Lords Sitting of 6 February 1930

Preamble
The House met at a quarter past four of the clock, The LORD CHANCELLOR on the Woolsack.

PRIVATE BILL FEES.
THE CHAIRMAN OF COMMITTEES (THE EARL OF DONOUGHMORE): My Lords, you will remember that just before the Christmas adjournment I mentioned that it would be necessary to make some such proposition as that which appears in the two Motions (one following the other) that are on the Order Paper. There is nothing in these Motions which is outside of what I referred to on that occasion, and unless any of yowl. Lordships desire that I should elaborate anything I will leave the matter there; merely reminding your Lordships that the ultimate result of the charging of these fees will be that in a Joint Committee the parties would have to pay very much less than they would pay should no Joint. Committee be agreed to and they therefore would be called upon to pay separate fees in the two Houses. Again, I would emphasise the fact that the fees of your Lordships' House are a very small proportion of the cost of obtaining an Act of Parliament as a Private Bill. At the same time to a great extent we are doing something to make it cheaper by these two Motions. I therefore submit the first Motion to your Lordships.
Moved, That the Schedule of Fees to be charged and taken in respect of Bills in the House of Lords referred to in Standing Order 147A be amended as follows:—
At the end of that part of the Schedule which refers to Local or Personal Bills insert:—
Joint Committees.
In the case of every Local Bill referred to a Joint Committee, whether by this House or the House of Commons, the following fees shall be charged and taken in respect of the Joint Committee:
For every day on which Counsel appear in support of Bill £5
For every day on which Counsel Agents or appear in support of a Petition £2
In the case of every Local Bill referred to a Joint Committee by this House the following further fees shall be charged and taken in respect of the Joint Committee:
Every Petition in favour of or against a Bill not praying to be heard £1
Every Petition praying to be heard against a Bill £2
Every Petition in favour of a Bill and praying to be heard against alteration therein £2
Order for attendance of witnesses, each witness £1
Every witness to whom an oath or affirmation is administered before a Committee 2s.
Committee on any Local Bill £5
Report, any Local Bill, with Amendment £4
Report, any Local Bill, without amendment £2
Report, Bill not to proceed £1
Order on Report that promoters do not intend to proceed further with Bill £1
—(The Earl of Donoughmore.)
On Question, Motion agreed to, and ordered accordingly.
THE EARL OF DONOUGHMORE: My Lords, the second Motion refers to the procedure which will be followed when Bills are divided. We know that there will be some such cases submitted to your Lordships in due course. I beg, therefore, to make the Motion standing in my name.
Moved to resolve, That in case during the present Session of Parliament any Local Bill be divided before the Second Reading in this House into two Bills, the usual fees shall be charged in this House in respect of each of the two divided Bills, provided that there shall be remitted to the promoters in respect of the fees applicable to Second Reading and Third Reading in this House the excess, if any, of the fees charged on the two divided Bills over the fees which would have been charged on the Bill as read a first time in this House.—(The Earl of Dononughmore.)
On Question, Motion agreed to, and ordered accordingly.

REDCROSS STREET BURIAL GROUND (BRISTOL) BILL. [H.L.]
Read 2a.
ROYAL EXCHANGE ASSURANCE BILL. [H.L.]
Read 2a.
SHROPSHIRE, WORCESTERSHIRE, AND STAFFORDSHIRE ELECTRIC POWER BILL. [H.L.]
Read 2a.

ROTHE SAY TRAMWAYS AND OMNIBUSES ORDER CONFIRMATION BILL. [H.L.]
Pursuant to the Private Legislation Procedure (Scotland) Act, 1899, deemed to have been reported from the Committee.
Bill read 3a (according to Order).
LORD MUIR MACKENZIE LORD MUIR MACKENZIE moved, after Clause 34, to insert the following new clause:—
Accounts of omnibus undertaking.
The company shall keep the accounts in respect of their omnibus undertaking separate from their other accounts distinguishing therein capital from revenue.
The noble Lord said: My Lords, I beg to move the Amendment standing in my name, which is simply for the purpose of enabling separate accounts to be kept of the omnibus undertaking under the provisions of the Bill.
Amendment moved—
Page 25, after Clause 34, insert the sail new clause.—(Lord Muir Mackenzie.)
On Question, Amendment agreed to.
Bill passed, and sent to the Commons.

MINISTRY OF HEALTH PROVISIONAL ORDER (GOSPORT EXTENSION) BILL.
House in Committee (according to Order) on re-commitment of the Bill: Bill reported without amendment.

WEST INDIAN SUGAR INDUSTRY.
VISCOUNT ELIBANK VISCOUNT ELIBANK rose to call attention to the serious state of the British
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West Indian sugar industry and to press His Majesty's Government for the early publication of the Report of the West Indian Sugar Commission which has recently returned from the West Indies. The noble Viscount said: My Lords, I rise to call attention to the question mentioned in my Notice on the Paper. This is not the occasion for a long or informative speech, and I only propose to state the facts as briefly as possible. It will be within the recollection of your Lordships that some four months ago His Majesty's Government decided to appoint a Royal Commission, consisting of two gentlemen, one a distinguished member of your Lordships' House, Lord Olivier, whom we are glad to see back here to-day after his long journey. His Majesty's Government appointed that Commission with the object of investigating the position of the sugar industry in the West Indies and British Guiana, and generally to make recommendations as to how the position might be remedied.
The members of the Commission have returned from the West Indies, and we learn from a statement in the Press that in the first instance a Report of the Commission's findings was cabled to the Colonial Office and received there at the end of December—four or five weeks ago. We have also learned from a statement made by the noble Lord, Lord Olivier, himself in the Press to-day, that the full Report has been presented now to the Colonial Office and is in the hands of that Office. My object in raising this matter is to ask the Secretary of State for the Colonies for the earliest publication of that Report, so that those who are engaged in the sugar industry in the West Indies and in British Guiana, and also those who are interested in the sugar business in this country, may know at the earliest possible moment what that Report contains and what its recommendations are. My reason for urging the earliest publication of that Report is that the condition of the sugar industry in the West Indies, critical as it was at the time the Commission was appointed, has become more critical still, and is growing more critical every day. The continued over-production of sugar in foreign countries, sheltered behind high tariffs, and subsidised and assisted by cartels, has so flooded

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the markets of the world that our Colonial sugar industry finds it impossible to compete with it.
We have to-day a very interesting statement in the shape of an interview between Lord Olivier and the Secretary of the West India Committee which was published in The Times this morning. In the course of that interview he gives some very interesting and very vital facts as affecting the situation to-day. For instance, he says:—
"There is now a load of over 5,000,000 tons of visible stocks unsold—and the over-production in 1930 seems likely to add to it another 1,000,000 tons."
I should like to refer to another matter. The Chancellor of the Exchequer, Mr. Snowden, in another place, speaking in July last, indicated that it was his intention to sweep away all duties on foodstuffs during the term of office of this Government. At the same time he said he realised that the abolition of the Sugar Duties might and would bear very hardly upon the Colonial sugar industry, especially in the West Indies and British Guiana. It was as a result of that, as I understand it, that His Majesty's Government agreed to appoint this Royal Commission and send it to the West Indies.
What does Lord Olivier say about that? I ought to preface the quotation by mentioning that if the Sugar Duties are repealed then, automatically, the preference on the sugar industry, which to-day amounts to a sum of about £3 15 s. a ton, would automatically disappear. Lord Olivier says:—
"If sugar throughout the world were being produced and sold under free trade conditions, the West Indian Colonies would be selling at good profits. As it is, they are selling—when they can sell at all—at a loss, even with the help of the British and Canadian tariff preferences."
It is clear that sugar is not being sold to-day under free trade conditions. As I have already pointed out to your Lordships, this over-production of sugar, which is being loaded upon the markets of the world, is very largely due to high protective tariffs, to subsidies and to cartels, and I would suggest to the Government, if I may venture to do so, that the Chancellor of the Exchequer might very well, in view of the financial exigencies which exist to-day and which everyone admits, consider the practicability
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of making a statement which will take the sugar industry out of the state of uncertainty in which it rests to-day. He might tell us, knowing as one can only believe will be the case, that it will not be possible to remove or reduce the Sugar Duties this year and that he will be prepared to continue the preferential duty which does exist.
What is happening as the result of this state of uncertainty with regard to the retention or non-retention of the preferential duty? The English refiners in this country have inserted a clause in their buying contracts and that clause reads to this effect:—
"The price stated in this contract includes the amount of preference in the duty based upon rates in force at the date of contract. Should there be any reduction in the amount of the preference in duty before the Budget introduced in 1930 or as a result of that Budget, then the seller shall reimburse the buyer by the exact amount of such reduction on the full quantity of the contract, notwithstanding the fact that a part or whole of the sugar to which this contract refers may already have been melted."
Those last words are the vital part of that particular clause: that—
"the seller shall reimburse the buyer by the exact amount of such reduction on the full quantity of the contract, notwithstanding the fact that a part or whole of the sugar to which this contract refers may already have been melted."
How can you expect business to be carried on under those conditions?
The effect of that clause is that to-day the British refiners are not bidding and have not bid for Colonial sugar in this market for some months. Not only that, but the Canadian Government give £4 8s. per ton preference, and Canadian refiners are taking advantage of the state of uncertainty in this country regarding the preferential duty and of this clause in the refiners' contract to come to this country and bid for British Colonial sugar at £10 5s. per ton, for February and March and £10 13,s. 6d.for April shipment, which is the actual price of the sugar without any preference at all. Taking the average cost of the production of sugar in the West Indies and British Guiana to-day—and it is a part of the world where sugar is produced more cheaply than anywhere else except, perhaps, Java—that means that the sugar producers in these Colonies are being asked to sell their sugar at a

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loss varying from £3 down to £2 10 s. per ton for the next three months. What industry can stand that? The noble Lord, Lord Olivier, who has such an intimate knowledge not only of present but of former conditions in the West Indies, and who has so recently been there and again investigated very carefully on behalf of His Majesty's Government the conditions existing to-day, tells us that as a result of this the sugar industry must gradually expire, and that nearly all the plantations must go out of business altogether.
That, shortly, is the condition as it exists. I am going to appeal to the Government for two things. Firstly, I am going to appeal to the Government to persuade, if possible, Mr. Snowden, the Chancellor of the Exchequer, to make a statement with regard to the retention of the preferential duties on sugar. If the Chancellor of the Exchequer were to make that statement I can assure you that that would immediately prove of very great, if temporary, relief. I am also going to appeal to the Government for the very earliest publication of the Report of this Commission, because I think it is of the utmost importance that those who are interested in sugar and those who, like ourselves in this House, have a responsibility for the well-being of the Colonies should know as soon as possible what are those recommendations. Moreover, if those recommendations are to be adopted it is important they should be carried out as quickly as possible.
LORD OLIVIER: My Lords, I do not think that the circumstance that at the present moment I am probably the best informed member of your Lordships' House on this subject makes it incumbent upon me to be silent and to refrain from supporting my noble friend on the other side of the House. My noble friend and I are familiar with the circumstances of the West Indies, and they are to us very much as Devon and Cornwall are to others. We have friends there, we have worked there, we know the interests of the Island intimately, and we perhaps feel more strongly than some members of your Lordships' House the intense gravity of the situation now threatening the West Indies, although I am quite sure that the members of the Government and all members of the House, if the facts were within their knowledge, would feel just
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as strong a sympathy and just as strong a conviction that steps must be taken to avert the impending calamity.
There is nothing whatever confidential in the conversation I had with the Secretary of the West India Committee which my noble friend just quoted. There is nothing whatever confidential in any part of our Report. All that is in our Report is statements of fact and findings very carefully canvassed, all of which have been publicly canvassed and taken in evidence and discussed by my colleague and myself in the West Indies. If anybody were to undertake the immense labour of wading through the files of the West Indian newspapers they would probably be able to write as good a Report on the subject as my colleague and myself, except of course the minute analyses which we have made with the assistance of our agricultural adviser, Mr. Jones, a man of great experience in the West Indies, of the factory work and cultivation work which make our Report perhaps a fuller document on the subject than has yet been published. In the interview which I had with the Secretary of the West India Committee, which the noble Lord has quoted, I expressed cursorily the opinion that when the Chancellor of the Exchequer made the statement which he did in July last he really could not have been fully acquainted with the facts of the situation. I say that in no impertinent or cavilling spirit, but the facts of the case have been made much more clear since the Chancellor of the Exchequer made his announcement.
Since then there has been published a very important document of the Economic Committee of the League of Nations which made a minute analysis of the world situation and of the causes which are conducing to the present difficulties in the sugar world. Taking that as our foundation, my colleague and myself have written our Report filling up the lacunœ of that Report with reference to the West Indies and taking that as an authentic document which may be held as the governing piece of evidence in the situation. We have elaborated that with criticisms of the situation in the various West Indian Colonies as the result of our investigations of the subject, and we have

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come to the conclusion—a conclusion that is quite unquestionable—that under present circumstances, and even with the preference, the West Indian sugar industry cannot continue to be carried on for two reasons: (1), because the collapse of credit is making it impossible for those persons who have to come for advances to banks and other people to get those advances or to get credit beyond the present crop: and (2), because the statements of the Chancellor of the Exchequer have knocked the bottom out of the market and no price can be got by West Indian producers at the present time for the sugar that they are now turning out, which is filling their warehouses, which they must get rid of somehow and for which they cannot get anything like a decent price. Those are the bones of the situation.
That is the position with the preference, and I say uncompromisingly, and your Lordships may take it as an unquestionable fact, that if and when the preference is taken away without any compensating or equivalent protection, the whole of the West Indian sugar industry, except so far as it provides for home consumption, will immediately be put in process of winding up. There will be no re-planting, existing crops will be taken off and sold for what they will fetch, and in the course of the next eighteen months, if present conditions continue and the preference is abolished, the West Indian sugar industry will come to an end.
No member of your Lordships' House who knows anything of the West Indies can contemplate that state of things without great perturbation. It will mean that the four Colonies which depend chiefly on sugar, St. Kitts, Antigua, Barbados and British Guiana, will be entirely knocked to pieces. The whole of the labouring population in the three first-named centres will be thrown out of work, and more than half that of British Guiana, and the whole economy of those Colonies will collapse. There will be great distress among labourers, there will be an entire cessation of the principal exports, there will be an entire destruction of purchasing power and there will be an almost entire collapse of the public Revenues. The basis of the society of those Colonies will be permanently destroyed. Those are results which I do not wish to elaborate. I just
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state them. They have been elaborated in our Report. These things will come to pass if the adumbrated intention of the Chancellor of the Exchequer to do away with the existing preference without some compensating succedaneum for it is carried out. That is a position at which I am sure my noble friend will be very much perturbed, and against which it is his business and that of the present Government to find a remedy.
Let me add that it is right and proper that a remedy should be found, even apart from the great distress that will be caused in the Colonies and the great damage that will be done to the British Empire if such a thing should come about. The West Indian producers of sugar produce sugar, from the world point of view, quite economically. If you take the cost of production of sugar in the various countries of the world, you will find that the British West Indies, Fiji and, I believe, also Mauritius—all British Colonies, long accustomed to carry on the industry, having spent a great deal of labour and capital on it and devoted much intelligence to building it up—come next to the great phenomenal producers of the world, Cuba and Java, in which the situations are very peculiar in the economy of sugar production. Cuba is the cheapest, but at present they are carrying on at a most serious loss to everybody engaged in the industry. Next to Java and Cuba, the West Indies are the most economic producers of sugar in the world. Cuba and Java together produce less than one-third of the world production of sugar. The West Indies come next, and the West Indies, Cuba and Java produce together a little less than one-third of the whole world production. In the rest of the world there is increasing cost of production, rising to double that of the West Indian Colonies. Is it not on the face of it an absurdity to say that it is economical for the world, for the British Empire or for anybody else to abolish West Indian sugar production?
I say, as the noble Viscount said, that this has nothing to do with free trade. If we were in a free trade world and sugar were produced and distributed on free trade principles, the West Indian producers would be making considerable profit. I think I have said enough about the gravity of the circumstances. They are fully established, as I hold, in our Report.

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I am quite sure that my noble friend is duly impressed with it and will do his best on behalf of the Colonies to seek a remedy. Let me add this. If there is anything in our Report which the noble Lords thinks controversial, or which any economist in the Cabinet thinks controversial, I challenge the noble Lord to make use of that newly established engine, the Economic Commission, which has been set up, to submit our Report to them and to allow my colleague and me and other experts on sugar to appear before them, not merely to state the facts, which are indisputable, but to state the argument which we found upon them. If there is any question of economic applicability in this matter let that brand-new engine of economists and statesmen get to work upon it. I do not think that my noble friend on reading the Report will find that it has any fallacies in its argument but, if he does so, I make that suggestion.
With regard to the publication of the Report, as a member of this House and of the public and as one with a life-long connection with the West Indies, I think it is of the utmost importance in the interests of the West Indies, both for the reasons given by my noble friend and for other reasons, that this Report, this perfectly non-controversial statement of facts, should be put in the hands of the electorate of this country and of Parliament, because it imposes upon His Majesty's Government the necessity of very serious consideration, and I am quite sure that His Majesty's Government will be assisted in that consideration and not hampered in it by a general understanding on the part of the public of what the issues are and of the premises upon which action ought to be taken. I do not think that the Chancellor of the Exchequer, speaking last July, was fully apprised of the facts of the situation. If he had been apprised of them he could not have made a statement which, on the face of it, was a derisory statement—just as derisory a statement as that of the King of Abyssinia or Assyria who said to one of the Kings of Israel: "I will give you two or three thousand chariots and horses if you for your part are able to put riders upon them."
The Chancellor of the Exchequer suggested that the difficulties of the West Indian sugar producers in facing world
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competition could be met by a little assistance in improving their methods of production. Their methods of production are pretty good and they do not require very much improvement. Every West Indian sugar producer knows how the methods could be improved if they had a little more credit and money to turn around on, but they have been dealing with a difficult market. If they are given a stable market they will go on without asking the Imperial Government for any assistance, and if they have a stable market and proper prices are assured for them they will not want any assistance at all. All they want are a fair price and a fair market. Any little improvements they could make would not put them in a position to face the world competition that has been built up by this enormous accumulation of stock's, founded on protective tariffs, on bounties and on subsidies.
The thing goes on in the most maddening way. Take Czecho-Slovakia. They say: "We must subsidise our beet industry because we have an important wheat industry and in order to enable the farmers to grow wheat more cheaply we must subsidise the beet industry." It is the same in Germany and Norway. The subsidy which helps the Continental sugar producers enables them to dump sugar outside, and the assistance which is given to the wheat producers enables them to dump wheat in this country; and so the thing goes on. Just now the Government of Norway has found that the bonus given to the sugar producers is not sufficient, because it does not enable them to give the farmers a high enough price for their roots. Consequently, the bonus is being increased in the interests of the sugar producers and also of the farmers. So it goes on. The lower the price of sugar falls the more essential it is to increase the bonus and the assistance. Under present conditions the West Indian producers are producing sugar at an average loss of 25 s. per ton, but if the preference is taken away they will produce sugar at an average loss of £5 per ton, and obviously the Chancellor of the Exchequer cannot have been aware of that fact when he suggested that a few improvements in production would enable them to maintain production.
All that is set out in this Report, and I think it is important that the country

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and Parliament should know that as soon as possible. I am sure that my noble friend is not unwilling to publish the Report, but last night I saw an extraordinary suggestion made that it might be necessary for the Government to declare their policy before publishing the Report. Twelve months ago a very important Report on East Africa was published, because it was thought to be a matter of urgent public interest. Later on another Report on the same topic was published, for the same reason. From that day to this His Majesty's Government have not been able to deliver themselves of a policy founded upon either of those Reports, and East Africa and the world are still waiting anxiously for it. Nevertheless, it was right and useful that both those Reports should be published, and it is equally right that this Report should be published at an early date. There is nothing confidential in it.
I will give my noble friend a last suggestion. The West Indian Colonies are paying for this Report. I do not say that those who pay the piper should call the tune in this case. My colleague and I thought it our duty to sing what tune we thought right, but I think the West Indies are entitled to have the tune played to them as soon as possible. Not only are the West Indies paying for the Report, but they are also presenting the Chancellor of the Exchequer with the amount of the Income Tax which he will be able to take from the fees paid to my colleague and myself as an honorarium, and therefore he will have a considerable windfall from the West Indian Colonies owing to the setting up of this Commission. That windfall will pay for the expeditious and full printing of the Report, and the appendices, and I urge my noble friend to ask the Chancellor of the Exchequer to allow that amount to be repaid to the West Indies if it is not required for the printing of the Report. I share the strong feeling of my noble friend as to the urgent importance of the West Indian situation, and agree that it is in the public interest and the Imperial interest that there should be a full understanding upon the subject throughout the whole country at the earliest possible moment.
THE SECRETARY OF STATE FOR DOMINION AFFAIRS AND THE COLONIES (LORD PASSFIELD): My
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Lords, I think your Lordships will excuse me if I do not follow all the remarks of my noble friend behind me upon the subject of this Report and its publication. I have in a small way known something of the joys of authorship, and of the impatience of the author to see his work in print, but I have seldom known an author quite so impatient. Part of the manuscript of this very voluminous Report was delivered to me, I think, just about seven days ago. We still have not got the whole of it.
LORD OLIVIER: I told my noble friend, verbally and in writing, that the whole of the Report relative to his inquiry was in his hands last Saturday. It is now in the printers' hands, and I have here a proof.
LORD PASSFIELD: My noble friend is very hasty. I was going to say that the important part of the Report has certainly been in my hands for five days, or something like that. It was immediately taken into consideration. The first thing to do was to print it. I think by now nearly all of it is printed, but I fancy there is still a part to come, though I admit that no doubt the latter part is not so important and urgent as the former part; but it shows a little undue impatience if the Government are to be reproached for not having issued a Report to the public on such an important subject, with important proposals in it, to which my noble friend did not allude, before the Government have had an opportunity of at any rate reading it and considering it. Of course, this Report will be published, and I hope it will be published without any undue delay, but my noble friend behind me is well aware of the necessary organisation not only of one Government Office but of the machinery of Government, and I am not in a position to say when this Report will be published, but it will be published, I hope, long before the ruin of the West Indies.
I do not want to minimise or to understate the gravity of the economic position facing us not only in these Colonies but also in Mauritius and to some extent Fiji. The Commission to which my noble friend was attached was not the only one sent out. A similar Commission went to Mauritius, and the Report of that very eminent agriculturist, Sir Francis Watts, has just

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been received. I may say at once that his Report shows in Mauritius a condition of things which is as grave as the condition of things in the West Indies. It will have to be taken into account at the same time as the Report of the West Indian Commission. This is not the first crisis which has overtaken the sugar industry. I think as a matter of fact that every twenty or thirty years during the last one hundred years there has been a crisis in the sugar industry. So much is that the case, that when, six months ago, I was told at the Colonial Office of an impending crisis, I am afraid I laughed and said: "Another sugar crisis." The West Indies have weathered these former crises, from which they have suffered, and I hope that they are not going to come to an end now. Undoubtedly the present crisis is one of exceptional severity and gravity. Fundamentally, the cause of the situation is that the world's production of sugar has out-run consumption. Consumption is increasing at the rate of 4 per cent. or 5 per cent. a year, but nevertheless production has been in excess of consumption by between one and two million tons each year, and there appear to be now visible stocks depressing the market of something like 5,000,000 tons, the annual consumption being about 27,000,000 tons. That 5,000,000 tons is an incubus, and is no doubt depressing prices quite unduly. But it is an extremely difficult thing for His Majesty's Government, or for any Government, to get rid of that incubus.
If I might venture, without minimising the severity of the crisis, to look at it from another point of view, I would say that it is an unfortunate incident of the system of production under which we live that it passes from excess to deficiency, and from deficiency to excess. At the present time the sugar producers of all the world have made frantic efforts to increase their production, with the result that they are getting lower prices for their product than before. And it must be remembered that ten years ago the West Indies were making huge profits on their sugar, earning an enormous percentage on the investment of capital which they had made. And I am afraid it is one of the incidents of this system of production—a very regrettable incident—that those who make the profits during the good years may not be those who
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bear the loss when the bad years come. Of course, if we were actually conducting a system of scientific and strict bookkeeping, those high profits in the good years would not have been taken as income at all. The normal percentage of capital might perhaps have been credited as income, and the rest would have been put aside as an equalisation of dividends fund, as it is called in some cases. Unfortunately, that is not the way in which these things happen. The enormous profits which some people were fortunate enough to receive in the boom years—and, of course, it is almost incredible to-day, the profit that was made in those days by sugar producers, and by other producers too—do not come as any sort of compensation to the producers in the bad years.
THE DUKE OF ATHOLL: May I ask if the producers are the same people in the two cases?
LORD PASSFIELD: I think the noble Duke can hardly have heard my statement, which was that the producers have changed. I was going on to say that some of the more fortunate of the holders in those years sold out at enormous prices. I have heard of one case where the sale was made on the condition that a quarter of the purchase price should remain as mortgage, and when the bad years came, a few years ago, the seller bought back his estate at the amount of the mortgage. That has happened in more cases than one. This depression in the trade has produced a catastrophic fall of prices—something like 65 per cent. in the last five years, and very much more than that if you make the comparison with ten or fifteen years ago. The Economic Committee of the League of Nations, to which my noble friend has alluded, has made an analysis of the world production in a very valuable Report, which quite bears out the discoveries that we have just made, both as to the West Indies and as to Mauritius.
What we can do in that matter I cannot tell at the present time. I am bound to say that the difficulty seems almost insuperable. We are bound to see what we can do for the West Indies and for Mauritius for many reasons. If the industry collapses we shall have a large proportion of the population, in some places almost the whole population,

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on the hands of the Government in a state of destitution. Something would have to be done for that reason, if for no other. As a matter of fact, we are bound by higher reasons to have that consideration for the West Indian population. They have been brought there in the past at the instance of people of our own race, to some extent at the instance of former Governments of this country they have been brought there from other places, in order that they might work at sugar production, and we are surely bound to have regard for their welfare if the industry should collapse and they should be cast into destitution. But I am not going to be led even into a consideration of the effect upon the sugar position of the existing preferences in this country and elsewhere.
Of course, it is not in my power to forecast the Budget, but I should just like to remind noble Lords that when the Chancellor of the Exchequer said that it was his desire, or his intention, if he had the power, to sweep away all duties on foodstuffs, I understand that he was only expressing the common feeling of all three Parties in the House, and, as a matter of fact, I understand that the Liberal Party is as strong against duties on foodstuffs as the Labour Party is. I understand, too, on the highest authority that the Conservative Party is against putting import duties on foodstuffs. That is a doctrine common to all three Parties in the House, and for a very good reason. It must be admitted that duties upon foodstuffs, necessarily raising the prices of those foodstuffs—you would not put them on except for that reason—puts a quite exceptional and disproportionate burden upon the cost of living of the great mass of the people. A duty upon foodstuffs violates in the grossest way all the canons of taxation. It was pointed out by the Colwyn Committee that, among all duties on all foodstuffs in this country, that upon sugar was the least defensible, and that it ought to be marked out for abolition at the earliest possible moment.
VISCOUNT ELIBANK: Might I ask, then, why we keep an Empire at all? What is the good of having Colonies? Why is it that we spent on the West Indies over many years hundreds of thousands of pounds, and lost many lives in building up these Colonies?
LORD PASSFIELD: I do not quite understand the relevance of the noble Viscount's remark. I was talking about duties on foodstuffs. Does the noble Viscount take it for granted that help for the West Indies is impossible without duties on foodstuffs? Then why do all three Parties in the State pronounce against duties on foodstuffs? Surely for the reason that there is the utmost scientific authority against duties on foodstuffs; and any Party which puts duties on foodstuffs is flying in the face, not only of public opinion, but of all the science on the subject. It may be necessary for some other reason, but do not let us pretend that it is otherwise than contrary to the principles of all three Parties in the State. Well, that has no necessary relevance to the question of the present state of the West Indies. The present state of the West Indies requires, no doubt, the most serious consideration, but I would utter a word of warning that it is not desirable to attach this particular question to any one prescribed remedy. There may possibly be other remedies, and whatever action is taken we must not suppose that we are confined to one particular remedy. That is a mistake which is very often made.
I should like to point out that if, in order to subsidise the planters in the West Indies, a duty is put upon foodstuffs, or a duty is continued on foodstuffs which would otherwise be removed, that means that the cost of that help to the West Indian planters is not placed where it ought to be borne—namely, by the community as a whole in proportion to its ability to pay, but is levied on the child's jam and upon the necessary food of the people. It would be a mean thing to do, even for the West Indies, to obtain that assistance in that worst of all possible ways. Because remember, it is cash handed out from the Chancellor of the Exchequer as if it had been a grant-in-aid, but if it were a grant-in-aid it would be added to the Income Tax and the Super-tax, and we should have to bear our share of it. Is it wise to propose that it should be levied upon the sugar in the tea of the charwoman, the jam of the children of the labourer? Is it wise to suggest that it should be levied in that way, rather than in proportion to our means? If we have to meet this great charge for the sake of the

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West Indies and for the sake of Mauritius, and for the sake of ulterior Imperial reasons, is it wise that we should suggest that that necessary charge should be levied deliberately in such a way that we shall escape and that all persons of any appreciable means will not feel it at all, but that it will fall with pretty severe weight upon the man with £2 a week or upon the old age pensioner? I do not believe that the West Indian planters would ask that this should be done. I do not believe that any noble Lord here would ask that it should be done. I venture to think that your Lordships would say: "If a large charge is to be borne for the sake of the West Indies that charge had better be borne by all of us in proportion to our ability to pay and not by the poorest section of the community in proportion to their means."
There are, of course, other things to be considered besides that. The noble Viscount who opened this debate referred to the way in which the situation has been intensified or even caused, I think he said, by the whole machinery of tariffs and cartels and hidden subsidies of one form and another. I largely agree with him, of course, in that. But I venture to think that that point of view is a little exaggerated. You have the bottom fact that whereas the West Indies are producing sugar, let us say, at £13 a ton, Java and Cuba are producing it, roughly speaking, at £9 a ton. They are not producing it in that way by any subsidy, by any tariffs, or by any cartels; that is the actual cost of production at the factory.
VISCOUNT ELIBANK: Might I interrupt the noble Lord for a moment to say that that is on account of the soil of Java and Cuba being so very much richer than the soil of the West Indian Colonies?
LORD PASSFIELD: I have no doubt it is on account of the soil; but that is why the industry San be carried on more economically there than anywhere else. Let me put a case. Supposing that Java and Cuba with their advantages were able to produce all the sugar that the world required—and they produce a very large proportion of it now—what a calamity it would be that the world should get sugar at £9 a ton instead of growing
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it on less grateful soils at £13 a ton, and a great deal more in some places! Are we going to think that this abundance is a great calamity? We used to think that of scarcity. I think in the Prayer Book there is a prayer against scarcity. There is no prayer against abundance in the Prayer Book. There are prayers against dearness in time of dearth and famine, but there is no prayer against cheapness. Is not that what we are all after? Is not the whole of the effort of civilisation in industry directed to getting the cost of production down to the lowest possible point? I am not going to be appalled or alarmed if things are getting cheaper. That is what we want. Does anybody venture to say that he wants things to get dearer?
But that does not alleviate the present problem. Because we have chosen to conduct our industry upon the system which is known to your Lordships, we are now called upon to come to the rescue of the industry out of which the profits have been taken in past years, now that it has come up against this position in Cuba and Java. Remember that Java and Cuba do not undersell the West Indies merely because of their climate or their soil. It is because in Java in particular they have put a very large amount of science into the work. They have discovered new canes. They have discovered more productive sugar plants, and they have put the utmost skill and capital and science into their machinery. I do not say that that has not been done elsewhere in particular places; but Java has been signally successful in sugar production very largely because of the ability and skill of the Dutchmen who have developed that industry. I am not going to say that that is a calamity for the world. Similarly, I have seen the Americans, not in Cuba it is true, but in Hawaii. I have been fed with figures there as to their enormous superiority over everybody else in their sugar production. I did not believe—
VISCOUNT ELIBANK: That is due to a preferential duty, is it not?
LORD OLIVIER: Because the production of Hawaii is greater than the production in the. West Indies.
LORD PASSPIELD: My noble friend is somewhat hasty. I was going to say that I did not believe all the figures that

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were stated to me. But is it not the fact that in Cuba you have, as with the Americans in Hawaii, a low cost of production?
VISCOUNT ELIBANK: That production was built up under a preferential duty given by the United States of America. In twenty years the production under this system went up from 750,000 tons to 4,000,000 tons per annum, which it is today.
LORD PASSFIELD: The noble Lord will know that no amount of preference has anything to do with what the cost of production is. It has to do with the profit, not the cost of production. I am talking about the cost of production and that, whilst it warns us against attaching ourselves to any particular remedy in advance, does not lessen the gravity of the situation or the necessity of something being done regarding the position in the West Indies and in the Mauritius. In that we shall be greatly helped by Reports of my noble friend and his colleague for the West Indies and of Sir Francis Watts for Mauritius. I am sure that noble Lords will realise that it needs a little thinking about, and I am not able at this moment, necessarily, to give your Lordships the least indication of what step the Government will take in the matter. I have made no secret of the fact that something will have to be done. If it is impossible to avert the ruin which will come over a large number of the sugar producers in these Colonies, then, at any rate, we shall have to take no less important action in relieving the distress which will inevitably follow from their ruin.
But it is not altogether so black as might be imagined. I distrust all these figures about average costs of production as being relevant to the circumstances. There are some sugar factories and plantations in the West Indies which are probably able to go on even at low prices. There are others which are hopelessly unable to go on, and obviously those which are hopelessly unable to go on will go under first. It may be that in a way which is, unfortunately, the normal way in capitalist competition, we shall see that the weak producers will be shaken out in a ruthless way and the over-production to which they have contributed will right itself in that way. Somehow or other, whatever is done we have to right this
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over-production. No Government can maintain any industry in the face of over-production in the world market and somehow or other that has to be brought to an end.
I hope we shall be able to do something in the international field—it can only be done in the international field—to deal with this over-production. In so far as countries are deliberately fostering and stimulating the sugar industry in their own areas—and I may remind your Lordships that this country has been doing that for the last five years in its subsidy to the sugar industry and has contributed its share to the overproduction—I think we can go to the other countries and say: "Let us all put on a similar white sheet; we have all been creating the over-production of sugar." In that international way I think something could be done. I do not know what else could be done immediately and I am not able to say. I have given a very inadequate answer. I know the gravity of this situation. I know the importance that it has and I have not failed already to do what I can in the matter; but it is not a matter on which your Lordships will expect the Government to make up its mind instantly, in twenty-four hours or anything of that kind. Certainly, I have no policy for the moment that I am able to announce. With all that I can assure your Lordships that the Government will not be slow in considering the matter and it will have to deal with it with the least possible delay; at any rate, I shall not be wanting in that respect.
THE EARL OF PLYMOUTH: Can the noble Lord tell us when these Papers will be published?
LORD PASSFIELD: I cannot give the date, but the Reports shall certainly be published with the least possible delay. The Government must read them first, and we have not yet been able even to read them.
THE DUKE OF ATHOLL: My Lords, I do not think anybody could have been better qualified to initiate what has become a debate than the noble Viscount who asked the Question. He has had a very long experience in the West Indies, and nobody could be more suited to sound a note of alarm than himself. The noble Lord, Lord Olivier, has just come

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back from the West Indies. He made a very courageous, a very understanding and a very well seasoned speech, and I think that the thanks of all sugar growers throughout the Empire are very much due to him for what he has done. He at least appreciates the gravity of the situation. I do not want to follow the noble Lord the Secretary of State for the Colonies into his various rambles, which really have nothing to do with the case, but I must say I think it would have been better perhaps if he had commenced his speech with the end of it and not troubled to make some of the first part.
The first part was really all jam and smiles. He said that when he was told of what was going to happen some months ago it really made him laugh. I can assure him it has been no laughing matter to those who have been concerned in this industry, who have put their capital into it, and have lost it, nor for the people who have been working in it. Surely it was unnecessary, in a grave question of this sort, to bring in all that stuff, if I may so call it, with regard to charwomen and their jam and so on. In fact the only person really appealing to our heart-strings whom he did not mention was the widow of the Unknown Warrior. The noble Lord asked: Was it not lamentable that we should tax the food of the poorest of our people. Those may not have been his exact words, but that is really what he meant. I quite agree with him, but I would remind him that everybody has to pay taxation in one way or another, and what I want to point out to him in regard to this free-breakfast-table ideal is this. I wonder if it would not be rather unpalatable to the average working man to feel that every lump of sugar that he was eating was probably foreign, or, if British, was produced in unfair competition by his fellow workers in another country, and that these m retched fellow-workers of his were working there and he was taking their sugar below the cost at which they could produce it—in other words, that he was helping to sweat them and the industry in order that he, the British working man here, might have his food below the cost of production I do not think any British working man has a right to ask for that.
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I do not want to entrench too long upon the time of your Lordships, but I would like to give a few facts from my own personal knowledge derived from some years of experience in the sugar industry. I do not want to follow a good many of the arguments used with regard to Java and so on. This is not the time nor the place for doing so. We shall, no doubt, have ample opportunities, and if the ammunition which the noble Lord uses against us then is of the same type as he has used to-day, I am sure we will be able to engage in a safe battle. I am able to bring some facts to the notice of your Lordships which perhaps were not known to you before. The Colonies that are chiefly under review are Mauritius, British Guiana, the West Indies, especially Trinidad, Barbados and Jamaica. I want to impress upon your Lordships that these Colonies have only one market and that is the British market. That is where all the trouble arises. Under certain conditions they have the Canadian market, but at the present time it is not really open to them. There are no other markets in the world open to the Colonies, and even our own Dominions have closed their doors to them. Yet the Colonies are the only part of our Empire to whose existence the growing of sugar is really vital. In Australia there is a high tariff. They have a definite reason for that; it is because it is necessary for them to keep out sugar if they are to maintain their own industry; and they keep out British sugar. The same applies to South Africa, where the situation is maintained by a price of something like £20 a ton being assured to the grower. That is all right for them, but the balance of all the Australian and South African sugar can then be dumped upon our market at a few shillings and below the cost of production.
As has been stated there is an overproduction of sugar of a million tons in the year, and, as Lord Olivier has said, some five million tons of surplus sugar are now in store waiting to be crashed upon the British market, which is the only market that will take it. The Government of this country seem to be prepared to allow this enormous quantity of sugar to be dumped on our market and thereby destroy the industry in our Colonies. Surely our Colonies might well expect something better than that from a British

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Government. In consequence of sugar being subsidised elsewhere and other markets being protected, other countries are able to dump their surplus here. The result is, as has been pointed out, that the price of sugar outside the protected markets is just about £2 below the cost of production. Our Colonies are able to produce sugar as cheaply as anywhere else in the world, except Java, but here other questions such as pay and labour come in. We have, however, to enter a market where sugar is £2 a ton below the cost of production, and in which we alone are affected because of the high subsidies or protection given by other countries. Our sugar is forbidden to enter into the United States, but American territories receive a preference of 10 s. 3d. per cwt. We are not allowed into their market, but they are allowed into ours. We are not allowed into the market of France, but the French Colonies receive a preference of 7s. 11 d. and any of their surplus sugar is allowed to come into our market. The British Colonies, however, only get 3s. 9d. as against 10 s. 3d., and that is one of the reasons why we cannot compete.
It is suggested that free trade in the world is the answer. I quite agree; we should be glad to have free trade seeing we have the best growing districts and an excellent organisation. But does anyone really and seriously believe that all the world will agree to have free trade in this matter? We are in difficulties at this moment in the West Indies, and we know perfectly well that other countries are not going to adopt free trade and alter their entire fiscal system. We know it is no use discussing that question. Unless the industry is to be allowed to go crash, and with it the West Indies, something has got to be done, and that something is either to increase the preference—I do not want to discuss that question now—or have some other means of making up for the difference caused by these outside subsidies and the low cost at which we have to sell.
There are a number of other considerations that strike one and one in particular which may or may not strike America; but this is a matter which I will not discuss now. Before the War and during the War those engaged in the sugar industry were well able to sell their sugar and various by-products. At
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the present moment, however, whether for good or ill, the duty on a puncheon of rum, which is only 110 gallons, is not less than £500. Obviously the rum industry has suffered. I am not suggesting for one moment that this should be altered in the case of rum, but I do think that those who are dealing with this question should remember that it has a very important bearing on the matter and should be taken into account when considering what assistance should be given to sugar. There is a good deal that one might say with regard to molasses also, but I do not want to trouble your Lordships with that question.
What we want to know is whether the Government are going to do anything during the present crisis. The matter cannot wait. It will take a long time to come to a permanent settlement and by the time a permanent settlement is reached the sugar industry will have gone. It is absolutely vital that something, whether it is good finance or bad finance, whether it is good politics or bad politics, should be done to save the industry in the meantime. Otherwise it will have gone. It is very necessary that the Government should make some statement at an early date, otherwise, as I say, the industry cannot go on. In Barbados it means the very existence of the Island; in Trinidad it is the mainstay; in British Guiana it is equally the mainstay. In Jamaica hundreds of thousands of pounds have been sunk in the industry, which must crash if help is not forthcoming immediately. It is almost touching, because they are such small people, to learn that in the latter Island the Legislature came forward with a small temporary bounty which was the best they could do but which is quite inadequate. As was said by one member of the Legislature: "We are small people and we can do very little, but this is an earnest of our desire to help ourselves, and we hope it will stimulate the great British Government to do something to help us in our distress."
The question was put before the late Government and, though sympathy was expressed and indication given of possible future help, the terrible state of the industry was apparently not appreciated. Then the present Government came in. It is no use saying that this is a sudden thing. The request was immediately

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made to the Chancellor of the Exchequer and to the noble Lord opposite, but owing to the Chancellor of the Exchequer being abroad he could do nothing and apparently the noble Lord was unable to do anything. The facts were then given fully to the secretary of State for the Colonies and I cannot believe that the present Chancellor of the Exchequer could have been aware of the facts of the case or could have realised the import of his words when he made his statement that the policy of the present Government was to sweep away all preferences on sugar, definitely using the word sugar. I want to point out that this was a distressed industry and the immediate result was that the whole credit of the industry was destroyed. And as if that were not enough, instructions were issued that in the case of those concerns which were at all shaky and had trade facilities loans, liquidators were to be put in. The moment this was done, of course, the whole of the credit of the industry was gene and then the banks began to call in the whole of their loans. Money that used to be lent to these planters for putting in their next crop was not forthcoming. What the Chancellor of the Exchequer said started a credit crash, and the industry is in a very parlous condition in consequence.
In conclusion I would ask His Majesty's Government to remember the peculiar situation of the Crown Colonies. The Dominions are independent and can look after themselves. The Dominions can consume sufficient of their products to make them worth growing. The Crown Colonies are not consumers and so are entirely dependent upon the British market. Moreover, many of them have no alternative crop that they can grow. If you take sugar away from places like Barbados and British Guiana, what does the node Lord suggest that they are going to grow instead? They are unable to carve out their own way in the world because they are subservient to the Home Government, to a Government in the election of whose members they can take part. This means that the British Government are in a fiduciary position to them and if they let down the West Indies they will be literally guilty of a breach of trust.
It is not as if it were a new story at all. It has been well studied and there
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is enough information at the Colonial Office, if the noble Lord would read it, to occupy him a very long time. The people of these Colonies are simple folk. They have to work hard to make both ends meet. It is no holiday task that they have at the present moment. They are intensely loyal and as a great Empire we cannot afford to neglect our outposts. There are other people who would like to possess those outposts. That, of course, is unthinkable, but the people in these outposts, finding they cannot get help from the main body, may possibly wish to walk out. Finding their quarters quite untenable they may even desert their posts, and they are doing so, I may say, almost every day. Very soon in the West Indies you will not find white men, or at any rate you will not find white men of the type England would like to see there. That is what is happening. These people are not interested in British domestic politics. They are only really interested in their own existence. Is it too much to ask that all Parties in the body politic at home should come together and try to arrive at some agreed and stable policy and not leave the West Indies simply the plaything of the various political Parties here at home? In the meantime it is for the present Government of this country to take rapid action and show that they are not forgetful of the great responsibility which rests upon those who control the destinies of our great Empire. I do implore the noble Lord to get stirring to do something, if he can, in this time of great emergency.
THE EARL OF PLYMOUTH: My Lords, I rise for a moment or two only to add the support of noble Lords on this Bench to the plea made by noble Lords that the Report of Lord Olivier's Commission with regard to this matter should be published at the earliest possible opportunity. No one who has spoken in the course of this debate has desired to minimise the real gravity of the situation. We have listened to a very interesting dissertation from the noble Lord, Lord Passfield, on economics, but I would venture to say that there was little in his speech which could give much hope or encouragement to those unfortunate people who are engaged in this industry in the West Indies. As far as I can

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make out what really matters more than anything else at the present moment is the state of uncertainty which exists.
That state of uncertainty is so great that Colonial sugar is almost unsaleable here at the present moment, and I think that state of uncertainty is due very largely to the statement made by the Chancellor of the Exchequer, with regard to this matter as long ago as July. The noble Lord, Lord Passfield, treated this statement as if it were a very ordinary one and as if the sentiments expressed in it might be ascribed to both the other Parties in the State. I venture to say that if we look at the statement, it will appear to be a much more definite one than the interpretation which the noble Lord has put upon it would suggest. The Chancellor of the Exchequer said:—
"We were pledged when we were in office to maintain these preferences as long as there were duties upon these articles, but I hope—and I am not anticipating any Budget statement—that before we leave office, if ever we do leave office, we shall have swept away all duties upon food—upon sugar, upon dried fruits and upon all articles of food which are subject to duty at the present time and on which there are preferences."
I think it is natural that those who are concerned in this industry should be alarmed at this statement, and I hope that something will be done as soon as possible to put an end to that state of uncertainty.
The noble Lord, Lord Passfield, spoke about putting duties on foodstuffs. So far as we on this side of the House are concerned, it is not a question of putting duties on, but, if possible, of taking duties off. From what has been said on all sides of the House it is perfectly clear that those engaged in this industry in the West Indies are facing utterly unfair standards of competition in other parts of the world. Although I quite agree that, up to a point, this is a matter for international arrangement, I do most sincerely hope that the noble Lord is not going to suggest that the way to treat this matter is to refer it to the League of Nations and to do nothing else. The industry is in a very sore state at the present time and something should be done at the earliest possible opportunity
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to put an end to this state of uncertainty and to do something to help the industry in the dire straits in which it finds itself. I quite agree that the Government must have time to consider the noble Lord's Report, but I cannot see that this is a reason why this Report should not be published at once. I hope that it will be published at the earliest possible moment and that the policy of the Government upon this matter will also be announced at the earliest possible date.
House adjourned during pleasure.
House resumed.

ROYAL COMMISSION.
The Royal Assent was given to the following Bills:—

Consolidated Fund (No. 2),

Arbitration (Foreign Awards),

Unemployment Insurance,

Ministry of Health Provisional Order Confirmation (Sheppey Water),

Ministry of Health Provisional Orders Confirmation (No. 13).

House adjourned during pleasure.
House resumed.

BUSINESS OF THE HOUSE.
THE LORD PRESIDENT OF THE COUNCIL (LORD PARMOOR): My Lords, in moving the adjournment of the House, I should like to say there is some doubt whether we ought to ask the House to assemble on Tuesday, but Motions and Questions might be put down before that day. I think we had better meet on Tuesday. I know of one Motion that could be considered on Tuesday, but of course it may only be a formal sitting. I say that in order that noble Lords should not put themselves to any inconvenience if the business is only of a formal character. I move that the House do now adjourn until Tuesday next.
Moved accordingly, and on Question, Motion agreed to.
House adjourned at six o'clock.