HL Deb 30 April 1936 vol 100 cc682-98

Order of the Day for the Second Reading read.

LORD TEMPLEMORE

My Lords, in rising to move the Second Reading of this Bill it will be necessary for me to detain your Lordships for a short time in order to describe to you the state of the cotton trade of this country since the War, and the reasons which have led up to the introduction of this Bill. As your Lordships are probably aware, the condition of the cotton trade has been a source of great anxiety both to the County of Lancashire and to successive Governments since the War. The industry, depending as it does to a large extent on its export trade, has been particularly vulnerable to the growth of what we call economic nationalism which has spread over so many countries since the War. A number of the largest markets which Lancashire used to supply now supply themselves with most, very nearly all, of their requirements, and in addition to that we have had a very intense Japanese competition. The result of these developments abroad has been to leave the Lancashire cotton industry with an equipment very largely in excess of present or indeed of any probable future demands. This excess of productive capacity has in its turn led to a state of very fierce internal competition between different mills for such orders as are available, and mills for the most part have been working much below their capacity. This has been both wasteful and unprofitable.

Naturally an industry like this does not attract any new capital, and there has, therefore, been created a situation in which the industry, hampered by what I can only call a dead-weight of redundant capacity, has not been able, and will not, we think, be able, to rescue itself from this slough of despond. Your Lordships will have some idea of the state of affairs when I tell you that in the town of Oldham alone there are, or were a very short time ago, two million spindles standing idle. If I take the production of cotton yarn, taking 100 as the basis in 1912, it is now 61. The export of cotton piece goods has fallen from 100 to 29. As against that the number of cotton spinning spindles in the United Kingdom has only fallen from 100 to 77. As your Lordships would imagine, in these circumstances much thought has been given to finding a remedy for the present most unsatisfactory state of affairs. I do not propose to weary your Lordships by going into great detail regarding the various methods which have been tried for the last nine or ten years to remedy this state of affairs, except to say that as time went on more and more attention was given in the spinning section of the trade to this problem of excess productive capacity, and the leaders of the industry became more and more convinced that as a preliminary to any healthy reorganisation of the spinning section something must be done to remedy the existing state of affairs.

I come to the year 1932 when my right honourable friend the President of the Board of Trade wrote to Mr. (now Sir Thomas) Barlow, who was then Chairman of the Joint Committee of Cotton Trade Organisations, and said that if the Joint Committee decided to prepare a suitable detailed scheme for concentrating production by means of a levy for the purchase of redundant machinery, and were able to secure for it a measure of support from the trade of a kind that would commend it to Parliament, he would be prepared to recommend to the Cabinet that legislation needed to give authority for the collection of the levy should be introduced. The actual scheme which the Joint Committee prepared did not prove acceptable at that time to the trade, but as I have already said, the feeling was growing that the first step towards reconstruction must take the form of concentration of production by the elimination of surplus capacity, and after a preliminary investigation by a Committee of the Federation of Master Cotton Spinners in 1933 and the early part of 1934, a Committee was appointed under the Chairmanship of my noble friend Lord Colwyn, whom I am glad to see in his place, to prepare a scheme. This Committee reported in October, 1934, and recommended the scheme on which the present Bill is based. A ballot of cotton spinners in Great Britain was then taken on the Colwyn scheme, and in February, 1935, His Majesty's Government were asked to prepare legislation.

This Bill which we are discussing this afternoon was actually introduced into the House of Commons in the last days of last July but, as your Lordships are aware, the late Parliament came to a somewhat sudden and premature end and the Bill in the last Parliament never got beyond its First Reading. It was, however, introduced again in December last, it was read a second time in another place on February 4 last, and it reached your Lordships' House at the beginning of April. Now let us look at the ballot of the cotton spinning industry taken at the end of 1934. The figures showing the result were very carefully scrutinised by the Board of Trade, and scrutiny of the ballot papers and other relevant documents revealed that firms controlling 27,750,000 spindles were unconditionally in favour of the proposals while firms controlling 8,750,000 spindles were opposed to them—a majority of more than three to one.

EARL PEEL

Would the noble Lord kindly tell us the total number of spindles entitled to vote?

LORD TEMPLEMORE

I thought some noble Lord might ask that question and I have figures here. I think it would be best to given them in this way. There are 47,000,000 spindles altogether in the industry. In the original ballot the owners of 23,500,000 voted unconditionally in favour, the owners of 7,500,000 supported the proposals conditionally, and just over 8,750,000 voted against the scheme. The owners of 4,250,000 spindles who accepted the proposals conditionally subsequently withdrew their qualifications and so finally there were unconditionally in favour 27,750,000. I am bound to add that the owners of 8,000,000 spindles—representing about 17 per cent. of the industry—did not vote at all. I hope those are the figures which my noble friend wants.

EARL PEEL

Some of them. We will have some more later.

LORD TEMPLEMORE

On this result, and having regard to the welcome given to the Bill by other sections of the cotton industry, the Government were fully satisfied that the introduction of the Bill was justified. It has been suggested in certain quarters that the operation of natural laws should be allowed to continue and should itself suffice to bring the productive capacity of the industry into line with demand, but experience has shown that this is a long and wasteful process. We consider that if Lancashire has to wait for the present war of attrition within the trade to be fought to the bitter end, other countries and other industries will seize the opportunities which might otherwise bring back prosperity to this great industry. The Bill provides a means whereby the process of dealing with redundant plant can be carried through speedily and in an orderly manner, which will not sacrifice efficient plant because it happens to belong to a firm in financial difficulties. The main object of the Bill is the purchase and scrapping of a considerable number of redundant spindles, by means of a levy on the remaining spindles. The levy is, of course, compulsory and there are certain requirements for the supply of necessary returns of spindleage, and such matters. These are the only elements of compulsion contained in the Bill—there is no limitation of production, there is no prohibition of new enterprise and there is no interference with the liberty of the cotton spinner to run his business on his own responsibility.

If your Lordships turn to the Bill you will see it is divided into three parts. The first three clauses deal with the establishment of the Spindles Board to administer the scheme, with its powers, and with the setting up of an Advisory Committee to assist the Board. Your Lordships will find details regarding the quorum, proceedings, salaries and other matters connected with the Spindles Board set out in the Schedule on the last four pages of the Bill. Clauses 4 to 13 are the financial clauses, and they set out in some detail the powers of the Spindles Board as regards borrowing; regulations regarding the spindles levy, which is to be found in Clause 5; the obligation of the Board of Trade to make good deficits in the Spindles Board revenue and expenditure account, which is to be found in Clause 10, and to make advances if they are necessary to avoid any default on the loan obligation of the Spindles Board. Clauses 14 to 23 are the miscellaneous provisions, including the rendering of returns, the restrictions on disclosing information obtained under the Act, penalties for false returns and matters of that kind.

This in rough outline is the Bill which I have endeavoured to explain as well as I can. I have purposely not gone at any length into the various provisions, but if any noble Lord should wish for information on any clause I know that my noble friend the Secretary of State for Air will be ready to give it when he winds up this debate. It is a Bill which, as I have tried to show, has a decisive majority of Lancashire opinion behind it, and I can assure your Lordships that without that opinion it would certainly not have been worth while for His Majesty's Government to introduce this Bill. I notice with some regret that during the last few days two of my noble friends have put down Motions to reject this Bill, and the noble Lord opposite, Lord Sanderson, has a Motion to refer it, if it is read a second time, to a Select Committee. To deal with the noble Lord opposite first, I can only say this in anticipation with regard to his proposal—of course, he has not spoken yet, and I do not know what he is going to say—that His Majesty's Government consider that this question has already been given a great deal of thought and has been discussed at great length. Matters concerning the state of the cotton trade have been discussed, certainly out of Parliament, for the last nine or ten years. This Bill has been on the stocks since February, 1935; it has been before this Parliament and the last for eight months, and His Majesty's Government could not at this stage consent to the reference of the Bill to a Select Committee, a device which indeed they would really consider simply to be a plan for delaying the Bill and possibly killing it.

With regard to my two noble friends behind me, of course I have no complaint; they have a perfect right, if they think the Bill is a bad one, to put down a Motion to reject it. But I would ask them, and I think we are entitled to know, what is their alternative if we kill the Bill this afternoon. I am very much afraid their attitude and the attitude of those who voted against the proposals in Lancashire really amounts to an attitude of sitting still and not doing very much—a course of action, or inaction, which His Majesty's Government cannot contemplate in the present serious state of the industry. None of us, unless he has a family or business connection with that great County of Lancashire, can have any idea of the hardships and the terrible devastation in huge areas which have overtaken this once great trade. I see my noble friends Lord Derby and Lord Peel both in their places and the noble Lord, Lord Colwyn, on the Cross Bench. They could, and I hope they will, describe far more graphically than I can the state of affairs, now so long drawn out, in the County of Lancashire and in this once flourishing industry.

I would never presume or dare to give advice to your Lordships. I have not been in this House anything like long enough. But I do think, and I am bound to say that I think, that this House would incur a somewhat serious responsibility if your Lordships were to kill this Bill to-day, considering the state of opinion in the trade and in the County of Lancashire with regard to it. I know that any right honourable friend the President has done all that he can by interviews, by correspondence, and by meetings both public and private, to find out the true state of opinion in the County and in the cotton trade. As a result he is satisfied, and His Majesty's Government are satisfied, that both the opinion and the needs of the cotton industry justify them in proceeding with this Bill, and, in fact, that it is their duty to do so. In the opinion of the industry, an opinion shared by the Government, this Bill should bring about a healthier condition and so pave the way to the recovery of trade. It was on these grounds that my right honourable friend introduced this Bill and conducted it through another place, and it is on these grounds that I ask your Lordships to assent to it this afternoon.

In conclusion, may I read you a few words, which ought to appeal especially to noble Lords opposite, because they are words used by the Clynes Committee, which was set up in 1930 under the Presidency of the right honourable gentleman the member for Platting (Mr. Clynes), who was then, I think, Home Secretary. The Committee said these words in the course of their Report: Lancashire must choose. She can lose her trade, she can reduce her standard of wage and living, or, perhaps, she can keep her trade and her wage standard by reducing costs and improving methods. My Lords, Lancashire has chosen: she has chosen this Bill, and she asks the Government to help her by passing it into law. I ask your Lordships this afternoon to assist us to help her by passing the Second Reading of this Bill, I hope without dissent, but, if my noble friend insists on going to a Division, then by a large majority. I beg to move.

Moved, That the Bill be now read 2a.—(Lord Templemore.)

THE EARL OK MANSFIELD, who had given Notice that on the Motion for the Second Reading he would move, That the Bill be read 2a this day six months, said: My Lords, every member of your Lordships' House and every right-thinking person in the country must have every sympathy with the plight in which the cotton trade of Lancashire has found iself practically ever since the War. That plight has been due in some measure to over-capitalisation and other follies perpetrated soon after the War, but also in much greater measure to the tremendous and unfair foreign competition which Lancashire has had to attempt to meet in various markets, both at home and abroad. It is not my intention to take up your Lordships' time this afternoon with a dissertation as to whether the late Government could or could not have done more than it did to prevent this unfair competition. All that I wish to say is that those of us who do not like this Bill, who are suggesting to your Lordships this afternoon that it should not at any rate yet become law, are anxious about one thing only: that something should be done which will really be of assistance to Lancashire, not only to the mill-owners but still more to the mill workers. Unemployment and all the consequent evils that follow thereon have been only too rife and rampant for the last fifteen years in that great County.

I have listened very carefully to the speech of the noble Lord who introduced the Bill this afternoon, and I must confess that, while he professed the utmost confidence that this Bill would be successful in removing a great part, if not all, of the ills that the Lancashire cotton trade has to face to-day, he did not seem to me to give any reason for this over-sanguine belief. I suggest to your Lordships that before you accept the principle of a Bill which is designed to reduce the possibility of production, you should investigate it much more closely indeed, because surely to assume that there is not going to be any chance of any expansion worthy of the name in the next few years in one of our great industries, is really the doctrine of despair. It seems to postulate that we have lost our trade for good and all, and even if we do not accept quite such a gloomy view, surely one is justified in asking what will happen if, owing to foreign competition, we lost another section of our trade and are again faced with a new problem of superabundant spindles. Will not the same position have to be faced all over again, and shall we not have to have a fresh Bill to reduce the number of spindles legally at work to even a more exiguous figure? I cannot see that this Bill is going to be a permanent cure for that. Furthermore, if we do succeed in reducing the number of excess spindles to what is supposed to be a reasonable number, what is to happen if for some reason there is some recovery in the industry? How is the industry to deal with the fresh trade which it will be called upon to absorb? Either there is going to be kept a certain reserve of spindles which can be brought into operation—which is hardly in accordance with the principle of the Bill—or the unfortunate industry is going to find itself totally unable to take advantage of the new-found prosperity.

Then there is the question of whether Lancashire as a whole really desires this Bill. With great respect to the noble Lord who introduced it, I understand that some of my noble friends, who know the details of the cotton industry far better than I can pretend to do, question the accuracy of the figures regarding spindles that he gave. There is also this point, that there seems to have been a very considerable amount of misapprehension among those who voted, or were asked to vote, when the ballot was originally taken. Many thought that refraining from voting was tantamount to disapproval, and they had no opportunity of rectifying that error. Furthermore it is alleged, and apparently with good reason, that the proposals upon which many voted when the ballot was taken were not the proposals which are before your Lordships to-day.

The noble Lord spoke of the impossibility of obtaining new capital at the present time, owing to the large number of surplus spindles, but for what is this new capital required? It is surely for the purpose of building more mills and introducing more spindles. I hear a murmur of dissent. If it is not for that purpose, then I presume it is for the purpose of bringing the mills up to date. If that is so, then the best thing the Government can do is to make cheap money available for the efficient mill-owners, who are able to make a living or even to avoid loss, because one of the most serious objections to the Bill as it stands is that you are asking the efficient members of the industry to contribute a sum of £2,000,000 towards keeping the inefficient mill-owners in existence. That is not a system of finance which I think can be considered as sound in any way whatsoever, from whatever angle it is considered. Surely if these mills which are now on the verge of bankruptcy were to be allowed quietly to disappear and suffer the penalty of their inefficiency or over capitalisation, it would be better than asking the mills which have managed to survive one of the most difficult periods in the history of this country to assist in keeping their inefficient rivals on their feet. From all the evidence it would appear that the mainspring behind the Bill is the ill-starred Lancashire Cotton Corporation, a body which seems to have devoted a great deal of time, energy and money to endeavouring to set the industry upon its feet, unfortunately without the slightest success.

Then there is the very important question of the workers in the industry. I fear that their interests are going to be very seriously affected by this Bill if it is passed in its present form, and should your Lordships, after all the arguments which you will hear against the Bill, still be of opinion that it should be read a second time, to-day, I hope you will also be of opinion that it should be referred to a Select Committee before it comes into operation. We are asked, to-day, to take a step of the utmost importance. It is quite true that it is vital to the industry as a whole; that the prosperity of thousands and the livelihood of hundreds of thousands depend upon it. There is, therefore, all the more reason why its provisions should be examined very carefully before you agree to allow it to pass into law. I suggest that the noble Lord who introduced the Bill has not been able to prove in any way that it is in its essence a good Bill, or will even carry out what it professes to do. If I could be assured that unemployment would be greatly alleviated by this Bill; if I could be assured that we are really going to see more employment and better wages; and most of all, if I could be assured that we are not going to see good money taken from the efficient mill-owners and handed over to the inefficient mill-owners, then I should be only too willing to withdraw my opposition to the Bill. I do not intend to inflict myself upon your Lordships any longer, because many noble Lords who have greater knowledge of this subject than I have are going to speak. I hope that very careful attention will be paid to the points which will be brought forward, and that unless you are perfectly satisfied that a good case is made out for this Bill you will be chary of passing it, in view of the fact that many persons believe it will do the industry more harm than good. I therefore beg to move.

Amendment moved—

Leave out (" now ") and at the end of the Motion insert (" this day six months ").—(The Earl of Mansfield.)

LORD SANDERSON

My Lords, my noble friends and I are very much interested in this Bill because it embodies what seems to be a somewhat despairing effort on the part of the Government, which believes in our present industrial system, to bolster up an industry which under private enterprise has almost reached a state of collapse. This is not of course the first attempt of this kind which has been made by the present Government. We have had agriculture and shipping, and now cotton. The cotton industry is in many respects a very typical capitalist industry. It is based on private enterprise, and its fundamental motive is profit. It is highly individualistic and extremely competitive. But since the War it has been seized with a creeping paralysis, which has extended and gradually become worse, and which, if something drastic is not done, may prove almost fatal to the industry.

The industry has made several attempts to reorganise itself from within, but they have all failed. The collapse of the industry of course is not by any means entirely due to those who are responsible for it. The owners of the industry are not responsible for the loss of many of its markets. It could not prevent the Indian tariff, and it could not prevent the rapid development of the cotton industry in Japan with the aid of cheap labour. But it is doubtful whether it has done all that it could for itself. It has not done much towards gaining fresh markets. Its marketing system is very weak, and it has not done all it could in the home market. The machinery of the industry itself is old-fashioned. These are things which it has not done for itself which it might possibly have done in recent years. In the boom just after the War the industry was enormously over-capitalised. I suppose that when the slump came it might have recovered by ordinary economic processes, as the methods of production became cheaper. Improvements in the methods of production might have enabled the better firms to drive out the weak, which is a sort of ordinary process in industry.

The noble Lord who moved the Second Reading mentioned that the possibility had been suggested that it might recover by what I might call natural causes even at the present time, although—quite rightly I think—he thinks that is not likely to be the case. But he did not mention what I think was one of the main causes why the industry could not recover by means of natural economic processes after the War, and cannot recover now by natural economic processes, and that was due to the intervention of the banks, which lent very largely to weak firms and helped to stimulate the boom and prevent the contraction of the industry in the slump. The industry as a result is still suffering from that period of reckless competition and from the strangle-hold which the banks obtained at that time.

The Labour Party have for years urged that the industry should be taken over and publicly owned and controlled and thoroughly organised from top to bottom. We have also for long advocated the nationalisation of the banks, so that we could have more control over the way money is lent. It is obvious, I think, that the money lent by the banks at the time of the cotton boom in many cases should not have been lent. We have also advocated for a long time a capital investment board, so as to try to ensure that capital flows into the industries where it is most needed and where it is likely to do most good to the community, and not merely where it is likely to earn the largest rate of interest. We have had since the War, with the exception of three years, I was going to say Conservative, but I will say anti-Socialist Governments in power—there can be no quarrel with that description, I think. And so our plans have not been accepted and no attempt has been made to carry them out. But we think that, had they been adopted, the cotton industry would be in a much more prosperous position to-day than it is. I know, however, that there is no use harping on the failures and the omissions of the past, except perhaps as a warning for the future, and we realise that our proposals will not be adopted now. Therefore we have to consider what is to be done, if anything can be done, for this industry at the present time and under the present industrial system.

That brings me to the Bill. If anything can be done for the industry it should, I think, be done on a big scale, and the industry should be dealt with as a whole. This Bill merely tinkers with one section of the industry. The industry, as your Lordships know, consists of many different sections—the carders, the spinners, the weavers, all the finishing sections, and the marketing section. This Bill only deals with the spinning section. All the other sections are ignored. I know that the President of the Board of Trade said in another place that if this experiment succeeds he proposed to go on and deal with the other parts of the industry, until, I suppose, the whole industry is dealt with. But how long is that going to take? Two or three years are allowed for the buying up of the spindles, and the whole scheme is to take fifteen years—that is, until the £2,000,000 which is to be advanced is repaid. Fifteen years is a long time to wait before you start on another section; even three years is a long time to wait. I think that if the Government wanted to deal with the question in steps it would have been far better to deal first with marketing. The whole marketing system of the industry is, I understand, extraordinarily weak.

We have some hundreds of merchants, all doing small amounts of business, with no real close connection with the productive side. They stand rather aloof from the productive side, whereas in Japan most of the marketing is done by a few very large organisations—three, I believe—who are closely connected with the productive side and who are able to deal in very large bulk, which apparently we cannot do. That, I believe, is one of the main reasons for the great success of the Japanese industry, and it is helping to increase the competition. It seems to me that the question of marketing should have been taken in hand at a very early stage at any rate. Then, of course, there is the question of machinery. I understand most of the machinery is by no means up-to-date. I have seen it stated that the average age of the machinery in the industry is about forty years, which is pretty old, and there is no doubt that new and more up-to-date machinery is required. Again, most of our competitors have adopted the ring spindle, which we are only adopting very slowly indeed, although the ring spindle is more suitable for the kind of cloth most in demand. I think something should be done to deal with these three matters—with the marketing question, with machinery, and with spindles. It would have been far more helpful to do that than to have this particular Bill, which only deals with redundant spindles.

I come now to one or two details of the Bill. First of all, the whole thing appears to be extraordinarily speculative. It may succeed to some extent, it may succeed altogether, but, on the other hand, it may completely fail to do what is wanted. I think it is quite likely it will fail. The whole procedure is highly speculative. Take the ease of the spindles. How do we know how many spindles will be offered for sale? There is no compulsion in the Bill, as the noble Lord has said. It is left entirely to the mills to decide whether they will offer their spindles for sale or not. How do we know they will get anything like the 10,000,000 spindles it is hoped to get? Then again—another important point—are we quite sure that the weaker mills, and not the more advanced mills, will sell their spindles? There is a possibility that you will not cut out the weaker mills by this method, because some of the old mills did not apply to the banks for finance during the boom. They were able to carry on, and they have now become rather obsolete. Some of them may be family businesses willing to carry on in a slow sort of a way, and as they are not under obligations to the banks they have no inducement to sell.

Some of them may not come forward at all, and these may be some of the most obsolete mills in Lancashire, whereas more advanced mills, which are for the most part under obligations to pay back their debts to the banks, will have pressure put upon them by the banks to sell in order that the banks may recover as much as they can of their loans from the wreckage—money which they ought never to have lent. The banks will use their influence rather strongly in the direction of encouraging mills to come forward and sell their spindles, and these, as I have said, may be some of the better mills and not the weaker ones. It would have been far better if a Commission were set up to go into the whole question and discover which are the weak mills. That Commission should have compulsory powers to buy out those which turn out to be mills which are really redundant and a handicap to the industry. That would have been far better than this haphazard method of allowing the mill-owners to come forward and sell what spindles they feel inclined to sell. Again, there is nothing whatever that I can find in the Bill about prices. How much is the Spindles Board going to pay for these spindles? Anything that the owners like to ask, or how much?

There is also the question of the effect on the price of cotton cloth. How much will this levy affect the price of cloth? It may affect the price of yarn and so go through all the industry, and ultimately increase the price of cotton cloth and so make it more difficult to meet foreign competition. It is said that the levy is not very heavy, but a very small amount may creep through the whole industry on to the finished article and have a fairly big effect. I do not know, but many manufacturers in the industry, who should be qualified to speak, seem to think that the effect of the levy may be a rise in the price of the finished article, and that, of course, would defeat the object of the Bill.

Now I come to a very serious point, and that is that the working people are not mentioned in the Bill at all. The men and women without whom the industry could not be carried on for another day are not mentioned in the Bill. Why should not there be a representative of the working people on the Spindles Board? Why should not one of the three members be a representative of trade unions? Then again, I should like to see two representatives of the working people on the Advisory Committee. There is to be one, I know, but I think there should be two. Much more serious than that is the point to which the noble Earl referred just now—namely, that there is no mention of compensation to the working people who are thrown out of the industry under this Bill. It seems to me an extraordinary state of things to propose to compensate the owners who voluntarily reduce their work or go out of work altogether, and not to compensate the working people who involuntarily are thrown out without a penny, except the unemployment pay to which most of them, of course, have contributed. Your Lordships must remember that these people have spent years and years of their lives in training to become really accomplished spinners. It is very skilled work, I understand. They perhaps begin as piecers and then become winders, and it takes many years to be come a really competent spinner in a responsible position. Many of these people will be turned out of their work, and the kind of skill they possess will be quite useless in any other industry. I cannot imagine that any one with any sense of justice would think it right to compensate the employers and throw the working people out on to the scrap heap, so to speak.

I may be told this. As the industry improves some of the mills will be working full time instead of half time, and they may increase their staffs; the people thrown out may be taken on and become employed again. I have heard it said that the Bill will not cause any increase of unemployment. That I do not believe, I am afraid, but if that is going to be the case the matter of compensation will be a very small one and will not be a thing to worry about. As the Government have been so lavish with "doles" to industries like the shipping industry and agriculture and sugar and so on, it would not be much to ask for a small grant towards helping these working people over a short period after they are thrown out. I may be told that there is no precedent. I may be told that working people are being thrown out of industry all the time, and that they have the "dole" But they are not thrown out by Act of Parliament, and surely to throw a lot of people out of work by Act of Parliament is quite a different thing from their being driven out by the play of the ordinary economic forces in industry.

I may be told, again, that there is no precedent for compensating working people. That may be true, but there are precedents for compensating salaried employees. You have it in the Local Government Act of 1929. And it is quite a common thing for commercial firms, when they have to part with their employees, to give them bonuses or pensions. That is constantly done in the case of salaried employees, and I cannot see why a hard-and-fast line should be drawn between the salaried classes and the manual workers. I very much hope that the Government will reconsider this question, and that they will be able to tell me that if I put down an Amendment in the Committee stage they will accept it. I think that that concession would be a very generous gesture on the part of your Lordships, and we know it would be highly appreciated by the working people of Lancashire.

My noble friends and myself cannot possibly vote for this Bill because it is regarded as entirely inadequate to meet the situation. We regard the results which are claimed for it as highly speculative, and we think it is unjust to the working people, but we shall not vote against the Bill because we never do vote against the Second Readings of Bills which come to your Lordships' House from another place, for reasons of which your Lordships are already aware. I appreciate what the noble Lord, Lord Templemore, said about my moving a Motion that the Bill be referred to a Select Committee of your Lordships' House. There is a strong opposition to the Bill in Lancashire and elsewhere which the noble Lord has perhaps rather under-rated, and I think there is room for further inquiry. I shall therefore feel obliged to move, as indicated on the Order Paper, that the Bill be referred to a Select Committee of your Lordships' House when the time comes.

THE LORD PRIVY SEAL (VISCOUNT HALIFAX)

My Lords, I am afraid it is necessary to ask your Lordships to interrupt the debate for a few moments in order that a Royal Commission may sit to give the Royal Assent to the Army and Air Force (Annual) Bill. The debate will be resumed as soon as that business is completed.

House adjourned during pleasure.

House resumed.