Lords Sitting of 2 February 1926

THE KING'S SPEECH.
The KING being seated on the Throne, and the Commons being at the Bar with their Speaker, His Majesty was pleased to make a most gracious Speech to both Houses of Parliament, and then retired.
His Majesty's Speech was as follows:—
"My Lords and Members of the House of Commons,
"My relations with foreign Powers continue to be friendly. Since Parliament rose My Ambassador at Constantinople has proceeded to Angora with a view to arrive at a definite settlement of questions in connection with the Turco-Iraq frontier. My Government cordially reciprocate the desire of the Turkish Government for the promotion of the friendliest relations between Turkey and Great Britain.
"A Treaty between Myself and His Majesty the King of Iraq, carrying out the stipulation laid down in the decision of the Council of the League of Nations, has been signed by our respective representatives and has been approved by the Parliament of Iraq. It will be submitted to you without delay.
"One of My Ministers will proceed to Geneva as British representative of the Preparatory Committee on Disarmament which is to work out the basis of a general conference on the reduction of armaments. In the opinion of My Government, a substantial step forward in that direction should now be possible as a result of the system of security created by the Treaty of Locarno and subsidiary agreements.
"My Government have recently received in London the Finance Minister of Italy, accompanied by a distinguished Delegation, and have concluded an agreement which provides for the funding of the Italian War Debt to this country on fair and honourable conditions. I rejoice that a friendly settlement has been reached of this difficult question.
"Invitations are being issued to the Governments of Belgium, France, Germany and Italy to attend a Conference in London to consider the possibility of securing an effective international agreement for regulating hours of labour.
"Members of the House of Commons,
"The Estimates for the Public Services will be laid before you in due course. My Ministers have given earnest consideration to the increasing need for national economy. Proposals

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for effecting reductions of public expenditure are now being formulated and you will be asked to pass measures required to give effect to them without delay.
"Proposals will be laid before you for authorising My Government to guarantee loans for the development of the British dependencies in East Africa and of mandated territories.
"My Lords and Members of the House of Commons,
"The improvement in trade and industry at the end of 1924, which it was then thought would result in an appreciable decrease in the volume of unemployment, was unfortunately checked early last year by the widespread depression which occurred in coal mining.
"Since the autumn of last year signs of a revival of industry have again begun to appear, but the growth of confidence on which revival depends is being arrested by the fear of industrial strife.
"The result of the Inquiry into the economic condition of the coal industry, which is now being conducted by My Commission, will shortly be laid before you. I am well aware of the difficulties that are inherent in the whole situation. But the interests of the nation are paramount, and I appeal to all parties to face the future in a spirit of conciliation and fellowship and to avoid action which would again postpone the return of good trade and prosperity for which we have so long hoped.
"With the object of securing greater economy and efficiency in the generation and transmission of electrical energy in the future, My Government have devised a scheme of reorganisation. A Bill to give effect to these proposals has been prepared and will shortly be introduced.
"The condition of agriculture has received the earnest consideration of My Ministers. The question of the provision of better credit facilities for the industry is receiving special attention and discussions are proceeding with a view to the formulation of definite proposals on the subject. A Bill will be presented to enable County Councils to continue and extend the provision of
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small holdings and cottage holdings, both for owner occupiers and for tenants.
"A Measure will be laid before you to provide in suitable cases for marking imported agricultural produce and manufactured goods, so that they may be distinguished from the products of this country, and Empire goods distinguished from those of foreign origin.
"while I learn with satisfaction of the progress made in the building of new houses in the urban areas of England and Wales, the conditions under which many of My people are compelled to live, both in country districts and in the congested areas of numerous towns, still occasion Mc deep concern. My Ministers are now examining certain proposals for the improvement of these conditions, and if time permits they will submit to you Measures designed to hasten the removal of the worst defects both in town and country.
"My Ministers hope that it may be possible to carry further the process of consolidating the main Statutes regulating the local government of the country.
"I propose to appoint an additional Secretary of State to replace the Secretary for Scotland, and you will be asked to pass the necessary legislation providing for the transfer of functions.
"Bills will be laid before you, if time and opportunity permit, dealing with the following matters:

National Health Insurance.

Unemployment Insurance.

The rating of railways.

The control of road vehicles.

The finance of Poor Law in London and the position and powers of Boards of Guardians.

Rating, and the valuation of machinery, in Scotland.

"Your labours upon these, and upon all other matters, I humbly commend to the blessing of Almighty God."
House adjourned during pleasure.
House resumed at a quarter past four of the clock, The LORD CHANCELLOR on the Woolsack.

LIST OF THE LORDS TEMPORAL.
GARTER KING OF ARMS GARTER KING OF ARMS attending, delivered at the Table (in the usual manner) a List of the Lords Temporal in the Second Session of the Thirty-fourth Parliament of the United Kingdom: The same was ordered to lie on the Table.
SELECT VESTRIES.
Bill, pro forma, read 1a.

ADDRESS IN REPLY TO HIS MAJESTY'S MOST GRACIOUS SPEECH.
The King's Speech reported by the LORD CHANCELLOR.
LORD TEMPLEMORE: My Lords, I beg to move that an humble Address be presented to the King thanking His Majesty for the gracious Speech from the Throne. I need not tell your Lordships how very deeply I feel the honour that has been conferred upon me to-day in being asked to move this Address. Nor need I tell the House how conscious I am of my own shortcomings and my unfitness to perform this duty. Although I have had the honour of addressing your. Lordships on several occasions, I feel that I am still very new to this House and I would therefore ask for that kindness and indulgence which I know you always accord to your weaker and more inexperienced brethren.
I turn at once to the gracious Speech and to that part of it which deals with external affairs. The first sentence of it, which refers to the continuance of friendly foreign relations, takes on a new interest owing to the Treaty of Locarno, and I should like, even at this late stage, to add my tribute of congratulation to the Foreign Secretary and to His Majesty's Government upon the outcome of Locarno, where the work so well begun by the late noble Marquess, Lord Curzon of Kedleston, and carried on in the same spirit by Mr. Ramsay MacDonald was brought to a successful conclusion. As the result of that, Treaty I see that His Majesty's Government propose to send a, Minister as British representative to the Preparatory Committee on Disarmament. I understand that the noble Viscount the Chan-
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cellar of the Duchy of Lancaster, whose absence through illness to-day we all deplore, is to be our representative. I am sure that the House will agree that no better appointment could have been made.
I come now to the Treaty with the King of Iraq. At the end of last Session a good deal of criticism, some of it not quite fair, and a certain amount of misrepresentation were heard as to the attitude of His Majesty's Government on this question, largely owing, I think, to misunderstanding of the facts. The facts are that this country has no direct interest and no ulterior motive in Iraq. We are there simply owing to the Mandate of the League of Nations. I am very glad to see that this Treaty has been made with the King of Iraq, and I sincerely hope that the conversations now taking place between His Majesty's Ambassador and the Turkish Government may lead to a speedy and successful conclusion to the very intricate and difficult question of the Turco-Iraq frontier.
I am sure that we must all rejoice that even within the last few days a debt settlement has been arrived at between Great Britain and that great and friendly nation our old friend and Ally the Kingdom of Italy. Such a settlement, besides improving the relations between those countries immediately concerned, will also, I think, help to bring about that quiescence and re-settlement in Europe for which we have now waited such a very long time. I am glad to see also that the Government are making loans to British Dependencies in East Africa and to some of the mandated territories. This is merely a further step in the policy, which I know that His Majesty's Government have so much at heart, of fostering and encouraging trade between this country and every part of the Empire.
Now I have to deal with that part of the Speech which deals with internal affairs and which, if I may say so, is quite admirable. It promises certain things, but it does not promise too much; it is not overloaded. There are, I think, no very great contentious measures contained in it. The largest measures in the gracious Speech are undoubtedly those dealing with electricity and economy. We understand that legislation may be required later in the year as the result of the Report of the Coal Commission, a Report which we are awaiting with great

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interest, not perhaps unmixed with anxiety. I understand that my noble friend who will follow me is to speak, as he is so well qualified to do, on electricity and on the agricultural proposals. Therefore I propose to confine myself to saying a few words on the subject of economy.
When I said just now that I did not think that there were any great contentious measures in the gracious Speech, I might have added that I am not quite sure that we shall find this to be so when we come to the subject of economy. I rather fancy that some of the followers of the noble Viscount opposite may not quite agree with our views as to what are the best subjects for economy. However, I will not anticipate difficulties in a speech of this kind, but will merely say that I think there is a general agreement in principle that economy is a good thing, that we must have economy and very soon, otherwise we shall lose our place entirely as a great industrial nation and cease to pay our way, perhaps sooner than some people imagine. My great complaint is that this campaign of economy was not begun several years ago, directly after the War, when we started living as a very rich nation instead of the comparatively poor nation that the War had left us. This economy campaign should have been started before the new Ministries and Departments which were set up were, so to speak, "dug in," so that they had come to think themselves perpetual and indispensable. Government Departments are like bad habits: the longer you stick to them, or allow them to stick to you, the more difficult it is in the end to get rid of them.
But this is all in the past, and I do not at all join in the hue and cry which is often raised, I think not very fairly, against His Majesty's present advisers for not economising more quickly. I wonder if many of those who criticise understand what a very difficult thing it is after many years of extravagance—and very wasteful extravagance—to start economy. Those of us who have any idea or experience of the work of Government Departments know very well what happens. Directly you form a new Department or a new branch of an old Department, the head of that Department or branch and all his staff have a perhaps natural but very tire-
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some objection to ever being abolished or even reduced to any large degree. I do believe, however, that Ministers are thoroughly in earnest on this subject, and I dare say that when we are a little older we shall find that they have done something more already than we think. With the help of the Bill which I am told will be necessary to deal with this subject, I confidently hope and expect that they will be able to accomplish a great deal more.
I have finished all that I have to say as regards the gracious Speech, but before sit down I should like to touch for a few moments on the situation at home as I see it at the present moment. I think there is no doubt that we are starting this Session with a feeling of greater hope and confidence than we have done for some years. I think there is reason for that confidence. Two great obstacles—great rocks I may call them—were negotiated last year. The first was the Treaty of Locarno, and the second was the settlement, as we hope for good, of the Irish Boundary Question. On both these matters I consider that the Government and the country may congratulate themselves. The third point which fills me with hope is that the figures of unemployment are week by week showing a decrease; not a very large decrease—I allow that the figures are still deplorable—but still a decrease. The old foolish optimism has passed away. We are beginning to Gee the true position and to realise where we are. In industrial affairs I think that employers and employed are beginning to try to understand one another better.
The Church still exercises great influence in our affairs. Long may it do so. I cannot help thinking that a great deal of the feeling which I have described is due to the open letter which the two most rev. Primates and the Moderator of the Free Churches thought fit to address to the nation just before Armistice Day last year. Only last week we escaped, by the good offices of the leaders of a great trade union, from what might have been a disastrous dispute. I regard that as a good omen and I strongly deprecate language, from whatever quarter it may come, which discounts all these signs of good feeling and talks about the certainty of trouble next May. There is no such certainty if we

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as a nation keep our heads and maintain our reputation for common sense and plain dealing. This nation, which has endured the brunt of four years of war and finally defeated the greatest military Power ever known, is nut going to lose industrial peace at this stage, and without being controversial I say this, that those who use language of menace or despair, or those, if there be any such, who would seek to subvert this ancient Constitution, have gravely misjudged the temper of this people.
We have not yet arrived in this country, and I daresay never shall arrive, at the situation—
"When none were for a Party but all were for the State."
I greatly doubt if any such state of things ever existed in any known country, and I dare say that it did not exist at the time and in the country about which those words were spoken. I do not think it would be to the advantage of this country, where the Party system has grown up, as our institutions do, from generation to generation, and has been on the whole, I think, for the benefit of the country. We are all, I suppose, more or less Party men. Nobody is a keener Party man that myself. I thoroughly believe in the ends and policy of my Party and of its future in the history of this country, but I do say that at a time like the present it is the duty of all of us, Lords and Commons, on whatever side of the House we sit, without abating one iota of Party loyalty, to do our best directly and indirectly, by speech and action, in any way we can to bring parties and classes together in this crisis of our fate. That is the only way in which in the end we shall solve our problems.
The Prime Minister has shown by his speeches and actions that he is a man of peace and not a man of war and that, in addition to being a great. Party leader, he can rise higher than that and be a great national leader in the best sense of the word. Let us follow his example and try to make this year a turning point in the industrial situation and in the relations between employers and employed. If we cannot do this I shall regard it as a confession of failure on the part of a great people, but if we can, and I think we can, then we shall win through, and I see a time of happiness and prosperity coming for all sections of our population
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and I see our great country growing greater both in herself and in her power for good among all the nations of the world than she has ever been in the whole course of her long Island story. I beg to move.
Moved, That an humble Address be presented to His Majesty as followeth—
"Most Gracious Sovereign.—We, Your Majesty's most dutiful and loyal subjects, the Lords Spiritual and Temporal of the United Kingdom of Great Britain and Ireland in Parliament assembled, beg leave to thank Your Majesty for the most gracious Speech which Your Majesty has addressed to both Houses of Parliament"—(Lord Templemore.)
LORD RAYLEIGH: My Lords, as you are aware, the lion curable duty has been assigned to me of seconding the Address, in reply to the gracious Speech from the Throne, which has been moved by my noble friend. He has already mentioned to you subjects with which I propose to occupy your Lordships' attention this afternoon. The first of these is the proposal of His Majesty's Government to take large measures for facilitating and increasing the possibilities of electrical supply in this country. Perhaps I may be pardoned for alluding for a few moments to what is now ancient history, and to a topic which is of special personal interest to me. It will be within the knowledge of many of your Lordships that the first legislation on the subject of electricity supply was passed in the year 1882, when the industry was in its infancy. That legislation had in its outcome a most unfortunate result. It was attempted to legislate in such a manner that those who provided the enterprise and the money for the dissemination of the electric supply in the early stages, when all was doubt and uncertainty and speculation as to how far it would be commercially successful, would be deprived of due reward for their enterprise and of return for their capital.
The legislation provided that the local authorities should be allowed, on utterly inadequate terms, to buy them up at the end of a period of twenty-one years if the enterprise were a success, and to leave them to their fate in the alternative, if the enterprise proved to be a failure. That legislation had the result that attempts to deprive capital of its due reward always must have. The
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enterprise was barked and the sources of it were dried up. A few years afterwards it became apparent that something must be done in the way of mitigating the position. The family to which I belong was at that time represented by one who was well qualified to speak on electrical matters, when the number of those of whom that could be said in the country at that time was very small, as compared with what it is now. He did what he could in this House to get that pernicious state of legislation changed, and to give electrical enterprise its fair chance. Since that day the wheel has come round full circle, and the Government of the day is now proposing to do all in its power to promote actively electrical enterprise instead of passively discouraging it, as happened in those days.
The broad outlines of the Government's proposals are known to us all through the Prime Minister's speech about a fortnight ago. In view of that, it is not necessary to go over these proposals in detail, but I propose to notice one or two special aspects of the question, which I hope may be of interest. It is a natural point of view to suppose that a country like ours is very unfavourably situated for large-scale electrical development, as compared with those fortunate countries, like Switzerland and Norway, where water-power is abundant and freely at the disposal of those who wish to harness it. We, on the other hand, have an advantage, which those countries do not possess, of a readily accessible supply of fuel, which provides us with the means of obtaining a prime mover—not, indeed, comparable in point of economy with that which water-power provides, but still by no means to be despised. No doubt at first sight, when you think of those who have to win the supply of energy for their prime mover from the bowels of the earth by human toil, their lot seems hard compared with that of those who have merely to look on while their primary source of energy descends from the clouds without any effort on their own part. But when the matter is looked into more closely our position does not appear to be so disadvantageous as is sometimes supposed.
After all, the prime mover is not everything. Very often the harnessing of water-power involves large capital expenditure. Great works in the
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way of development are required in order to harness the power, and bring it to the place where it is wanted. The relative importance of all these considerations can only be judged by the financial outcome, and, although an occasion like the present is not one for presenting statistics, I think it may be allowable to mention that, if we take the year 1924, the actual selling price of electricity in the Clyde Valley, which I take as an example of a region where the possibilities have been successfully exploited, is only about half as much again as the average price in Switzerland. So that the position does not appear to be so bad, always supposing that the conditions which can be commanded to-day for making the best use of the fuel are utilised to the uttermost.
I think it may be of interest to consider for a moment what those conditions are. The first is to do the best one can with the fuel which is actually employed. The amount of energy that can be obtained from steam is subject to well-defined limits. These limits were laid clown by a former member of your Lordships' House, Lord Kelvin, with whom as a boy I had the privilege of being intimately acquainted. He showed by an admirable piece of abstract reasoning, of which the cogency and force has never been surpassed, what were the limits of the amount of power to be obtained from steam. The modern development of the steam turbine by Sir Charles Parsons has approached very closely to the limits which he then set out as possibly attainable. So that there does not remain much to be done except to utilise the benefit of his labours, and those of other modern engineers, and to employ large-scale plant which has been proved to be indispensable if the utmost economy is to be obtained. It is only on the largest scale that the steam turbine is capable of giving a full yield. Units of not less than 20,000 horse-power ought to be employed, and that necessarily involves the abandonment of all small-scale generating stations. This is one of the essentials of any real improvement in the electrical situation. Large-scale stations equipped with modern steam plants should be substituted for the small-scale stations, which should be got rid of.
The serious problem which the supply of electricity raises is that the greater part

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of the ouput of the plant is not practically available for selling purposes; the load is by no means uniformly distributed. If the large-scale plant were capable of uniformly selling all that it produces, and if there was always a demand up to the full capacity of supply, then the problem of maintaining the supply would indeed he a comparatively easy one. But that is by no means the case. The exceptional occasions when the demand is at its full are those which really produce the difficulty, and that difficulty can be met only by the different available sources of supply uniting their powers and, when an exceptional demand comes in one district, the other districts co-operating and adding as much as possible to the supply available. In other words, the supplies must be linked up in different parts of the country by long-distance transmission, and the whole country covered with an electrical network. It is only in that way that an adequate pooling of our resources can be achieved. That, then, is the central part of the Government's policy in the electrical development of the country.
It is a matter of general agreement among electrical engineers that the alternating current system of supply is the one which is adapted to the situation. There is no need to labour that. It will be known to most of your Lordships that in this system pulses of electrical current are sent out from the generating stations into the mains, much after the fashion that, in the human organism, the pulses of the heart are sent out into the circulatory system. In many ways one may compare the electrical system with the human one. But there is this point particularly to be noticed, that the rates of pulsation in the different electrical systems are different and unless they can be brought into agreement it is clear that these systems cannot co-operate.
It is impossible as a rule to adapt existing electrical plant to work at a frequency differing from that for which it was originally designed. For that reason the co-ordination of the supply will require the standardisation of frequency all over the country. This standardisation is a difficult undertaking involving, no doubt, the sacrifice of much valuable plant. Exactly how far the process can be carried is something which must be a matter of judicious compromise.
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It may be by no means necessary, in fact, to carry it out to a point of absolute uniformity all over the country. To take a concrete example, Scotland for this purpose, as for many other legislative purposes, forms a separate unit. One hopes that the romantic border country which separates England from Scotland is not to be industrialised to such an extent that the advantage of uniting Scotland into one system with England will be enough to justify the great expenditure which would be involved.
I have compared the position in Switzerland with the position in our own country and I have pointed out that the comparison does not lead to a result so unfavourable for us as might at first sight be supposed. But there is another side to the question which I think might not unfairly be noted on such an occasion as the present, even though it is not perfectly relevant to the problem of the hour. We are working with a wasting asset. Our coal supplies are becoming exhausted. It true that this generation and its children will not live to see this exhaustion take effect, but after all our present position has not been won in a century, or in two centuries, and those of us who value the heritage of the past cannot afford to take a short sighted view and to shrug our shoulders when the question as to what should happen in the future is raised.
In discussing this question with my scientific and lay friends I find that some of the latter, among them leaders of industry, have a great and touching confidence in what is going to be done for them in the way of scientific discoveries and they think that some way out of the difficulty will be found. Science is conceived as a kind of fairy godmother which is capable of supplying whatever the needs of the hour may most requite. I think it would be foolish to attempt any forecast as to, what will or will not be discovered. 'Reputations have been lost before now through the making of that foolish attempt and certainly I do not mean to make it. I limit myself to two remarks. The first is that the gifts of science up to the present have not really been of the fairy godmother order. Let us take, for example, broadcasting, which we have all learned to know and appreciate. That was not developed because the

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evenings were dull and it was thought convenient to have some cheap and variable means of entertainment available to everybody without stirring out of doors. That was not the reason why the development came about. It was because technicians saw how the thing could be done. When they 'saw how to provide it, they very soon provided it, the thing was appreciated and the demand for it grew. It was not because the demand was formulated beforehand. In the case of a supply of energy also I do not think we can expect that the discovery will be made merely because it is wanted. My second remark is that I think from experience those who are most likely to be able to assist in the making of such a discovery are not the most sanguine that it will be made.
To return, however, to the more immediate problems of the hour, His Majesty's Government is very harshly criticised in some quarters because it does not immediately embark upon a large scheme of what is called low temperature carbonisation. To hear the way some people talk one might think that this would be a panacea for all our existing social ills. Carbonisation, I need hardly remind your Lordships, is the process by which the coal is heated and wholly or partially converted into coke and the by-products collected. The fuel remaining behind after that process may be useful for a variety of purposes, while the valuable by-products are saved. One cannot live entirely on saving and that is really the keynote of the subject. It would be a mistake to suppose that when coal is made into coke the by-products are usually wasted. That is not at all the case. Immense quantities of coal are turned into coke for the purposes of metallurgy, smelting iron and so on, and the by-products are nowadays carefully preserved and rectified and made available for industrial purposes. That is the modern practice. It is true that twenty years ago the by-products were ruthlessly burnt and sent up the chimney in the process of making coke. It is now recognised that that was uneconomic and the practice is almost extinct.
While we realise that there is a much further scope for a similar process for the production of domestic fuel the problem becomes much more difficult. I think that a bright and cheery fire, on which
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most of us set a high value, is not a thing to be easily dismissed. If the project of low temperature carbonisation results, as I think it inevitably must do, in the production of a fuel which only burns with a pale flame and without a cheerful appearance, it is clear that the fuel so produced will not be much in demand for domestic consumption. Unless the fuel so produced, the smokeless fuel of which we hear so much, can be sold at the same price as the raw coal itself is sold at present the economy to be obtained is more than doubtful and it seems very clear that our national salvation is not to be found in any such direction. In saying this I am well aware that it is contrary to many sanguine hopes, but I am confident it represents the opinion of those best qualified to form one. Therefore, I think those criticisms of His Majesty's Government may very well be dismissed as not based on any adequate foundation.
I come now to the subject of agriculture, on which I hope to say a few words. At present the position of arable farmers in this country is very hard and difficult. We have often heard complaints of that kind before, but the ultimate test of their position must be the demand for farms. It is very difficult to get tenants for arable farms, though in the West Country, where the farming is grassland farming, that difficulty does not exist and tenants are more than ready to come forward. I do not think it will be of any use to flatter ourselves that the proposals of the Government contained in the gracious Speech will be regarded by farmers as an adequate amelioration of their distress. 'The proposal to produce credits for them will doubtless be valued and there are two particular directions in which these credits are thought likely to be of special use. The first of these is to enable them to hold on and to dispense with the selling of their crops until later in the year when prices may be better.
It is easy, however to over-estimate the advantage to be expected from this source. There are various considerations which tell in the opposite direction. One of these is that the time most advantageous for thrashing is, as a rule, in December, and that at that time the labour on the farm is comparatively freely available. If the thrashing is deferred till a later date the necessity arises of

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diverting labour for the thrashing that might better have been employed in other ways. As the season goes on and the corn remains in stack unthrashed, the rats and mice are at work, and in the meantime the interest on the borrowed money is running on. In those ways much of the anticipated advantage may very easily be lost. More I think may be expected from agricultural credits when they are used to enable the farmer to borrow money on his standing crops. In this way a smaller amount of the capital is required to be locked up in his business. It may, of course, be argued that if the capital were his own instead of being borrowed it might, during the time when the crops were standing, be used in other ways, but in practice this is not so. If the capital is not to be gathered in at a given date then the probabilities are that everything is done more slackly, and the result is that less use is got out of the capital.
There is also mentioned in the gracious Speech the project of doing something further for small holdings. In dealing with the question of electricity I have already emphasised that the economic tendencies of the age are all against small-scale operations. In the case of small holdings there is some offset to this economic tendency, because the most important outgoing to the farmer at the present time is the wages bill. Those who are prepared to use their own labour on a small holding, and to give it without stint, have a certain economic advantage in comparison with those who have to employ the labour of others, and in this way the economic disadvantages of small holdings are in some measure offset.
Finally, I come to the question of housing and the attempt to facilitate it by credits given by His Majesty's Government. This raises interesting questions. There are doubts as to what is the best method, whether to build a new house or to spend money in repairing an old one, and no doubt the question as to which of the two should be done is partly a matter of temperament and partly a matter of compromise. Sometimes, for half the cost of a new cottage, an old one can be put into a condition of serviceable repair for twenty or thirty years. In that case, considering how great the needs of the times are for more houses, them can be little doubt of the
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wisdom of making the repair. I have mentioned the subject of repair as one largely dependent upon personal temperament. In Oriental countries, so far as my limited observation has enabled me to see, there seems little tendency for any one to repair anything. I was personally brought up on the opposite principle of never having a new thing if the old one could by any means be made to serve. The needs of the present time, I think, leave no doubt that we require both policies. New houses must be built, and old ones made serviceable, in order that the acute needs of the time may be satisfied. I thank your Lordships for the attention that you have given me. I have spoken at greater length than I had intended. It only remains for me now formally to second the Motion of my noble friend for an Address in answer to the gracious Speech.
VISCOUNT HALDANE: My Lords, the language which the Ministers of the King have put into the most gracious Speech is not of an alarming character. On the other hand, it is not of a very exciting character. We have looked in vain in the statement of policy contained in the words of the Sovereign for the outcome, for example, of the deliberations of His Ministers on, to us, the most interesting topic of the reform of this House. Not a word have I been able to find from beginning to end of the gracious Speech on that subject.
Although on the Speech itself there is perhaps less criticism than usual to be made, that does not detract from the circumstance that the Address has been moved and seconded in two very interesting speeches. The noble Lord who moved the Address told us that it was not his first speech, and indeed some of us very well remember a speech that attracted us all which came from him on the subject of military organisation. It gave us great satisfaction to think that we had somebody in the House who cared about those things, and who could speak about them as he could. Then the noble Lord who seconded the Motion inherits something that is even greater than any dignity which could have come to him by the passing of law. He is the inheritor of one of the greatest scientific names of this century, and it is to us a matter of high satisfaction, having listened to what he said upon this occasion,

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to know that as was the father so is the son, and that we have got a highly trained scientific mind amongst us to guide us when we require guidance.
I now come to the substance of the gracious Speech. It begins with a phrase that I have seen before about the relations with Foreign Powers continuing to be friendly. My recollection is that those were the initial words of the last King's Speech. It is a very good thing that it should be so. If the words do not tell us much, they at least inform us that there is nothing about which we need be very alarmed, and they introduce a series of more or less pacific announcements. It is quite right that the Government should have done their best to get into easy relations with the Turkish Government upon the subject which recently was before the League of Nations. There is only one comment that I would make. The Ambassador is stated to have proceeded to Angora since Parliament last met to negotiate with the Turkish Ministers. I am one of those who think that, as the centre of the Turkish Administration is now Angora, it will be necessary in the future for our Ambassador to be there much more constantly than has been the case in the past. You cannot settle these things in the East-without a great deal of conversation and personal communication. Indeed, it is on personal communication that most depends, and we have had lessons in recent times of how much we have suffered in this country from not thoroughly understanding the affairs of the Near East. Therefore I hope that this means that our very capable Ambassador will take up his residence there. For my part, even in these days of economy, I Should not be sorry to see the expenditure incurred of a transfer of the Embassy from Constantinople to Angora.
Reference is made to a Treaty which has been concluded between the King of Iraq and His Majesty's Government. We can say nothing about that until we see it; but I am not so greatly concerned as some people are about that Treaty. What has been done has been done, not on our own initiative, not, as was well said by the mover of the Address in reply to the gracious Speech from the Throne, with any desire to get anything for ourselves, but to give effect to a direction of the League of Nations. It
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is to carry out the policy of the League of Nations that we presume that Treaty was entered into. We shall look with interest to the Treaty. We do not desire to add Iraq to the British Empire, nor have we any desire to stay there if we can get out of it. We are there only for the purpose of facilitating peaceful relations among the people, and that is not so difficult or so serious a matter as some people suppose. Investigations have been going on for a long time and arrangements have been made for providing for the proper defence of the people of Iraq, and I have no reason to suppose that these arrangements have been dropped or have been in any way altered. So long as it is not so, and so long as we are on decent terms with the Turkish Government, I anticipate that Iraq will settle down to a condition of peace and I think that we may, at any rate for a time, render some assistance in bringing that desirable state of things about.
There is a reference in the gracious Speech to the Preparatory Committee on disarmament. That is a very difficult subject. We have not got very far when we are only talking of sending a representative to a Preparatory Conference, but I quite realise that the question of disarmament is a very difficult one indeed and is a subject on which people must be allowed to take their time unless things are to fall to the ground altogether. Still, we shall expect to hear more a little later from the noble Marquess who leads the House as to the nature of this Preparatory Conference, the scope of its activities, and the sort of lines we propose to take when it meets.
Then there is a reference which has moved one a little to sadness—it is the reference to the arrangement come to with Italy. Everybody wishes to make things easy for a nation with which we are on traditional friendly relations, but that we should bear six-sevenths of the Debt which Italy incurred in the War does seem to me a little melancholy. The £4,000,000 which we have got—it is not £4,500,000—is not much to set against the enormous sums which we are paying out to those who lent us the money which we had to borrow to set Italy on her legs during the War. His Majesty's Government may have done all that they could have done, or they may

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not, but there are a good many people who think that we should have had more, if it was only the best fraction of what Italy owes us.
I notice that invitations are to be sent out to a Conference to consider the possibility of securing an effective international organisation for the regulation of hours of labour. That is a most desirable thing. We suffer in this country—or at least it is said We do; I am never sure about it—because of the hours of labour abroad, and it is desirable that the standard we have in our own country should also be the standard which obtains in other countries—the standard of short hours and good wages. But I look in the gracious Speech for a reference to a Bill which was in the last gracious Speech from the Throne. It is not in this Speech. It is a reference to the Factories Bill which has been in existence for a long time and which has been the work of two Governments. We fully expected to hear of it in the legislative programme for the present Session. Doubtless we shall hear from the noble Marquess why the Factories Bill has been omitted and whether there is any intention of introducing it at a later stage.
There are a good many other subjects touched upon in the gracious Speech. There is economy. Of course, I agree about the necessity for the most careful economy, but I have always been compelled to bring the charge against the present Government, and I repeat it today, that they are very bad at grading in their economies. They are very bad in saying: "We will economies all round," without any reference to what is actual economy and what is not. I do not call it actual economy to deprive your farm or garden of the cultivation which is necessary to enable it to produce crops in the future, and crops in increasing proportions. I do not call it economy to starve your business of the necessary revenue and capital. Members of the Government appear to say; "Let us have economy all around." When we see the Report of the Colwyn Committee we shall find out whether any instructions were given to that Committee to differentiate between things which are essential to the future of the nation, things without which we cannot hold our own because of the relative progress of other nations, or whether there were no such instructions.
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That brings me directly to the question of education. I am not sure that we have occasion to be so much alarmed over the proposals of the Government with regard to cutting down expenditure on education as we at one time believed. I do not know; and I cannot make it out. I am a diligent student of their speeches on education, but I find it difficult to put them together. The Prime Minister says some admirable things about his desire to promote education, but probably on the same day there is a speech from the Minister of Education, it may be a reluctant speech, but it is a speech which indicates that he has been compelled by some higher power to cut down his estimates. It is not only a question of cutting down the estimates—there may be in the field of education regions in which you may cut down your estimates without doing much damage to the organization—but it is also a question whether the new developments which are in progress, and which were going to be continued, will now be continued. Look at what the London County Council did the other clay and what is going on all over the country. These are very serious matters. All over the world the standard of education is rising, all over the world a more highly trained class of workman is being g brought into competition with us and if not, only do we not keep up our own level but raise that level we shall be left behind in the international competition which is every year becoming more keen. Therefore the last thing on which I should have been disposed to economise wholesale is the subject of education. We shall hear no doubt in the course of a short time what is going to happen, because a noble friend of mine is proposing to put down a Motion on this subject on which the Government will be able to make a statement which I trust will be a reassuring one.
Then I come to the subject of a very interesting part of the speech of the seconder of the Address—namely, electricity. It is, as he said, a very great subject, and it would be a, very difficult subject were it not that investigation into its possibilities has been going on for a very long time. A great deal of scientific work was done and planned in the time of the last Government, and I have no reason to think that this has

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been thrown overboard. To be told that a Bill concerning electricity is being brought forward, to be told even as much as the Prime Minister told us at Birmingham the other day, to be told as much as the seconder of the Address has told us, does not lead us much farther on. We want to know that the thing is really going to be done on a large scale. With most of the observations of the noble Lord, Lord Rayleigh, I find myself in agreement. It is certain that we shall have to have uniformity and a standard of what is called frequency, and this is certain for more reasons than one. We ought to be the greatest manufacturers of electrical plant for export in the world. We have admirable electrical engineers in this country and we have admirable firms of electrical constructors, but they cannot sell their products abroad as they would because they have to manufacture for one frequency here and for another in the foreign market. That is a very disastrous state of things, and if we get the 50 frequency, which I understand to be the frequency at which the Government is aiming, we shall not only have uniformity in this country but we shall gain an opportunity for foreign trade which will enable us to increase our production and our employment.
This brings me to unemployment. I have never been one of those who worried as much as some people do about unemployment. I never believed it to he really so bad, nor do I believe it to be really so much better at the present moment, as people are prone to make out. Unemployment is simply the result of our not being able to get markets for our goods. The manufacture of goods naturally went down when the markets diminished. We have to get these markets by the maintenance of peace, by the development of good relations with other countries and by various arrangements. I do not think that tariffs hinder us to anything like the extent that people suppose. The skill of manufacture in this country is so great that we can get a range of quality for which the foreigner is willing to pay even a considerably enhanced price, and we shall always have a market so long as we produce goods of a high enough standard of quality. It is satisfactory to see that shipbuilding orders are beginning to come in again and that things are a little better, but I
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agree with the noble Lord who seconded the Address that we must not expect too much or imagine that we are going to go very fast in this matter. With regard to improvement in unemployment and improvement in electricity we had better make up our minds that a considerable time will elapse before we can solve all our problems.
We have heard nothing definite, of course, about the Report of the Samuel Committee. I assume that in the course of a fortnight we shall probably know whether that very valuable Committee has anything to recommend of a tangible character, and, of course, I make no reproach to the Government that they have not told us more on this subject, for they could not. There are other things which are germane to our present sitting in the gracious Speech, but I think that on the whole we must say that, until we know a little more about some of the propositions which it embodies, we are not in a position to say very much about them. At any rate it is a satisfaction to have before us an intimation of the immediate work of the Session, and I congratulate the Government at least on having produced nothing highly controversial concerning electricity if their plans come up to the standards which were definitely laid down in the last Parliament and which we worked out in much greater detail than appeared, I can only say, speaking for myself and, I think, for my colleagues also, that we shall view them in the most favourable light.
THE LORD PRIVY SEAL (THE MARQUESS OF SALISBURY): My Lords, I should like to join with the noble and learned Viscount, the Leader of the Opposition, in congratulating my two noble friends, the mover and seconder of the Address, upon the manner in which they have accomplished their task. My noble friend the mover, as he has told your Lordships, is not an absolute novice in this House. We have, if he will allow me to say so, watched with great gratification the careful attention which he has for many months paid to the business of your Lordships' House, sharing from time to time in our discussions and always being present. Both when he has addressed us on previous occasions and also particularly to-night he has shown that he has a very considerable power of

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joining in our debates. His speech was full of political wisdom; it was just the kind of speech that ought to be made in moving the Address, very loyal to his own Party without being aggressive to the Party opposite; and there was from time to time a satirical touch which lighted up his speech. We are very much obliged to him and look forward to hearing him on many occasions.
As the noble and learned Viscount has said, my noble friend the seconder of the Address brings to bear on our discussions a great wealth of technical knowledge. It is very gratifying to hear once more one of his names taking part in our debates. There was a time when your Lordships' House was very rich in scientific members. There were very great names among us, and, as the noble and learned Viscount has said, not the least great was that of my noble friend's father. We believe that it is of the most immense importance that there should be in your Lordships' House men representative of the great scientific world who are able to guide our discussions and decisions when scientific issues are before us. I sat in admiration at the fullness of my noble friend's knowledge as he went into the difficult questions with which he had to deal.
When I turn from the two speeches of my noble friends to the speech of the Leader of the Opposition I really have very little of which to complain. It was, I think, the mildest criticism that I have ever heard of a Speech from the Throne delivered by the Leader of the Opposition. I am not sure that I find very much in his speech to quarrel with, but perhaps I may be able to seine extent to relieve his anxieties. He was very anxious about the reform of the House of Lords. I am not quite sure that, when we come to the actual process of reforming your Lordships' House, he and I will be altogether agreed, but on the view that there ought to be some changes we are, no doubt, at one. I hope your Lordships will not think, merely because the subject does not appear in the gracious Speech from the Throne, that therefore it has not been engaging the careful attention of His Majesty's Government. On the contrary, we have done our best to explore this very intricate subject, and all the difficulties which attend upon it, but the matter has not yet reached such a point
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that it is ripe for production before Parliament, and I think there is very little use in putting into the mouth of His Majesty, in His gracious Speech, all sorts of subjects which have not yet become matured. It would be a waste of time. But we shall certainly go on with our efforts, and I hope that, before very long we shall be in a position to make something much more positive in the way of a declaration in this House.
Then the noble and learned Viscount turned to our foreign policy. I do not gather that he criticised anything very much in our foreign policy. He was all for the Government policy in Iraq, so far as I understood, but he reserved, and very properly reserved, his approval of the Treaty which His Majesty's Government have made with the Government of Iraq until he has seen it, and I hope that his patience will not have a long trial. The Treaty will be laid before Parliament within a few days, I hope. But so far as the general policy which that Treaty represents goes the noble and learned Viscount had no criticism. He said that he hoped we should conciliate the Turks. We are doing our utmost to conciliate the Turks. If I may try to describe the policy of His Majesty's Government in one phrase, I should say that it is a sincere policy of conciliation and reconciliation. That is the object of His Majesty's policy in every quarter of the world. Although it is impossible for us to abandon the position taken up by us with regard to Iraq and the Mosul Vilayet, because if we abandoned it we should be abandoning our obligations as trustees for that people, yet we are most anxious that the ancient friendship between this country and Turkey should be restored, and that there should be no bad blood over difficulties in that quarter of the world.
We have, as the gracious Speech says, taken the necessary steps to put our Ambassador in touch with the Government at Angora. The noble and learned Viscount asks: Why does he not live at Angora? It is not only in this country that there are housing difficulties. If the noble and learned Viscount, on his next holiday, were to take a little trip to Angora I am afraid he would find that the accommodation there is rather primitive. At any rate, I share with him the hope that before very long there

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will be some possibility of a permanent residence at Angora. At present it is not possible. We are doing all we can do to renew the full friendly relations with Turkey, and in so far as anything can be done to conciliate the Turks, within the four corners of the decision which the Council of the League of Nations took at Geneva, we shall be very glad to avail ourselves of that expedient.
The noble Viscount also asked me about the Disarmament Conference. I have very little to say about that, because it is, as its name implies, distinctly of a preparatory character. It is not intended to settle anything, but merely to prepare the way. These things, as he knows, are extremely difficult and raise very intricate issues, and it is thought by those who direct the deliberations of the League of Nations that no time will be lost if the first step should be of a preparatory character. Great difficulties as to the scope of disarmament arise: as to whether it shall affect existing armaments only, or what I may be allowed to call potential armaments; as to how it shall be distributed having regard to regional considerations. These things are very difficult, and preparatory discussion is probably the most useful method of approaching an ultimate decision. We hope before very long that a noble friend and relative of my own, a member of the Government, will be our Representative at this Conference, although I am quite unable to say how soon it will take place. So far as the British Government are concerned we think, and we have said, that the sooner it takes place the better we shall be pleased. That is the position we have adopted.
Then the noble and learned Viscount said a word about Italy and the Italian Debt. He did not object to our having come to an arrangement with Italy, but there was a certain element of criticism, I think, in the way in which he approached the terms which have been agreed upon. There is no question whatever that the Government value very highly good relations with Italy, and it is a matter of great satisfaction to us that in the terms at which we have arrived we have been able to conciliate Italian opinion. It is really most vital in the present position of Europe that we should bring this question to a settlement. We have, of course, certain rights; we may make
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certain concessions upon them, but we cannot go beyond a certain point. It is no use pretending we can go beyond a certain point, but we are willing to go to a great length and in determining how far we can go we must take account of the capacity to pay of the debtor country. We know that the Italian nation, prosperous in a way though it is, is not in the same position as regards resources as we are ourselves. There is a great want of mineral resources. On the other side of the account they have received a, very small part of the German Reparation payments. All these things make considerable difference.
And I may say that in giving what I think may justly be called liberal terms to the Italian nation we have only followed the policy of successive British Governments. I think it will be found that almost every successive British Government have assured the Italian Government that they desire to treat them with the utmost liberality which is possible in all the circumstances of the case. Those are considerations which influence His Majesty's Government, and I do believe that on the whole a good settlement has been made. The immediate contributions which they will make are of great importance indeed. When I consider this subject it seems to me that greater weight should be laid upon what is going to be got in the course of the next few years than upon the Debt which is to be held over for a long term. Looking at it from that point of view I think we may congratulate my right hon. friend the Chancellor of the Exchequer upon the arrangement which he has made.
The noble and learned Viscount next asked me a few questions about home policy. His first criticism was as to the absence of any reference to the Factories Bill. His Majesty's Government do not propose to proceed with the Factories Bill in the present Session. In considering that question I would ask your Lordships to reflect upon the trade situation of this Country. After all, industry is a very tender plant. It is beginning to show distinct elements of recovery after the long winter through which it has passed. The spring is just beginning. It would, I believe, be most unfortunate if by any act of the Government, we were to nip it in the bud. We must do everything we can to cherish it and nurture it. And,

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although the Factories Bill is certainly very much required, and must be passed within a short time, yet there are elements in the factory question which might undoubtedly have involved a temporary set-back to industry. No doubt within a certain number of months that might be got over, but we are riot prepared to run the risk at this moment of any set-back. We will do everything we can to help industry forward, and therefore we do not propose to proceed with the Factories Bill in the present Session.
I might call your Lordships' attention to the improvement in trade, such as it is. The two middle quarters of 1925 were very disappointing. There was a great set-back in trade. But, towards the end of the year, especially in the fourth quarter, there was a distinct recovery, so much so that, on the whole, 1925, when it was finished, did not present a worse picture than 1924. You may think that is rather small praise but when you think what our anxieties were in the middle of 1925, then your Lordships will realise what a relief it was to find that at the close of the year there was the recovery of which I have spoken. And, when you look at the trade of the fourth quarter in detail, it will be seen that, not only in value, but even in volume, there was an improvement, in trade. I do verily believe that we are on the eve of a recovery, if no adverse circumstance takes place.
That is the real anxiety. Great labour troubles would be fatal to this recovery. The noble and learned Viscount spoke, for example, of the difficulty in the coal trade. He did not ask me any questions; he said, with great truth, that it was impossible for me or any member of the Government to say anything at the present moment. Of course, we are waiting for the Report of the Coal Commission; but if, unfortunately, after the Report of the Commission there should be labour trouble in the coal industry that would be a set-back to our trade of the most formidable character, and undoubtedly anybody who is responsible for affairs must view that prospect with no little anxiety. But we hope—and we have some reason to hope—that the good sense of our people will see that no labour trouble arises thereupon. My noble friend who moved the Address
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said in very becoming terms that he was confident that the good sense of the British people and the vigour of its character would survive these difficulties, just as it had survived the great trial of the War. We hope that may be the case. That is the reason why I have some confidence in the recovery of trade, and why, also, we are determined to do nothing, so far as we are concerned, which will have the effect of checking it.
Then I turn to the question of economy. The noble and learned Viscount, so far as I understood him, divided expenditure into two heads: that which was wasteful, and that which was essential. He thought it was quite right to economise in respect of that which was wasteful (in which I do not suppose he would find any human being to disagree with him), but he did not think it was right to economise on anything that was essential. There, too, I think no one would disagree with him. But when you have divided expenditure into what is wasteful and what is essential you really have not given a complete account of it at all. There is a vast amount of expenditure which is neither wasteful nor essential, and it is in that vast area where economy must take place, if it is to be effective. Of course, we must cut off all waste—who doubts it? And of course we must maintain all essential expenditure—who doubts it? But we must, if we can, economise, so far as our obligations permit, in everything else. I say "so far as our obligations permit," because there are a large number of commitments in regard to which we, of course, cannot fail; but where we are not committed we must economise if we can. That is essential to this very trade recovery of which I have been speaking. We must give up thinking in this country in terms of affluence: we are not affluent. We may be affluent again, but at present we are not affluent, and the whole spirit in which, through so many years of our history, we have approached this question of expenditure must be entirely altered. In the days before the War we fussed about expenditure, but it really did not matter very much. A few thousands, even a few millions more or less did not seriously affect the prosperity of the country. But that is all altered now, and we have to scrutinise everything very carefully.

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That applies to all the subjects with which the noble and learned Viscount dealt. Of course, he was against economy in education. I say "of course" because he is a noted educationalist, and it is a common-place of this subject that no one wants to economise on the subject in which ho is interested. But I hope your Lordships will not carry away a wrong impression of the policy of His Majesty's Government in respect of education. There is the larger policy which applies to education, but not to education alone—the policy, if possible, of substituting for the percentage grant system the block grant system. That, we believe, to be, broadly, the proper policy in all the departments which have to do with local affairs. The other policy leads to extravagance. As between the central Government and the local governments there is a loss of the sense of responsibility, and that leads to extravagance. Indeed, when half or three parts of the expense of a particular service is paid by somebody else, it is human nature to incur it on the ground that you are taking something out of what is not at present in your own hands. So we have seen that the percentage grant system leads to expense. There is an element, too, as between the officials on the one side and the other. Apart altogether from the Ministers in London and the representatives of the ratepayers in the localities, there is a great body of officials. Those officials, of course, are entirely in favour of efficiency, even if that efficiency is of a most expensive kind; and behind, as it were, the screen of this vagueness of responsibility as between the central Government and the locality on which the expense really falls, these officials are all-powerful and push forward expenditure, which, consequently, rises higher and higher.
We aspire to arrive at the block grant system. It has not yet been ascertained how far that can be applied to the Education Department. Discussions are still going on. It will not be applied immediately to education, in the Estimates, that is to say, for 1926–27; but it is the policy to which we are working. In regard to the immediate education policy of the coming financial year, it is a question of examining very carefully what economies can be made in detail; how far, that is to say the local education authorities are already committed
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to expenditure. Where they are absolutely committed their commitments, of course, must be acknowledged. Where they are not committed we propose to scrutinise very carefully any increased expenditure with which the country may otherwise be burdened. Broadly, that is the method and the spirit in which we are approaching the expenditure upon education. I will not go through them all, but what is true of education is true of all the other Departments of Government. When the economy policy of the Government is sufficiently matured to be laid before Parliament—and it will not be very long delayed—your Lordships and the country will see that we are going to apply those principles, so far as we can, not in one but in every department.
At the end of his speech the noble Viscount said a word or two about the Bills which were promised, notably, of course, the Electricity Bill. I do not intend to follow my noble friend the seconder of the Address in his description of the principles which must govern the Electricity Bill. In the first place, I am not qualified, as he is, to deal with that question, and, in the second place, it would be more convenient for your Lordships and Parliament to wait for the production of the Bill before discussing it. All I can say is that it is part of the effort which we think ought to be made in the difficult conditions through which the country is passing that its equipment should be perfected and its organisation made as effective as possible, notably in the matter of electricity. If we can save on the one side and improve our organisation on the other, and if, above all, we can inspire our people with the spirit of effort, we are confident that we shall pull through.
It is the last thing which we believe to be, far the most difficult. There is an unfortunate idea, the result, I suppose, of a misunderstanding of the situation in times past, prevailing not throughout the working class, but amongst many members of it, that there is some benefit to be achieved by working less than they can. I cannot conceive how that has arisen. It seems to me that the great object of human life is to work as hard as you can. But many of those people do not seem to think so. Until that spirit is eradicated you cannot expect the country to recover as we hope it may.

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But when the Government have done their utmost, when Parliament has done its utmost, and public men of all Parties—we appeal to public men of all Parties arid not merely of our own Party—have urged upon the people of the country the necessity for hard work in order to recover from the difficulties in which we are placed, then we are confident that we shall once more sail into that sunny sea of prosperity which we left at the time of the breaking out of the Great War.
EARL BEAUCHAMP: My Lords, your Lordships will allow me, I hope, to begin my remarks by emphasising the compliments paid by the two noble Lords who have just spoken to the noble mover and noble seconder of the Address. It is not by any means the first time we have listened to them in your Lordships' House, and their speeches on this occasion were as full of common sense and of knowledge as on previous occasions. I only hope they will take part more frequently in the discussions in your Lordships' House than they have in the past.
When I turn to the gracious Speech from the Throne I make this comment at once. It is the case with this as with so many similar Speeches, that what is omitted is as interesting as what is included. Let me take one point of outstanding, importance foreign affairs to which there is no reference in the Speech and to which none has been made in the discussion this afternoon. I refer to the evacuation of Cologne by the British troops. It is true, for reasons it is not necessary to mention, that this evacuation has been delayed for rather over twelve months. I am rejoiced to think it has taken place at last. It seems to be a suitable opportunity and place in which to pay a very high tribute to the conduct of the British troops who took part in the occupation of that territory. Their task was a difficult and invidious one, but I believe they earned the esteem and good will of the inhabitants of the district which they were occupying, and I think it is only right that we should express our high admiration of the conduct of them all from the Commander-in-Chief to the smallest drummer boy during those, years.
I am glad to think it was an occupation which we were able to reduce. It began
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seven years ago with something like 400,000 men and had become something very much less at the time of the withdrawal. No serious complaint has been made of the behaviour of those men during that time. That is a remarkable fact and one of which we may well be proud. With regard to the future, I venture to urge upon His Majesty's Government to consider whether it would not be possible for them to reduce the further terms of occupation provided for in the Treaty of Versailles. It is difficult for anybody to see what advantage can be served in the future if Germany joins the League of Nations, as we hope will happen directly, by the continuation of that occupation even in a smaller and modified degree. I hope, therefore, that His Majesty's Government will take that point into consideration.
There is yet another matter of first-class importance to which no reference has been made, and which is one, I hope, of great augury of good for the future—the entry of the United States of America into the World Court. It is but a small step to begin with, but it is one which may be fraught with the gravest and most excellent consequences in the future.
Of home affairs I regret to think that there was no mention in the gracious Speech, nor in what was said by the noble Marquess the Leader of the House of the Speaker's Conference which, I understand, is to take place this year. Speaking in another place on May 8, the Secretary of State for Home Affairs intimated that it was the intention of His Majesty's Government to set up another Speaker's Conference to deal with die position of women and their votes, and it was also intimated that it might include, amongst other subjects for consideration, methods of voting, absent voters, and even such a matter as Proportional Representation. I should have liked to have heard from His Majesty's Government whether that was still their intention, how large they expected the scope of the Inquiry to be, and whether they intended that these other matters should be included amongst the discussions of this new Conference.
Your Lordships cannot but feel that the success which attended the last Speaker's Conference is an excellent reason for having another Speakers Conference,

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and asking it to consider these matters, which really are of importance at the present time. This is not the moment to enter upon a discussion of those proposals for Proportional Representation which this House introduced on the last occasion—proposals which I hope it may once more agree to, and perhaps even insist upon when it comes to a discussion of them between the two Houses of Parliament. But that a Speaker's Conference of this kind will take place, and will include all these matters, I do hope.
There is another subject which was not referred to in the gracious Speech, although it has been referred to by both noble Lords who have spoken, and that is the reform of your Lordships' House. The noble and learned Viscount on the Woolsack took part in a discussion that was initiated by the Duke of Sutherland in this House in the month of March last year, and, speaking with the precaution which I think is habitual to his profession, he abstained from giving anything in the nature of a definite pledge. What he did say was that he had hopes that in the near future, and possibly next year, the Government might be in a position to introduce a measure dealing with the subject. There is nothing in the Speech about it. The noble Marquess the Leader of the House has explained to us why that is so.
Will he allow me to make a suggestion to him with regard to this matter? There are really two different subjects involved in the discussion of the reform of the House of Lords. One is the question of the constitution of your Lordships' House, and the other is the powers given to your Lordships' House under the Parliament Act. In the course of one of the discussions that we had last year upon this subject it was, I think, most remarkable that the noble and learned Earl who then spoke for His Majesty's Government, Lord Birkenhead—the cause of whose absence to-night I regret—should have spoken in a way that showed that His Majesty's Government had no intention of introducing anything in the nature of a repeal or a serious amendment of the Parliament Act. That it should be the intention of His Majesty's Government to enter into nothing more than small amendments of detail must, I think, be a matter of no small congratulation to my noble friend (the Earl
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of Oxford and Asquith) who is the author of the Parliament Act. But it is, I think, a matter of common agreement that there are matters of detail, such as those which are connected with the Speaker's Certificate, that should be susceptible of amendment. Those, however, are very different matters to the question of the constitution of your Lordship's House.
I cannot help thinking that His Majesty's Government might find that their difficulties would he to some extent made easier for them if they were to deal with these two subjects in separate measures, and perhaps even at separate times. That an early dealing with the subject is the wish of your Lordships' House admits, I think, of no doubt whatsoever. The discussion that took place last year, and the approval that was given to the demands for an early dealing with the matter by His Majesty's Government was so evident that it will be, T am certain, a matter of real disappointment to a great many members of your Lordships' House if it is found that His Majesty's Government have not seen their way to deal with the matter during the current Session.
I turn to other matters that were discussed in the gracious Speech from the Throne, and first of all to the subject which the Government have themselves put almost in the forefront of their programme—the question of economy. We are all agreed, of course, that there are right steps and wrong steps in connection with economy. The only points upon which we differ are as to where the economy should be exercised, as to what is right and what is wrong. I confess that I am not very hopeful. One remembers last year that His Majesty's Government, in the gracious Speech, spoke of economy as being a very desirable object to attain, but, instead of it being attained, the Estimates for the year were no less than£9,000,000 more than the Estimates of the year before. If that is a sample of the way in which His Majesty's Government think they can deal with economy, I must confess that the prospect is not very hopeful for the taxpayers of this country. Those£9,000,000 were wholly apart from unexpected subjects of expenditure like the coal subsidy.

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Of course, all of us have our pet extravagances. I join with the noble Viscount who spoke just now in thinking that education is one of those subjects upon which it is right that we should spend money. I should deplore any retrenchment upon the education of children, but that does not prevent me from saying that there is plenty of room for economy in administration. As time has gone on all the great local authorities have gained a very real amount of experience and knowledge of education, which makes it quite unnecessary that they should be controlled in the same way by the Board of Education as they had to be controlled when the system of education by local areas was started. I believe that a great deal might be said for giving more autonomy to the great local authorities, to the large county boroughs and the large county councils. By giving them more autonomy the cost of administration might be reduced, and, therefore, economy would be effected in such a way that it would be unnecessary to economise upon money that is actually spent upon the education of the children.
I desire to add that His Majesty's Government in their policy have hardly carried out the precepts of economy that they have preached. There has been not only the extra£9,00,000 in the Estimates for the year, hut there has been an increase in the taxes on various articles of consumption in this country. There have, in addition, been such subsidies as those for the coal industry and the sugar beet industry. The unfortunate fact remains that our experience of His Majesty's Government is that, in spite of their profession, they have not been able to procure that economy of which they spoke, and they have set us, unfortunately, a bad example in this matter. I may take one example that I saw mentioned in The Times yesterday. It was in a speech delivered by Signor Mussolini. Referring to the armaments in Italy he said:
"While words of peace flash on the horizon I cannot avoid noticing that the skies are filling with prodigious flying machines and the seas with new naval war units."
I cannot help thinking that if His Majesty's Government had abstained, on their part., from filling the seas with new naval war units they might have saved a certain amount of money to this country,
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and also that the people of Italy would have found it unnecessary to spend as much money upon their own war expenditure.
Mention of Signor Mussolini brings me naturally to the settlement of the Italian War Debt. It was mentioned both by the noble Viscount and the noble Marquess. The question to which I should like to have had an answer from His Majesty's Government is this: How far do they still adhere to the terms of the Balfour Note with regard to the Debts that are owed to us by the various foreign nations? Your Lordships will remember the generous declaration that was made that we did not wish to get from foreign countries more money than we had to pay on their behalf. The question is whether we still adhere to that line in principle, or whether we have thrown it over, as appears to be the case. For, after all, this Debt was not our Debt. It was money that we borrowed for the benefit of other people, money which they were not able to borrow for themselves and for which the approval of a Free Trade country like ourselves was necessary before the money could be loaned. And the position is really a very serious one. As I understand it, the net, Debt which is owed by Italy to us amounts, in round figures, to£570,000,000, and the net payment we are to have during the next few years amounts to only£4,000,000 a year. That, as the noble and learned Viscount said, results in this: that something like six-sevenths of their Debt to us is cancelled and we are obliged to pay interest on the whole of the rest of the Debt.
Taking all our Allied Debtors together the British taxpayer has to pay every year£100,000,000 upon the money we borrowed for the benefit of other people, and it is a little difficult to say how much we are going to receive from these other nations. A very small sum indeed is in sight. The Chancellor of the Exchequer estimated some£9,500,000 this year in Reparations from Germany. We know now that we shall get£4,000,000 from Italy, and as regards France I think the figure mentioned when the French Minister of Finance was over here was about£12,500,000. That is very far from providing the amount of money we have to spend; it leaves a very large gap which

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has to be filled out of the pockets of the British taxpayer to-day.
The noble Marquess spoke very truly of the lack of natural resources in Italy. That makes it all the more to the credit of that country that they should have managed to recover so large a measure of prosperity as they have. I venture to call myself an old friend of Italy. For more than thirty years I have found constant refreshment and delight by visits to that country, and it is surprising and delightful to notice how very much more prosperous Italy is to-day than she was when I first visited that country. Her prosperity has increased rapidly during the last five years, and any one who goes to Italy to-day and visits either Rome or Florence or Milan, or even the countryside, cannot but be struck by the constant evidences of prosperity amongst all classes of the population. We are all heartily delighted that it should be so and that they have been able by hard work—and may I add by low taxation—to make themselves so prosperous as they are at the present time. Whether we in this country have the same prospects, bearing as we do the highest proportion of taxation of any country in Europe today and having the largest number of unemployed, is a matter of very considerable doubt. I wish I could join, in the modified optimism of the noble Marquess.
There is one other omission from the gracious Speech, and that is that there is no direct mention of the vast number of unemployed who still remain in this country. We are in some danger of drifting into a position of thinking that it is normal that there should be this vast mass of unemployed, but to my mind it is important to realise that it is abnormal and dangerous, and that it is a state of affairs which we should do our utmost to get rid of as soon as we can. Therefore, I regret that there is no direct reference in the gracious Speech to this great burden of unemployment and no direct mention of any measures to do away with this open sore in our national body. I think this also should be said: that the conduct of these unemployed men through all these years really deserves the highest credit. They have lived lives of real misery, not necessarily of starvation but of constant hardship, and yet we have had a population
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which has certainly suffered in no way at all from disturbances which have been only too frequent in the history of this country in days gone by when the circumstances were not even so bad as they are to-day. We owe a great deal to the character of the unemployed working man for the stoicism with which he has borne this hardship. I repeat my regret that; His Majesty's Government, by making no reference to the grave state of unemployment, have made no effort to arouse the conscience of the nation to the real danger in which we stand in this matter to-day.
THE EARL OF MIDLETON: My Lords, I do not rise to trouble your Lordships with any remarks on the general trend of the debate, but I should like to say one single word on what has fallen from the noble Earl with regard to the reform of your Lordships' House. There are many members on this side of the House who would be very sorry if it was supposed that there was any decrease in the interest taken on this subject by a large number of members of your Lordships' House. They are greatly disappointed that the Government have not found themselves in a position to deal with this question during the present year. It is a question which in my opinion is overripe for settlement. I am not going to throw across the House to the noble Earl, the Earl of Oxford and Asquith, those well-known quotations with which he garnished many of his speeches some years ago, quotations all in the direction that this question was ripe for settlement, and that it was part of a pledge when dealing with the Parliament Act. I think the issue grows graver every year that we are unable to come to a settlement. I think from the expressions that he has used that it is known to my noble friend the Leader of the House that there is an increase in the anxiety of members of the House on this subject. Declarations have been made from a variety of sources during the last few months which have shown that they have every confidence that the Government will proceed to take measures to ascertain the opinion of Parliament on the subject. I will not trouble your Lordships with any further remarks, but I do hope that these anticipations will not be disappointed.
THE LORD CHANCELLOR (VISCOUNT CAVE): My Lords, I do not propose to enter into the controversial topic which has been raised by the noble Earl, but if no answer were given to his speech it might perhaps lead to misunderstanding. The whole House heard with complete assent what was said by the noble Earl, Lord Beauchamp, with regard to the conduct of the British troops in the occupied zone. Their position, and that of the commanding officers, was obviously a very difficult one, but I think we all agree that by the manner in which they discharged their task they have maintained and strengthened the reputation Which British troops have throughout the world for good conduct and good discipline in any territory which for the moment they may occupy. The noble Earl said something about terminating our occupation of other parts of the country. That is a matter which can only be dealt with in conjunction with those other countries which are concerned with us. He also referred to the decision of the Government of the United States to take part in the proceedings of the Inter national Court. With all respect to the noble Earl, this is not a matter which would in the ordinary course be mentioned in the King's Speech, hut nevertheless I think he was entitled to say that all of us are glad, and certainly I am glad, that the. United States has taken this important decision, which will strengthen the hands and increase the prestige of that Court and will help it to make a real contribution to the future peace of the world.
As regards the reference which has been made to the proposed reform of your Lordships' House, the noble Earl referred to something which I said in the last debate on the subject. I do not withdraw a word that I then said. His Majesty's Government have not lost sigh of the subject in any way. A most serious inquiry into the matter has, taken place and has continued down to the present time, and considerable progress has been made. The matter is under the immediate consideration of the Government, but, as my noble friend said, it has not yet reached a stage at which it would be right or proper that an announcement should be made. An announcement today would be premature, and I am sure that the noble Earl will agree that in a matter of this kind a premature an-
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nouncement would be undesirable. I can assure the House that, so soon as a decision has been come to, Parliament will be acquainted with the view that His Majesty's Government adopts.
As to the Balfour Note, may I say, though I speak with some diffidence, for I do not pretend to be a financier, that I think the essence of that Note was that we should not ask from our foreign debtors more than we were prepared to pay and had to pay to our foreign creditors. If the noble Earl would enumerate the amount of the annuities which, one by one, we are receiving engagements to pay from our foreign debtors, and will compare them in the aggregate with the amount which we are paying to our one foreign creditor, I think he will see that at all events the figures are gradually approximating the one to the other. We have not gone back in any other way from the Balfour declaration. We do not ask more from our debtors than we are to pay to our foreign creditors. Whether we shall in the end make the two sums coincide I would not venture to predict, but I am sure the noble Earl will agree with the view that has been put forward that in all these settlements we must have regard not only to the nominal amount of the debt but to the capacity of the debtor to pay.
I will add only one word more. Unemployment with great deference to my noble friend Lord Beauchamp, is mentioned in the gracious Speech. He will find a very sympathetic reference there. I think all of us will agree with him that the subject is of the utmost importance and nothing that can be done by any Government towards reducing that haunting evil of unemployment should remain undone. I agree entirely with the objects of the noble Earl, and I assure him that the matter is never forgotten by the members of His Majesty's Government.
On Question, Motion agreed to nemine dissentiente, and Address to be presented to His Majesty by the Lords with White Staves.

CHAIRMAN OF COMMITTEES.
The VISCOUNT HUTCHINSON (E. Donoughmore) appointed nemine dissentiente to take the Chair in all Committees of this House for this Session.
Committee for Privileges—Appointed.
Committee for the Journals—Appointed.
Stoppages in the Streets—Order to prevent, renewed.
Appeal Committee—Appointed.

AGRICULTURAL WAGES (REGULA TION) AMENDMENT BILL. [H.L.]
THE MARQUESS OF LINCOLNSHIRE: My Lords, I ask permission of the House to introduce a Bill for the purpose of ensuring a minimum wage for agricultural labourers, and to move that it be now read a first time.
Moved, That the Bill be now read 1a.—(The Marquess of Lincolnshire.)
On Question, Bill read 1a, and to be printed.
House adjourned at twenty minutes before seven o'clock.