HL Deb 14 December 1926 vol 65 cc1611-31

The LORD CHANCELLOR acquainted the House that the Bill had been endorsed with a certificate from the Speaker that it is a Money Bill within the meaning of the Parliament Act, 1911.

Order of the Day for the Second Reading read.


My Lords, your Lordships are probably aware that this Bill has been certified as a Money Bill and, like my noble friend Lord Burnham, it is no part of my intention to stand between your Lordships and the interesting Motion which my noble friend Lord Weir has on the Paper. I will be as brief, therefore, as I possibly can in explaining this Bill. The principle involved in the Bill is that of an Imperial guarantee for a series of loans which are to be raised by six or seven different Governments. In the Bill the guarantee is in regard to £4,500,000 for Palestine and £10,000,000 for the contiguous countries in East Africa. As your Lordships are probably aware it is only Kenya that is entitled to raise a loan under the Colonial Stock Act inasmuch as it is the only one of the territories mentioned which is a Colony. The territories of Palestine and Tanganyika are mandated territories, while the territories of Uganda, Nyasaland, Northern Rhodesia and Zanzibar are Protectorates.

Turning to the First Schedule of the Bill, that schedule deals with the loan of £4,500,000 in so far as Palestine is concerned. The purpose of this loan is three-fold. It is, first of all, for the repayment of £1,000,000 sterling to His Majesty's Government for railways constructed in that territory, which were constructed and paid for by the British taxpayer. Secondly, it is for a sum of between a million and a million and a half to repay the Crown Agents for money advanced by them from the surplus balances of other Colonies for capital expenditure incurred in connection with roads, railways, telegraphs and public buildings; and, thirdly, it is to provide new money for harbour construction. The principal commercial harbour will be situated at Haifa and improvements are to be carried out at Jaffa itself. I understand that the noble Lord, Lord Arnold, is going to ask a question as regards harbour construction at Haifa and Jaffa and it might shorten the debate a little if I gave him some information at this stage. With regard to the harbour at Haifa the scheme has not yet been approved and is still under consideration. The only works that are proceeding at the present moment are certain improvements which are being carried out at Jaffa in order to relieve the congestion which prevails there at the present time.

Turning to Schedule 2 of the Bill, which deals with East Africa and its contiguous territories, this schedule has a history. As your Lordships will probably remember, a Commission was set up under the Labour Government and was sent out under the Chairmanship of my hon. friend the Under-Secretary of State for the Colonies, Mr. Ormsby-Gore, assisted by a Liberal and a Labour colleague, to examine the possibilities in East Africa. That Commission reported that the development of the six continuous countries depended on a continuous programme of providing better transport facilities, and it recommended that in future it would be advisable to work to a programme over a series of years and not, as hitherto, to carry out the work by fits and starts as and when the money was available. After careful consideration of these proposals His Majesty's Government felt that before they were accepted it was essential that they should be in possession of the views not only of the local Governments themselves but also of financial and railway experts.

Accordingly, the local Governments having proposed that a sum of £16,000,000 should be spent in so far as these works were concerned, their suggestions were submitted to the Schuster Committee, which has published two interim Reports, the principal one in July of this year. This Committee, in considering these proposals, felt that further service and economic reports should be forthcoming and, in order that the necessary material may be acquired for investigation, men have been sent out and are at present carrying out that work. When Sir George Schuster, who is at the present moment in the Soudan, where he is principal financial adviser, and General Hammond, the railway expert, who is at the present moment in Iraq, return, the Committee will once more meet and will recommend Which projects shall be proceeded with and when.

That, I think, explains the Bill, but before I formally move the Second Reading may I make quite briefly one or two remarks. I do not suppose, so far as we on this side of the House are concerned that there is any difference of opinion on the question of utilising our credit for developing the resources of the British Empire and I do not know that on the financial side it would not be true to say noble Lords opposite are with us in this respect, inasmuch as Mr. Thomas, when he was Colonial Secretary, appointed the Commission to which I have referred, that went out to East Africa under the Chairmanship of Mr. Ormsby-Gore. I do not suppose those will be any dispute upon this point, that it is our duty to help mandated territories just as we do our Colonial Dependencies. We cannot place them, surely, in a worse position because they do not happen to be in the strictest sense of the word part of the British Empire.

In regard to the question of money I would desire to remind your Lordships of the statement that was made in another place—I think it was during the debate on the Financial Resolution—by my right hon. friend Mr. McNeill, Financial Secretary to the Treasury, who gave the House of Commons an assurance that the money would only he used as and when needed. My right hon. friend the Secretary of State for the Colonies, speaking in another place, assured the House that in his opinion we were not backing in any sense of the word a losing venture, or one which would involve the British taxpayers in loss, since the loans which were guaranteed by the British Government were amply covered by the Revenues of the countries to which the money would be lent. I need hardly remind your Lordships that no guarantee will be given until a most careful and thorough scrutiny has been made of these proposals and after the Government itself has received the expert advice, not only of financial and economic but of railway experts, on the wisdom of these schemes.

There is one further point that I should like to make. We are doing something further than is suggested in this Bill. We are creating a substantial volume of orders for this country. About one half of the money which is required by these territories will be expended upon railway construction and quite a large proportion of the material will be supplied by manufacturers here. I do not know that I need make any further observations at this stage, but will content myself with moving that Bill be now read a second time.

Moved, That the Bill be now read 2ª.—(Earl of Clarendon.)


My Lords, the noble Earl has outlined the main provisions of this measure with his customary clearness and conciseness and, if I may, I should like to take, this opportunity on my own behalf—and I think many noble Lords will agree with this—of expressing regret that I am afraid this is perhaps the last time we may hear him as spokesman in your Lordships' House for the Dominions and Colonial Office. This measure does raise very large questions of financial and of Imperial policy. It is true, as the noble Earl has said, that this is a Money Bill, but that is no reason why it should not be discussed. As a matter of fact it may interest your Lordships if I point out that this is not a Bill which comes under the operation of the Parliament Act, because it has not been sent up to your Lordships' House earlier than one month before the end of the Session and, indeed, strictly speaking—I am not suggesting this should be done—it would be competent for your Lordships, if you are so disposed, to insert an Amendment in this Bill. It would be a privilege Amendment, but, if it was agreed to in another place, it would then become law.

I mention that because the noble Earl will perhaps recall that in another place the Secretary of State for the Colonies, who was desirous of inserting an Amendment, stated that it could not be done in your Lordships' House and, therefore, he went through a somewhat unusual procedure in order to obtain the Report stage in another place. As a matter of fact, strictly speaking, it could have been done in your Lordships' House if, when it was sent down to another place, it was agreed to there. I am not saying that that ought to be done, I am not at all commenting upon the position of affairs in regard to these matters, but am merely stating what the position is.

We have in the Labour Party given general support to this Bill—not unqualified support. I shall have certain criticisms to offer. The first thing I would say in a general way about it is that it is only another instance, if one were needed, of the inconsistency of His Majesty's Government. The position is this. His Majesty's Government intimated some months ago that they would not continue the Trade Facilities Acts and that the system of giving guarantees must come to an end. They used language, I think your Lordships will find, about the deleterious effect which these repeated guarantees had upon the national credit. But it is not because of that that this Government, as I will point out, has considerably depreciated the national credit. They said the Trade Facilities Act must come to an end, yet, within a very few months of that, we find the same Government coming to your Lordships' House and asking for a guarantee of £14,500,000—not a small sum—and also setting up an Advisory Committee which, as I understand, will function almost precisely as the Advisory Committees have functioned under the Trade Facilities Act. Therefore it is an inconsistent thing to do so far as that is concerned, but inconsistency is one of the minor vices of this Government. So far as we in the Labour Party are concerned we are not inconsistent, because we wish the Trade Facilities Act to be continued and, broadly speaking, we are in favour of this guarantee.

I will deal first with Palestine, but upon that I have not very much to say by way of criticism. From the start the Zionist movement has received the warm approval and support of the Labour Party and we are rejoiced at the great progress which the new Palestine has made and at the way in which its financial position has improved. I think that general satisfaction will be felt on this account. In particular, if I may say so, it must be very gratifying to the noble Earl, Lord Balfour, whose great part in the inception and development of the new Palestine is, of course, a matter of history. As to the loan of £4,500,000 I certainly agree that the security seems to be sufficient. The financial position of Palestine has improved rapidly in the last two or three years. About three years ago the Budget scarcely balanced, but last year the total Revenue, I believe, was about £2,750,000 and there is a surplus of no less than £700,000. Therefore, the security seems to be sufficient even if it were a guarantee of £4,500,000. But, although that is true in one sense, in another sense it is not true, because £3,000,000 to £3,500,000 of this is coming back to this country at once. That is a very satisfactory state of things and it occurs to me that it would be a rather happy circumstance if we could adopt the same procedure with regard to certain other countries which owe us money. It is noteworthy that Palestine is possibly the first country, the first post-War country, to repay, or which will repay according to this Bill, all that has been advanced.

About £1,115,000 will be available for harbour works in Palestine and for other works. I am not quite clear what the other works will be, but they will be public works of one kind or another. As regards the harbour of Haifa, which understand will absorb most of the money, I would very much like to ask whether before that enterprise is undertaken at Haifa the Government is going to get expert advice upon the matter. I am not in any way objecting to the harbour at Haifa—that is not the point—but I have not forgotten the Takoradi harbour. The present Secretary of State knows a great deal about that matter. The fact is that the bad situation there was transformed owing to the prompt action of my right hon. friend Mr. J. H. Thomas in sending out that eminent authority, Mr. Palmer, to report and advise.

As the result of that action Takoradi will in the end, I believe, prove to be a big success. But it is only right to say-that owing to the early mistakes there was lost on this harbour work at Takoradi some hundreds of thousands of pounds, amounting, I believe, in all to a sum not far short of £1,000,000. I think your Lordships will agree, in view of that experience, that I do not do wrong in suggesting that the harbour work at Haifa, if and when it conies to be undertaken, should be most carefully considered. It would be a considerable advantage if there were some experts' report before the contracts are let. I suppose it is too early to inquire what system of contract there will be—whether the work will be put up to tender or not—but I would like to say a word on the question of wages in connection with the harbour works and other works in Palestine.

It was suggested in another place that a fair wages clause should be inserted in the Bill, but the Secretary of State said that could not be done. He did, however, make a pledge that as regards the new harbour works at Haifa wages would be very carefully considered. The point is made that they must not be so low that only Arabs could be expected to take them. Jews must also be able to take them, and they must be of such a level that white people could live on them. The Secretary of State gave a pledge about that matter which gave much satisfaction to the Labour Party.

Now I come to East Africa, and here I have rather more criticism to offer. A great deal of the case for the loan to East Africa is based, as the noble Earl said, on the Report of Mr. Ormsby-Gore's Committee. But much in that Repot conflicts with the Report known as the Schuster Report. The fact is that we want more information about these matters—I think the Government will admit that—and that makes it all the more a pity that the Southborough Committee, which was set up by my right hon. friend Mr. J. H. Thomas, was disbanded by the present Government. The noble Earl has referred to the Ormsby-Gore Committee, but not to the Southborough Committee, which as a matter of fact was set up before the Ormsby-Gore Committee, which was a large Committee, which was an influential Committee, and which was presided over by Lord Southborough. The Ormsby-Gore Committee was really only a sort of Sub-Committee of the Southborough Committee.

Yet, owing to the change of Government, we are faced by the extraordinary position that the Southborough Committee was disbanded without any good reason at all after the present Secretary of State assumed office. Not only so, but the Islington Committee, set up by the Labour Government, was similarly disbanded. I say emphatically that I think this is a very bad precedent to set. Quite apart, as has been said, from the discourtesy to my right hon. friend, the information collected by these Committees would have been of great value. Moreover, we cannot expect gentlemen to give time to sit on Committees if there is a prospect on a change of Government that they will find all their work immediately brought to naught and the Committee disbanded. It is made all the worse because really no adequate explanation or excuse has been offered by the Secretary of State for what he did.

However, as regards the East African Loan of £10,000,000, we in the Labour Party give it general support. The financial security is not so good as in the case of Palestine, but it is probably good enough. £10,000,000 is a very large sum and it is noteworthy that only about:£1,500,000, according to the Schuster Report, will be used in the near future. Therefore a very much larger sum is being asked for than is needed for some time to come. It will, in fact, in all probability be many years before the whole of this £10,000,000 will be needed. The noble Earl does not dissent from that.

There is one important point in this connection which is not satisfactory at all. I have more than once referred in your Lordships' House to the damage that this Government has done to trade in various ways and, as I have said, the Government has unfortunately also seriously depreciated the national credit. Therefore it is very much dearer to borrow money now than when the Labour Government went out of office. The noble Viscount may laugh, but I am stating a fact. The Conversion Loan, which stood at 80 when the Labour Government went cut of office, stands to-day at about 75. Consols, which stood then at 58½stand to-day just below 54. What does this mean in terms of credit? It means that for every £100 borrowed these Colonies will have to pay in the region of 7s. 6d. a year more in interest than when the Labour Government was in office. I say frankly that I look for very little improvement so long as the present administration remains in office. In fact, things may very likely get worse.

Happily, there is a prospect of a Labour Government before very long and then no doubt the national credit will be restored to what it stood at before, but that will take time. Despite the careful and prudent policy in finance and other ways which the Labour Party will follow it will take time to undo the mischief wrought by the present Administration. Probably by the time the last million pounds of this loan is needed the Labour Government will have done its good work and borrowing may be decidedly cheaper for the Colonies concerned. So far as that goes the delay is not one of which we need complain. Indeed, I am not complaining myself of delay, except that it seems somewhat extraordinary to ask for £10,000,000 so long before you need it. If I may say so, and I speak with some little knowledge, it would appear that the amount of work which can be wisely undertaken at a particular time is not very great. The Schuster Report bears that out. Therefore, the position is that a very large advance is being made over and above what is actually needed.

In the debates in another place it was suggested that Kenya should be taken out of the operation of this Bill, and the main reason for that lay in the question of labour conditions. I should like, before I sit down, to say a word on that point. This is a matter of the greatest importance, and it arises in connection with this Bill and with our whole Colonial policy. The Labour Party is watching very closely and very anxiously the course of affairs in this regard. The subject is, of course, a very big one, and unfortunately, with the great pressure of work thrown upon your Lordships' House at the end of the Session, to which reference has already been made several times to-day, it is not possible to make more than a passing reference to this matter to-day. There are, however, two or three things that I wish to say.

First let me observe that the position and policy of the Labour Party with reference to the natives in our Colonies has been laid down in a recently published book by my right hon. friend Mr. J.H. Thomas, who, I need scarcely remind your Lordships, was Secretary of State for the Colonies in the Labour Government. In this book there are laid down three very clear principles regarding our obligations towards and trusteeship for the natives, and the second of these principles reads as follows:— The native must, as a worker, be a free man, and hence there must be no slavery, no forced labour and no pressure upon him to work for the settlers. Certainly so far as Kenya is concerned, and perhaps in other parts also, there seems to have been much going on which is not in accord with the words that I have just quoted. As recently as October of this year a statement was made by the Colonial Secretary in the Kenya Government which seems to us in the Labour Party to be very unsatisfactory from the point of view of the natives. As I say, it is not possible on this occasion to go into these matters with further quotations or in greater detail, but I wish to make it clear that, so far as we in the Labour Party are concerned, we strongly object to anything in the shape of forced labour being used in connection with the works that will be carried out under this Bill or in connection with any works of this description. Fortunately, so far as this Bill is concerned, the Secretary of State for the Colonies has accepted an Amendment which covers the point, and we are obliged to him for that.

I now pass to my last point, which concerns the schedule. The noble Earl himself drew attention to the way in which this sum of £10,000,000 will in due course be allocated. I have already said, and the noble Earl agrees, that it will probably be some years before the full amount is needed. In those circumstances I would submit that it does seem unnecessary here and now specifically to allocate this money in definite proportions in the schedule of the Bill and to describe the way in which it shall be spent. I am quite satisfied, for instance, that it would be a very good thing if more money were available than can be available under this schedule for scientific research and so forth. Various ameliorative measures could be undertaken, and I should very much desire that the item which includes this subject in the schedule were of a bigger amount. I cannot quite understand—perhaps the noble Earl will be good enough in his reply to tell me—why it is necessary to do this now. The Secretary of State has said that he must immediately ask for £10,000,000, for reasons that he gave and that did not seem to me very convincing, although I admit that this is a matter for argument. However that may be, why is it necessary now, when there is so much uncertainty, specifically to allocate these sums into what might be called watertight compartments? That is all that I have to say. I think that my noble friend Lord Olivier, who is, of course, a great authority on many of these questions, desires to say something, and accordingly I will not speak any longer, but perhaps the noble Earl, with his usual courtesy, will be good enough, when he replies, to answer the questions that I have asked.


My Lords, I do not propose to detain your Lordsips more than a very few minutes, because, in the first place, I have nothing but praise to give to this proposal of the Government and, in the second place, we are in the unfortunate position of having to pass an enormous amount of legislation at the present sitting. I listened with interest to the speech of my noble friend Lord Arnold, but I confess that I did not quite understand why, every few minutes, he dragged in the Labour Party. I am glad to think and believe, and, from all that he said, I think I am justified in declaring, that in regard to our Colonial policy generally there is no difference of opinion between the different Parties in the State. Broadly speaking, they are all supporting the proposals made by my noble friend in this Bill, and they agree also in regard to the native question, and I think, therefore, that it was rather a pity, if I may say so, seeing that the late Labour Secretary of State for the Colonies has done as much as any man to bring about a general agreement in regard to this question of native labour and other matters, that this sort of distinction should be drawn in relation to such a Bill as this.

The proposals of this Bill—perhaps I ought to say that I am speaking now not with regard to Palestine, of which I am afraid I have no special knowledge, but in regard to East Africa—will, I am confident, be of the greatest possible advantage from the point of view of the Empire and of the East African Colonies. There is no question about it that this money is required for the development both of railways and harbours, and it will undoubtedly be of enormous advantage to those parts of the Empire, as well as to ourselves at home. It is well worth our while, looking at it from a purely business point of view, to do that which this Bill proposes—namely, to lend them our credit so that they may develop their country. I quite agree with my noble friend Lord Arnold that one has to be careful under present conditions of utilising the credit of this country in such a way as is likely to diminish that credit, but I do not think that this objection applies to this particular proposal or to the method by which the credit is to be used in this case. I agree that £10,000,000 is a large sum, but unfortunately it is a mere fleabite in the present conditions of our Debt. This money will be used in such a way as to bring advantage both to this country and to East Africa, and accordingly I am in entire agreement with the general principles of the Bill.

There is another point upon which I agree with my noble friend who spoke just now. I think we ought to recognise that we really owe these proposals for the development of railways and harbours to Mr. Ormsby-Gore, the Under-Secretary of State for the Colonies. They were entirely due to his efforts and those of his colleagues, one associated with the Labour Party and the other with the Liberal Party, to his enterprise, to his extraordinarily rapid appreciation of the various problems that had to be considered, to the courage with which he made his proposals and to the lucidity with which he explained them in his Report—a Report which (like his other Report an West Africa) may be regarded as epoch-making in the view of the fact that it convinced the Government of the day and the succeeding Government of the necessity of doing something on a large scale for East Africa. I think that he is to be warmly congratulated on the success that has attended his efforts and those of his colleagues. I also agree that we owe a great deal to Sir George Schuster for his Report, which is quite invaluable from the point of view of finding the best way in which this money can be allocated.

On the other hand, I am inclined to agree with my noble friend Lord Arnold that the matter should not be pushed forward too rapidly. We do, I think, at all events in some cases, require a little more information before we allocate so definitely and clearly, by means of a schedule, the various sums to the various proposals. We want, I think, a little more elasticity about it, because I believe that we are all quite prepared to give authority to the Colonial Office to deal with this matter. I am very glad to hear it said that there is to be a further meeting of the Schuster Committee in the light of what has occurred since the last meeting, with a view to giving further advice to His Majesty's Government. That, I think, is all to the good. Lastly, I agree very warmly with the proposals made in this Bill, and certainly I and those with whom I act will give it our support. There is one other matter to which I may refer in conclusion. I greatly regret that Lord Clarendon is leaving the Colonial Office to take up what is undoubtedly a very important position, and all of us who have had to deal with him, officially and personally, deeply regret that he is leaving the Colonial Office and in that sense leaving official life.


My Lords, the noble Earl took exception to Lord Arnold' reference to Mr. Thomas as if he were an authority in this House, or as if we were in any way more advanced in policy on African affairs than other Parties in this House. I quite agree that it is hardly to be expected that Mr. Thomas should be quoted as having any authority on your Lordships' Benches. I would therefore, very gladly, in connection with what my noble friend said, quote the words of Mr. Ormsby-Gore, in whose policy I have always concurred, and in whose policy I feel the greatest confidence. He well deserves the eulogy which has been passed upon him. With regard to labour in Kenya—and that applies to forced labour of whatever kind—Mr. Ormsby-Gore told us in the House of Commons, a few months ago, that in Kenya they were seeing the working out of the policy of giving an absolutely free choice to the native, as to whether he stays in the reserves or comes out and lives and associates with Europeans in agricultural work. That is a very important pronouncement, and one which is entirely satisfactory to us on these Benches, but we are continually disquieted both by the action of the Governor and of Government officials in Kenya, and by the sentiments which are continually being expressed by influential persons in Kenya, edging or trying to get away from this policy.

The Acting Governor, two or three years ago, gave us reasons for apprehension, and quite recently the Colonial Secretary said in the Legislative Council of Kenya that the Government "does believe that an attitude of positive energy on the part of administrative officials is of the greatest assistance in aiding the flow of labour from the reserves" and also believes that "the attitude of hostility or neutrality on the part of administrative officers hindered the flow of labour"—the neutrality promised by the Secretary of State far the Colonies. Therefore, he said, administrative officers had been "definitely instructed to do their utmost to promote the flow of labour from the reserves, a matter which was of immense importance to the industries of the country." That is entirely in accordance with the action taken by the Governor, and after the dual policy was announced there was an immediate suspension of labour coming out of the reserves. Thereupon the Governor went on tour round the Colony and expressed to the chiefs great dissatisfaction.

That is not a neutral policy, because if the Government, or the Governor himself, goes round and tells the native chiefs that he wants this or that thing, the native at once thinks he had better do it, and it is not leaving him a free choice in the matter. That is why we are distrustful of the Colonial Government breaking away from the policy of the Duke of Devonshire and others, with whose pronouncement we have been absolutely contented, and whose policy we absolutely support. Quite recently, when the Governor was addressing a conference of associations in Kenya, he made certain observations with regard to the labour position in the Colony, and said very straightforwardly that forced labour could not be used, and then judicially gave advice to the planters to concentrate altogether upon crops which did not require much labour and which they could attend to themselves. His advice coincided with the advice given by the Surveyor of Land in Rhodesia Colony the other day—namely, that if white men were wise they would try to do their own work themselves. The immediate result of that pronouncement by the Governor was, as we are told, according to The Times report, that the conference of associations passed a resolution urging that a greater measure of self-government should be given to the Colony, because it wanted to have more control. Self-government in Kenya would be control by 2,000 white men over an enormous number of coloured men, and the Government are, I am sure, convinced that it is not safe at present to give that small minority of employers the control which they desire. I have simply endeavoured to indicate our reason for the fears and apprehensions which we entertain.

Finally, I want to refer to one or two matters in the very important Report of the Conference of Governors of the East African Dependencies. With regard to the systems of native taxation, they were of opinion— that there was no objection to a tax on native cattle where the stock was sufficiently numerous; and that such a tax was desirable where natives had surplus cattle, and a suitable market existed, in order to promote the economic use of stock and the development of animal husbandry. in order to induce the natives to sell their cattle to an Oxo factory, or something of that sort, being set up in the Colony. It is perfectly unjustifiable to impose a tax on native cattle for such a purpose. With regard to finance, I am very glad to see one thing which they say—namely— It was considered that the Poll Tax should eventually be replaced by some more scientific form of taxation. I hope that that will be borne in mind.

It struck me, however, that it was an unfortunate observation by Sir Edward Grigg, when he said: It is the settled determination of the leading Powers that the rapid transformation of tribal life and custom which is thus imposed, and cannot be set back, shall raise the standards of the backward peoples in the same measure as it benefits their conquerors. That is a most unfortunate expression. It is true that the Scottish nation may call themselves our conquerors, because we have accepted their King and they have taken over our Colonies, but these tribes were not conquered. The supremacy of the King in East Africa was proclaimed after a Treaty had been entered into by agreement with all the natives, and there was no conquest. If there had been it would have placed the natives in an entirely different position. A native conquered and beaten in battle accepts the position, and has no rights. It was agreed by the Privy Council that we had conquered the Matabele, and that therefore the Crown had full rights in Matabeleland, but these natives in East Africa have not been conquered.

The native African has a very judicial mind and the fact that we did enter into agreements with these people causes them to be very much injured in their minds if we do any such thing. Although they do not express their dissatisfaction, yet it is a very evil influence upon our rule and upon our authority in these countries that we should appear to break contracts, and to say: "We did not enter into an agreement with you; we conquered you, and we are going to do what we like with you" The only people we conquered in East Africa are the Masai, and we conquered them because we made a Treaty with them, and broke it, and thereupon they disobeyed the Governor, who sent a punitive expedition against them. I think this, perhaps, may have been an injudicious expression of the Governor, but it is very undesirable that we should take up the position, or allow the natives to think that we take up the position, that we conquered them and can do what we like with them; because, as a matter of fact, we made agreements with them, and are bound to implement the pledge made in those agreements.


My Lords, before the noble Earl replies there are two brief points I should like to raise. The first is this. I understood the noble Earl to say that there was a duty upon the Home Government to guarantee loans to territories which were mandated to us in exactly the same way as that duty falls on us in the case of our own Dominions or Colonies. I, for one, am not prepared to accept that without a good deal more consideration. It may be that eventually opinion in this country would adopt that view, but I do not think that that view is yet adopted, and I would not like his observation to pass without some sort of caveat having been entered with regard to it.

The other matter is this. I noticed that the order of subjects to which the money, when raised for the benefit of Palestine, is to be allocated is—railways, railway, harbour. It was my good fortune to be in Palestine two years ago. What we mostly suffered from there was the want of water. The noble Earl the Lord President of the Council will remember very well, for my visit synchronised with his, the great absence of water from which we both personally suffered, and from which the country as a whole suffered. We were there in the beginning of April, when there had been a tremendously long drought, and it had become necessary for the Government to spend a large sum of money in bringing a train up from Ludd every day laden with water. I observed, I think it was in the paper yesterday or a day or two previously, that at last, much to the relief of the inhabitants of Jerusalem, the long drought which had continued for some months had come to an end, and that three inches of water fell in one day. I do not know which would be the more unpleasant. But, anyhow, it is perfectly obvious to the casual visitor who goes to Palestine that the one thing which is required to increase the value and productiveness of the country is that a good system of irrigation should be established, and I regret to observe that in the schedule no mention is made of what in my humble judgment, is the most important and almost the first duty falling upon a Government which has the means of carrying out that duty.


My Lords, first of all, may I thank both Lord Arnold and the noble Earl, Lord Buxton, for the very kindly references which they made to myself. It is quite true that probably this is the last time that I shall address your Lordships from this position, but I cannot promise never to speak in your Lordships' House again, and it occurs to me that, in taking up this new duty, the Chairmanship of the British Broadcasting Corporation, I shall perhaps, in at any rate some small way, be able to give some measure of assistance in those, matters with which I have been connected, both in the Dominions Office and in the Oversea Settlement Department.

The noble Lord, Lord Arnold, during the course of his remarks accused the present Administration of some inconsistency. I will not follow him in that argument, although I am afraid I do not agree with him altogether. He asked me in connection with the Haifa harbour, whether His Majesty's Government will obtain further information before the expenditure of this sum of £1,000,000 is entered upon, in so far as the construction of the harbour is concerned. The matter is still under consideration. At the present moment information is being procured, and nothing will be done until that information has been most carefully sifted and examined, that is to say, no money will be spent until expert advice and opinion has been obtained.


It is expert advice?


It is expert advice. The noble Lord asked me a question with regard to wages. I am extremely glad to learn from him that those whom he represents are satisfied with the pledge that my noble friend gave in another place, and I would only say, in respect of that, that in regard to these contracts the Secretary of State will, in consultation with the Governments concerned, most carefully consider the manner of the letting of these contracts in order that the interests of all those employed may be amply safeguarded.

Lord Arnold also said that it was more expensive in these days to raise money than it was under a Labour administration. I frankly confess I have not followed the movements of the money market with the same amount of care which Lord Arnold has, but I venture to submit that, if the schemes proposed in this Bill go through, there seems to be every likelihood of an improvement of British credit. Lord Arnold, as your Lordships are well aware, constantly takes a prominent part in this House, especially on matters connected with finance, and it occurs to me that when the next Labour Government comes into power it is quite possible that we in this House may have an opportunity of congratulating him upon his appointment as Chancellor of the Exchequer. The noble Lord made some reference to labour conditions in Africa. I venture to say that with the views that he put forward we on this side of the House are by no means in disagreement. We feel with him that the native should exist as a free man. I will not say anything more on that point at this moment, because, in answering Lord Olivier's question, I will deal with the matter of labour.

The noble Lord also asked me a question with regard to the allocation in the East African Schedule of this sum of £10,000,000. I want to assure him that in so far as that £10,000,000 is concerned although £2,500,000 is specified for railways, £2,500,000 for harbours and £1,000,000 for roads, those allocations are purely provisional and it is not intended in any way as a final allocation. If the noble Lord will look at paragraph (a) of subsection (2) of Clause 1 of the Bill he will find that there is given therein to the Treasury and the Secretary of State powers of what is known as virement in so far as these heads of expenditure are concerned. I think those are all the questions that my noble friend Lord Arnold addressed to me.

There are only one or two points which my noble friend Lord Buxton raised on which I should like to say a few words. May I say that we on this side of the House are very glad to learn that he and those he represents are in accord with the principles laid down in this Bill? And in connection with the Report which stands under the name of my hon. friend Mr. Ormsby-Gore, the Under-Secretary of State for the Colonies, should like from this side of the House to join with the noble Earl in expressing the gratification of His Majesty's Government at the very valuable Report he issued on this particular subject.

Now may I turn to the questions which were addressed to me by my noble friend Lord Olivier? The first question he asked me was in connection with labour in these territories. Let me take first the question of private estates. My hon. friend Mr. Ormsby-Gore made it quite clear in another place that in so far as forced labour upon private estates was concerned, His Majesty's Government would in no circumstances tolerate the use of forced labour upon private estates in any territories over which they had jurisdiction. With regard to public works, it is true that forced labour has been used, but here again both the Secretary of State and the Under-Secretary of State made it clear in another place that this kind of labour would be dispensed with at the earliest possible moment.


Is there any reason to suppose that it will be used for any of these works under the loan?


That I cannot tell the noble Lord at the moment; but I will tell him this—


Is it not the case that the assurance given by the Secretary of State in another place and the Amendment which he accepted covered that point so far as this Bill is concerned?


Let me explain a little further. In so far as this forced labour is concerned, it has only been used once in Kenya, and if I read aright the explanation given in another place by the Secretary of State, I think it was that in no case is it ever used for more than 28 days in the year and it is only used when there is no available free labour of any kind, and then only when the local Government itself certifies to the Secretary of State that the work upon which it is to be engaged is work of a public character and that no free labour can be utilised. Then only is it that the Secretary of State is authorised to issue a certificate for such labour.


When forced labour is used, is it subject to the terms of the Convention?


I presume it is, though I cannot definitely answer that question now. Then the noble Lord dealt with the Report of the Governors' Conference in East Africa. I will not follow him into his question to me about the tax on cattle because it does not seem to me to be particularly relevant to the subject matter of this debate; but I should like to say one thing about the passage he quoted from Sir Edward Grigg's speech dealing with the question of the progress of the natives. I think the noble Lord must have misread or rather misinterpreted that passage, and I should like to quote one sentence from just before the passage mentioned by the noble Lord, where these words occur: "I refer to the vast range of questions born of the quickening of Africa by the touch of European progress." Sir Edward Grigg obviously was not referring to Kenya or to any particular part of Africa; he was dealing with the whole of Africa. He was not applying that to the progress of any particular part but to the whole Continent of Africa.

My noble friend Lord Ullswater asked me a question regarding loans to mandated territories. The answer to that question is, I think, that mandated territories are not in the same happy position as the Colonies inasmuch as they are not able to raise money on such advantageous terms as they could under the Colonial Stock Act. Therefore, if they receive a guarantee from the British Government it enables them to secure the best possible terms for money so lent. He also drew attention to the fact that I had intimated that the expenditure of this money would be incurred in so far as railways and roads are concerned, and he referred to the absence of water in Palestine. Probably the answer to that question is this: If the noble Lord will refer to the First Schedule he will find that the allocation of £745,000 is to be devoted to public buildings, telegraphs and telephones, surveys and minor works of development, which, I think, probably would include the question of water. That I think is all I need say in reply.

On Question, Bill read 2ª: Committee negatived.

Then (Standing Order No. XXXIX having been suspended) Bill read 3ª, and passed.