§ LORD CRANWORTH rose to ask His Majesty's Government what immediate steps they propose to take to save the agricultural industry from ruin; and to move for Papers. The noble Lord said: My Lords, in rising to move the Motion which stands in my name I would like to preface my remarks by saying that I have no intention of upbraiding His Majesty's Government and still less of censuring them. I am well aware of the great complexity of the problem with which they are faced, and I am deeply appreciative of the earnest way in which they have endeavoured to meet it. My motive is a different one. What I hope to get from the noble Earl who answers for the Government is some message of 1003 hope and help to the men engaged in the agricultural industry—some message of hope and help, not for their far-distant descendants, not a statement that the industry in the fullness of time will be restored to prosperity, but a message of hope and help for themselves, their wives and their children.
§ There are many of your Lordships, probably all of you, who know the condition of agriculture. Any who do not presumably read the newspapers, and it is unnecessary for me to labour that condition unduly. We know the position to-day of the agricultural labourer, the lowest-paid skilled labourer in the land and one who is to-day threatened with the loss of his living. If I might interpolate the remark here I would like to call attention to the extraordinary and invidious position of wages boards to-day. They are faced with two alternatives, and as far as I know only two—one, to award a rate of wages which is quite insufficient to keep the labourer alive; and the other, to award a rate of wages which the farmer is quite unable to pay. With regard to the farmer I speak, of course, only for my own area, but as far as that is concerned the farmer has almost ceased to exist. Every asset he has has been mortgaged up to the hilt and he pays to the lenders, who are usually the banks, a rate of interest for which the sole justification, as far as I can see, is that so many of the borrowers never repay that those who do have to make up for those who do not. That is presumably good finance, but not very encouraging for those who have every intention of repaying.
§ With regard to the landowners, many of your Lordships are among them and you know full well that in the majority of cases the income derived from land, after the taxes and Death Duties are paid, does not leave sufficient margin even to pay for the necessary maintenance and upkeep of the land and buildings thereon. Your Lordships know, too, the position of the markets to-day. You know quite well that stock, if it goes out to graze at the beginning of the summer, comes back worth less than before, that sheep and lambs are being sold to-day at one, two and three shillings; and the same with regard to pigs. A little homely incident brought this home to me in my 1004 own county. A small holder who had some festivity arranged was told by his wife to take six pigs to market, to buy seven rabbits and to bring back the change. He did so and handed her back sixpence.
§ I listened only the other day to the new Minister of Agriculture, to whose efforts probably everyone, and certainly everyone in this House, wishes the utmost success, and I heard him say that the nation which has no agriculture is no longer a nation. I think there were others besides myself who realised, if that were so, how slender was the thread en which our existence as a nation must hang. I said I did not wish to censure the Government, and I have no intention of complaining. On the other hand, I have every intention of thanking the Government far what they have done. Already, in my opinion, they have done more than any other Government of recent years. They have given ns the Wheat Bill, keeping under cultivation many thousands of acres which would otherwise have gone out of cultivation. They have, almost for the first time, in their measures of Protection established the principle that where industry is to be helped agriculture is no longer to be definitely left out, though, having established the principle, they went far in practice to controvert it by leaving out at least three-quarters of our produce. They promised us more and they mean more.
§ Their immediate hope would appear to lie in quotas. I heard the noble Lord, Lord Beaverbrook, the other day say that quotas were to be welcomed in the spirit in which a drowning man welcomes a straw. I find myself to a great extent in agreement with the noble Lord, and I only hope that the straw will prove of better quality than I fear it will. What are quotas? As far as I know, quotas are a form of Protection and their merits over the more Obvious forms of Protection would appear to me to be almost entirely political. They were introduced by Socialist members. Mr. Wise, Sir Oswald Mosley and Dr. Addison would perhaps claim the credit, and it may well be thought, and no doubt is thought, that if you introduce Protection with a red tie you may to a great extent do away with the opposition to it from those quarters. I suggest to your Lordships that that hope is a barren one, because 1005 it seems to me that there never was a Party so ready to throw over the Leaders of the present for the Leaders of the future, if only they will bang a bigger drum. It, may be thought that the quota might be used to form a cloak against the Election cry "Your food will cost you more," but I think it would be found a thin garment against that wind. On the other side you have the cry that tariffs are more easily worked, and they at all events have this in their favour, that if they fail in their immediate object of providing employment they have compensation in that they furnish revenue.
§ There is, or so it seems to me, a feeling growing up in this country that our troubles are not due entirely, or oven mainly, to Protection or Free Trade, and that the remedy does not lie entirely in those directions. We see countries highly protected or less protected or nearly free trade, and all seem to feel the draught in the same measure. Still less would it appear that the fault lies in some inherent defect in our political situation or in our present social system, because when we look at a nation like Russia, which has made the greatest change in her social system, we find that she is feeling the depression more than any other of the nations of the world, The people who think this, think that the basic reason of our troubles lies in the fact that currency is no longer the servant of civilisation, but is bidding fair to be its master. I do not pretend to be an economist. Economists have too divergent and discordant a cry for me to join in. I cannot talk about discounts, inflations and re-inflations, and so forth; but I do appreciate this simple fact, that there are in this world a great many people anxious to produce and a great many people who are anxious to acquire, that a few years ago they were brought together by the medium of currency, and that to-day that medium seems unable to bring them together in the same way. We hear of over-production. The noble Viscount the Leader of the House talked the other day about a glut of meat, but it would be a little hard to convince the people of that in the district from which I come, where there is hardly a house which would not, consume twice as much meat but for the fact that they have not the money to buy it. Whether that be the solution of our troubles or whether it be not, that will take time, and mean- 1006 while bodies like the Central Landowners' Association, the National Farmers' Union, the Central Chambers of Agriculture, and the Ministry at Whitehall itself, are seeking for some method of keeping the head of agriculture above water till the tide turns; and even more palliatives demand time.
§ We were told that the Pig Bill was being introduced. We have seen the admirable Report of the Pig Commission. That cannot come into operation before next summer. We may, I think, assume that, in the spring the tax upon beer will be reduced. That again will not come into operation until next autumn. Best of all, America might go wet. That is perhaps the most immediate and hopeful thing which agriculture in this country has to look for, but if America does go wet the results will not be apparent for at all events a few months. The Milk Commission may report, presumably they will, and in due course some Bill to implement their decision will be introduced; but the effect of that cannot be yet. A Meat Bill may be brought in. I sincerely hope it will, because of all our troubles those of the meat producers are the greatest; but that cannot be brought in, at all events, until next summer. I would ask your Lordships to remember this. There have been troubles and bad times in agriculture before, but there was a difference. Before, agriculturists had a guard behind them in the shape of capital. Even as late as 1925 a White Paper shows that the farmers' capital invested in agriculture was £365,000,000. Where is that to-day? It has gone. Behind that stood the landowners with a capital of £815,000,000. Where is that to-day? I venture to think that, except in as far as properties are entailed, 90 per cent. of that capital has gone the same way as the capital of the farmers.
§ There is one aspect of this problem to which I desire to call the noble Earl's attention, and that is the question of covenants—valuations. When a farmer goes out valuations are left which are taken over by the incoming tenant. Those valuations or covenants consist of certain things, like hay, manure and so forth, but they also consist of the cultivations that have been made and have not been made use of. Those covenants amount to a large sum. At the present moment very often they are of greater 1007 value than the land itself. In the ordinary course the incoming tenant takes them over. If there is no incoming tenant they fall upon the landowner. Never before this year, I think, has occurred what is occurring now; that when the covenants have fallen in there has been no incoming tenant and the landowner has not got the money to pay for those covenants at all, and the unfortunate farmer, having lost all the capital he had, has not even this little nest egg to put in his pocket. That is a new and, I think, dangerous factor that has come into our agriculture to-day. So much so is that the case that to-day it is not too much to say that if it was a certainty next year, in certain parts of the country, that a profit could be made in farming, there would yet be no applicants for farms unless new capital or new credit, or both, was introduced. Of course, with regard to that, there are no new farmers being trained, and very few new labourers either.
§ The Government think that the industry is worth saving. It is one of the first Governments that has thought so, and I think the industry is worth saving. I heard the noble Lord, Lord Beaverhrook, say the other day, and without contradiction, that the production from agriculture was equal to the production from cotton, iron, and steel put together. If that is so it is worth saving, and the Government know it. They say their plans to save it are sufficient, but, if so, they must give them time to mature; but time is of the essence of this problem. The noble Earl who will answer me may well ask what I suggest. I do not know that this is quite the time or place to make specific recommendations, but I will make him a present of one. At the end of November there will be leaving the farms in East Anglia, and no doubt elsewhere, many thousands of labourers who have been employed on sugar beet. Those men in old days would have been employed throughout the winter on various tasks—hedge-cutting, draining, improvement of watercourses and watering places; when there was a frost they would have put chalk or manure on the land. Theirs was a very necessary and useful task, but it is not immediately remunerative, and the farmers and those who own the farms cannot afford the money for it now. These thousands of men, therefore, will 1008 go out of the industry for four months, and those of them who can will go into insurable occupations and add to the intolerable burden that industry has round its neck. The vast majority will go to the public assistance committees and will receive approximately 15s. a week per man.
§ There is work waiting to be done and there are men who want to do it: I suggest that they should be brought together. My suggestion is a simple one. It has been in general terms proposed before. My suggestion is that a quota of necessary labour to each farm should be made, and above that quota any farmer who took on and employed extra men should be paid a sum less than the sum that would be given to those men by the public assistance committees, but yet such a sum as in many cases would induce him to employ them. I have no doubt the scheme is subject to every kind of difficulty. I have no doubt it runs across every old tradition of the last century, but it has certain things to recommend it. The first is this. It does not throw one additional penny of burden on the public purse; on the contrary, it is likely to lessen it. The second is that it is immediate. The third is that it would put to profitable employment men who otherwise at a greater cost would either be doing nothing or would be doing what appears to me the sham of test work. And the last thing to be said in favour of it is that it would appear to be quite easily worked through the medium of the agricultural committees.
§ I only wish to say once again that time—time—is the essence of this problem: time and courage. And may I say that it would appear to me to be a tragedy of the very gravest description if the first Government which for generations had the mind to set agriculture on its feet again were to fail through lack of courage? I beg to move.
THE EARL OF RADNOR
My Lords, my noble friend Lord Cranworth has moved this Motion in his usual extremely able manner. He has told your Lordships of the necessities of the situation, and he has laid a certain amount of stress on its urgency. I do not know whether the desperate urgency of the situation is fully realised throughout the country. I do not know whether it is fully realised to 1009 what extent the farmers to-day are in the hands of those from whom they have borrowed money. Most of them have borrowed up to the last limit of their resources, and not only they, but also those from whom they have borrowed are at their wits' end to know what to do. The plain facts of the situation are that a very large number of farmers to-day have not got the money to pay the wages for the essential cultivation of their land through the winter. Not only that, but they have no money to pay either rent, or their foodstuffs' bills, or even the interest on their loans. That last item is perhaps the most important of the lot, because the result of non-payment of interest on loans is that ultimately the farmer is sold up, his live and dead stock is sold, no new tenant can be found for the land, the land goes out of cultivation, and with it a lot of agricultural labourers lose their employment. From the national point of view that is a very serious matter indeed.
We have had the wheat quota from the National Government, and we are grateful for it, but a very large proportion of our agricultural industry is concerned with live stock in some form or another, and through the past year we have been put off from time to time, when questions have been asked, by the Government saying that we must wait till after Ottawa. We were given to understand that at Ottawa arrangements would be made whereby the home production would have the first place in the home market, and that Imperial imports would have a preference over other imports. Ottawa has come and gone. We who are concerned in agriculture have studied those Agreements with some care, and have hoped to find therein something which would give us a promise of better prices. The only constructive proposal, so far as home agriculture is concerned, in the Ottawa Agreements is that concerning meat. I dare say your Lordships are aware that two nights ago there was a debate in another place on this very question, and one speaker stated that the result of the meat proposals in the Ottawa Agreements amounted only to a reduction of imports at the end of two years of 2½ to 2¾ per cent., which is a very small amount. Another speaker, working on somewhat different figures, compared the results with the 1930 imports, 1010 and made out that for the first half-year of that schedule of restriction of imports there would actually be an increase of the permitted imports, and that at the end of the period there would be a reduction, comparing it with the year 1930, of only 1¾ per cent. That offers little or no hope to those concerned in the production of meat in this country.
But, in addition to that, there are other sections of the industry which are concerned. If your Lordships will study the Ottawa Agreements you will find in the schedules of the Agreement with every relevant Dominion that the First Schedule states that eggs, poultry, butter, cheese and other milk products are free, and there is unrestricted importation to this country for three years certainly. We do not get a great many eggs from the Dominions, but I can assure the noble Earl that poultry keepers in this country look on that with the deepest suspicion, knowing as they do that any country, if they wish, can double their egg production in nine months or less. So far as butter is concerned there is to be a tariff on foreign butter, but a tariff which will not be adequate to bring butter up to a price, even if the whole of that tariff were passed on to the consumer, which would have any interest to the home producer. So far as cheese is concerned, the bulk of our imports comes from New Zealand, a considerable quantity from Canada, and an almost negligible quantity from other countries. Cheese is a very important item to the farmer, because cheese is the outlet for his surplus milk, and we are going to have free and unrestricted importation of cheese from the Dominions for three years certain. I think that perhaps I have said enough to show that the farmers are feeling that they, at any rate, can look for no immediate help of any sort or kind from these Ottawa Agreements. Personally, my own belief is that they do not go nearly far enough, and that the help we shall get from them will be entirely negligible in the present state of the industry.
As my noble friend has already said, something has got to be done, and it has got to be done soon if agriculture is to be saved. Much has been said about assistance through helping meat production. A tariff has been suggested—and a heavy tariff by some people—as an 1011 immediate desirability. I think something possibly might be done by assisting meat, but I cannot agree that a tariff would be of any immediate assistance. However heavy your tariff, the countries that import into England have no other market, and as they have no other market and having the animals they must import into this country regardless of whether there is a heavy tariff or not. If the Government are proposing to give immediate assistance through any form of restriction on meat, the only form which will give immediate assistance is that of a quantitative restriction of the imports. I do not say anything regarding a long-range policy which might quite reasonably bring the question of tariffs on meat into consideration. I am talking of the immediate necessity, and in my opinion it is only an immediate restriction of imports on a quantitative basis which is going to help agriculture at the present moment. It may be that the Government feel that that is out of the question. It is quite possible it is so, either for national or even for international reasons.
If they cannot help in that way, there is only one other way, and that is through financial aid, as my noble friend has already said, to tide the farmer over the time that he is going through now. I should like to make it perfectly plain that in my opinion it is no use this Government or any other Government putting forward suggestions for a temporary alleviation of the situation, or palliatives, unless at the same time they are prepared to bring forward a long-range policy which will give the opportunity to the farmer in the future of making himself entirely independent of any palliative in order to make his business profitable. If finance is the only method by which the Government can help the industry through these difficult times, might I suggest, if Lord Cranworth's suggestion is not acceptable, another thing. I would suggest to the noble Earl that he would consider guaranteeing the interest on the loans that have been made to farmers, or even of paying that interest straight out. The demand of the farmer to-day is for money to pay the wages of his men to perform the essential cultivation of his land. If his bank insists on his paying interest on his loans he has not got the money 1012 to pay those wages, and his land goes out of cultivation.
To my mind it would be a simple way. It would possibly be rather expensive. I dare say that the noble Earl will tell me that there is no money and that the Treasury would not consider it. I would point out to him that if there is no money to help in any way there soon will be no agriculture to help either. I believe he said himself only yesterday that if no assistance was given by the Government there would soon be no agriculture. If there is to be no agriculture, perhaps the Government will get a certain crumb of comfort in being able to dispense with an unwanted Ministry of Agriculture on the grounds of economy. I do not wish to detain your Lordships too long, but I do urge upon you that this is a matter of supreme and urgent importance. It is absolutely essential that the farming community should be not only helped through this winter, but that they should also be given some prospect of making a profitable production in future years. Whether it be through a speeding up of whatever programme the Government have, or in what direction, I do not mind, but I do hope that we shall to-day get some comfort from the noble Earl when he replies to this debate, and that we may then consider the Government really intend to help agriculture, as was their intention and their mandate when they were elected to office.
§ LORD BEAVERBROOK
My Lords, I have listened to the speech of the noble Lord, Lord Cranworth, who gave us a most concise and moving statement of the difficulties of the agricultural industry in this country. I do not at all agree with the noble Lord when he says that he does not wish to censure the Government, but instead that he wishes to thank them. I am in no such frame of mind. I should like with all my force and power and strength to censure the Government, and would offer them no thanks whatsoever. The Government have been in office for a year. In that time, according to the statements of the noble Lords, Lord Cranworth and Lord Radnor, the Government have produced a wheat quota, but the wheat quota is a very doubtful benefit. That quota provides for a deficiency payment of 6,000,000 quarters. In all probability there will be 1013 a crop of 9,000,000 quarters next year, perhaps more. It is certain there will be a considerable increase on the crop provided for of 6,000,000 quarters. Then Lord Radnor says that Ottawa will give us nothing, that Ottawa has produced no benefits for the agricultural industry whatsoever. If that is the case, then we have got nothing from this Government at all except the doubtful benefit of a deficiency payment of 6,000,000 quarters of wheat when the crop is likely to be 9,000,000 quarters or more.
I hope very much that the noble Lord, Lord Cranworth, will go to a Division, and give us an opportunity to express in the Division Lobbies the opinions we hold of the unsatisfactory conduct of the Government in failing to do anything for the industry, an industry which they have seen steadily decline. They have had warnings all through the country, warnings from everywhere. Their own supporters have raised their voices in condemnation of the Government's conduct; yet still they go on delaying to do anything. Now the industry is indeed in a grave condition. There is not any market any more for store cattle; that market has gone altogether. The reason the market has gone is that farmers have not any money with which to buy store cattle and they cannot borrow any money from their banks; consequently the store cattle market has disappeared. Unless store cattle are bought shortly the hay will rot and the roots will rot in the ground. There cannot be any doubt about it. The present position is a disastrous position and unless it is dealt with swiftly a panic and the most serious consequences will follow. At Banbury Fair, which is held in October, where there is usually a sale for 1,000 head of cattle, this year only 100 head were brought to sale. Mr. McDougall tells me that he has a letter from Mr. Colegrave, one of the principal dealers, and Mr. Colegrave says: "I never left Banbury Fair without cheques for £4,000 in my pocket. This year I have not sold a beast." Imagine the consequences of that situation. If the market for store cattle collapses completely, the situation will be just as serious as if you had to face another financial panic.
Turning to other branches of the industry, Mr. R. M. Tallent was one of those who put pressure on the Conservative Party—which Party I contend 1014 dominates this Administration—in 1931 to adopt a policy of Protection for agriculture. That policy was conceded. Mr. Tallent went on in the belief no doubt that he would get Protection. He has been refused it. What is the result? He has had to abandon his farms. He writes to me:I called my men together and told them my intentions. They suggested that I should carry on. They would agree to accept 25s. a week. I cannot avail myself of this offer.I could go on giving you instance after instance of the real crisis which now exists, a crisis which has been growing for weeks and weeks while the Government sit clown and do nothing at all. The labourer with his 30s. is being asked in many districts to take a reduced wage, and indeed considerable pressure is now developing in that direction. In Norfolk, for instance, the labourer is to be asked to take 28s. Out of your kindness, in Norwich an unemployed man with a wife and two children is drawing 28s. a week in unemployment benefit for doing nothing, whereas not five miles from Norwich the agricultural labourer is offered 28s. for doing a full week's work. The farmers themselves detest these proposals to reduce the pay of the men. They hate them. They would rather come forward with increases of pay, but it is sometimes impossible for them in their present conditions to provide the weekly wage bill.
In Norfolk a few years ago a Scotsman bought land for £13 an acre. That land was brought to sale just a short time ago and it realised only 35s. an acre. Imagine what would be the position if such a crisis existed in the City. What a different situation we would have in this House if the bill market were gone, if there were no buyers for Government securities and if the very best investment shares had fallen in price from £13 to 35s. ! There would be a great outcry. There would be a demand for a special Session of Parliament. There would be legislation passing through this House, almost with the approval of all Parties. There would be a cry for a moratorium, and it would be given, too. When it comes to farming, although the position is quite as desperate, it seems quite impossible to arouse the Government to a realisation of its own responsibilities.
1015 I have no hesitation myself in suggesting to the Government a definite programme. I know quite well that the Government will not accept it, but here is a programme at any rate. We are entitled in the farming industry to a moratorium for the money due by farmers and by auctioneers to the banks and to the Government through their Agriculture Mortgage Corporation and their Public Works Loan Board. The reason why it would be of advantage to give the farmers a moratorium, and the auctioneers too, is that they cannot pay interest. Any interest that is charged by the bank is merely added on to the total amount of the debt. It would be a much better thing to acknowledge at once that these interest charges ought not to be multiplied, but that the farmers are to have liberty and leave to have a moratorium, not only for the interest but for the amount of money due to the banks and to the Government.
Next, I would like to reduce interest rates, and to reduce them at once. The banks are charging the farmers 5 per cent. but the banks are paying to the depositor only ½per cent.; sometimes, generously, 1 per cent.; occasionally, 2 per cent. in the country districts, but no more. The spread is too big; the spread is far more than it has ever been before. The banks are simply collecting this high rate of interest from the farmers and using the money to write down bad debts which they have made elsewhere, many of them not in this country at all but to foreigners. They were all too free in lending their money to the foreigners in 1928 and 1929, and now these bad debts which they have made in foreign countries are being written down at the expense of the farmers of this country who are being asked to pay 5 per cent. The Government are doing the same thing through the Government's Agricultural Mortgage Corporation—because it is a Government institution and nothing else. It is all very well to say it is owned by the banks, but the Government made the Agricultural Mortgage Corporation's debentures legal for trust funds. The same applies to loans from the Public Works Loan Board. These loans are standing at 5 to 5½per cent. The Government are paying only ½per cent. on Treasury Bills or 2½, per cent, on savings bank deposits and 3 per cent. on 1016 long term loans. The Government ought to set an example to the banks by taking steps to reduce the rates of interest at once. A third measure which should be taken at once, in my opinion, is the restoration of the market for store cattle. That market must be restored with Government assistance; there is no other method of doing it. Several schemes have been brought forward. Mr. McDougall, whom I have already quoted, has brought out a sort of hire-purchase plan for dealing with the store cattle market, but until that market is restored the menacing condition of agriculture must persist and continue.
Government assistance to farmers is not any new departure. The United States have assisted farmers. In the last seven months the Finance Reconstruction Association has advanced altogether £20,000,000 sterling to 500,000 farmers. Our Government have no hesitation in lending money abroad and in assisting the City of London to lend money in immense sums. Much of the money which goes abroad is used to subsidise agriculture in foreign countries. We have sent £40,000,000 in the last two or three years to Austria, and Austria has been subsidising agriculture in competition with our own farmers at home. We send money to Hungary. Hungary is giving a moratorium to the farmers now and reducing their rates of interest. The present Government have given £1,000,000 to Lithuania with which to build elevators which are being used in competition with our farmers. The preceding Government, of which this Government is the residuary legatee—there was the same Leader then as now—paid £6,000,000 to an exhibition in the Argentine and during the period when that money was being spent our sales to the Argentine actually fell by £10,000,000. The Government have also given money quite recently for an exhibition in Denmark, but the same result will follow. We will get no benefit or advantage from it at all.
The Government seem to be willing to give money to foreign countries which is used for agricultural purposes, but they give none here. All they offer us is the quota, and the quota cannot possibly do anything to benefit our industry for nine months anyway. It does not come into operation until that time. I cannot imagine why the Government 1017 hold so firmly to the quota. I have looked everywhere to try to get an explanation. I have heard it said that it is because the Dominions want the quota. The Dominions do not want the quota. The Dominion Ministers wanted duties. Mr. Bennett, the Canadian Prime Minister, wanted duties and Mr. Bruce set up a case for duties. The story that the Dominions wanted the quota is finding wide circulation, and it is being put about for the purpose of damaging our case against quotas and for no other reason. I wonder if quotas were introduced and held to so firmly to meet the Election pledges of Mr. Runciman? He certainly said at the last Election that he would not consent to any duties on wheat or meat. If those pledges still stand, I suppose we can consider Mr. Runciman, in part at any rate, responsible for the quota proposals.
I am beginning to come to the conclusion that the real reason for the quotas is the desire to implement the Marketing Act. That, I am beginning to think, is the real reason. The Government know that if they are to implement the Marketing Act they must have import boards and quotas and they must limit home production. That is a pretty big proposal. Imports boards with the limitation of home production will involve central marketing and will involve central slaughter houses, too. But central slaughter houses are obsolete now. Road transport has put an end to that sort of thing. Over-centralisation of supplies of meat is a very dangerous thing. If you have over-centralisation of supplies of meat those supplies will have to be chilled. If you chill British beef then at once you put it in competition with Argentine beef, with no advantage to the home-killed British beef whatsoever. If this project of the Marketing Act with quotas and import boards is gone on with, 16,000 privately-owned slaughter houses will be closed down. These privately-owned slaughter houses are the workshops of the butchers of this country, who are too frequently ignored and too frequently traduced. There are 16,000 of them. Is it possible that the Conservative Party will close down these privately-owned slaughter houses and turn these 16,000 workshops of the butchers over to Government control? That is a very dangerous path for the Conservatives to take. Let us never 1018 forget that Conservatives dominate this Government, and must be held responsible for what this Government does. I can quite understand the laughter of the noble Earl [Earl De La Warr]. He can afford to laugh at the Conservatives, because he is one of the little band which has got them in handcuffs at the moment.
The quota will increase foreign production and will increase the value of foreign production. The foreigner will get higher prices for what he produces on account of the quota. Mr. Gullett, the Australian Minister, went back to Australia and said that the quota would increase prices to the producer in Australia. Very well, if the quota increases the producer's prices in Australia the quota will increase the foreigner's prices too. The result is really to subsidise the foreigner. In any case the quotas proposed for the foreigner are excessive and so are those for the Dominions. The quota proposed for the Argentine is 100 per cent. If the Argentine gets a quota of 100 per cent. for chilled beef there is no possibility of any increase in beef production in Britain. That shuts it out completely. Australia arranged at Ottawa for an increase over the average of five years of 80 per cent. in the case of mutton and beef, and New Zealand for an increase of 30 per cent. over the five years average. But Great Britain over an average of five years is to have a minus quota, actually 3 per cent. less than the average production for the last five years. We all know what will happen in regard to pig meat if the Report of the Pig Commission is adopted. Canada, sending 50,000 cwt. of pig meat to Britain, is in future to send, under the quota, 2,500,000 cwt. In other words Canada is to keep twice as many pigs for the British market as are kept in this country.
With all these objections to the quota—and on all sides we hear the quota denounced—why not adopt the policy of a duty on meat? A duty of 2d. per lb. would be a very good beginning. I am not prepared to say that I want to see the duty limited to 2d. but 2d. would be a very good beginning. We are importing into Britain 25,000,000 cwt. of meat yearly. If we had a duty of 2d. a lb. the revenue would be £25,000,000 yearly. On the other hand if you increase production at home that revenue from duties of £25,000,000 would decline, but only to the extent to which our own production 1019 was extended. Our own production only amounts to 17,000,000 or 18,000,000 cwt. at the present moment. If that could be increased to 25,000,000 cwt. what an advantage it would be to the agricultural industry in Britain. What would be the effect on prices if there were a duty of 2d. a lb.? The Argentine producer gets for his carcase at this time £6. A carcase weighs 720 lbs. A duty of 2d. would mean that the importer of Argentine beef instead of having to pay £6 for a carcase delivered here would have to pay £12. The combine, this trust that has the Argentine meat industry in its keeping, charges4½d. a lb. for chilled beef at the present time. Assume that a duty of 2d. increases the price to 6½d. Very well, British beef always sells at 2d. a lb. more than Argentine chilled beef, and is worth more than that extra 2d. The Argentine figure would become 6½d. and the price for our home-grown beef would be increased to 8½d. or even 9d. There would be ½d. for the offals. This price would give the British farmer 50s. per live cwt. or, as is usually said, "on the legs." That 50s. would be a satisfactory price to the British farmer.
Why should we not have a duty? The manufacturer has got a duty of 20 per cent. on everything the manufacturer produces in this country. There are one or two exceptions, but they are unimportant. Agriculture has only got a duty of 10 per cent. on one quarter of its production in this country. It is a terrible injustice, a frightful inequality. Why should there be such a distinction? I say once more to the Conservatives, as I have said over and over again, that there is great danger in these half measures. There is danger for all of us. This policy must stand or fall on its merits, and if you have to stand or fall on only part of it then I say the policy is not being given a fair test. It is not just, it is not proper. Agriculture is the greatest of all industries. As the noble Lord, Lord Cranworth, said, agriculture is actually worth more in the value of its production to us than iron and steel and coal and cotton put together. The total wealth of all those three industries is not equal to the wealth that is produced by agriculture. There are employed in the agricultural industry more men than in the cotton industry, in woollen manufacture and in the iron and steel industry. The farmer 1020 and his labourers, the manufacturer and his workmen, are all in the same boat. If they come ashore they must come ashore together. Let us hope that swiftly and without further delay the Government will realise its responsibility and give the same opportunity to agriculture and agricultural labour that has been given to the manufacturer and his work-people.
§ VISCOUNT ASTOR
My Lords, you will agree that we have just listened to three interesting speeches, and the large attendance in your Lordships' House to-day indicates not only that your Lordships realise the importance of agriculture as an industry, but also are fully aware of the point brought out by each speaker as to the grave position of the industry at the present time. I gathered from the noble Lord, Lord Cranworth, that it was not his desire to initiate a general discussion on agriculture to-day, but rather to limit the discussion to live stock, and more particularly to deal with prices and credit.
§ VISCOUNT ASTOR
I beg the noble Lord's pardon, but I did gather that he wanted to bring out that the urgent matter at the moment was the critical position of the live-stock farmer, and that is the point to which I wish to devote myself. I wish to examine the question of price and the question of credit. As the noble Lord, Lord Beaverbrook, pointed out, farmers at present have not the money to buy cattle. Although the situation is critical, I am not going myself to urge the Government to do anything as the result of panic or anything precipitate. I can imagine the Government being forced into a line of policy which might create a situation a year or two hence which would place agriculture in a worse position even than that in which it is to-day.
There are two proposals before the country intended to raise prices. One of them is tariff duties—that is to say, to give the British farmer protection by the tariff and then to allow world competition; and the second proposal for raising prices is artificially to create a scarcity by a quota blockade. I wish to 1021 say that I am whole-heartedly in favour of the first alternative, and I wish to spend a few moments examining some of the consequences of what I think is a very dangerous proposal of a Government deliberately setting out to create an artificial scarcity in a food commodity. An attempt by a Government to equate world production and consumption is, I believe, bound to fail, because I do not think any Government can have the necessary facts before it.
For such an attempt the Government would have to make an accurate estimate of the fertility of ewes, sows and cows, of weather conditions, of what the public taste would be a year hence—and the public demand would depend not only on public taste but the price of rival articles—of the course of world events, of what happens in Russia, in South America, and in the United States of America. All those facts would have to be accurately before the mind of the Government if they set out to regulate world production in order to meet an estimated world demand, and I do not believe it is possible to do that. I have very grave apprehensions of any serious attempt to restrict world production of food-stuffs, particularly where live stock is concerned, lest at any moment we sound a scarcity. It is relatively easy if there is a shortage of coal to start digging, but if there is a shortage of live stock there would be a serious time lag. It would not be possible for several years to re-establish the necessary numbers. I think therefore we should be very wary before embarking on these schemes of control or so-called planning.
I think the noble Lord, Lord Beaver-brook, indicated that the quota as an instrument of Protection has not been brought forward on merits, but has been brought forward because politicians thought they could escape well-known Election cries. Let me examine some of the demerits and dangers that I see associated with the instrument called quotas. I read in the newspapers to-day that the Sub-Committee of the League of Nations which is making the preliminary arrangements for the Economic Conference repeated what the World Economic Conference in 1927 had said and what the Genoa Conference had said—that quotas imposed a serious rigid block on inter- 1022 national trade—that as an instrument they were dangerous and worse than ordinary tariffs. For a country like ourselves, dependent on world trade, an instrument like the quota brings us face to face with a serious menace.
Shortly your Lordships will be discussing the report of the Pig Commission which proposes quotas. I can imagine this country in conjunction with others attempting to rationalise pig production in Europe. I can visualise a cartel by agreement. I think it would break down, but I can conceive it. But that is not the proposal the Government are invited to consider. The proposal of the Pig Commission is that this country should determine the fate of each of the pig-producing countries in Europe, not that we should rationalise by conference, but that this country should appoint supermen to decide absolutely the fate of Latvia, Poland, Sweden and other countries which export bacon. I fear that such a course might lead to bitter international feeling. Far better protect our own farmers and let the world settle by competition what they are to produce.
Quotas must inevitably be associated with schemes of internal control of distribution and production. Let me examine how that might work out. Take the case of the butcher. If you have a meat quota you must also have a scheme for the control of home meat. Under that the farmer is to get an artificially-fixed price. The butcher is to go into a market artificially restricted and buy from a farmer who is to have an artificially-raised price. But when that butcher comes to sell he has no guarantee of price. He has to sell in an open market in competition with other commodities the prices of which have not been similarly raised. That will place him in a very difficult position. Take another case. There is a big importing firm that owns a considerable number of butchers' shops. It might well be that if you restrict the supplies of chilled meat this firm might give a preference to its butcher shops, to the detriment of its competitors. Or take it in terms of the grocer. In the case of artificially-restricted supplies of bacon you may imagine a case in which you might have good bacon coming from one country and inferior coming from another. The big grocers, with their greater facilities, are going to buy the 1023 good bacon in advance. You might then find yourself in this position, that the little grocers would be able to buy only inferior bacon. By creating an artificial shortage of good bacon, you would be driven inevitably to adopt a system of rationing. Quotas are only intended to do what the German submarine was intended to do—namely, to create a scarcity, and I believe a system of rationing would be the inevitable sequel.
Then let us take the position of the housewife. We are all told we ought not to have import duties because the housewife would then have to pay more. I believe that under the quota she will have to pay a great deal more than under import duties. Let us examine how these two implements would work out in the matter of price raising. Let us assume, for the purpose of argument, that you want to raise prices 15 per cent. If you put a duty on South American meat the exporter who wants to sell in the British market has got to pay the whole or part of that duty. He would sell at a price which would enable him to make a small profit, and he would make a substantial contribution to our Treasury. Under a quota system, if you have artificial restriction on imports in order to raise the prices in the British markets by the same amount, the foreign exporter is going to make no contribution to our Treasury, and if the price goes up he is going to get the whole of the benefit, instead of making a contribution, as he would have to do if there were a Customs Duty. That is to say, with a tariff you might have to ask the housewife to help the English and Dominion farmer, but under the quota systems we are going to ask the housewife, in addition, to help the foreign farmer by giving him the whole of the increase in price. Moreover, by reason of the profits which the foreign importer would make under the quota, he might be able to sell in his own country below the price of production. That is to say, the British housewife would be compelled to subsidise the consumer in the Argentine—a sort of topsy-turvy dumping. That would inevitably be one of the sequels to quotas, and for that reason I personally should prefer a straightforward policy of tariff duties. I agree with what Lord Beaverbrook said about 2d. per lb. upon foreign meat being a great benefit 1024 to the British farmer, and a preference of ½d. to ld. could be given to Empire producers.
Just one word upon another point before I sit down. The present scale of the short-term credit under the Agricultural Credits Act is inadequate. Farmers are unable to get the money required or to avail themselves of the facilities that have been offered. I have seen a scheme and I will, if I may, hand it to the noble Earl. It is a scheme adopted and tried for a period of five years by the Midland Mart. Under that scheme the market buys stock and hires it out to the farmer. The farmer makes a small deposit and resells the beasts within two to twelve months, not necessarily in the Midland markets but anywhere he likes. Individual farmers have had sums of from £50 to £300 advanced, and there has only been one loss of £20. At the present moment what is being offered to the farmer is in fact frozen credit. Under a scheme of this kind what would be given him is liquid money, which would enable him to carry on. The proposals which I put before the Government are a credit scheme on the lines which I have indicated, and a tariff duty on meat, which would not only help to re-establish the breeder and the feeder, but also be of enormous assistance to the dairy farmer. By that means, without imposing a blockade upon international trade, I believe that we could do a great deal to set British agriculture upon its legs.
§ THE PARLIAMENTARY SECRETARY OF THE MINISTRY OF AGRICULTURE AND FISHERIES (EARL DE LA WARR)
My Lords, I cannot help feeling that from my own point of view this debate has been almost worth while, for I never expected to be told by anybody that I had the Conservative Party in handcuffs. Seriously, I think we must all be very grateful to the noble Lord, Lord Cranworth, for bringing up this subject, which must be in all our minds at the present moment, and for the manner in which he and following speakers have put the case for the agricultural industry. I hope that some noble Lords will forgive me if I do not follow them into all their abstract discussions of various points, with regard to the relative advantages of the quota or the tariff, or into the necessity for particular amendments of the credit legislation, because I believe 1025 that to-day what is in our minds is really the wording of the Notice—"To ask His Majesty's Government what immediate steps they propose to take to save the agricultural industry from ruin." And we have plenty of time in the future, on legislation that will be coming before your Lordships' House, to discuss the long-range policy which is in the mind of the Government. For that reason also I think it would be meeting your Lordships' wishes if I passed very briefly over the past policy of the Government. I think your Lordships want to deal with the present situation, but as the wheat quota has been mentioned I would like to thank Lord Beaverbrook for the tribute that he paid to the efficacy of the wheat quota.
§ EARL DE LA WARR
No, it was the noble Lord. Before that Act was put upon the Statute Book the amount of wheat grown in this country was 4,500,000 quarters and the noble Lord anticipates that the policy is going to be so effective that there is reason to fear that the acreage will be increased to over 9,000,000 quarters. That increase will only take place in so far as the wheat quota is an effective instrument for assisting the agricultural industry. I think it is hardly necessary to remind your Lordships of other action that the Government have taken—in regard to the assistance of horticultural products, the continuance of special assistance to the sugar beet industry, the Milk and Bacon Reorganisation Commissions. The Bacon Reorganisation Commission has already reported. When we remember the pleas from the farmers that the Report of the Milk Reorganisation Commission should be proceeded with as quickly as possible, I think the noble Lord who has somewhat cast aspersions on the policy of the Agricultural Marketing Act will realise at any rate that in doing so he is not at the present moment speaking for the farmers of this country.
But, my Lords, that is the past. I believe that the vast majority of your Lordships, just as the vast majority of farmers in the country, are agreed on what one noble Lord said, that this Government has done more for agriculture than any other Government for the 1026 last hundred years. It has done more for agriculture than any other Government, but no other Government has had to deal with the industry in the state of the world to-day. Whatever we say about the past, whatever we say about past policy, however much we may approve of that policy and laud it, admittedly a new situation has arisen comparatively lately, and I believe that it is that situation that is in your Lordships' minds in wishing to have this subject debated. We all know that of the agricultural output of this country over 70 per cent. consists of live-stock products, and even in East Anglia, an area which we regard as the home of arable cultivation, when a survey was carried out recently on a large number of typical farms, it showed that nearly 70 per cent. of the gross income was derived from livestock production. It is for that reason and because of the catastrophic fall that has taken place in the last few months, and even more in the last few weeks, in meat prices, that I think your Lordships must be wanting to hear mainly of the Government's policy with regard to meat.
Suggestions have been thrown out to-day—one suggestion that of assisting the store cattle market. Of course, the store cattle market does require assistance; it is in an appalling state. But what use is a hire-purchase system for store cattle when we know perfectly well that when those store cattle are ready to be killed the best can only be sold at something like 5½d. a lb.? Surely in all the talk of hire-purchase of store cattle, in all the talk of increased credits to farmers—although Heaven knows the industry is in desperate need of credit at the moment—we are not dealing with the immediate crisis. What the farmer wants to-day is a means whereby he can get out of debt, not further into debt, and to lend him further money on a still falling market is going to be of very doubtful use to him.
I have no doubt that the facts that I am now going into are familiar to your Lordships, but it might be useful for the purposes of the discussion if we tried to get a picture of the situation with regard to the meat market. It is not really necessary for this purpose to go back beyond Ottawa. Some criticism has been offered of the settlements arrived at at 1027 Ottawa. It was always contemplated from the beginning that those arrangements with regard to meat at Ottawa would be of a temporary character, and it was arranged that in 1933 a general World Meat Conference should be held for putting those arrangements upon a more permanent basis. It was realised all along that there was a next step to Ottawa. What perhaps nobody at that time realised was that it was going to be necessary to have the next step so soon as it has become necessary. A crisis has admittedly arisen in the meat world. If your Lordships were to ask why at this particular moment or during the last few weeks the crisis has arrived, I should say this is a result of a gradual process of saturation of the market, combined with the general world depression and decrease of purchasing power. Some time ago the Thames overflowed its banks. It was partly as a result of the flood water coming down, it was partly as a result of the high tides, it was partly because of the wind. It was due to no one cause, but it just happened that you got the flood water, the high tides, and the wind all coming together at the same moment and concentrating all their energies at one point, and then you got the overflow. That is really what has happened in the meat market.
But if we admit that the arrangements at Ottawa are of little use in dealing with this particular crisis, we must also realise that if it were not for the foundations laid at Ottawa it would be impossible for the Government now to be contemplating any further step. At Ottawa certain definite principles were laid down. The principle was laid down that we should attempt to establish a firm bottom to the industry. The bottom we were searching for appears to have been deeper than was anticipated, but the principle was established. Contacts were made in regard to working out that principle, and if it is decided that circumstances have arisen when further developments of that policy must be brought forward, then we have not to sit down and initiate a new policy and establish new connections and new relationships, but we merely have to proceed further on lines which have been already traversed. What were actually the arrangements come to at Ottawa? The maximum quantities of 1028 foreign meat to be allowed to be imported into the United Kingdom in the period January, 1933, to June, 1934, were, in the case of frozen mutton and lamb and frozen beef, to be progressively reduced every quarter from the quantities imported in the base year ended 30th June, 1932 (the Ottawa year); and in the case of chilled beef to be stabilised at the quantities imported in the Ottawa year. The average imports into this country of chilled beef from the Argentine in the years 1927–1931 were just under 8,500,000 cwts.; the imports in the Ottawa year were just over 7,600,000 cwts.—a considerable reduction.
The Southern Dominions undertook to limit their exports to this country of frozen mutton and lamb for 1933 to those of the Ottawa year. Australia, which in 1926 to 1930 had exported to this country on the average 660,000 cwts. of frozen mutton and lamb, will be able to send us in 1933 1,490,000 cwts. or nearly double the previous average. New Zealand, which in 1926–1930 had sent an average of 2,848,000 cwts. of frozen mutton and lamb, will be able in 1933 to send us 3,908,000 cwts. or an increase of over 1,000,000 cwts. In addition, bacon imports are at present 2,000,000 cwts. more than a year ago. The Lane-Fox Report seeks to reduce that figure by July, and in actual fact a reduction is taking place at the present moment owing to the reduction of the pig population on the continent of Europe. Then, hanging over the whole situation, we know that in Ireland there is a great hold-up of cattle, and that some time probably before Christmas, or possibly very shortly afterwards, something like 60,000 beasts have to find their way on to this market. In addition, we know that our farmers are holding back supplies; and not only that, but there is actually an increased production in this country.
To give your Lordships that picture and to sum it up, the over-all increased production of meat that has to find its way on to the market at the present moment is 7 per cent. above the average of the years 1926 to 1931, and the total of the reductions under Ottawa and under the Lane-Fox Report will amount to something like 2 per cent. by next year. That leaves an increase of over 5 per cent. to be dealt with somehow if we are 1029 going to cope with the situation. There are certain outstanding facts that arise out of those figures. One is the interrelationship, the inter-connection of the whole meat market. We have to think of the meat market as one. It is the unregulated and increased productions of mutton, lamb and bacon that are mainly responsible for the situation in the beef world to-day. Those of your Lordships who are able to follow the figures that I have given will see that the chilled beef imports into this country are actually down, and the figures for mutton and lamb are up by very large quantities, as also at the present moment are the figures for bacon. It is clear from that statement that whatever the merits or demerits of our policy may have been we have to admit that what we have hitherto done does not really affect the immediate situation in the meat market.
We have a World Meat Conference coming on in 1933, when we hope to be able to place the meat imports into this country on to a more permanently orderly basis. We have to consider and compare plans for the organisation of the meat industry in this country, a most essential step if we are really going to benefit from the regulation of imports, and we have to consider the putting into operation of the report on bacon. All those steps are absolutely essential. Still we come back to the fact that none of them can really affect the present situation. The Prime Minister, the other day, in company with Mr. Baldwin and the Minister for Agriculture, received a deputation of agriculturists representing all the various Parties in the National Government. Whilst he was unable at that moment to make a definite statement he laid down, as three essential conditions of any agricultural policy, or of any policy dealing with this situation, that that policy must be immediate, must be effective, and must be tolerable. Certain suggestions were at that time made, one of which I have already mentioned, the question of farm credits, and I have tried to give your Lordships the reason why, although we admit the importance of credit in any reconstruction of agriculture, we do not believe that it is the fundamental point for assisting us out of this present situation.
Then there is the question of further limitation of foreign imports. Every- 1030 thing must be considered and, amongst other considerations, this, of course, must be one. But let us ask ourselves: Will it alone be effective? If we are to risk industry, trade and invested capital in certain parts of the world which at the present moment export meat to us and then have the market destroyed by mutton and lamb or by Irish cattle coming from Dominion sources, we are going to damage the towns and not help the countryside, a solution that is neither effective to the farmer nor would it be tolerable, for that reason, to the towns. There is no doubt that the solution, to be effective, has to be comprehensive. Here we come back to that principle which was established at Ottawa, that basis of friendly negotiation and friendly cooperation that was set up amongst the various interests at the Ottawa Conference. We can assure ourselves that, whatever solution is come to and however comprehensive that solution may be, we now have the machinery for negotiating amongst ourselves on a friendly and constructive basis.
There is one other consolation and one other factor, I think; that is, that in the present situation no one is gaining. It must be clear to all oversea producers, whether they are foreign or whether they are Dominion, that by throwing supplies on this saturated market, a market which has already fallen a little over 33 per cent., as regards beef in the last few months, they will certainly not be helping themselves nor helping to establish that increased prosperity and increased purchasing power which they most desire for themselves and which we most anxiously desire for them. Therefore it is to the interests of all of us to find a solution. I am afraid that to-day I am not in the position of being able to make a definite statement of policy. I have simply tried to lay before your Lordships, for the purpose of the further continuation of this debate, the point of view that the Government have in considering this matter. I can assure your Lordships that the Government are not giving merely formal consideration to this problem. We realise the importance of the problem; we realise its urgency; and if to-day I have ventured on their behalf to lay before your Lordships a recital of some of the difficulties that 1031 we have to face, I hope your Lordships will rest assured that we consider that these difficulties can be overcome, because they must be overcome to make any scheme effective, and that in the opinion of the Government the difficulties, though great, are not an excuse for inaction in the future.
§ LORD HASTINGS
My Lords, the terms of my noble friend's Question are: "To ask His Majesty's Government what immediate steps they propose to take to save the agricultural industry from ruin." When the noble Earl took the convenient course of rising in his place at this stage of the debate instead of waiting till the end, I had hopes that it was in order to take the opportunity of stating what such steps were likely to be. I was all ears when the noble Earl got up. All I can say now that he has sat down is that, in comparison with him, Job was a veritable comedian. Never has anyone given less comfort than fell from the noble Earl. The agricultural situation in England, though comparable with the agricultural situation all over the world, is not yet quite identical with it. It is the first time in the history of this country that Parliament has been called upon to deal with a crisis, so to speak, singlehanded. These crises have come before. Prosperity and depression in agriculture always go in cycles. I remember perfectly well as a boy in the 90's when my father in Norfolk had some ten or a dozen farms on his hands. In ten or a dozen more he was in partnership with the tenants, and it was not until better times came round that he was able to unload those farms; and I am suffering to-day from the immense financial burden which that operation created.
There is nothing new in it; it has happened before. What is new to-day is that Parliament has to do what the landowner formerly used to do himself. Over a long period of years there has been a determination and a long-continued policy to destroy the only stable factor of British agriculture—the only one. I say that advisedly, because even though to-day a very much larger area of English land is in the occupation of its owners, that is to say, small properties, still the landlord and tenant system controls the whole situation. Even to-day the vast majority of agricultural land is conducted under 1032 that same system. Over a long period of years efforts have been made, most successfully, to deprive the landowner of the only usefulness that he ever possessed to the State. It has been done partly economically and partly administratively. The Death Duties have removed from the landowning community the one means by which they have hitherto been able to stand as a buffer between crises and the State. Acts culminating in the Agriculture Act of 1920 have removed from the landowner that administrative authority which alone used to make it possible to keep land in proper cultivation and in good heart so that, when better times came, new tenants could be most easily found.
While Parliament and the State have been busy destroying the ancient edifice, not one brick has been laid even of the foundations of a new edifice. You have destroyed what was; you have created nothing to take its place. If, in those early days, when this policy of restriction of the landowner was begun, you had made up your minds to the nationalisation of the land, it would have been sound. But you never did that. You destroyed without creating. Consequently the chaos which is now prevailing in the agricultural industry has come about. Do you suppose that in the 90's, when the crisis was just as great as it is to-day, these cries were heard in Parliament? They were not. The landowner was doing what he was able to do and what he felt it was his duty to do. To-day he can no longer do it. It is perfectly certain that Parliament has got to decide very soon whether it is going to reconstitute the landowner in a position of financial and administrative capacity or whether it is going in for nationalisation of the land. We cannot have the matter remaining as it is now. One or the other has got to be attempted.
Personally I am of opinion that nationalisation of the land—looking at the matter from a wholly impersonal point of view—is thoroughly bad. Why? The country can never afford it. The country should not be asked to lose the money which the landowners in past years have been in the habit of losing and which it would be bound to lose. Nationalisation of the land is uneconomic. Consequently I am utterly against it. If 1033 that meets with general approval, then you have got to do something to reconstitute the landowner in the position which he once occupied. Although it may seem a little remote from the Question, the one thing that agriculture is suffering from to-day is lack of capital. Somehow or other it has got to be refinanced, and you must begin with the one stable factor in agriculture; that is, the owner of the soil. How are we going to refinance the industry through the medium of the landowner? You want new capital to come to the land. The noble Lord, Lord Beaverbrook, pointed out that land—it happened to be in my immediate neighbourhood—has actually been sold freehold for 35s. an acre. What you have to do is to create an enhanced value of the land if you want to bring in new capital.
I am not suggesting that those landowners who have been broken by the taxation of past years can themselves be reconstituted. I am speaking of the system, not the individual. You want to bring new capital to the land. You can do it in one way most cheaply. It may sound almost mad, but it is a true way of doing it, and that is to remit the Death Duties upon agricultural land and never charge them again. If you take that seemingly extreme step you would at once create in the land of England the most desirable investment in England. Capital would flow to it, and it is capital of which agriculture is short. The comparatively trivial loss to the State of Death Duties which accrue from agricultural land would be more than offset. Capital would flow automatically back to the land and if, as is undoubtedly the case, agriculture is our primary industry and if without progressive and prosperous agriculture no nation can remain a nation, surely the sacrifice I have indicated is far more than worth while. It is the only way I know whereby that capital which is so urgently required can be almost immediately brought back to the land.
Again, why should the land of England continue to carry a tax which no other property carries—the archaic Land Tax which was imposed in days when land was the only real source of wealth in this country? It remains at roughly 1s. an acre. It does not sound much, but if a man happens to own 10,000 acres it means £500. What would not £500 do 1034 towards repairs and necessary outgoings? It is an unjustifiable charge. Why should is remain? It ought to be abolished at once. It is a standing injustice. I have referred to the position of the landowner at some length because it is apt to be forgotten that so long as our present system remains the landowner is the greatest force in it, and should be again, as he was in the past, the buffer between the State and the kind of thing which we are experiencing to-day. He ought not to be ignored, and I have dealt with him first because by dealing with him we can also take some steps to save the agricultural industry from ruin.
Now consider the case of the tenant-farmer or the owner-occupier. The farmer is not only suffering, as has been stated to you, shortage of money, but his capital is absolutely exhausted. He never was a person of large resources. Those resources have gone. Money has been borrowed up to the maximum and beyond, and he has no money left with which either to meet the interest upon his obligations or buy the requirements of his farm, or, more important still, to pay his weekly wage bill. What is to be done in that sort of case? I agree with what fell from my noble friend and others in admiration of the long-range policy put in motion by the National Government. A good many bouquets have been thrown to the National Government to-day, but I have got one brick. Why did the National Government select a struggling industry in order at this stage to crush it by increasing the Beer Tax? Were they not warned? What has been the result? They have made the position of the producers and growers of malting barley impossible. Whereas they were struggling before, they have now ceased to struggle. They are dead. Barley is quite unsaleable in the East Anglian markets. Why? Because the Treasury officials proved themselves to be wholly inaccurate prophets and the result is a loss of millions to the Exchequer and the destruction of one the stable industries of East Anglia. That is my brick. The noble Earl can make what he likes of it.
That was done deliberately and in the face of warning, and the consequences to East Anglian agriculture have been catastrophic. There is no other word for it. I do not suppose it was done 1035 with any intention of promoting temperance. The noble Viscount, Lord Snowden, was not the perpetrator of this outrage, otherwise I should have thought that that was the reason. It was not done for that purpose. It was done in face of the advice of persons who knew what they were talking about, and their advice was not taken. The National Government are most gravely to blame for the effect of that most unfortunate action in the Budget of last April. That tax ought to be repealed immediately without waiting until next April when the situation will be worse. You may think it an extraordinary procedure, but this is an extraordinary difficulty, and remarkable precedents would have every reason for their creation. If it were done some of the thousands of stacks of barley that now stand in East Anglia might meet a market. If it is not done they will stay there until rats have eaten the lot.
The wheat quota has been referred to with satisfaction, but the farmer has to wait till next July for the money for the wheat that is now being sold. Could not that payment be expedited? Could not he get that money almost simultaneously with the sale of the wheat? It would be a godsend if he could.
§ EARL DE LA WARR
Lord Peel, the Chairman of the Wheat Commission, has announced that an advance payment will be made to growers before Christmas.
§ LORD HASTINGS
I saw that the noble Earl, Lord Peel, hinted that something of the kind might be found possible and I am thankful to hear it, but he was not speaking in his capacity as a legislator, or in that of a member of the Government since he does not hold office. I am now speaking in the hope that what I say will be carried to those in authority. Quite clearly the noble Earl, Lord Peel, cannot do these things without superior authority. But my point is simply that if these payments could be expedited and made available now it would be one of those things that the Government at small cost could do to save the agricultural industry from ruin.
With regard to meat, I cannot see any way of dealing with that most difficult question otherwise than by providing the 1036 farmer with credit. It has been said: What on earth is the use of credit unless you make it certain that the individual who receives it is put in a position to pay back his borrowings? If the Government are assured of the future success of their own meat policy then it ought not to be beyond the wits of the Departments concerned to find some means of helping the farmer over this stile.
Then we come to the most serious matter of a moratorium in respect of farmers' debts. We all realise how terrible the consequences of a moratorium may be, but on the other hand something of the sort has to be contemplated unless you make up your minds to see practically the whole of rural England derelict. That is an unfaceable thing, but if, as is happening to-day, the individual occupier of the soil is unable to pay the interest accruing upon his borrowing and is therefore forced out of his occupation, you reach a time when you really cause the land of England to become derelict. Landowners are doing their best to occupy land which they have not the capital or organisation to occupy, but there is a limit to these things and unless you take some steps in respect of the farm debts you are going literally to empty the land of the only community that has it under cultivation. I commend that to the noble Earl for serious consideration. Although the advancement of credit to farmers under present conditions would meet with little approval from me, something of the sort, dangerous and difficult though it is, has to be attempted if the conditions contemplated in my noble friend's Question are to be met.
Lastly, as to labour. The labouring man—in the arable district in particular, but not only there—is faced with the grimmest winter that can ever have confronted people of his class and it is the grimmer because in the inevitable unemployment which faces him he is also confronted with the poverty of the county in which he lives, and the impossibility of that county extracting from the ratepayers sufficient to keep these unemployed persons reasonably supplied with the necessities of life. It is the duty of public assistance committees to see to it that no man starves, but even public assistance committees cannot get blood out of gate-posts. Where the rate- 1037 payers are unable to produce the money how is it to be dealt out to these masses of unemployed? There is a limit to the thing, and I visualise in East Anglia not 15s. but a very much lower figure as the maximum that can be got out of the rates for the support of these unfortunate men. What has the agricultural labourer been to England? What does he mean to England? We all know that the virility of the race is based on the agricultural worker, and that every nation in the end has to rely for the recruitment of its strength upon those born and brought up upon the land. Yet here are men whose craftsmanship is absolutely necessary to the country, whose virility is of vital importance to the State, being thrown out of employment by reason of economic causes entirely beyond their control, and beyond the control of their employers and of any who get their living from the land. If there were no other class engaged in agriculture it would be the duty of the Government to take drastic and unprecedented measures to see to it that their employment was not lost and that their value to the State was retained.
I am not going to admit for one moment that the possibilities of this situation are limited to the kind of discussion and the kind of remedies given to us by the noble Earl. If it were once realised in high places what the situation is, all precedents would be cast aside and drastic unprecedented measures of the kind I have ventured to ventilate taken at once. The noble Lord, Lord Beaverbrook, referred to panic. If you are going to avoid panic you have to act now. Panic when it comes will be so dangerous that you will deeply regret not having acted before. I trust that the noble Earl will be able to convey to his colleagues in the Government the sense of deep anxiety which prevails not only throughout this House, but in the minds of all those who have thought about these agricultural problems and of all those who live upon the land. The right rev. Prelate the Lord Bishop of Norwich is sitting there. May I remind your Lordships of the clergy, because in the rural districts they will fall with the rest? The collapse of the Church of England in rural districts is as imminent as the collapse of the tenant-farming community. I trust the noble Earl will be able to convey to the Gov- 1038 ernment the sense of this House that the long-range policy which he has explained, while accepted wholeheartedly and with great pleasure and satisfaction, is wholly insufficient to deal with the situation which has arisen; and that if the Government imagine that they can deal with the situation by merely concentrating on their long-range policy their own life will not be three months. The country will never stand it. We do not wish to see the National Government destroyed, and if it takes no action in this great matter it will unquestionably destroy itself.
§ LORD NOEL-BUXTON
My Lords, I sympathise deeply with the problems of Lord De La Warr, but he may console himself with one reflection, that if he was still a Minister in a Labour Government the bombardment which he has to suffer would be ten times more vehement than it is. I only interpose for a moment in the civil war which is so interesting to behold, in order to make one or two suggestions which seem to me practical and likely to be forgotten. The question before the House raises a deep response in all of us, in every Party, and I am sure that we feel we would give our eyes to see what is the solution by which prosperity may be secured and stabilised for all the classes concerned with agriculture. But are we not taking rather a short view in considering, as we are really considering in the main, the proposal alone of High Protection? I desire to suggest one or two points that we ought to consider, if we are to consider High Protection.
I leave aside for a moment the merits of the case and I ask your Lordships to remember in detail the conditions laid down by the Prime Minister. He said, in the first place, "let your help be effective." We must remember that the trouble in which agriculture is involved is very largely a monetary trouble. It is a question of currency as much as anything else. That was elaborated years ago, in times of far less severe depression, in the work of Mr. Enfield of the Ministry, one of The first productions of the Marketing Department which I had the privilege of establishing, and it is shown beyond dispute that over the whole of the last twenty years it is currency conditions which have caused depression far more than any other cause. If the noble Lord, Lord Cranworth, is to 1039 find his immediate steps, he ought to have his eyes very firmly fixed upon the monetary conference which is to come, and see that agricultural interests are fully represented there.
The Prime Minister, however, laid down a still more urgent condition—namely, that the protection if it is given should be tolerable; and tolerable not only in regard to the prices to the public, for I think we ought to have in mind the manner in which it is made tolerable by showing that it will enable agriculture to make the most of its opportunity. We all know perfectly well in our hearts that our agricultural resources are not used to the full. We know perfectly well that at least 20 per cent. of the farming of this country is not up to the mark, but very far below the average at which it ought to be. If the Government are taking a long view they should consider the re-enactment of Lord Lee's Act of 1920, which was regrettably and hastily repealed the following year, but which perpetuated many of the measures by which inefficiency in farming was dealt with. Lessons learned during the War were proposed by Lord Lee to be perpetuated, and it is a matter of regret that that Act was repealed.
The truth is that we are trifling with our agricultural resources, and not treating them in a business way, as we should do other industries. Even if we are to make High Protection tolerable to the public, as it must be made, we have got to show that we are dealing with the provision of capital, above all for equipment. Lord Irwin dealt with this question some years ago in a rather pregnant passage. He said "We cannot watch this process going on"—he had spoken of the inability of the modern landlord to provide equipment—and he continued:And the State will come in to fill the function of the old landlord by lending capital. When it does that you may depend upon it that it will claim some measure of control in the business that it finances, and so you may well find yourselves in the course of the next thirty or forty years within measurable distance of something like nationalisation by a side wind.Lord Irwin was speaking simply as a rational man, undeterred by sentimental considerations. He did not see red because nationalisation came into his speech. He was only pointing to a 1040 business proposition, that if you are to provide the necessary equipment of agriculture you must follow the trend of the times and bring in the activity of the State. That has already been accepted with regard to coal and electricity, and Lord Hastings is right that for this purpose of equipment and capital you have got to deal fundamentally with the tenure of the land.
I wish to urge another point of special interest to the farmer. You should not endanger the position of the farmer himself by giving him a support which will be precarious. If you give precarious aid, which will come to an end, you are doing less than nothing for the farmer. You are doing something far worse than inactivity. There was never a greater disaster to the farmer than the Corn Production Act and its repeal. Unless you satisfy the public that Protection is worth while your Protection must be precarious; because the public will not tolerate that Protection shall result in what is properly called a "dole" to land owners—an unearned gift which is nothing more than a "dole," which would undoubtedly be the result of High Protection, unless you satisfied the public that the advantage is going to the man who works for his living on the land and to nobody else. The public did not complain in War time because the measures taken in the early part of the War controlled the increase of rents. And if you are really in earnest about using our resources and putting agriculture on a permanent basis of prosperity, it is very well worth while considering whether the Government should not re-enact the relevant measures that were taken at the beginning of the War, and take power to control and to acquire or lease in perpetuity large areas of land.
That is not a thing that is irrelevant to the question of immediate aid, nor is it a wild proposal. If the State is not to recover the value that it gives by Protection, your Protection will be reversed by the absolutely inevitable criticism of masses of consumers in the country. Your Protection will certainly come to an end; and, after high values have been created which have in many cases compelled farmers to pay exaggerated prices for their farms, the farmers will once more be let down. We ought 1041 not to close our minds against measures which would remove that precarious element from any Protection that we give. Do not let us make a bogey out of the phrase "national control," any more than a bogey was made by Lord Irwin in the speech that I quoted. The objection to State action is a sentimental objection, attaching to the sentiment of ownership; but even the historic position of a family on the land has not been damaged by leasing large areas to a county council for small holdings, or by selling land for public improvements.
In the last few years, almost unknown to us, we have had a silent revolution in land ownership. We are hardly aware that something like two million acres are now in one form or another in public hands—an area equalling two or three counties. The county councils alone have now 440,000 acres, the Crown, as we know, has an elleonions area, the Scottish Board of Agriculture has acquired 360,000 acres, bodies like the Ecclesiastical Commission and Oxford and Cambridge Universities own immense areas, on which a tenant has the advantages appropriate to public ownership. They have stable control, they are not in danger of property being sold over the heads of the farmers, and we have it as a certain fact that land under that ownership is more attractive to the farmer than land in private hands.
I only quote these things to show that we should not close our minds to drastic measures of control if we are seriously considering giving to the agricultural industry the artificial advantage which High Protection would give it. The reply to this will be: "What has this got to do with immediate help? What good would this do at the present time?" The answer to that is: What good would it have done in recent years? It seems to me undeniable that if the conditions we had in war-time, and especially the conditions perpetuated by Lord Lee's Act, had been continued from that time till now the farming industry would have been in a much happier position. We should have had far greater interest on the part of the public in the whole matter of agricultural prosperity. We should have had readiness for measures to grant credit or to grant Protection. We should have had the matter of equipment dealt 1042 with, as it has all the time been dealt with to the advantage of farmers in difficulties, in thousands of cases on the Crown lands or the College lands or the Church lands. We should have had very much better management.
Nobody can deny that there are flaws in our system of land agency, and good agency is one of the advantages that these publicly-owned lands provide. We should, I think I may assert, have had less drift of the best men from the land. There is a drift of the most active and independent-minded men from the land, quite apart from the mere inability to get situations. There is in the fact of the more or less subordinate position, and the danger of victimisation, which still sometimes occurs, an influence which keeps driving the better men from the villages to the towns. Nobody can deny the authority on the advantages of public control of such men as Sir Daniel Hall or Mr. Orwin of the Oxford Institute. Their arguments are quite overwhelming. It is not relevant to this debate to discuss ownership on its merits, but I claim that it is relevant to the question of Protection, because unless you deal with this matter you will have the public turning violently against your Protection, and a repetition of the disaster of 1921 and 1922. That would be the cruellest blow to inflict upon the farmer. This is not a question of State farming, it is a question of introducing the influence of the State into organisation in many directions.
It is a hopeful sign that we may expect that the Government will legislate on the lines of the Pig Commission. That illustrates the fact that State action is to be used in any increasing degree. The Labour Party may congratulate itself that its Marketing Act is found to be the best machinery by which State action can be given in connection with the pig industry. We may congratulate ourselves also that in the question of allotments there is a reversion to sanity and against misplaced economy in the intention to help the settlement of unemployed men on allotments. Well, carry the principle of State intervention and State aid a little further, and show the public that, if it is prepared to give Protection, you will use the opportunity to bring your agriculture more nearly up-to-date.
My Lords, I wish I had had the advantage of hearing that last speech ten years ago, when I should have had the time to devote to it, and I feel sure that the farmers who are waiting for assistance round the country would also more fully have appreciated the words of wisdom that fell from the noble Lord. Meanwhile, I have some thrilling news for your Lordships on the authority of The Times, in which I read to-day:As a matter of fact the position of agriculture occupied a considerable part of the time at yesterday's Cabinet meeting. Ministers are determined that they will not be stampeded into a decision.Is not that marvellous? What is the mark of the stampeder or the stampeded? The mark is that he has not thought about the subject before, otherwise he would not have to consider stampeding or being stampeded. And that is the gravamen of our complaint against this Government.
No one, I think, is a much more loyal supporter of this Government than I am. But I do not take up the position that my noble friend Lord Cranworth took in absolving this Government from blame in the matter of the live-stock industry. They have had ample warning. When the noble Viscount, Lord Astor, was discussing the Wheat Bill, he and I—to name perhaps the most insignificant champions of the live-stock industry—impressed upon the Government that sectional aid to agriculture by assisting arable farming and arable farming only was of no use and would not save the situation. I will not speak of the other bodies who represent agriculture, who have, I know, repeated time and time again that the live-stock industry was the key of the whole position. I may be a Goliath facing the giants upon the Front Bench, hut I would warn the noble Earl, if he is anxious to adopt that rôle, that the Government has supplied me with the stones which I shall proceed to hurl at him.
The first is this. The Government have shown an entire lack of prevision. And we expect prevision as the first quality of statesmanship, even amongst the giants. If the task that they have assumed has been a gigantic one—and we know it is—we must point out that we expect giants, we demand giants, to govern this country. No one else will 1044 do for us. Mr. Chamberlain in another place said yesterday, or the day before, that at Ottawa no one could have expected the recent fall in prices. The noble Earl has said very much the same thing to-day. Why could not they expect it? What is the use of the marketing intelligence section of the Ministry of Agriculture? Who should be better informed than the Ministry on that particular subject? Was it for want of warning? Have we not hammered and hammered the Government to point out to them what Lord Beaverbrook brought out so clearly, that whilst they have protected the whole of the manufacturing industry in this country they have only protected one quarter of the agricultural industry in this country, and that to the extent of only 10 per cent. as against 20 per cent.? The sectional application of Protection can never lead to anything but disaster. Why has not the Government thought that question out?
The case for this Motion and for this debate is a case of urgency. What has the noble Earl given us? He has told us that this collapse of prices has "just happened." He has admitted that the arrangements of Ottawa have been of little use in dealing with this particular crisis. I will say for the noble Earl, that I think he gave us a very accurate and fair statement of the situation. I prefer his analysis of the situation to any that I have heard in this House, but he was not in a position, because his Government was not in a position, to take us any further. That will not do. We have got to be taken further. May I point out what has not hitherto been pointed out, that this country is on the verge of negotiating a whole series of treaties with foreign countries, and that it is quite impossible to negotiate those treaties with foreign countries—I need only mention Denmark to bring home that point—without our Government having first made up its mind what its attitude towards home agriculture is going to be. It would be futile to follow up the magnificent work commenced by His Royal Highness the Prince of Wales by suddenly pressing Denmark, in the middle of the negotiations that were going on, and suggesting a restriction upon her exports to this country when the whole of the rest of the negotiations have proceeded perhaps on a different basis.
1045 It is, therefore, essential if we are going to carry on these negotiations with foreign countries, that the Government should make up its mind now at once what its attitude is going to be towards the home producer. The first treaty that this Government has to make, is a treaty with its own countryside—a far more important treaty than a treaty with any other foreign country can be. The trade to be gained from the countryside of England is, as has been often pointed out, the equivalent of the trade of the rest of Europe to the manufacturers of this country. In any case it is impossible to proceed in this sidelong, sectional way.
Very well then. The next stone I have to throw is this. Why have not the Government got the courage of their convictions? We very well know that this Government went before the country determined to place agriculture on a proper basis. Why have not they realised that they must set to work and do that? They have failed, therefore, in prevision. They have failed in courage. One more point, they have failed in appreciating the temper of their own supporters. Lord Beaverbrook again put the case very plainly to your Lordships the other day, when he said that the fortunes of this National Government were coupled with the fortunes of agriculture. I venture to submit that that was a very true remark, and we look to the Government to produce something very much better than we have heard to-day if they are going to ask us to go into the next Election with the same fire and enthusiasm that we put into the last Election.
§ LORD CRANWORTH
My Lords, I must thank the noble Earl for the courtesy with which he replied, a courtesy that we always expect from him whether we are on his side or on the other. But when I have said that, I must express my profound disappointment with the matter of his speech. Some of your Lordships go out shooting occasionally. I understand that this year has been a year in which there was a good deal of cover and very little game, but I suspect you found more game than I found in the speech of the noble Earl. The only thing I asked for was a message of hope. The only thing I have to bring back when I go home is that there will be a Meat Conference sometime in 1933. I repeat that I am profoundly 1046 disappointed, and if I thought it would be of any practical use whatever, even if there were sufficient here to divide the House, I should most certainly do it, but as I doubt if we have numbers enough now and as I doubt if there is any real gain to be obtained, with your Lordships' leave I beg to withdraw my Motion with profound regret.
§ Motion for Papers, by leave, withdrawn.