the Motion, in accordance with the arrangements made, to be taken on a subsequent day, but found it put down for to-day. It is really very inconvenient to noble Lords especially if they live in the country, and if we could have dates a little more definite and fixed, it would be to the convenience of everybody.
THE MARQUESS OF SALISBURY:My Lords, it is only fair that I should say that in the matter of the Indian debate I do not think that any blame attaches to His Majesty's Government. It was down for yesterday and could not be taken because of the other proceedings. An arrangement was then come to with the Government that it should be taken at a later date. There is a little difference of opinion between me and the noble and learned Lord whether that was Thursday or Friday, but it certainly was not to-day. The responsibility for putting the Notice down for a later date, however, did not lie on His Majesty's Government, but on one of us, I am afraid. That is an oversight for which I apologise to my noble friend. As the Motion was in the name of the noble Viscount, Lord Peel, it was our business to see that it was put down for a later date. But I hope that nothing will be understood as fixed with regard to the Indian debate until a later hour this afternoon. I shall have the opportunity of seeing Lord Peel and the noble Marquess, Lord Curzon, and the matter can be put on an. absolutely firm footing. I entirely agree with the noble Earl, Lord Beauchamp, that it is very unfair to noble Lords when a mistake of this kind is made.
LORD PARMOOR:I sympathise with the noble Earl, and I hope that later in the afternoon everything will be quite settled.

PIER AND HARBOUR PROVISIONAL ORDERS (No. 2) BILL.
Amendments reported (according to Order).
KEIGHLEY CORPORATION (TROLLEY VEHICLES) PROVISIONAL ORDER BILL.
Amendment reported (according to Order).

SUMMARY JURISDICTION (SEPARATION AND MAINTENANCE) BILL.
Order of the Day for the Second Reading read.
THE LORD CHANCELLOR (VISCOUNT HALDANE):My Lords, this Bill is a very simple one. It follows the principle which your Lordships laid down about three
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weeks ago in connection with the Guardianship of Infants Bill. In that Bill you decided that it was well that while a married woman living with her husband and cruelly ill-treated, with the children neglected, should be able to get an order which should provide for their maintenance under her guardianship, that order should not be enforced while the husband and wife were still living together. There is always a chance that things may come right. The advantage of the order is that it gives the woman somewhere to go to with her children, if she is driven out of the house by her husband.
This Bill follows the same principle. It has been represented to us by some of the Stipendiary Magistrates that it would be a very great advantage to them if, in the case of orders made on the ground of cruelty, the orders could be made so that the woman might be sure that she had somewhere to go to and yet should not be enforced while she remained living with her husband. There is the advantage that the husband knows that she has got an order from the magistrate. The whole subject of the Bill is contained in Clause 1, where your Lordships will find that the law is proposed to be made as I have stated. There are other things in the Bill; for example, it extends the jurisdiction in cases where the husband drives his wife into prostitution. I do not think there will be much controversy about the measure. I beg to move.
Moved, That the Bill be now read 2a.— (The Lord Chancellor.)
LORD BANBURY OF SOUTHAM:My Lords, I think this is rather a good Bill. It is the first Bill which the Labour Government have brought in which, in my opinion, deserves any commendation. I sincerely hope that the Government have turned over a new leaf, and are in future going to bring in Bills which may possibly do some good.
THE LORD CHANCELLOR:I am very grateful to the noble Lord.
THE EARL OF ONSLOW:Was not the substance of this Bill brought in by the late Government in the last Parliament?
THE LORD CHANCELLOR:I rather think it was.
On Question, Bill read 2a, and committed to a Committee of the Whole House

FINANCE BILL.
Order of the Day for the Second Reading read.
THE UNDER-SECRETARY OF STATE FOR THE COLONIES (LORD ARNOLD):My Lords, last year there was a debate on the Second Reading of the Finance Bill in your Lordships' House, and during that debate the view was expressed that there should be some financial discussion on the day when the Second Reading is moved. This year there has been intimated to the Government, through the usual channels, a desire for some discussion this afternoon. In these circumstances, and as this Bill enacts the first Labour Budget which has been presented to Parliament, it may not be inappropriate if, in moving the Second Reading, I touch briefly upon some of the broad principles of Labour finance. I do not, however, propose to deal with individual taxes in detail, because I understand that it is not usual to do so in your Lordships' House. I will confine myself to certain general principles and considerations bearing on the raising of revenue. I will not to-day go into questions of Expenditure. This is a Bill to raise money not to expend money, and there are other occasions for discussion on expenditure. Indeed, one such debate took place in your Lordships' House two or three weeks ago.
Now, Labour financial policy as regards taxation is, in the main, based upon two principles. First, the taxes should be equitable, and, secondly, they should be economically sound. That a tax should be equitable means, of course, that it should conform to the well recognised maxim of ability to pay. The view of the Labour Party is that there is a figure of income, which is at present fixed at £250 a year, below which there should be exemption from taxation on income and on necessaries. I maintain that the theory underlying this policy is based on an unshakable foundation, which is that there is a certain minimum standard of living below which there should be no taxation of income or of the necessaries of life; for example, food taxes, because such taxes would eat into the margin which is essential for health and efficiency. In short, to impose food taxes on persons with less than £250 a year would be wrong for two reasons. In the first place,
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there is no real ability to pay such taxes, and, in the second place, they would be economically unsound. They would be economically unsound because they would decrease the physical efficiency of the people which, of course, it is the duty of the Government so far as it can to maintain at as high a level as possible.
The Budget of this year has been constructed in accordance with these principles of which I have been speaking; so when the Chancellor of the Exchequer found himself in a position to make remissions of taxation it was only natural that the food taxes—that is, the taxes n sugar and tea—were the first to receive his consideration, and out of total remissions under this Bill, which in a full year will amount to £47,943,000, the relief given in the remission of the sugar and tea and other food duties amounts to £25,193,000, and of the balance of £22,750,000 rather more than half, or £12,500,000, is absorbed by the abolition of the Corporation Profits Tax. The main lines of the Budget met with a large measure of support, at any rate in the first instance, in almost all quarters; in fact, the Chancellor of the Exchequer was told that had the late Government been in power their Budget would have been practically the same as his. I must confess it is a little difficult to believe this.
THE MARQUESS OF SALISBURY:By whom was he told this?
LORD ARNOLD:Words to that effect were used in another place. I confess it is a little difficult to believe this in view of what happened in 1922 and 1923, in each of which years it was possible to give substantial remissions of taxation. There was a substantial surplus in each of those years; that is to say, the Chancellor of the Exchequer had the same opportunity as the Labour Government has had. But what happened? In those two years, 1922 and 1923, taking them together, remissions were made from direct taxation to an amount of about £90,000,000 a. year while, on the other hand, the remissions made in respect of indirect taxation in those two years, taking them both together, were only about £22,000,000. That is to say that the relief which was given to the direct taxpayers in those two years was about four times as great as the relief which was given to the indirect

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taxpayers. In these circumstances, I think that a little scepticism may be pardoned when it is suggested that if our predecessors had been still in office the Budget would have been practically the same as the present Budget.
I think this scepticism is all the more justified in view of the fact that whereas, as I have said, in the first instance the Budget was received with a great deal of approval, there gradually emerged a more critical line which concerned itself, in part, with a proposition which always seems to excite great interest in Conservative circles. What is that proposition? It is that there ought to be a certain balance—what exactly is the balance is never very clearly defined— between the proportions raised by direct and indirect taxation. I want to deal with this matter because, in my view, there is hardly any other financial subject on which there is more unsound discussion than on this one. It is true that it used to be deemed desirable to maintain a balance, formerly half and half, between the amounts raised in our Budgets by direct and indirect taxation. But this theory is not really based upon any scientific principle. It had been abandoned in practice before the war, and it has been abandoned still more since. I have agreed that taxation should be imposed, in the main, in accordance with two principles—that it should be equitable, and economically sound. Those are the main principles which should govern the tax system, irrespective of how the proportions between direct and indirect taxation work out in the result. In short, the theory that you must maintain a certain balance between the two kinds of taxation is purely arbitrary, and leaves out of account altogether the overriding considerations of equitable and economically sound finance.
I believe this view that I have been advancing about this question of the proportion between direct and indirect taxation is one which is based on scientific principles of taxation and finance; in fact, I do not believe that scientifically it can be attacked. There is, however, another standpoint from which what I have been saying may be criticised; that is, that it is wrong to raise too small a proportion of the national Revenue from indirect taxation because such a policy means that large numbers of the people
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of the country who have votes have not a sufficient responsibility for national policy and national expediture. This is an argument which, I confess, has never seemed to me to have much real substance in it. Irrespective of anything else, there is, I submit, one supreme consideration which is, in itself, a sufficient reply. It is this—that the workers more than any other class feel the effects of any mistake in policy. They feel it first, and most, and last. Therefore, apart from taxation (and the workers do pay heavy taxes), they have every interest and motive to exercise the suffrage wisely and with a full sense of responsibility.
While many opponents of Labour policy will agree that indirect taxation in the shape of the food taxes has been too heavy, yet they contend, on the other hand, that the Labour Party is not sufficiently mindful of what are deemed in certain quarters to be substantial reasons against the present direct taxation and particularly the present high Income Tax. I should like to examine two or three of the reasons. The first one which I will take is that the Income Tax ought to be reduced, because in this way a great stimulus will be given to those engaged in industry and commerce. My reply to that is, not that the argument is untrue, but that it is greatly exaggerated. Let me look at the actual facts and analyse what would happen. A reduction of the Income Tax would, if it could be a considerable reduction, act as a stimulus to those classes of the business and commercial community who are working for themselves—that is, who are in business on their own account—but only a very small proportion of the Income Tax comes from, such persons. On the other hand, a reduction of the Income Tax could not act as a stimulus to those who are drawing their income from War Loans or other loans, or from rents or mortgages, or from debenture interest, or preference dividends, or who are ordinary shareholders in public limited companies. It must be remembered that the work of limited companies is for the most part carried on by paid officials and employees, who will continue to perform their duties and conduct the business much the same whatever the Income Tax is, and therefore their activities cannot really be stimulated by a reduction of the Income Tax. I have now enumerated some of the chief sources from which the Income Tax is derived,

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and I say that if the whole matter is examined closely, it will be found that very much the major portion of the Income Tax is paid in one way or another by persons who are, as a matter of fact, entirely outside the area where this stimulus theory could operate. It is for these reasons that I maintain that too much is claimed by the advocates of what I may call the stimulus theory.
There may be more force, it is true, in the contention that the effect, especially psychological, of a reduction of the Income Tax would be to act as a stimulus as regards extensions of business, new enterprises, and so forth. But for this factor to operate in any material degree it would be necessary for there to be a much bigger reduction of Income Tax than seems at all likely in the near future. If the Income Tax were to be halved, the psychological effect and the stimulus might be appreciable, but it can scarcely be contended that a reduction of the Income Tax by, say, sixpence or so would be sufficient in amount to cause persons to engage in new undertakings which otherwise they would not enter upon.
The next reason in favour of a reduction of the Income Tax which I will examine is that a reduction ought to be made in order to increase the amount of capital which is saved, or, at any rate, to increase the possibilities of savings. It is, however, by no means clear that anything like the whole amount remitted by a reduction of the Income Tax is saved. Indeed, in these post-war days, when so many people are feeling the burden of high taxation and high prices, it seems reasonable to suppose that a considerable proportion of money coming from reduced taxation is not saved but is spent. At any rate, what exactly happens must be a matter of considerable doubt, and I pass on to another consideration in this connection, which is that about £300,000,000 of national Revenue goes back to the wealthier classes in the form of interest and redemption of War Debt. Therefore, looking at the matter in this way, more than the whole of the Income Tax and more than half of the Super-tax are not raised for expenditure in the ordinary sense of the word; that is to say that this large amount of about £300,000,000 goes back again to the taxpayers, in this way adding to the reservoir for savings.
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Another reason advanced against a high Income Tax by some people is that they think it is so keenly felt, that in order to avoid it capital will be sent abroad. Those who make this objection overlook, for one thing, that sending capital abroad does not help a man to escape Income Tax, unless he is prepared to try to defraud the revenue, which, by the bye, it is not very easy to do. A man in this country is liable for Income Tax wherever the income is derived, either here or abroad. Therefore, if a man sends his capital abroad he is just as liable to pay tax on the income from that capital as if he had kept it at home. I will only add that the number of people who, in order to escape taxation here, not only send their capital abroad but who go with it and live abroad must be very small. The price to be paid—that is, exile from England which is involved—is too great.
But there is another argument, which, though somewhat vague, seems to come to this, that our higher rate of taxation has such a generally depressing effect upon the whole trade position of the country that capital can find more remunerative markets abroad. It does not, however, seem necessary to take these suggestions too seriously. The question naturally arises if capital is to go abroad, where is it to go? Let me examine this problem. Investments in our Dominions, Colonies and Protectorates are, for the most part, in the shape of Government and similar Loans, but there is, of course, a limit to the demand for Loans, though I am glad to think that as an outlet for British capital such investments are as good as ever they were. Let me, however, look at the position in some other parts of the world. South America does not offer the same scope nor the same attraction for new issues as in pre-war days. The same applies to the Far East, though I should be sorry to think that some capital cannot profitably find a home in that quarter of the globe. As regards the United States of America, if investors choose to send their money there, they will find that they have the privilege of paying not only Income Tax in this country, but also United States' Income Tax.
I do not wish to press any of these points too far. All I am saying is that the opportunities for investment abroad are not so unlimited as some people seem

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to suppose. A certain amount of such investment year by year is desirable, but when it is suggested, because of high taxation and so forth here at home, that the export of capital abroad will take place in undue amount, the reply is, as a review of the position shows, that such a proceeding is not likely to happen. The good opportunities are not sufficiently numerous. At one period prior to the war it became the fashion for certain people to make nearly all their investments abroad. But I know that in not a few cases this course was repented of and later on investors brought much of their money back home again. They had found that the old country was the best and they were wiser, if poorer, men.
I submit, then, that some of the prevailing objections against the present rate of the Income Tax are a good deal overstated. Moreover, whatever differences of opinion there may be as to that, it is necessary in these questions of taxation and finance to survey the problem as a whole and to balance various considerations, and then try to arrive at a policy which possesses the greatest net advantages for the country as a whole. I will not weary your Lordships with going through various figures and calculations in order to prove the point I am going to make, more especially as I said I was not going to deal with questions of Expenditure to-day. I scarcely think, however, it would be disputed that at present further reductions in the Income Tax will in the main be made at the expense of long overdue outlay on social objects. Therefore, your Lordships will scarcely expect a Labour Government to do otherwise than scrutinise closely suggestions that a further reduction of the Income Tax is of greater importance than anything else.
I emphasise again that in these matters it is necessary to survey the problem as a whole and to take into consideration large questions of policy. It will, I am afraid, always be found that the problem of taxation chiefly consists of a choice of evils. It is a question of balancing things and having regard to the fact that there have already been substantial reductions of the Income Tax in both 1922 and 1923, amounting to 1s. 6d. in the £, or a total remission of £80,000,000 a year, and that this Finance
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Bill abolishes the Corporation Profits Tax and the Inhabited House Duty, both really forms of Income Tax—and the repeal of these two taxes will mean in all a further loss to the Revenue in a full year of £14,500,000, making £94,500,000 in all—I say, in view of these facts, it seems not unreasonable to proceed for the time being upon the plan of doing something so far as possible to meet other and even more urgent claims. Please observe, my Lords, that I say for the time being, and I am not suggesting that the present rate of Income Tax should continue indefinitely.
I have now dealt with some of the main principles and considerations which underlie the provisions of this Bill. As I stated at the outset, I do not intend to discuss individual taxes in detail, because that is not usual in your Lordships' House on this occasion. If it were customary I should certainly have wished to say something about the McKenna Duties. I do not, however, propose to detain your Lordships longer this afternoon, though there are many tempting themes in connection with the Budget which I should like to touch upon. In view of the fact, however, that the Finance Bill passed both its Second and Third Readings in another place without a Division, it is evident that there have often been Budgets more controversial than this one, and, indeed, it seems only fair to assume that the main provisions of this Bill are deemed to be just and right. I beg to move.
Moved, That the Bill be now read 2a —(Lord Arnold.)
THE EARL OF MIDLETON:My Lords, it is well known that discussions on Finance Bills in your Lordships' House are, in a sense academic, and I should not have risen after the speech of the noble Lord had it not been for the fact that he laid down certain principles which ought not to pass without brief comment. The noble Lord has made statements which we must challenge as being entirely opposed to our view. He spoke, without apology, of the difference in regard to the reduction between direct and indirect taxation during the last three years, and he said that the balance rested on no ascertained basis.
LORD ARNOLD:No scientific basis.
THE EARL OF MIDLETON:He, if I may say so, is comparing like with unlike. He proceeded to say that last year, or the year before, some £90,000,000 had been taken off direct taxation and only £22,500,000 off indirect taxation, but he forgot to remind your Lordships that the amount levied in direct taxation is out of all proportion to the amount levied in indirect taxation and, therefore, the comparison he made in this respect is wholly inapplicable. As a matter of fact, nearly two-thirds of the Revenue is raised by direct taxation—Income Tax, Super-Tax and Estate Duties—and it is not a question of whether or not the sum raised is out of proportion merely; the question is whether it is not acting in a burdensome way on trade and actually checking the entrance into the Exchequer of other revenue to which the Exchequer is fairly entitled. As an illustration, let me deal with the strange statement of the noble Lord that we need not worry if we do pay extra Income Tax because £300,000,000 comes back to us in the way of Grants. In the first place, I challenge the statement, and I do so after having listened to many Budgets in the House of Commons. I have heard Chancellor of the Exchequer after Chancellor of the Exchequer admit that of all Government expenditure the most profligate is that on Government Grants.
LORD ARNOLD:The noble Earl will allow me. My point was that it comes back in interest on the War Loan into the pockets of the taxpayer without any interference.
THE EARL OF MIDLETON:The noble Lord used the word Grants.
LORD ARNOLD:No, pardon me.
THE EARL OF MIDLETON:I think he will find that he used the word Grants. If not, I apologise for my observation. My point was that any Government Grant is often dissipated and does not produce the result intended. There is one other point in the Finance Bill which I hope the noble Lord will consider. Some progress has been made in regard to the fairer taxation of land. The only thing I ask is that land should be treated as a business; that operations with regard to landed properties should be treated in the same way as you treat a business. If
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that is done all cause of complaint will end, I do not know whether the noble Lord has had to study this particular question. It is only by very slow steps that successive Chancellors of the Exchequer have come to regard the taxation of landed property as if it were not something abnormal. But there is nothing abnormal about it. Such profits as it produces should be taxed in exactly the same way as the profits of a business.
I will give the noble Lord one example, and this is the last matter with which I shall venture to trouble your Lordships. At this moment there exists, in regard to the taxation not only of land but of other settlements, a system which presses in a most extravagant way upon land. Supposing, for the sake of argument, that a man, through business or by other means, obtains a sum of £2,000 a year free of tax. His assessment for Super-Tax is at £2,000 a year plus Income Tax—say, for the sake of argument, £2,700. That is fair. He has also covenanted to pay, or it has been covenanted to be paid for him, as a portion of his estate, £2,000 a year free of tax, and when he comes to deduct that sum, over which he has no control whatever and of which he does not see a farthing, he is told: "You could have done that, but it is not £2,000 a year plus the tax, but only £2,000."
That is because, in the year 1918, by a rule of the Finance Act which I do not suppose was ever read by any member of the Lower House who could deal with it, it was specially stated that all such settlements free of tax should be disregarded for the purposes of that Act, and therefore the unfortunate person, who finds himself tied down to pay a sum which perhaps he has no desire to pay, finds that he has to pay Super-Tax of 4s. or 5s. in the £ on £700 a year of which he receives nothing. I have put that case before the Treasury. It was perfectly indefensible, but they said that to change it would be to reduce the amount coming into the public Exchequer. I do not think that this argument would stand the racket of fair consideration, and I suggest to the noble Lord that it should be considered for another year.
Speaking in general terms, the noble Lord told us that the problem should be stated as a whole and that it was a choice of evils. I sincerely trust that, when the

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choice of evils takes place next year, he and his colleagues will not forget that, unless they see their way to reduce the burdensome taxation on trade, now far in excess of that of any foreign country, the difficulties of unemployment must unquestionably continue to be not merely pressing but permanent.
VISCOUNT GREY OF FALLODON:My Lords, I wish only to offer a very few and, I am afraid, somewhat perfunctory observations on the Finance Bill. I am not sure that they will be entirely in line with the objections taken by any particular Party. The reason why my observations will be few is that I want to point out that I do not think it possible to have any really useful discussion by following the arguments of the noble Lord who introduced this Bill. And for this reason: he started with a premise that the Chancellor of the Exchequer was in a position to remit taxation. It is that premise that I think is mistaken. If the Chancellor of the Exchequer were really in a position, looking not only to the present but to the future, to remit taxation I should not be prepared to find much fault with this Budget. I should regret the remission of a portion of the Entertainment Tax, because I doubt whether that will really inure to the benefit of those whom it is intended to benefit, and I think that if you wish to convey a benefit you might have found better means of doing so than by the remission of the Entertainment Tax. But that is a detail into which I will not go.
My feeling is that, although at the moment the Chancellor of the Exchequer is in a position to do without the money which is remitted in the Budget, he had before him, and he and the Government knew that they had before them, a very large increase in the expenditure of this country. The taxes which they are in a position to remit, so far as the expenditure of this year is concerned, will have to be replaced by increased taxation in the coming year. To consider the expenditure lying ahead was part of their old policy, and to some extent of the policy of every Party, and with the admitted necessity for increased expenditure on a very large scale ahead of us, and, apparently, without the prospect of corresponding economies in other branches of expenditure to meet them, I think that
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this is really an improvident Budget. I know that it is a popular Budget, but nearly everything that is improvident is popular at the moment. My real objection to it is that it will, in the long run, be found to be an improvident Budget, and that next year the Chancellor of the Exchequer, whoever he may be, will be faced with the necessity of imposing new taxation. That will really bring us to the test of whether the Government, if they are in office a year hence, really think that they can get much more revenue on economically sound principles by increasing direct taxation.
I do not care at all about the balance between direct and indirect taxation, as an abstract proposition. If the Revenue of the Exchequer were within such limits that the whole of it could be raised by direct taxation, and were so moderate in amount that it would not press upon the springs of industry, I would not mind seeing the whole raised by direct taxation. What I feel is that the present high rate of direct taxation does press upon the springs of industry, and really deprives the country of some of that elasticity which is necessary for its recovery from the ruin wrought by the war. If it is already pressing upon the springs of industry, I should very much like to know—though we cannot expect the Government to tell us now—how it is in their minds, if they are in office next year, to meet the gap between Revenue and Expenditure which will undoubtedly arise next year, and will be larger than ever because of the remittance of taxation this year. If they are going to meet it by increasing direct taxation, they are going, I think, to deal a blow at the recovery of British trade.
There does really lie between us and some of the supporters of the Labour Government, if not the noble Lord opposite, this difference of opinion, that some of his supporters believe that all surplus income should go to the State. We believe, or I, at any rate, believe, that if the State is to have all surplus income, that is to say, if the capital of the country is to be placed at the disposal of the State, then those resources which are now used in the form of surplus income to increase and develop the productive capacity of the country will not be used by the State to anything like the same extent. If the Government, by these

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remissions of taxation, were not preparing the way for new direct taxation which will have to be imposed, I should not desire to criticise the Budget, but it seems to me that the Budget as it stands, with its remissions of taxation brought in with the knowledge of the increased expenditure which is ahead of us, and apparently without much prospect of economies in expenditure, is a Budget which is really clearing the way, if it is not actually intended to make a case, for some new taxation next year. I do not believe that you can find new taxation next year, if it is required to replace that which could now be imposed, without pressing more hardly upon the trade and prosperity of the country than the actual taxes which are removed under this Budget.
Then I come to the other point which seems to me to make it rather unprofitable to follow the arguments of the noble Lord. He said, as he was entirely justified in saying, that this Budget took no account of Expenditure. Now, Expenditure is really, it seems to me, of the essence of the question.
LORD ARNOLD:Will the noble Viscount permit me to interrupt? I said that I would not this afternoon deal with Expenditure. I did not say that Expenditure had nothing to do with the Budget.
VISCOUNT GREY OF FALLODON:I entirely accept the noble Lord's statement as to the way he put it, and I said he was justified in saying that he would not in this discussion deal with the question of Expenditure. That is my whole point. It is most difficult on the Budget, of course, if no account is taken of Expenditure, to have a profitable discussion. If it were not for Expenditure ahead I should not be discussing the Budget. I am, however, not going into it any more than I have done, but I wish to point out that no reduction of taxation will be really equitable or economically sound if you have heavy Expenditure ahead and you do not see your way to meet it. I am sure of this, that however much you reduce taxation on the wage-earning classes, what the noble Lord opposite said is perfectly true, that if there is distress—he did not use that word but I think he meant that—in the country, and trade is bad, it is those classes who suffer most.
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It is not enough to say with regard to Expenditure ahead, as the noble Lord did say, that it is long overdue. That is not the question. The question is whether the country can afford it, and I feel the Budget has not taken account of what Expenditure is ahead, and that if we find new taxes are necessary next year, and those taxes have to be taxes which press upon the industry of the country, this Budget, though it appears to be equitable in relieving taxation on the wage-earning classes, will really, in the future have provided for a position which is not economically sound, and in which the greatest burden must inevitably fall upon the poorer and wage-earning classes. That is my real objection to the Budget—that it is put before the country as a popular and equitable Budget, but unless the Government can justify the remissions of taxation by economies in the national Expenditure, and by keeping the national Expenditure within the national means, this cannot be said truly to be a Budget which is either equitable or economically sound.
On Question, Bill read 2a: Committee negatived.

LEGITIMACY BILL.
Read 3a (according to Order).
Clause 1:
Legitimation by subsequent marriage of parents.
1.—(1) Where the parents of an illegitimate person marry or have married one another, whether before or after the commencement of this Act, the marriage shall, if the father of the illegitimate person was or is at the date of the marriage domiciled in England or Wales, render that person, if living, legitimate from the commencement of this Act, or from the date of the marriage, which last happens; and such person is in this Act referred to as "legitimated person."
(2) Nothing in this Act shall operate to legitimate a person whose father or mother was married to a third person when the illegitimate person was born.
(3) This section does not enable a legitimated person to take any interest in real or personal property, which he would not have taken if this section had not been passed.
(4) The Registrar-General may, on production of such evidence as appears to him to be satisfactory, authorise at any time the re-registration of the birth of a legitimated person, and such re-registration shall

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be effected in such manner, on such information and at such place as the Registrar-General may by regulations prescribe.
(5) No person whose parents have married after the passing of this Act shall be legitimated, nor shall the birth of any such person be re-registered under this Act, unless both parents shall avow in writing at or before the date of the marriage, the paternity of such person, and the regulations to be made under this Act by the Registrar-General shall make provision for such avowals: Persons who have married one another before the passing of this Act must make their avowal in writing at some time during their joint lives, and provision for this purpose shall be made in the regulations, in all other cases legitimacy must be established by proof of percentage and marriage of such parents
EARL RUSSELL:My Lords, there are some drafting Amendments to this clause which have been circulated, and which look rather serious, but they are not really so formidable as they look. You will recollect that Clause 1 was amended in Committee, with the result that it was not quite clear what was intended, or who was a legitimated person, and these Amendments to Clause 1 are to make that clear. I think, perhaps, it will be more convenient if I moved the Amendments one at a time, but they are all, so far as they relate to Clause 1, for the same purpose. I would point out to your Lordships that the noble and learned Viscount, Lord Cave, has put down Amendments to my Amendments, and I am prepared to accept them, because I think they are improvements. I move my Amendments as amended in the way suggested by Lord Cave, the noble Viscount not being present to move his Amendments.
Amendments moved—
Page 1, line 6, at the beginning insert ("Subject to the provisions of this section")
Page 1, line 13, leave out from ("happens") to end of line 14
Page 1, line 21, at end insert as a new subsection:
(" (4) No person shall be legitimated under this section unless his parentage is recognised by an avowal in writing made in the prescribed manner by both his parents, and such avowal shall be made in the case of parents marrying each other after the commencement of this Act on or before the date of such marriage and in the case of parents who have married each other before the commencement of this Act at any time during their joint lives:
Provided that, if in the case of any person whose parents married one another before the commencement of this Act, such
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an avowal cannot be made by reason of either parent being dead, or the date of such commencement, the avowal may be made by the surviving parent at any time during his or her life, and if both parents be dead at the commencement of this Act, this subsection shall not apply.")
In this section "prescribed" means prescribed by regulations made by the Registrar-General.—(Earl Russell.)
On Question, Amendments agreed to.
EARL RUSSELLmoved, after subsection (4), to insert as a new subsection:—" (6) In this Act the expression 'legitimated person' means a person legitimated under this section. "The noble Earl said: My Lords, it is not clear whether the expression "legitimated person" would include the new persons dealt with under the new subsection, and I therefore move this Amendment.
Amendment moved—
Page 2, line 2, at end insert the said new subsection.—(Earl Russell.)
On Question, Amendment agreed to. Amendment moved—
Page 2, lines 3 to 15, leave out subsection (5).—(Earl Russell.)
On Question, Amendment agreed to.
Clause 8:
Provisions as to persons legitimated by extraneous law.
8.—(1) Where the parents of an illegitimate person marry one another, whether before or after the commencement of this Act, and the father of the illegitimate person was, or is, at the time of the marriage domiciled in a country, other than England or Wales, by the law of which the illegitimate person became legitimated by virtue of such subsequent marriage, that person shall in England and Wales be recognised as having been so legitimated, notwithstanding that his father was not at the time of the birth of such person domiciled in a country where such a rule of law prevailed.
(2) The provisions of this Act with respect to persons legitimated by this Act shall (wherever the father was domiciled at the time of the birth) apply to persons so recognised as having been legitimated in like manner as if such persons had been legitimated by this Act:
Provided that nothing in this Act shall affect the right of any person under any intestacy occurring, will (including codicil) coming into operation, or settlement or other disposition made, before the commencement of this Act to which he would have been entitled if this Act had not been passed.
(3) For the purposes of this section, the expression "country" includes Scotland and any other part of His Majesty's Dominions, as well as a foreign country.
EARL RUSSELL:The Amendments to this clause—the first in subsection (1), after "legitimated," where that word secondly occurs, and the other, in subsection (2), after "The provisions of this Act with respect to"—are to cover the special provision of Clause 8 which relates to people under foreign law.
Amendments moved—
Page 4, line 30, after ("legitimated") insert ("as from the commencement of this Act or from the date of the marriage, which last happens")
line 33, leave out from ("to") to the end of line 37 and insert ("legitimated persons and to the issue of illegitimate persons in cases where such persons died before the marriage of their parents shall apply respectively to persons recognised as having been legitimated and to the issue of any person who would have been so recognised if he had been living at the time of the marriage of his parents").— (Earl Russell.)
On Question, Amendments agreed to.
Bill passed, and returned to the Commons.

HOUSING (FINANCIAL PROVISIONS) BILL.
Order of the Day for the Second Reading read.
THE LORD CHANCELLOR:My Lords, I have risen to lay before the House the character of this Bill. It is a Bill of far-reaching magnitude, and it imposes a heavy financial burden. I am well aware of that. If there had been no discussion throughout the country about this Bill, and if it had not had a long period for its passage through the other House, it would have been necessary for me to detain your Lordships at some length, but I think that if you will allow me to make some general observations in explanation of the Bill I can put it in such a shape that its substance can be expressed comparatively concisely.
The purpose of the Bill is to supply 2,500,000 houses for the working classes within a period of fifteen years. That is a very large undertaking. It is an undertaking which means a heavy burden on the national income. It is a Bill which touches closely what your Lordships have just been discussing on the Finance Bill. But in this matter it is not enough to look only at one side of the account. The Bill is brought forward with the complete assent of the local authorities, who will
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have the duty of carrying it into effect and who have to make substantial contributions to the cost. And the local authorities are strongly in favour of the Bill, for a very good reason. The absence of proper houses for their poorer classes imposes upon them a heavy financial burden of their own. That is part of the other side of the account. And, when you turn to the State itself, there is also another side of the account which must not be omitted. This Bill will cost the country one per cent, of its income. On the other hand, there is another column to be set on the credit side, which— assuming that the Bill succeeds, which is, of course, a hypothesis—contains a saving of a very far-reaching character.
In this column are certain things which we are apt to dismiss as though they had no bearing upon the financial question, but which really have a very great bearing. For example, bad housing is a fertile cause of tuberculosis, and of other zymotic diseases. It also tends to fill our prisons, because bad houses are nurseries of crime. It imposes on the country expense and loss due to intemperance. It also creates moral evils, such as those which arise when young men and women are huddled together four or five or more in a single room, with the result that there is incest, and much that is very degrading to the moral level of the country. Then, the burden on our hospitals and charitable institutions is added to very substantially by the slum population. It is not only ill-health, it is not only non-moral conduct, but it is that variety of evils which come when a large section of the population is very inadequately housed which we have to consider. These things mean very heavy expense—an expense which is not easy to set out in exact figures of pounds, shillings and pence, but which is undoubtedly very great. And if it is all taken together, I doubt very much whether it does not exceed that one per cent, of charge which appears on the other side of the account.
There is, too, the increase to the rates which these things cause—the poor rate, for example. There is also the fertile source of unemployment owing to conditions which make the workman unfit to do his work. That means resort to the funds of the nation, which have to provide for those who are unable to take

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care of themselves. And another direct result is that the better class of workmen tend to emigrate. Last year, I think, 62,000 skilled workmen left these shores for other lands both because of the difficulty of getting employment and of the bad conditions under which they had to carry it on. More than that, from a good system of housing you get increased industrial efficiency, and also a tendency to diminished unrest. Bad housing is one of the most fertile sources of unrest, and unrest sometimes in a very menacing form.
It is not merely the great cities, or even the small towns, which you have to consider. Our agricultural population is often very badly housed. This Bill will extend to the agricultural districts also. Besides that, if you go into our mining districts you will find the miners too often housed in villages which are only fit to breed Yahoos. I am speaking of what I have observed myself. This Bill, if passed, will provide housing not merely for the agricultural labourers but also for the miners. If that be so, then it is obvious that the national account in connection with this Bill is not an account which has only one side, it is an account which has two sides, and you have to take the balance; and I am by no means sure —in fact, my impression is very strongly the other way—that, when you arrive at a balance, you will not find, even in money, that, assuming that the scheme proposed in the Bill is a success, you have got a source from which you will not only avoid loss but will make a profit for the nation. Of course, it is a Bill which invokes the assistance of the State, and on a very large scale. In that sense it is a Bill which is coloured by Socialism, but we are all Socialists now.
NOBLE LORDS:No, no!
THE LORD CHANCELLOR:Well, I will make an exception of my noble friend, Lord Banbury of Southam, because I suspect that he opposed the Housing Act, 1923, an Act which was carried by the Conservative Party by an enormous majority on the footing of doing exactly what this Bill does.
NOBLE LORDS:No, no!
THE LORD CHANCELLOR:It used State funds to provide houses for the
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working classes. This Bill proposes to use State funds for providing houses for the working classes. The two Bills passed through the other House by large majorities, and one of them has received the complete approbation of your Lordships. I do not think I am very far from being right, therefore, when I say that I am speaking in a somewhat Socialistic atmosphere when I address your Lordships in support of this Bill. The standard of public opinion has advanced, and one reason for that is that, with the spread of education, the people have come more and more to the consciousness of their own title to ask for consideration from the community, which alone can help them. And to-day they are pressing for better houses more definitely than for any other reform which is on the political horizon.
Having said so much, I will come closer to the provisions of the Bill. As I have said, it is a Bill the purpose of which is to provide 2,500,000 houses in the space of the next fifteen years. Controversy has arisen as to whether this might not have been done under the provisions of the Housing Act of 1923. The method is somewhat different from that of the Housing Act of 1923, because the object to be attained is a larger one —so large that it will require the energies of the whole building industry and perhaps the whole body of local authorities. The Bill consists of a threefold treaty. I call it a treaty advisedly because it is not an indenture or a definite contract. It is a treaty in the sense that it is founded on resolutions passed by the local authorities accepting the task of carrying this Bill into execution. Secondly, it is a treaty with the building industry. It is not a treaty with one part of the building industry. It is not a treaty with Labour alone or with Capital alone. It is a treaty with Labour and Capital in combination, and what Labour and Capital in combination have said to us is this: "If you will give us a guaranteed programme, a programme for fifteen years, we will carry through the work." We thought it wise not to deal with them about details of wages and materials, or things of that kind, but to say to them: "Contract to give us houses," and they have said: "We will give you houses and we contract to supply you with 2,500,000 houses

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within fifteen years." That is the treaty with the building industry and that is the treaty with the local authorities.
It remains to show what is the charter to the tenants. The charter to the tenants is that the working classes will have better houses at the same rates relatively as they were paying before the war; not for the same money because money is of a different value now. Wages have gone up. The cost of living has gone up. Rents and other things have gone up. Workmen were paying, and I have no doubt are paying now, about forty per cent, more than they paid just before the war. They are paying what is considered equivalent to the rent they were paying then. If that be so, the tenant will have for equivalent money, though not for the same money, a better house and there will be better houses in quantities which will afford accommodation for all, or nearly all, who are likely to need them.
Having said so much, I want to bring out the relation of this Bill to the late Government's Housing Act of 1923, because I think that requires to be made plain. This is not a Bill to repeal the late Government's Housing Act of 1923. On the contrary, the powers under that Act will be continued. The only difference will be that the development of operations under that Act will be substantially extended. Under that Act —it has been my business to consider it closely—the houses which were to be subsidised by the State were to be completed by the end of 1925 or, in exceptional cases, 1926. Then they were to receive a subsidy. This Bill proposes to afford subsidies of a. still larger amount. Those houses were houses which, as I shall show your Lordships presently, could not possibly be finished within the time—that is to say, by the end of 1925— and, consequently, we are adding fifteen years to the time, but we give to the system brought into existence by the late Government the same chance as it had before that period of fifteen years was added. Consequently, whatever good there was in that Act is not diminished by our Bill to-day.
Then there comes in a very great difference of principle. The Act of 1923, as it was and as it is to-day, provided not for the building of houses by local
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authorities in all cases; it provided for the authority assisting by subsidy private builders and other bodies to build houses. When they were built it was open to those who had built them to sell those houses. They did so, and it turned out to be the only really profitable way of operating under that Statute. The result was that tenants could not get houses except under conditions of control. In your Lordships' House we have discussed again and again the system of control. It is a bad system. It is a system that interferes with the liberty of people to deal with their own affairs and leads, consequently, to great friction. But this tendency was not enough to prevent the people who built those houses and who owned them from selling them, and that was the scheme which was most profitable for them to undertake. They did so, and many more houses were sold than were let, with the result that working people could not get the houses they required. They were not in a position to buy; they could not get them on lease; and, consequently, there has been, and is, a very great shortage of houses.
Those things ought not to be stated merely in general average and I will give your Lordships some figures concerning the subsidy. I am not blaming the Act of 1923 at all. As I say, we are keeping it alive. I go further and say that so difficult and so great is the problem that I do not wonder that at the first go off, if I may use the expression, the machinery provided has not been sufficient to meet the tremendous shortage with which we are faced. But under the Act of 1923, whatever happened, nothing like a sufficiency of houses was provided to meet the social needs with which we are now trying to cope. Under that Act it has been estimated that for letting—that is what I am dealing with because, as I have said, the working classes cannot, as a rule, buy houses—7,500 houses were completed and 15,500 were under construction. That means that a total of 23,000 were provided for letting. Then if you turn to houses for sale, which has been the much more popular thing, 10,000 have been completed for sale and 29,000 are under construction. A total of 39,000 houses are, therefore, for sale. Taking the whole number for which contracts have been made, or in respect of which local authorities have issued certificates to

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private builders—they are not complete yet—there will be 37,000 for letting and 62,000 for sale. Obviously that Act has not solved the problem.
The problem is to provide not less than 2,500,000 houses within a stated time of fifteen years, and the contribution of available houses made under the Act of 1923 is consequently far short of the necessity. It is a real necessity. If we were going to war in defence of our liberties your Lordships would point out that we were taking some risk, and some financial risk. You would say: "See that you think out completely your plan of campaign; see that you are dealing with competent generals, generals who are fitted for their task; study the psychology of the generals on the other side so that you may know what you have to meet, and then put your whole energies into the business of obtaining victory. Do not hesitate about risk. The best you can do is to reduce these risks to a minimum." With this problem as with the problem of war, the very same considerations apply. This is the effort that the nation is asked to make for the liberty of the thousands of men, women and children who live under conditions which are a disgrace to the country, and which are retarding its prosperity, and preventing it from recovering itself. In these circumstances the necessity which is imposed on us is only less than the necessity we should be under if we were compelled to undertake the conduct of a great war, and I 123456invite your Lordships to approach this question as being one not really of a speculative Character on the part of the country, but something we are driven to undertake, and which we must undertake under the best conditions that we can get.
I do not stand here to say to your Lordships that this great measure will attain complete success. Nobody can foresee the future. You cannot see ahead in a case of this kind, but this you can do. You can take care to bring all the powers of thought of which you are capable to bear upon the problem, and take care that in dealing with that problem you obtain the best advice which it is possible to get. That is what my right hon. friend, Mr. Wheatley, has tried to do, and what he has tried to do I propose now to tell your Lordships. I have described to your Lordships the Act of 1923. "We leave that Act standing in the
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hope that any good which may be obtained from it in the way of the provision of houses may be obtained. Some of the houses built under that Act, but not very many, I am afraid, reach the working classes. A limited number of houses has already been constructed. I believe the number is 17,500. But we want an enormous increase in that number. It is not merely the great cities with which we have to deal. It is not merely in the cities that we have to clean out the slums, but we have to deal with the agricultural districts, which are, in a way, just as important, and we have to deal with the mining villages which are dotted up and down the country and which, in some respects, are the worst of all.
The plan I have already described is a plan on a very large scale, because the problem is one on a very large scale, and this is the way in which it is sought to deal with it. Under the Act of 1923 £6 was paid by the State annually for twenty years for every house which was completed, or was to be completed by the end of 1925. Under the new scheme we have to pay more, because we found we could not get the houses otherwise. After careful negotiations, and after cutting down the demands of the local authorities, who asked for £12 per house, we have got them to undertake that, for £9 a house from the State and £4 10 s. from their own pockets, they will build these houses and let them. These houses are for letting—please bear that in mind in following the plan—and they are houses for letting subject to certain conditions to which I will presently draw your Lordships' attention.
We propose to continue this subsidy until 2,500,000 houses are built, but your Lordships will understand that there may be authorities who may be slack, and there may be builders and builders' operatives who may be slack. We take power to stop the contributions whenever that is found to exist, and machinery is provided so as to see that we get delivery of the goods. If at any time less than two-thirds of the houses which ought to be delivered in the specified time are not being delivered, then automatically the contribution ceases, and, if there is extravagance and costs go up, the same thing happens.
Your Lordships may ask how do we propose to ensure that prices are not run

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up by a great deal, and that the nation is not bled in that fashion. I have told your Lordships already that if the houses are only being produced at a cost which is over the scale that is established, then there is power to stop them. But there is more than that. Under the Bill it becomes the duty of the Government to make an inspection every three years, for which machinery is provided, to see that everything is going on well. That inspection will reveal how things stand in each particular locality, and will bring the operation of the scheme to a close there if it should turn out that people are not working up to the standard laid down. Then, is regards the materials, we have agreements which have been worked out with those who have provided building materials, and they will supply them at the 1924 cost.
And we have agreements with the men that they will produce the houses. It was suggested that if we did not introduce dilution there would not be sufficient labour, but the trade unions have satisfied us that there is a very large supply of labour which is capable of being brought to the aid of these building operations. They have agreed to enlarge the age at which apprentices may be taken, and they have agreed to look for apprentices in an active fashion. They say—and the others whom we have consulted say—that that can be done, and that there will be no shortage of labour if only there is, what there ought to be, a definite programme of work for fifteen years. People do not like sending their boys into the building trade when they think that they may be thrown out of employment very quickly, but if you have this guarantee of building operations for 2,500,000 houses for fifteen years, then there is a very different state of things. We are informed by those with whom we are dealing that they have no doubt that they will be able to supply the amount of labour that they have undertaken to supply to produce the houses. If they do not supply the houses, then so much the worse for them, for there will cease to be employment for them. We have every reason to take the view that they have a strong motive for carrying out the undertakings that they have given to us, and that the contracting builders themselves are in the same position.
This, my Lords, is not a Socialist Bill. On the contrary, it is a Bill which deals
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with Capital, and leaves Labour and Capital on their existing footing. We leave the builders to employ the workmen, and we leave the workmen to engage with the builders, and they are both satisfied that they can do it. They have come to us in a joint organisation, have ventured into this scheme, and have given us an undertaking that it will be carried out. The local authorities have been equally helpful and sanguine, and that notwithstanding the fact that a good deal comes out of their own pockets in carrying out the scheme. That is, broadly, the scheme and the security for it. It rests upon the motives which people have for giving it reality, and also upon the strong pressure of local feeling and of general feeling to get these houses built and to house the working classes. Therefore, we are not afraid that the scheme will break down. Of course, we cannot tell what will happen in public affairs, but so far as investigation and so far as the responsibility of other people with whom we have to deal go, the prospects are, I think, as satisfactory as we could have hoped that they would be. Anyhow, it is not a matter in which we had any choice.
This evil must be faced and must be dealt with, and I challenge any one to say how it could be more satisfactorily dealt with than the way we propose to deal with it. It is not enough that we have the Act of 1923. Under that Act we were told by local authorities that no more houses could be got for letting, that people only built houses for sale, and that there was not a sufficient prospect for them to go in for letting, and they could not possibly let a house at the same rent as before the war. The plan, then, is a subsidy for each house during the statutory period of £9 from the State and £4 10-s. from the local authority. A differentiation is made when you come to deal with agricultural houses. In agricultural districts in England and Wales houses are much more expensive to build, they are much more isolated, and the rent paid is not the same. It has, therefore, been found necessary to make the subsidy for each agricultural house £12 10 s. The rent received from the agricultural labourer will be substantially less than the rent received from the town worker, who can afford to pay 7s. a week, and even more, while the agricultural labourer is not likely to pay more than

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3s. 6d. That is the reason for the difference between the rate of subsidy in the two cases—£12 10 s. in agricultural districts and £9 in the case of other houses.
That being the condition of things, I must say a word about control. We do not leave the local authorities quite free in this matter, nor did they ask to be left free. They are getting a subsidy from the State in order to enable them to build houses for the working classes, and if you will look at the Bill you will find the special conditions enumerated. One important condition is that the rents to be charged in respect of these houses shall not exceed the rent that would be payable if the houses were let at the normal rates charged in respect of working-class houses prior to the war. It is to be a rent which is the financial equivalent to what a. workman had to pay at that time. These houses are not to be sold without the consent of the authority, and, indeed, there will be no sale without the assent of the State. We are watching closely to see that the houses get into the right hands.
These statutory conditions are based on continuity of production. Without continuity we could not get the workmen, and we are encouraged by the belief of the builders and also of the workmen that we shall get sufficient houses and sufficient labour if we have this continuity of employment. It means that anybody going into what is really a new department of the trade will have a guarantee that his employment will continue for years ahead. We hope also to develop very much the resources of the building industry. Taken on this large scale employers tell us that it will be possible to get materials in a way they cannot be got at the present time, when the demand is sporadic. The demand will be systematic; and we are encouraged to hope—I do not encourage your Lordships to hope and I should be sorry to make any prediction whatever on it—that new methods will come into operation by which bricks may be made mechanically much more rapidly than at present. With the reform of the bricklayer and the reform of his machinery I think there will be some prospect for the success of the scheme.
In order to encourage local authorities to be economical we do not propose to
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take away any surplus which they may save upon their contributions. We leave them to apply it towards the reduction of rates, and I hope my noble friend Lord Banbury of Southam will regard this as one of the bright spots in the Bill. Indeed, local authorities have gone into the scheme very cordially on this basis. Then again, to prevent profiteering, we have introduced, in another place—it will come before your Lordships later, in the autumn—a Building Materials (Charges and Supply) Bill which strikes at the profiteer and provides that when it is a gross offence it becomes a criminal affair. We think the moral effect of such legislation will be useful in the present case.
Now I come to the Bill itself. The first clause, as I have said, enables a local authority to build, and Clause 2 increases the subsidy to local authorities. But the subsidy is not confined to local authorities. It can be given to public utility companies, bodies not working for profit, and there is also power in certain cases to enable private people or corporations to do the same thing, provided, of course, they conform to the conditions and let the houses at rents which are equivalent to those which were collected before the war. Clause 3 contains the special conditions to which I have already referred. Clause 4 deals with the termination of Government liability to make contributions, and Clause 5 provides for a three years' revision to see whether there is any reduction in expenditure, in which case the subsidy comes down.
A question has been raised as to whether the trade unions might not take in supplement of their labour people who have been trained for a short period in laying bricks. It would have been convenient and desirable if we could have taken on ex-Service men, and we should have been glad to take them on. But not merely did the trade unions but the employers also came to us and said: "Do nothing of the kind. To become a bricklayer requires a certain amount of training." This is what the builders told us just as emphatically as the operatives. They said that the difficulty of house building is that the rate is determined by the slowest bricklayer. If you put a man on who has come late into the business and is not thoroughly trained, then the rate of construction is diminished to the rate at which this man

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can lay bricks. The employer and employees told us exactly the same thing, and it is a matter in which no opinion of mine, or any opinion of your Lordships, is of any value; it is a matter which must be determined by the people who have experience of the business and who know things at first hand.
That is the substance of the Bill, but I must not sit down without telling your Lordships something about its cost. You will find this set out in Command Paper No. 2,151, which has been printed and is in the Vote Office-, and which explains the Financial Resolution. I told your Lordships that the cost of this scheme was necessarily very heavy—more like the cost of a small war than that of an ordinary social reform. If your Lordships will turn to page 7 of the Memorandum, which the Treasury have approved, you will find that in the year 1924-5 the Exchequer charge is comparatively small, amounting to £278,000, the charge on the local rates also being small, and amounting to £135,000. In 1925-26 the Exchequer charge rises to just over £1,000,000, and the charge on the local rates to £521,000. In 1926-7 the Exchequer charge is £1,905,000, and the charge on the rates £925.000. In 1927-8 the rise becomes more rapid, the Exchequer charge being roughly £2,800,000 and the local charge £1,300,000. Then there is a steady progress until the charges reach their maximum. The peak figures are for the years 1940-41 to 1963-64, and then they are very large indeed, the Exchequer charge being £23,000.000 and the local charge £11,000.000. After that there is a drop, until this Bill comes to an end in 1979, when the charges cease and the work is done
These are very large figures, and I can only say to your Lordships that this is only one side of the account. As the houses develop, they will undoubtedly exercise a very material change not only in the charges to which people are put but in those to which the benevolent and high minded are exposed in their sense of the misery disclosed by these features of our cities and towns and by the state of things in the country. Better population is what we need more than any other reform. I will say that I have a hope of seeing the population in this country upon whom the educational facilities of the time have operated become conscious of
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better and higher needs, workmen with a decent wage living in a decent home and able to give leisure time to studies and to thoughts which will raise them in the scale of society and which will put them in a position to feel themselves the equal of any man and the inferior of no man. That is what spiritual qualities can give him, and it can be given him by nothing else. Real equality does not depend on the possession of wealth. Nature makes too many artificial distinctions to admit its possibility. But if you give a man a decent wage, a decent home and a decent education, then, indeed, it is his own fault if he does not make it possible to put himself in that position in which he envies no man what are mere material goods, and in which he is content because he has what is best for himself and for his wife and children. I beg to move.
Moved, That the Bill be now read 2a.— (The Lord Chancellor.)
LORD WEIR:My Lords, I ask from you this afternoon the kind indulgence you extend to those who address this House for the first time on a matter of national importance. Each post-war Government has produced legislation to promote the building of houses, and in each case performance has lagged far behind both expectation and requirements. To-day we have to consider a Bill containing the proposals of the present Government, and in examining it I trust that your Lordships will appreciate that I am not actuated by any political spirit, but rather by the spirit in which I would attack the ordinary problems of a business life. I will not speak of Socialism, but will confine myself strictly to housing. Accordingly, without any further preliminaries, I suggest to your Lordships that this Bill will be little more effective as a measure than any of the earlier Bills promoted by other Governments in its ability to obtain homes for the poor at the rate, and in the time, essential to reduce hardship, to quell growing unrest and to meet the crying need so eloquently pictured by the Lord Chancellor.
In all production problems—and housing is, above all, a production problem—the solution is partly seen when the problem itself is clearly defined. Nowhere can I find any authoritative statement of the number of houses of

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specific types which the local authorities have shown to be required in any specific time. The Bill, it is true, deals with a programme of 2,500,000 homes to be built in fifteen years. That is a programme which represents the re-housing of over twenty per cent, of our population, but it is the proposal, not of the Minister of Health nor of the local authorities who might be presumed to know their requirements, but of the National House Building Committee, which consisted of master builders and trade union officials. That Committee considered it unlikely that the programme would be fulfilled, and they suggested that the Minister should rely upon a programme of two-thirds of its magnitude. The difference between the two programmes represents a difference in capital expenditure of £400,000,000, and your Lordships are surely entitled to know which programme represents the actual needs of the country, and how these needs were established. But, accepting either of these programmes, it is difficult to agree that they fulfil the actual requirements in respect of the initial five years. The acute aspect of the housing problem is surely the supply of homes for those poor people who are living to-day either in slums or in conditions of grave overcrowding, and I feel that your Lordships should insist that no measure can be regarded as satisfactory which does not provide specially for a more rapid remedy of that situation.
I now pass to an examination of the manner in which the Government programme is to be fulfilled. The proposals are founded on the advice of the master builder, the building trade union, the supplier of building material, and the local authority. They have told the Minister, and he has evidently believed them, that the only way to get houses which can be rented at the tenant's present ability to pay is to treble, approximately, the 1923 subsidy, and to guarantee a minimum demand on the building trade for 1,600,000 houses during the next fifteen years.
With regard to the guarantee, it is a new principle in our industrial history for a Government to guarantee continuity of employment over a long period of years to an established British industry, and I consider it a very dangerous principle. Reviewing British industry as it stands to-day, and especially the state of British
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employment, if this House were asked to guarantee employment to any industry why should it select the building industy? If special and favoured treatment is to be extended to any industry, surely the selection would be made from one of the great export industries on which our national welfare depends; industries like coal, cotton, iron or steel. Any help or security which can be given should surely be given, to those workers who are fighting for their employment at low wage rates against the world, rather than to those in an industry which is not only protected against foreign competition but one especially well paid, one working particularly short hours, and, finally, an industry faced with a steady demand for its product many times in excess of its ability to supply that product.
It is all very well to talk glibly of expanding the building industry and stabilising it, but what are the economic reactions of that policy going to be on other industries? Will not these other industries require to bear some of the cost of the stabilization? And will not this increase the cost of other British products and accentuate unemployment? I think your Lordships are entitled to some explanation from the Government on these points. Again, on the question of guarantee or, as the noble and learned Viscount has termed it, the "treaty," I fully expected that he would have told us if the modifications which have been made in the Bill in another place have affected the treaty with the building trade, and I now ask if the Government have any definite assurance that the trades are still prepared to carry out their part of the bargain, in view of the many changes which have been made in the Bill. If they have not that assurance, then the entire foundation of the Bill is insecure and unreliable.
Now I pass to the second condition, that of the enhanced subsidy. In very approximate figures the maximum programme, if carried out, will involve a charge on the Exchequer of over £900,000,000, and on local rating of £400,000,000 between now and 1980. Taxation and local rating will have to find about £24,000,000 per annum, and in addition to this the local authorities will incur capital expenditure on a scale which should receive the closest attention of the financial experts of this

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House. On this question of finance I will confine myself to one single observation. The permissible expenditure on social services—and I think it is quite fair to say that according to this Bill housing is now regarded as a social service—is surely dependent upon the productive performance of the nation, and, in the case of Great Britain, on the productive performance of the export trades. I ask the Government to explain clearly what evidence they possess that our future national performance is going to be effective enough to carry this colossal new burden. In what direction is this country going to increase its turnover to justify the new expenditure?
Let me next examine the main reasons given as to why this increased subsidy is necessary. On page 9 of the House Building Committee's Report it is stated that houses are being built to-day at the lowest possible cost. Without any disrespect to those who subscribed to that statement, I suggest to your Lordships that no one is entitled to declare that any product is ever being produced at the lowest possible cost. Such a statement merely means that the authors at the moment saw no way of reducing the cost; but such beliefs are destroyed daily in hundreds of cases by the march of progress in methods and scientific development. It is a particularly fatal belief when it is held by the very people whose every effort should be directed towards destroying that belief. However, the Minister of Health evidently accepts this dictum, and having laid down the principle that rents are to be to-day's rents of pre-war houses, the disparity between these and the economic rents represents the subsidy figure.
This principle of subsidising rents is strongly political in its character, and I therefore will not dwell upon it, as I anticipate others may do so. But I would point out that since the war we have become familiar with what is called emergency legislation, involved by the abnormality of post-war conditions. One example your Lordships had yesterday —the payment of unemployment benefit without contribution. Another is this question of subsidising rents. I am not prepared to say that the abnormal conditions can yet be entirely disregarded, but I have no hesitation whatever in asking your Lordships to reject any proposals
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which would appear to accept the principle of subsidised rents as a permanent part of our legislation.
I return to the question of building costs, because the Committeee's Report and the Bill are equally unsatisfactory. Neither of these documents contains any suggestion whatever of the slightest hope of cost reduction, whereas nothing would help the nation more than new light on that point. On the one hand, we have a great industry, comprising workers and employers, who, after closely studying the problem, declare that they see no hope of reducing costs. On the other hand, we have the Government, faced with the most tremendous financial responsibility, equally bankrupt of idea or imagination in regard to this vital question. As a matter of fact, the Committee's Report holds out definite suggestions of increased cost. And I would now ask the Government to tell us by how much the new apprenticeship scheme and the new scale of apprentices' wages will increase building costs. Here I feel that the building trade has lost a wonderful opportunity of rehabilitating itself in the eyes of the community. Suppose they had said: "We have only domestic competition. We obtain fair contract prices. We are relatively highly paid craftsmen. We work very short hours. We recognise the nation's need for homes, and our contribution will be the promise to work pre-war hours for the next five years, and thereby, at a moment's notice, increase by at least 12½ per cent, the output of homes at the most critical period." That would have been a real, effective gesture, but it was not made. These are a few reasons why I consider this Bill will be not only as ineffective as the earlier Bills, but more dangerous in its application. And, in addition to these objections, I think it fails to reveal anywhere the slightest appreciation of the only principles on which a true solution can be found.
These remarks have been entirely critical. I now propose to take the harder course of suggestion, which I hope will be regarded as helpful. Certainly no other course will ever solve the housing problem, and it is only by throwing new light, or by striking some new note, that your Lordships may succeed, where, in my view, the Government and the other House have signally failed. I suggest that the most acute and, in a national sense, the most important part of the

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housing problem is the supply of about half a million houses, to be regarded as substitutional for the worst existing houses, and the time available for that supply is not over five years. That is the real burden on our national conscience which should be discharged at the earliest possible moment, and that is the part of the housing problem which calls for the most drastic and imaginative handling. Then I propose that every encouragement be given in every legitimate way to the building trade to expand, to develop, and to become more efficient.
But, altogether apart from what that trade can do, and in addition to its efforts, the Government should lay down an auxiliary scheme of housing to provide half a million houses in the next five years under a system of standardised production. Any such scheme must be framed go that it is not permissible under it for any one to trench in any way on building trade labour, or on building trade materials, which are in short supply. Here we have a real production problem—the problem of building so many houses in a specific time, without skilled labour and without the ordinary building materials. The only known principle under which effective production can be secured without the use of skilled craft labour is by the standardisation of product. Given a large enough demand for the standardised product, subdivision and simplification of operation enables intelligent, but unskilled, labour effectively to produce anything, however complex. In the standardisation of homes probably three types will be required to meet the needs of a working-class community, and, by skilful siting and arrangement, monotony could be entirely avoided.
Dealing with materials, it is at once obvious that we must depart from the normal materials. In the first place, some of them are not available, and secondly, normal materials involve a particular method and process of construction, which means high costs. At present houses are built by a process of sending raw materials to a site, and allowing an agglomeration of craftsmen to exercise their various crafts on the site in our unreliable climate. Supervision is difficult, lost time is serious, and it is not easy to remunerate by results. Our objective should be to expend our labour
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as far as possible in a factory, and reduce the amount of work done on the site.
A review of materials hitherto used in building construction, and also of novel materials, discloses that one of the most suitable alternatives to choose for the main structure would be a combination of timber and steel plate Facilities for the production of steel plate are large and insufficiently employed, and there is no shortage of timber in the world. The use of these materials eliminates the bricklayer, while the multiple production of timber units, by the use of jigs and other methods, makes us independent of the skilled joiner. The inner walls and partitions would be lined with either wood or composition board, no plasterers thus being required. The use of either metallic shingles or asbestos sheets for the roofs avoids the use of slates. By standardisation of the lay-out all the pipes and electric wiring can be produced by factory methods independently of the plumber and electrician, while by the standardisation of equipment and fittings the problem of baths and sanitary appliances, and so on, is rendered much simplier, the middle man is eliminated and the costs are considerably reduced.
I would ask your Lordships to believe that there is practically no novelty or experiment involved in these proposals other than the application of well-tried principles to the production of houses. Quality is not sacrificed; it is rather improved. These principles of production were, of course, applied with complete success in wartime but with this difference. During the war we had no good men unemployed. To-day we have over a million without work, many of whom would be available for this work, and very convincing reasons indeed would be required as to why they should not be so employed. I have no hesitation, in saying that the application of a scheme of this nature would result in reducing the cost of production to a level at which the burden on the country would become supportable and reasonable. I must be very careful in giving estimates, but if the scheme were applied on a sufficiently large scale a three-roomed house with a scullery and bathroom, including foundations, but exclusive of land, roads and drains, could be made and erected ultimately for under £300.

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I trust your Lordships will recognise that I have not recommended to you a particular type of house which you should build. The type I have described I took merely as an illustration. But what I have tried to do is to indicate the very real and definite possibilities of an auxiliary housing scheme based on the principle of standardisation and of cheap and rapid production methods. It is a scheme or system of building designed to meet the needs of to-day's conditions, equally in housing and unemployment, and I trust it is clear that in its conception it is of the essence of successful private enterprise. Existing methods have failed to meet the emergency needs of our people. This Bill does not alter those existing methods. It stereotypes and perpetuates them, and it will equally fail. More effective methods must be adopted, and that is why I have ventured to offer to your Lordships not merely criticism but also definite and practical suggestions.
LORD STEACHIE:My Lords, I am sure that your Lordships are most anxious to do all that is possible to increase the number of houses in this country. On the other hand, while the need is very urgent, the problem of how those houses are to be obtained is a very difficult one to solve. So far, no Government has been able to solve it, and the question that your Lordships are asked now to consider is whether this Bill will solve the problem or not. The only thing that is perfectly clear about the Bill is that it will throw an enormous burden on the Imperial Exchequer and the local rates. The noble and learned Viscount on the Woolsack said that there was complete agreement with the local authorities in regard to the Bill. I happen to be a member of a local authority and of one of the large associations of local authorities, and it is certainly not my recollection or view that there is complete agreement among them concerning the Bill. It is true that when the Government had before them this very difficult problem they consulted the local authorities upon it. I have read the various reports and it is clear that what really happened was that, while not in complete agreement about it, the local authorities made the best terms they could with the Government in the circumstances, and I say without fear of
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contradiction that the local authorities, certainly those representing rural areas, are not in complete agreement on the present Bill.
I noticed, too, that the Lord Chancellor was careful to say that the success of the Bill was more or less hypothetical. I have heard the speeches of many Ministers who were introducing Bills both in your Lordships' House and another place, and I cannot remember a Bill which was introduced with pessimistic views about its success. Most Ministers, in introducing a Bill, say that it is a very necessary measure, that it is a God-sent Bill and is certain to succeed. Curiously enough, this Bill proposes to do very little in the way of increasing houses in the first two years. May I draw your Lordships' attention to the First Schedule to the Bill? In the first two years there is only to be an average of 63,000 houses a year. In the year 1921, under the present Housing Act, 86,000 houses were put up and in the year 1922, 89,000 houses were built. So that under this Bill the Government clearly admit that they are going to do nothing in the first two years to increase the number of houses built as compared with 1921 and 1922. In the next two years they propose to put up 95,000 houses a year. What happened in 1923 was that 71,000 houses were provided for. It is only fair to say that something like 19,000 of those were not completed.
I think that your Lordships have a right to complain of the way in which you have been treated by the Government in connection with this Bill. No doubt, it was a very difficult Bill for the Government to deal with, but it ought to have been introduced in another place earlier in the Session so that it could come up to your Lordships' House in time to receive proper consideration. It might, on the other hand, be said that what was done in the other House is well known, and, therefore, that your Lordships had plenty of time. But may I call attention to the fact that the Bill was introduced in another place on June 5 and received a Third Beading on Friday last? In addition to that, it is only four days since it was read a first time in your Lordships' House. Moreover, it is not now the same Bill as received a Second Reading in another place. It was much smaller then. It consisted of nine clauses covering nine pages, whereas it comes before your Lord-

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ships with sixteen clauses covering fifteen pages. The Bill has been practically transformed during its passage through the House of Commons, and there is now not sufficient time for your Lordships to consider its effect and what it purports to do.
Not only is this a complicated Bill, hut it follows the vicious practice of referring to various other Acts of Parliament. It contains many cross references. What does the Bill do? It proposes to produce in fifteen years two and a half million houses. It is not proposed to build in the first four years any more than have been built during the past three years, 1921, 1922 and 1923. Then, the scheme is going to involve the enormous expenditure of over £1,000,000,000. I notice from the statement of Mr. Wheatley that there is going to be an annual expenditure of something like £34,000,000. Like most of your Lordships, I very much dislike "doles" and subsidies because I think they are most demoralising. In one of the reports of the employers they state that they do not like subsidies because they think that they are very demoralising. On the other hand, it may be necessary to have subsidies, but I am very doubtful as to how these subsidies are going to provide more workers, and you cannot get more houses built unless you do provide more workers. Subsidies may be of great advantage to those who build houses, but they do not provide the workers who build those houses.
I will ask your Lordships to consider the position in the building trade. In 1901 there were some 800,000 men employed in the building trade. In 1914 that number had fallen to 480,000, and by 1924 it had shrunk again to 360,000. We are told that the number is going to be increased by dilution. In the old days, in 1901, it was quite common for a man to lay 1,000 bricks per day. Now he only lays something like 300 a day. It has been suggested—I do not know whether it is true or not—that if a man lays more than 300 bricks a day he is reported to his trade union. There is a very mistaken idea in the trade unions that by the limitation of production you can relieve unemployment. As a matter of fact, exactly the contrary is the case, as has been shown in America. In America the workmen's idea is to increase production. They know that the result of that is that
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there is more employment and that their wages are increased enormously in comparison with the wages of the people of this country. An increase of production in one trade is also good for the general trade of the country. The greater your production the more business you do.
We are told that there are going to be more apprentices in the building trade. Your Lordships will remember that not so long ago there were thousands of ex-Service men out of employment and starving, who asked for an opportunity to learn the building trade, but the trade unions absolutely refused to take them in. The noble and learned Viscount said that was not the fault of the trade unions alone but of the employers also. I do not know whether or not that is so, but if it is the employers are equally to be condemned. I think those men who have done such good service to the country ought to have been given employment in the building trade. Mr. Wheatley asked the building trade the other day to increase the number of skilled men. What was the answer of the building trade? They said that they would do it under certain conditions. They were prepared to increase the apprentices from one in ten to one in three, but they laid down certain conditions and, so far as I am aware, those conditions are not a part of this Bill. One condition was that there was to be a definite and continuous scheme for fifteen years. It is true that there is in the Bill a scheme for fifteen years, but there is a definite proviso in the Bill that the Minister may, under certain conditions, scrap the scheme and put an end to it. There was another provision that there should be a statutory committee with great powers, but there is no statutory committee provided for in this Bill so far as I have been able to see. I may have missed it, because this is a very complicated and difficult Bill and cannot be understood in a short time.
The Minister, though often asked in the House of Commons if there was any definite bargain binding on both sides, has never replied to that question, so that it is clear there is no bargain. It would, indeed, be impossible to make any bargain for this very good reason: How on earth can he bind any succeeding Minister? We know that Governments do not always carry out their pledges. We know what happened in the case of the Corn Production Act. The very

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Government which passed it also repealed it. How can we tell that Parliament will not repeal this Bill if it becomes an Act? What is the reality of this Bill? In reality, it is a Bill to reduce rents at the expense of the Imperial and local taxpayer and also to set up a privileged class of householders who will have a subsidy to help them to pay their rent. This proposal of a subsidy will, like all the proposals of that kind, have a bad effect in increasing the cost of building houses. The Government themselves evidently admit that; in fact, the noble and learned Viscount on the Woolsack has told us that they are going to bring in a Bill to deal with profiteering in the price of materials.
But I would point out that it is not only a question of profiteering in materials. There will also be a possible increase in the cost of labour. As this big scheme of building 2,500,000 houses goes forward there will inevitably be a shrinkage in the available quantity of materials, with the usual result that the cost of those materials will go up in proportion as the difficulty of getting them increases. It is an invariable rule that the price goes up as the supply diminishes. The subsidies have already had an extraordinary effect on the cost of building houses. At the beginning of this year the price of a non-parlour house was estimated at £380. Now I am told the price of a house of that kind has risen to £420, and I shall not be surprised if it be found impossible to build any houses of that type in country districts under £500. We are told that the materials may be controlled. I notice that the Lord Chancellor did not say anything about the control of wages. There is a strike or lock-out going on at the present moment, and strikes may occur while this scheme is being carried out so that it may become impossible to get labour except by paying high wages. That, again, will increase the cost of the houses.
The noble and learned Viscount on the Woolsack referred to agricultural districts. It is the fact that the Government have given a larger subsidy to the agricultural districts, but I wish there had been a clearer definition in the Bill as to what exactly an agricultural district is, and what agricultural land is. Let us take, for the sake of argument, a house
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that would cost £450 in an agricultural district. Having regard to what has happened in the past, that is not a very large amount to take. I notice that one of the local authorities has put down the price of a parlour house under this Bill at £450. The Government subsidy for that will be £12 10 s. a year. After deducting the Government subsidy, the rent will be 3s. 7d. per week, or £9 6s. per year. That does not include the rates, and everyone knows who lives in the country that the rates have increased enormously. It is not unfair to say that at present in this case the rates would probably be 10 s. in the £. If you take the rateable value at £8 10 s. a year, the amount of the rates per year at 10 s. in the £ would be £4 5s. That makes a total of rent and rates of £13 11 s. From that you have to deduct the local authority's contribution of £4 10 s. a year. The local authority has to give at least £4 10 s. a year; so far as I know there is nothing to say that the local authority may not, if it choose, increase the amount of £4 10 s. a year. But taking the figures that I have given they show that the deficit will be £9 1s. per year, even after you have received a subsidy of £4 10 s. from the local authority.
It is all very well to talk about 3s. 7d. per week. It may be all right in great towns like Manchester, Bristol and Birmingham, but in agricultural districts 3s. 7d. plus the rates, which will add another 3s. 6d. is entirely out of the question. The agricultural labourer will not be able to pay it, and therefore I do not see how it is possible to erect houses under this scheme in agricultural districts except by putting an enormous burden on local rates, and any noble Lord who is acquainted with the conditions in the rural districts will agree with me that in the majority of cases the rates are too heavy at the present time.
I will only deal with one or two details of the Bill, and deal with them very briefly. There is one provision which I think your Lordships will insist on altering in connection with the Regulations to be made under the Bill. In one case they are permissive; I think they should be mandatory. Again, it is provided— perhaps it is because we have a Labour Government in office now—that the House of Commons may take objection to these Regulations, but the House of Lords is left out entirely. I have no doubt that

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your Lordships will insist upon these Regulations being laid before this House as well, and that your Lordships shall have exactly the same power and control over them as the House of Commons. There is a very curious provision at the end of the Bill to the effect that all houses, apparently, are to have bathrooms. That is quite right and proper, and it was done under the Addison scheme. But in this Bill all houses, however small, are to have bathrooms. That may mean the sacrifice of a bedroom and in my opinion that would be unsatisfactory. I do not see how you are going to provide a bathroom in one of these flats which has only from 550 to 850 cubic feet space.
This Bill is the successor of four previous Bills, all of which for one reason or another have been failures, and this Bill is the worst of all, for if it fails it will involve the country in enormous expenditure without any compensating advantages. It is interesting to note that for the first two or three years at least there is to be very little expenditure; the burden is to come on succeeding Parliaments and Governments. But for the first two or three years there will be no increase in house building at all, and it is clear, therefore, that the Bill, which is supposed to be a remedy for the shortage of houses, will not do anything to meet that shortage for at least two or three years.
VISCOUNT INCHCAPE:My Lords, I should like to associate myself with a great deal of what was said by my noble friend, Lord Weir, in his excellent and practical speech this afternoon to which we all listened with great interest. However much I desire to see housing in this country improved, and I certainly think it wants improvement very much, I view with alarm the expenditure to which the country will be committed if this Bill becomes an Act. It can be met only by continuing the present heavy taxation under which our people are groaning or by increasing the taxation, or by borrowing, or by robbing the Sinking Fund. The trade of the country, on which the stability of our finance depends, is extremely dull, wages continue to be forced up, while unemployment shows little sign of decreasing. The outlook generally is by no means rosy. If we get a settlement in Europe things may
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improve, but with constant demands for higher wages and shorter hours, and strikes to enforce them, it is highly problematical whether we shall be able to hold our own in our foreign trade against the keen competition with which we are faced. I will not go into the technical points in the Bill, but I venture with all due deference to sound a note of warning on the financial side.
THE EAEL OF MIDLETON:My Lords, the Lord Chancellor introduced this measure in a speech which I think he himself will not describe as enthusiastic or full-blooded. He dealt with, certain aspects of the measure, but he did not deal, and I do not think he professed to deal, with the subject-matter of the grave and important speeches we have heard from Lord Weir and Viscount Inchcape. When the Lord Chancellor spoke of this measure from the point of view of sanitation, education and other matters which are common ground to all of us, we might well have asked that he should reconcile these obvious needs, with which we all agree, with the methods adopted to relieve them. What has become of the speech to which we have just listened and the speech delivered with such great effect earlier in the debate? It really comes to this, that housing has been treated, for the special purpose of this Bill, as if it were the only great national need to which the whole of our great resources should be applied. We are to be pledged to an expenditure which has been variously estimated at from £1,500,000,000 to £2,000,000,000 in forty years.
Is housing the only demand we have to make on the country? What about unemployment, for which we may have to make tremendous efforts rather than allow a million of our population to remain permanently unemployed? What about our foreign trade, of which Lord Inchcape has just spoken? What about agriculture, for which we may have to make great sacrifices? I ask the Lord Chancellor to consider whether it is a wise policy to take one serious question, deal with it from one standpoint alone, when it can be dealt with from other standpoints as well, and then say, as the Lord Chancellor says, that in this matter we cannot, with certainty look far ahead. We are all familiar with the views attributed to one

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Party in the State, that their policy has been for years past—
"… I do not ask to see
The distant scene; one step enough for me."
If we take this one step we are going a long way towards creating that grave apprehension which has been voiced by one of the greatest business men of the country.
I do not propose to say one word on this subject from a political standpoint, but I do make bold to say that there is no assembly in this country which has a greater right to deal with the question of housing than your Lordships' House. There are no men who have more practical experience of the difficulties of housing, and, I may add, have spent more in order to receive less, so far as money goes, than have the collective body of your Lordships' House as compared with any similar number of men in the country. What is our quarrel with the Government? In the first place, it is that the Bill deals with the matter through only one method. I submit that the key to the whole situation was given us by Lord Weir. The difficulty is that we are 500,000 houses short—I am taking the highest figure; some authorities say that it is not more than 300,000. If you provide 500,000 houses in five years you will have solved the difficulty. The present numbers, which are being constructed without any subsidy from the rates, meet the annual deficiency in houses. But the 500,000 houses have to be provided, and this Bill, unfortunately, does not deal with that problem. It proposes to take fifteen years to do that which we all feel should be done in five years.
The noble Lord, Lord Weir, gave an instance of one class of houses by which this emergency might be met. But that is not the only class. I believe that what he calls the three-roomed house, which I believe is really a four-roomed house, is the best model that has yet been suggested in any quite permanent material, but I have had a great deal of correspondence with a number of persons who have other types of house to suggest. What I would really put to the noble and learned Viscount with all the force that I can command is an appeal that the Government will not shut their ears to the possibility of these other sources of construction. Take wood. The Government of Nova Scotia are ready to produce plans of sec-
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tions for frame houses to be delivered here, and, like Lord Weir's house, to be put up on the site. Can they get any assistance? They have applied to the Ministry of Health, and had no answer but an acknowledgment. They have asked for a specification, being aware that some of the larger municipalities, like Leicester, have already decided to change their by-laws in order to put up sections of these wooden houses. But no specifications have been received, and this very day I had a letter from the Agent-General asking me whether I could use any influence to obtain for him a specification, so that the Government of Nova Scotia could show what they believe they can do —namely, to produce houses on the site at 25 to 30 per cent, below the cost of the Government house.
I must say, in passing, that after our somewhat insulting treatment of the Dominions recently in the matter of trade, one would have wished, if it were possible, especially at great advantage to ourselves, to give them an opportunity of coming forward and helping in this emergency side by side with the great scheme of the noble Viscount. The same may be said of British Columbia. They have had no opportunity of the kind; and there are others whom I need not mention. What I would press is that we should, without delay, enter into an investigation which surely, on every ground, ought in our present difficulty to have been undertaken many months ago.
I cannot attempt to review the details of the Bill, but there is another point which I think it is really impossible to pass over in this House without a word. This Bill will not only result in stopping, but is intended to stop, all private work in the matter of providing houses. I was very glad that the noble Lord who has just sat down, Lord Strachie, said a word upon the agricultural standpoint. After all, agriculture is still our greatest trade, and there is not a single provision in this Bill which those who are most interested in agriculture believe can have the effect of providing agricultural houses at rents which it is possible for the agricultural labourer to pay. The case of agricultural houses is wholly different from that which is contemplated in the Bill. The Minister of Health thinks of his rows of workmen's dwellings, just as the noble Viscount spoke with great effect of the unfortunate

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rows of colliery dwellings and others, which require to be very much improved.
But all your Lordships know that, in dealing with agricultural cottages, an expenditure which puts on a single room, or a room to be used as a bathroom, is far more appreciated by the man who is willing to pay his 3s. or 3s. 6d. a week, if it is done in the place where he wants to live, than the prospect of having to walk a mile and to live in a row with a number of others. That kind of work has been brought to an end by the Bill. A noble Lord sitting on this Bench, who knows more about agriculture than I do, told me that in his county the price of bricks has gone up in the last four months, since the Bill was introduced, from 50 s. to £5 a ton. That stops the whole business. How can you ask those who know the improvements of rural cottages that are going on upon estates from week to week and from month to month to arrest them in favour of providing a man, in five or ten years' time, with a house which, when he gets it, he cannot possibly afford to rent? I wonder whether that side of the question has really been considered by the Government.
Then I come to the very serious indictment made by the noble Viscount, Lord Incheape. Your Lordships know that we have to find £200,000,000 worth of food every year, and to do so we must sell products. But taxation and rating, as was shown in the debate in your Lordships' House a fortnight ago, are now heavier by far than in any foreign country, and it is impossible for industries which are already staggering and working at a loss to carry any fresh burden. It is absolutely certain that this Bill must throw an additional burden upon the rates of the towns where it takes effect, and that the burden of taxes must be largely increased. The noble Viscount, Lord Grey of Fallodon, speaking an hour or two ago, reminded your Lordships that, quite apart from this Bill, there has been a great increase in the commitments of the Government, and not a single farthing has been preserved from existing taxation with which to meet them. May we not therefore ask whether it is wise or politic to provide expensive houses for men whom you cannot employ, for mouths that you cannot feed?
May we not reiterate to the Government Lord Weir's inquiry as to what
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hope they have that the future national production will be able to carry this enormous burden? Lord Weir has put before us an alternative, and we have to ask ourselves what course it is proper to take with regard to the Second Reading of this Bill. I know there are people who will say: "You know that the finance of this Bill is unsound; you have shown it will check private industry; you know the burden is one which cannot be borne and that the houses will not be supplied in time; surely, then, the logical outcome of those arguments is that you should vote against the Second Reading of the Bill?" I think there is another side to that. In the first place, there is grave ignorance among the working classes as to the effects of this Bill. Two days ago I was speaking to a man who would rank as one of the most intellectual men in the country, and when I told him that the cost of this Bill would run to something like £1,500,000,000 he interrupted me and said: "You surely mean £15,000,000?" I do not 'believe there is one man in a hundred in this country who has the smallest idea of what the burden will be.
If this House, by a large majority, were to throw out the Bill, as you might do, or even arrest the progress of the Bill, it might be felt that the very section of society which knows most about the needs of the working classes in this respect, have come down with a heavy hammer to smash a measure which the working classes have been assured by their leaders will bring salvation and relief. Nevertheless, I think we have a grave responsibility, and we are bound to call upon the Government to investigate these alternative methods—to consider, before the Bill is set in operation, whether they cannot combine the emergency action proposed by Lord Weir—to be carried out in whatever may be found to be a conjunction of the best elements for more rapid construction, without calling upon the building trade, now depleted in numbers as has been shown by Lord Strachie—with the carry-on of the measure of last year, so as not to arrest all the progress that can be made in bricks.
I feel so strongly upon this matter that with your Lordships' indulgence I propose, before we go into Committee on the Bill, to move a Resolution inviting the Government to institute such an Inquiry

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without delay, with a view to obviating what, if it is once set on foot, cannot fail to be an intolerable burden upon our finances, without producing the effect intended. If your Lordships will take that course, we shall have before us an alternative to the present Bill. If you adopt the alternative of the emergency house for the present immediate shortage, instead of crushing trade with additional burdens you will actually stimulate the trades which are suffering most at the moment. Instead of increasing unemployment you will reduce it, and instead of increasing the lamentable chasm between the building trade and other trades in the matter of wages you will diminish it. Wages in the building trade have gone up by 120 per cent, since the war, whereas in the- steel trades and other staple trades wages have gone up by only between 40 and 50 per cent., and it is that very chasm that you are going to increase in depth and width.
If we adopt the alternative, instead of doing that we shall bring these different trades into more correlation with each other, and instead of forcing up the prices of materials we shall give them a chance to come down. Instead of spreading the difficulty over fifteen years we shall meet it in five years, and instead of establishing a State monopoly we shall only have done what the State is meant to do in a moment of emergency—namely, co-operate with private enterprise to the extent that private enterprise falls short. Surely that is not an inconsiderable result to hope to achieve? In his final speech on this measure, the Minister of Health said that all our forces in the country should be directed to bringing down the cost of house building to a reasonable level. That is what we are inviting your Lordships to assist the Government to do, and I hope that as the speeches to-night have been made with no Party object, and with hardly a Party allusion, but only with the desire to meet a great national need as rapidly, efficiently and cheaply as possible, the Government will not refuse our suggestions.
THE LORD BISHOP OF SOUTH-WARK:My Lords, the noble Earl told us at the commencement of his speech that there were many of those who supported this Bill as if housing was the only great national need. Certainly I am one of
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those who regard the housing problem as one of the greatest and most difficult problems before the country at the present time. The more I know of the condition of the houses in our great towns, the more appalling and serious I feel it to be. There are literally not thousands but tens of thousands of men, women and children living in conditions where health, decency and happiness are practically impossible. Bad housing is the fertile ground of the agitator, and for one who is converted by the street corner speaker there are scores who are converted into bitterness against order and against the Constitution through the hard housing conditions in which they have to live. It is impossible to carry out satisfactorily any reform, whether it is education or licensing, unless we deal satisfactorily with this housing problem, and although I quite recognise the force of the arguments which have been advanced by those who have criticised the Bill on the financial side, I would venture to .say that this matter is so urgent that we ought to be prepared to take very real and considerable risks, in the endeavour to remove what has been too long a very real scandal to our civilisation.
The measure before the House does attempt to encourage building. I know it will be said, and it has been said, that the 1923 Act would have solved satisfactorily the problem, even if nothing else had been done. The 1923 Act has certainly not justified the gloomy predictions of those who opposed it, but I think it can hardly be said to have fulfilled all the optimistic expectations of those who supported it. No doubt the Act of 1923 has resulted in the building of a considerable number of houses, and at the present, time something like 140,800 houses have either been built, or are being built, or are promised in the future. As a matter of fact, of those only 17,000 in eleven months have actually been built, and, according to the Minister of Health, in Scotland only nineteen have been completed for letting, while in England, out of the 17,000 finished, 7,500 only are available for letting. What has happened has been that in the majority of cases these houses have been sold, at a considerable gain, by the speculative builder, and the average working class man has not had the money to buy these houses, and he does not find them available for occupation by renting. In addition, I would remind the House

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that there are something like 500 local authorities which have not yet drawn up any scheme under this Act. I think it must be recognised that, whatever the 1023 Act has done, and whatever it may do in the future, it will not solve this problem; certainly it will not solve it in the agricultural districts.
The subsidy which is provided under this measure will, I believe, do something towards the encouragement of building more houses, but, of course, a subsidy is not the root of the difficulty. That is not the centre of the measure. The measure stands or falls by the way in which it provides fresh labour. At the present time it is practically impossible to build the necessary houses unless more labour is provided. A noble Lord opposite has quoted some striking figures, showing how the number of those engaged in the building and allied trades has fallen in recent years. There are 25,000 fewer skilled men than there were in 1920. The numbers are still falling.
I quite understand the attitude that has been taken by the unions in saying that they would not allow any dilution unless they had some kind of guarantee against unemployment. I always hoped that building schemes would be guaranteed for a large number of years, and that, on this condition, the trade unions would allow dilution, and that thus there would be found employment for a large number of ex-Service men and others. Unfortunately, both the builders and the trade unions have refused to accept this suggestion, and so the Minister of Health has apparently adopted the best course possible under the circumstances, and has made some kind of arrangement or bargain with the building trade, by which, without actual dilution, at any rate without dilution in name, a large number of additional apprentices are admitted. Instead of one apprentice to ten men, there will be in future one apprentice to three. If that agreement is carried out, within a very short time there will be a large increase in the number of those who are engaged in the building trades. I must add, however, that I hope that the Government will be able to give us some assurance that the building trades have accepted the Bill as it has been amended in another place. With this additional
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labour, it ought to be possible to build a large number of new houses.
There are two points of detail in the Bill to which I will shortly refer. I wish that this Bill had dealt more directly with slum clearance. It is true that you cannot clear slums until you have houses into which you can place those who have been turned out of their old dwellings. I wish we could have had a clearance scheme running with this scheme for the building of new houses. I hope that we may have some very definite assurance from the Government that at an early date they will introduce some measure for dealing with the existing slums, in which life is practically intolerable. I am glad to see that in this measure steps have been taken to do something, at any rate, to provide against the building of fresh slums. There is a clause in the Bill which says that, unless the Minister allows an exception to be made, not more than twelve houses to an acre are to be built. When the Act of 1923 was passing through this House I moved an Amendment to that effect, but, unfortunately, the Government could not see their way to accept it; they recognised that that was an ideal, but the practical difficulties, they felt, were too great. What is happening at the present time is that many of the housing schemes which have been carried out in the last ten years in the suburbs of London are turning these places into slum districts, because the houses have been built too closely together. I believe that the clause in this Bill will do much to stop the creation of slums in the future.
My other criticism is this. I wish that the Government had been able to do more to encourage public utility schemes. Under this measure a very, large number of the houses built will be built by the wealthier local bodies, and we shall not have sufficient houses built in the rural districts, or at a distance from the great towns. Something has been done towards encouraging public utility schemes, but the amount granted to them will not be sufficient to enable them to act very effectively. I wish it had been possible to give them greater encouragement. I recognise that the financial difficulties in the way of the Bill are very serious. The carrying out of this Bill means that the country will have to spend a large amount of wealth, but in the spending of that wealth I believe it will secure the

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greater wealth of the country, which consists in the happiness and prosperity of its citizens.
LORD TREOWEN:My Lords, the noble Earl, Lord Midleton, in his speech, to which we all listened with great interest, reminded your Lordships that there are in this House many who have special reasons for being interested in the housing problem, and who have experience in connection with it which would have been worthy of being considered by the Government in its dealings with this Bill. I should not venture to address you this evening were it not that I happen to be one of those who have had much to do with housing. I have lived all my life in a country, many of the most beautiful spots of which have been disfigured by the terrible housing conditions created by past generations. I have seen the development and the gradual improvement of the housing in those Welsh valleys, and for the thirty years that I have had any responsibility for it, I have worked with all my soul to try to get these conditions improved. And they were being improved. One of the most terrible and distressing things to me is that by the action of the Government of this year the whole progress of that improvement has been stopped. For one whole year there has been no work done. That means that thousands of families, who might this winter perhaps have been living in decent conditions, will be still in the condition that they were in a year ago.
The Lord Chancellorvery properly said that this was a far-reaching measure. It is far-reaching, though I think that "ambitious" would be a more appropriate expression to use, because one can hardly say whether or not it reaches in the right direction. I would like to utter my protest against the way in which this Bill has been thrown upon your Lordships. In the last days of this Session a problem is brought before us which has puzzled all the wits of those in another place, and has been treated ab initio in an entirely new-fangled fashion, in a way unknown to our Constitution, by the present Minister of Health. On two occasions I tried to get some information from the representatives of the Government here as to the policy of the Government and the lines on which they were going to proceed in this matter; but I failed. It was obvious that the Minister
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himself did not know how he was going to treat it.
As a result we have seen what I would call the promotion of a Public Bill—a thing unknown to our Constitution. Unofficial Committees were formed and consulted; the representatives of trades were called in and bargained with, and out of that process a Bill emerged which has been changed almost from the first line to the last in the course of its passage through another place. I venture to say that no member of the other House could give a clear account of the measure as it stands now. Yet we are asked to give it full and clear thought while other Bills are pouring in upon us, and during the very last days of the Session. I confess that I was inclined at first to move that if the Bill was read a second time its further consideration should be postponed until the autumn sittings. It seems to me that that would have been a reasonable course to adopt. On consideration, however, I should hesitate to do that from the very fact that, since one of the chief accusations I make against the Government is that they have wasted precious time, I would not like to see another precious moment wasted in dealing with the matter. That is no reason why your Lordships should accept the Bill as it stands. More light has been thrown upon the question this evening by the speeches of two members of your Lordships' House than I have been able to perceive in any of the debates I followed in another place. A new suggestion was made as to how the difficulties could be met.
The Lord Chancellorspoke of the "treaty" which had been made with the building trade. What is that treaty? It is nothing more than the offer of a monopoly to a trade. Is that the way to deal with such a problem as this in a business-like manner? After all, the provision of these 2,500,000 houses is to be spread over a. considerable period. Is that monopoly to stand for ever and are we, therefore, to be debarred from opening up other methods of meeting the demand? The thing is monstrous. Again, the Lord Chancellor spoke of a treaty with the local authorities. What is that treaty? It is another bargain—a bargain for an increased subsidy. I know something of local authorities, and I say that a local authority would not be human if it did not immediately open

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its mouth and demand a higher subsidy, and you would not get local authorities to agree unless the Government gave it. What is gained by increasing the subsidy under the Act of 1923 from £6 to £9? Increasing the subsidy will not give you houses. The only thing that will give you houses is an assurance that you have the labour and the materials. The giving of £6, or £9, or £12 will not alter that. Will your treaty with the building trade ensure the provision of the labour? Look at the conditions in the building trade to-day!
During the passage of this Bill I hope that your Lordships will do your utmost to limit the liability under which this country will be placed by reason of the excessive expenditure which will be cast upon it. It is a liability which will last for a whole generation, or two generations. In the weighty words uttered by my noble friend Lord Grey earlier in the evening, we have to think of the present liabilities of the country and the means of meeting our future difficulties. The two things cannot be separated, and I would point out that this Bill will lay an enormous burden upon future generations, and we have not the smallest idea, as to how it will work out.
I should like to say a word on one point which was mentioned by the right rev. Prelate and referred to by the Lord Chancellor. The Lord Chancellor spoke of houses which never reached the working classes. I am speaking of housing conditions in a country where I can honestly say that every house that is built in the crowded areas is immediately occupied by members of the working classes. It is argued on the part of those who believe in these new-fangled theories of social order that a man must not be encouraged to have a house of his own; he must hold it on some form of tenure from a local authority. I could tell your Lordships many touching stories of the anxiety that men have shown to own their own houses and the sacrifices they make for the purpose. If I may be permitted to sound a personal note, the one thing in connection with this matter that I shall never regret is that from the earliest days of my association with it I have tried my best to make it as easy as possible for men to acquire their own houses, and I must say that I have been amply rewarded by the happiness which I have seen as the re-
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sult of that, and also by the efficiency of the labour which has come about in these particular cases where the men have had the character and the thrift to do this for themselves. Those men do much more for their employers, and also for industry generally.
On the details of this Bill I am not in a position to speak as I should like to do. The Bill only reached my hands this morning. Like many of your Lordships, owing to other responsibilities, I had to be away for the week-end, and consequently the Bill only came into my possession to-day. It is, therefore, impossible for me to go into the details of a Bill which has been so materially changed in the course of its passage through the other House. It is a misfortune that your Lordships' House, to which so many noble Lords come with practical experience and with a fresh mind—which is so important in dealing with a question that has been so much discussed—should not have had the opportunity for a more full and careful consideration of this Bill. When we get into Committee I should urge that we should direct our minds to limiting the liability which is going to be imposed upon the State.
THE EARL OF ONSLOW:My Lords, in the lucid speech with which the noble and learned Viscount on the Woolsack introduced this Bill he claimed, while explaining Clause 1, credit for prolonging the Act of 1923 until the year 1939, and it seemed to me as though he were conveying that the Government which introduced that Act contemplated that, the year 1925, or in some cases 1926, marked the period of the necessity for any special legislation to deal with this problem. Before I venture any further observations I would like to remind your Lordships of what I said, what my right hon. friend Mr. Chamberlain said in another place, and what the noble Marquess behind me (the Marquess of Salisbury) said here. We did not say anything of that kind.
I said to your Lordships that the Bill was only a step in the ladder, and one which we trusted would take us some way towards the time when the housing situation would revert to the normal. I said: —
"We are not legislating for a long period, because we do not know—we cannot

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possibly tell—what the conditions will be in the year 1925."
I merely mention this fact in order to recall it to your Lordships' recollection in case there may be any misunderstanding of the attitude in which we approached the problem in introducing the Bill of last year.
A few days ago my noble friend opposite, Lord De La Warr, in answering a Question that I put to him, informed me that under the Housing Act of last year there were, as the right rev. Prelate, I think, also mentioned, 148,000 houses authorised. Besides that there were 100,000 houses under contract, and, in addition, there were 44,000 houses actually under construction. Of these, I think the noble and learned Viscount told us, the majority are for sale; still there was a considerable proportion, something under 50 per cent. I think, which were to let. In the public Press, and in replies published to Questions which have been put by members of the Opposition in another place, I think it is quite clear that the stimulus which the Act of last year has given to building has absorbed all the available energy of the building trade as it is constituted at the present moment. By that I mean that at present the trade is working up to its full limit, so that neither this Bill, nor any other Bill, can give us a single additional house unless it be done either by accelerating labour, or by providing additional labour and materials.
The noble and learned Viscount said something with which we all agree when he touched upon the evils of bad housing. Every speaker who has followed him has done the same. We all admit the necessity of more houses. The noble and learned Viscount pointed out that bad housing conditions increased tuberculosis and zymotic diseases, and occasioned consequent expense in dealing with those evils. We do not disagree with what the noble and learned Viscount said on that point. But how do the Government propose to get additional houses under this Bill? The Bill does not propose to accelerate the existing rate of work by labour. The noble and learned Viscount tells us that it will produce additional labour, and that is the way in which the houses will get built. The way in which it is proposed to get this additional
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labour is, he tells us, by giving a guarantee of employment for fifteen years. He laid particular stress upon this question of guarantee. I do not think I am wrong in saying that he emphasised the fact that this treaty, or so-called guarantee, is really the basis of the whole scheme and of the Bill. Without it, both the scheme and the Bill fall to the ground. What is this treaty? Honourable members in another place have asked if there is any written guarantee, or written agreement, with the building trade. I would venture to ask the noble and learned Viscount the same question, and whether he can give us any more specific details about this guarantee and treaty? I should like him to tell us exactly how the treaty has come about, and what the agreement is, because it is the most important thing in the whole matter, for, as I have said, if it falls to the ground the whole scheme falls to the ground.
Then the noble and learned Viscount told us that all the local authorities were in favour of this Bill. I confess that I was astonished to hear him say that, and I was not surprised to hear my noble friend Lord Strachie say that his information on that point was not the same as that of the noble and learned Viscount, and that he had been given to understand that all the local authorities were not in favour of the Bill. I would point out that there is no obligation whatever on any local authority to work the Bill; indeed, the local authorities have expressly, in the correspondence which took place before the Bill was introduced—and it is embodied in the Bill—reserved to themselves full discretion to fix the number of houses they propose to build, and to suspend building at their discretion. I think the only course open, if a local authority fails to carry out the Act, is provided under Clause 9, which contains a somewhat nebulous power. Perhaps the noble and learned Viscount will give us a few more details in regard to that when he replies. There is really no guarantee that the local authorities will work the Bill. They have reserved to themselves the right not to work it if they do not choose to do so.
But let us assume, for the sake of argument, that the local authorities do work the Bill. What guarantee is there that the full fifteen years will be main-

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tained? There is no guarantee of any kind that the policy which is laid down in the Bill will be maintained for the whole fifteen years. The utmost that you can say that there is any guarantee for in the Bill is continuity for three years. Under Clauses 4 and 5 the Government take power to terminate the whole scheme, to revise the contributions, and generally to alter and change the whole scheme. The Lord Chancellor, in dealing with this clause, showed his great ingenuity and described the powers given to the Government as a stick with which to beat local authorities and make them carry out the obligations they may have undertaken, but the clause goes much further than that. The Government have done wisely to insert the provision, but it would have been better if they had curtailed the revision to two years, or perhaps one year. Be that as it may, the so-called guarantee for fifteen years is, under the Bill, merely a guarantee for three years.
Those are two difficulties which occur to me. Let me assume that they are overcome, that I have over-estimated them, we are still confronted by this difficulty; How are you going to obtain the labour to build these houses? If you turn to the First Schedule you will see that during 1925 and 1926 190,000 houses are to be produced, and according to the Report of the Building Trade Committee that is 110,000 more houses than are being produced at the present moment, or 50,000 houses more each year than are at present produced. These 50,000 houses will, according to this Report, require 34,000 additional craftsmen which the Government will have to find before they can deal in any way with their scheme. How are you going to get these 34,000 additional craftsmen? I listened with great interest to the Minister of Health when dealing with this matter in Committee in another place and from what he said, and from reading the report of the debate, I gather that the Government in the main rely on the production of additional apprentices.
Every one will agree, certainly the Minister of Health will agree, that these apprentices will be of very little value at the outset. In fact, Mr. Wheatley said that the apprentice bricklayer was of very little use for the first twelve months. But in order to accelerate the process the Government have announced a scheme
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for instruction to be given in bricklaying in technical schools. I have had but a short experience of the Board of Education—the Lord Chancellor has had a lifelong experience—but I know that local authorities have had the greatest objection, and naturally, to using their machinery for teaching purely craft trades. What guarantee has the Government that local education authorities will work this educational scheme and lend their machinery to the Government in order to instruct apprentices in craft trades? And if not how will they get over the difficulty that the apprentices will not be able to learn sufficient of their duties until a considerable time has elapsed?
The next source upon which the Government rely in order to get additional labour is by turning a bricklayer's labourer into a fully-fledged craftsman. They have not been very explicit on this point, and it is difficult to see what they really propose. Perhaps, since the debates took place in the House of Commons, they have more information on the point. I desire to ask the Lord Chancellor whether he can give us any more data in regard to this matter and any estimate of the number of men he considers likely to be supplied from this source. We were told also, in another place, that a large number of men would return from America and elsewhere. The Lord Chancellor has said this evening that some 62,000 skilled craftsmen have gone to America and Canada, attracted, no doubt, by better wages and better conditions. I should like to know whether the Lord Chancellor has any information as to the prospect of the return of these thousands from America and elsewhere. Then the last source from which it is possible to draw in order to get more men employed in building houses is the possibility of a slump in commercial building, but that is not considered to be a source from which to expect anything at the present time.
It is estimated that 34,000 additional men will be required to build these 50,000 houses, but it is possible that less may be required if a reorganisation of the building trade is undertaken. I should like to know whether the Lord Chancellor has any further information as to the reorganisation of the trade which will admit of fewer men being

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employed in order to obtain greater results. It is very difficult to suppose that the number of men required, even if all these sources of supply materialise, will be tempted into the industry except under some powerful inducement such as a considerable rise in wages. If that rise in wages occurs, how is it possible to finance this Bill? Unless you can build houses for £475, with the subsidy, you are bound to get an increase in rent. The Lord Chancellor has told us that as regards materials agreements have been made with the trade to provide them at reasonable prices, and the Government are introducing a Bill to prevent profiteering in materials. I have not seen the Bill, and I can express no opinion on its merits or whether it is going to stabilise the cost of materials at the present prices or not.
But let us assume that it stabilises the cost of materials; is that going to stabilise the wages of bricklayers, plumbers, joiners and all the other branches of labour employed in the building of a house? If the wages in the building trade are increased, the cost of the houses must be increased, and it will be quite impossible to let the houses at the pre-war rent plus forty per cent. The possibility that rents might be higher is in the mind of the Government, because in some correspondence which took place before the Bill was actually presented for a First Heading, it was stated that the aim of the present scheme is to secure rents in each locality equivalent to the rents now prevailing there for working-class houses built before the war, and that until these rents can be reached local authorities will charge such rents as will be remunerative after allowance has been made for the total subsidy of £13 10 s. for forty years It shows that the Government are not so sanguine that the pre-war rent,plus forty per cent., will be realised.
I should like to ask one other question. The Lord Chancellor told us in regard to agricultural houses, for which an additional subsidy is given, amounting in all to £17, that these houses would be let at 3s. 6d. per week. I should like to ask the noble and learned Viscount if he could tell us exactly upon what figures that rent is based.
It has been said by several speakers that this Bill has two quite different objects, but that those objects are correlated. One is to attempt to
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bring men into the industry, to increase the number of houses produced, in order to construct 2,500,000 houses in fifteen years; and the second is to obtain houses to let instead of houses to sell. I would point out one consideration which I think it is necessary to emphasise, in view of what has been said by the noble Lord behind me with regard to the finance of the Bill. The Act of 1923 allowed a subsidy of £75 a house. This Bill proposes a subsidy of £240 a house, that is to say, the subsidy is increased by £165. I do not believe that this increase in the subsidy gives any security whatever that this scheme will produce houses which it will be possible to let at the rents contemplated, nor do I think that there is any guarantee whatever that the scheme will produce the increased labour and increased supply of materials necessary to secure the construction of the number of houses aimed at. What is certain about the Bill—the only thing that is certain—is that every house supplied will cost the country £240 instead of £75, and the total burden on the rates and taxes, if the whole programme is carried out, will be close upon £1,300,000,000. Indeed, I believe it will be even more than that. I made that calculation upon the Memorandum circulated in regard to the Financial Resolution in another place. Since then very considerable modifications have been made in the Bill in another place, and I think that many of them, especially the agricultural Amendment, will entail increased cost to the Exchequer and to the rates. Consequently I venture to think that the total cost, if the whole scheme of the Bill is carried out, will be above rather than below the £1,300,000,000 that I have mentioned.
During the course of this debate we have had the good fortune to listen to something that is a little unusual in debates in Parliament—namely, a concrete suggestion which aims at the erection of a number of new houses rapidly and expeditiously. The speech of the noble Lord, Lord Weir, to which I think all of your Lordships listened, as I did, with the greatest possible interest, has, as the French say, given us furiously to think, and I hope that not only the noble and learned Viscount on the Woolsack and the Minister of Health but all of your Lordships who are

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interested in this question will consider very carefully every word that fell from the lips of my noble friend Lord Weir. On the Third Reading of the Bill in another place, the Minister of Health announced that an exhibition of building materials would shortly be held. I hope that one of the most prominent exhibits will be a model of a fully constructed house illustrating my noble friend's suggestion for constructing houses in addition to the efforts of the building trade, and without interfering with that trade. I hope that everybody interested in this matter will give that proposal the most serious consideration possible.
THE LORD CHANCELLOR:My Lords, I do not propose to reply in more than a few words, because if I were to do so I should have to take up a great deal of your Lordships' time in dealing with specific questions. It was satisfactory, 1 think, to all of us, independently of our political views, to hear a speech, for the first time in this House, from the noble Lord. Lord Weir. He comes to our debates, not only with a great reputation, but with an amount of technical knowledge which is rare, and it is a real addition to our ranks that we should have him among us. Lord Weir made certain criticisms and certain counter-suggestions. I do not think that he at all disputed the urgency of the housing question—he knows Glasgow too well to do that—but he said that we might haw proceeded in a more modest fashion. I think his suggestion was that we should have begun with 500,000 houses instead of 2,500,000, and that we should have proceeded with our erection of houses on lines of standardisation. But 500,000 houses are wholly inadequate to the problem which we have to undertake. The problem is very vast, and, so far as the standardised methods are concerned, I would point out that under the combined operation of Clauses 4 and 10 of the Bill all the new methods can be adopted, and ought to be adopted, wherever they are feasible. If the noble Lord will apply his immense skill and authority to the production of methods by which houses can be produced more quickly and more cheaply by standardisation, by substituting the work of the factory for the work of the open space, we shall all be delighted, and under Clause 10, this will
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fit in not only with this scheme but with the duty of the local authority to adopt it.
The noble Lord made other suggestions which were, perhaps, more dubious. He said that the bricklayers ought to work longer hours. Perhaps they ought, but how are you going to make them? The noble Lord knows the difficulties of dealing with workmen as well as any of us, and if you propose to lengthen hours at the present time the probability is that you will have to say good-bye to the provision of houses, either for the working classes or for anybody else, for a long time.
LORD WEIR:I think it would be hardly right that it should go out from this House that I said that bricklayers ought to work longer hours. What I said was that, under the conditions of to-day, it would have been a fine gesture for the building trade to have agreed to work longer hours, pre-war hours, for the five critical years of the housing scheme.
THE LORD CHANCELLOR:I beg the noble Lord's pardon; apparently I misheard him. Now I understand that he did not express any injunction to the bricklayers, but all he did was to invite them to make a fine gesture. I am afraid that is not a prospect upon which we can rely in solving the pressing problem of housing. The right rev. Prelate, who spoke with such great eloquence upon the condition of things as he knew it, spoke from observation. The question of housing is a pressing one for the country, and to undertake to erect 2,500,000 houses is not to undertake anything which goes in excess of the problem with which we have to deal. I trust that there will be many improvements in the methods of building houses, and I trust that the advice and experience of the noble Lord in devising any such methods will be available. But we cannot rest on possibilities. We have to do the best we can with the materials which we have in the face of a problem of crushing importance.
Other speeches raised other points, but they are points of too great detail to make it desirable that I should attempt to go into them at this hour of the evening. They are points of varying importance, but they are points all of which, I think, were based upon an insufficient realisation of the urgent and pressing character of

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this question of housing, and the immense social demand which lies behind it. It is all very well for the noble Earl, Lord Midleton, to say: "Why housing? Why not something else?" Housing is upon our backs and housing is confronting us, and, if we do not deal with the housing question, I do not say that you will have a revolution, but you will have a very sharp reminder of the power of the people of this country. Of course the question which we have had to discuss to-night is difficult. Of course we are taking a step into the future, a step which it is essential to take, and we cannot be perfectly certain as to what ground may be covered. So far as I can see, however, after having given the closest study I can to the Bill, I think it offers a reasonable chance of success.
THE MARQUESS or SALISBURY:Is the noble and learned Viscount not going to tell us anything more about the treaty?
THE LORD CHANCELLOR:I wonder whether the noble Marquess has seen the Report of the joint committee of builders and builders' operatives. If he has, he will find there the details of what was recommended to them, and what was agreed to with the Minister. If the noble Marquess implies that we ought to have indentures written out—
THE MARQUESS OF SALISBURY:What I wished to imply was that there was no treaty.
THE LORD CHANCELLOR:There was a treaty. Indeed, I am using an expression used by the Minister responsible in another place. It is contained in this Report, and prior to it he got undertakings from them with which he was satisfied, and with which he asked the House and the public to be satisfied. The substance of it is set out in this Report, which will be available to the noble Marquess if he desires to see it.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

LAW OF PROPERTY ACT (POSTPONEMENT) BILL, [H.L.]
Read 3a (according to Order), and passed, and sent to the Commons.
UNEMPLOYMENT INSURANCE (No. 2) BILL.
Amendments reported (according to Order).

BUSINESS OF THE HOUSE.
EARL BEAUCHAMP:My Lords, may I be allowed to ask a question? When discussing the Unemployment Insurance (No. 2) Bill on the Second Reading on July 24, the noble and learned Lord, Lord Parmoor, said it was important that the Bill should receive the Royal Assent not later than next Wednesday, which is to-morrow. I am afraid it is hardly possible that that can happen now, but it would be for the general convenience if we heard what the noble and learned Lord had in his mind with regard to procedure
LORD PARMOOR:It is this. I am. afraid that we cannot pass the Bill to-night, because of the Standing Orders. It will be put down to-morrow, and I had intended to ask noble Lords opposite if we might take it as the first Order to-morrow. That would enable it to go early to the other House in order that it may be dealt with.
THE MARQUESS CURZON OF KEDLESTON:I think that that proposal is quite reasonable, and that your Lordships will be disposed to agree with it. Might I, as I am upon my feet, ask the noble Lord what arrangement he contemplates for business in the next few days? As I understand, an arrangement has been made with the Lord Chancellor, by which the first place on Thursday is given to the Indian debate, and I take it that a Notice will be placed on the Paper providing for that. Will the Lord Chancellor tell me what are his intentions as to other business?
THE LORD CHANCELLOR:I think that on Monday it would be well to take Committee on the Housing Bill. As regards Friday, I think my noble friend Lord Parmoor has a measure for that day.
LORD PARMOOR:I propose to take the Second Reading of the Agricultural Wages Bill on Friday.
THE LORD CHANCELLOR:On Friday also there is a Royal Commission at a quarter to four. I think we might sit on that day at twelve, and that would enable us to finish the sitting towards four o'clock.
EARL BUXTON:With regard to the Unemployed Insurance Bill, it will go to-morrow to the House of Commons, and they will have to consider certain Amendments made by your Lordships. Is it likely to come back to us on Thursday?
LORD PABMOOR:I am unwilling to make any statement with regard to that until I know how the Amendments are dealt with in another place. I can only says that it is desired to deal with the measure as quickly as possible, subject, of course, to proper consideration.

WEIGHTS AND MEASURES (MEASURING INSTRUMENTS) BILL, [H.L.]
Read 3a (according to Order), and passed, and sent to the Commons.
PUBLIC WORKS LOANS BILL.
House in Committee (according to Order): Bill reported without Amendment.

WORKMEN'S COMPENSATION (SILIOOSIS) BILL, [H.L.]
Read 3a (according to Order), and passed, and sent to the Commons.
House adjourned at twenty minutes past seven o'clock.