HL Deb 30 March 1938 vol 108 cc497-517

Page 43, line 7, column 1, leave out ("15") and insert ("20.")

VISCOUNT SWINTON

The two remaining Amendments are on page 43, in line 7, column 1, to leave out "15" and insert "20" and in line 21, column 1, to leave out "12½" and insert "15." I think it will obviously be convenient if these two Amendments are taken together because the one is in fact consequential on the other.

LORD MOYNE

My Lords, I am only rising on a point of order. It is possible that some of my noble friends may wish to suggest a compromise to one of these Amendments and accept the other. If they are put together like this, is it possible to move another figure in the first place and accept the Government's suggestion in the second?

VISCOUNT SWINTON

I would not suggest that they should be put together. They would, of course, I take it, be put separately. I was merely proposing to deal with them together because the two are really entirely interlocked.

THE LORD CHANCELLOR (LORD MAUGHAM)

My Lords, the noble Lord, Lord Darcy (de Knayth) has handed to me another Amendment. I am not quite sure whether it is within the knowledge of the House. It proposes on page 43, line 7, column 1, to leave out "15" and insert "17½." I do not know if it is convenient that this Amendment should be moved.

VISCOUNT SWINTON

My Lords, I think it would be convenient if I dealt with the two Amendments and then, if, having heard what I have to say on them, my noble friend desires to put some other Amendment, no doubt he would advance to your Lordships whatever arguments he thought were right thereon. I beg to move that the House doth not insist on this Amendment in line 7. I was very glad to hear that my noble friend and his lieutenant were going to take, in this matter, a practical and commonsense view, because that is what I am going to invite them to take. My noble friend will say I am moving that your Lordships should agree with the Commons in their disagreement. It is fair, I think, to remember that after we had considered this Bill here we sent a volume of Amendments down to the House of Commons, ten or eleven pages of them, and every one of the Amendments which we made in the Bill here were accepted in the House of Commons with the exception of these Amendments and the Amendment with which we have just dealt, and on which my noble friend himself admits, on reconsideration, that both Houses are right to agree. This only leaves therefore a single bone of contention out of the very large dish of Amendments with which we supplied another place. These Amendments, with which the Commons have disagreed, would raise the quota of long films for the renter from 15 to 20 per cent., and for the exhibitor from 12½ to 15 per cent.

It will be within the recollection of your Lordships that an Amendment was moved here to increase the quota both for renters and exhibitors of short films very materially. That Amendment has been agreed to in another place. We therefore have imposed a considerable increase of obligation both upon the renters and exhibitors, and we have imposed that increased obligation in addition to the wholly new obligation to have a separate quota for short films as well as for long, films. I would also point out that this Amendment, which Lord Moyne proposed, only affects a single year, and that is very important from the point of view of the renter and the exhibitor. Next year, on the 1st April, 1939, the quotas go up both for renters and exhibitors to the figure at which the noble Lord would like to put it in the first instance. We are not dealing here with an obligation which is to come into force at some long time ahead. We are dealing with an obligation which will come into force the day after to-morrow. It is, of course, inconvenient that we should pass an Act of Parliament so close to the date on which it has got to operate, and particularly I think is it true—and particularly does this impose upon us a duty of caution—that the obligation which we are going to impose upon renters and exhibitors is an obligation which cannot be discharged rapidly. It is not just a simple prohibition that you may not walk on one side of the street. It is an obligation which is imposed upon long periods of work in the collection of finance in order to make these films and the whole process of film construction on a very considerable scale.

There are certain very important facts which I would ask your Lordships to consider in deciding whether we ought to "step-up" these quotas of renters and exhibitors at the last moment. We have made great changes in the structure of film legislation. We have introduced for the first time a cost test in the making of these films. We have done that in order to kill the "quota-quickies." That means that for these long films, with which we are concerned in this Amendment, no film, unless it is certified to have peculiar merits, is to be allowed to count unless it has a £7,500 minimum labour value. That means that it is to cost not less than £15,000 to produce, and of course in many cases the cost will be very much greater than that. Time is required to arrange for the necessary finance and to produce effectively films of that kind. The worst service we could do to producers—and I am sure my noble friend will believe that I, at any rate, who was responsible for all this legislation, have as much at heart the interest of producers as he has; I think it would be true to say that but for the Act which I introduced and persuaded Parliament to pass, there would not have been a British producer at all.

LORD MOYNE

Hear, hear.

VISCOUNT SWINTON

Therefore if I ask the House most sincerely to be moderate in the instantaneous obligation which it puts upon renter and exhibitor, it is not out of excessive tenderness for those branches of the trade, although we want their good will and must do justice to them, but it is also in the interest of the producers, because nothing could be worse than that, as a result of this legislation, we should start off with some horrid bad films which would get us a thoroughly bad name. I apologise to your Lordships for dealing with this at some length, but there are such technicalities in the Bill that it is clearly important that we should know what we are doing. First of all, we talk about a 15 or 20 per cent. quota. On the face of it any one would suppose that that is something like a 15 per cent. duty; that it means that if you introduce 100,000 feet of foreign film you have to show 15,000 feet of British film. It is not that at all. You have to show 15 per cent. or 20 per cent., as the case may be, of the aggregate amount of film which is shown, and therefore if a man rents or exhibits 100,000 feet of film the quota of British film is not 15,000 feet but 18,000 feet. If we take 20 per cent. it means not that you have to exhibit on the 100,000 feet basis 20,000 feet of British film, but 25,000 feet, and I think it is important that the House should realise that, because many members of your Lordships' House are not intimate with the intricacies of the trade, and would suppose that 15 per cent. meant 15 per cent., whereas in fact it means 18 per cent., and 20 per cent. means 25 per cent.

There is another thing which it is very important to bear in mind. I heard a number of speeches on the last occasion, in which noble Lords spoke about the aggregate number of films which were available. They said: "After all, why are you so careful? Why will you not put the quota up another 5 per cent.? There are more than 20 per cent. of British films available." It is enormously important to realise that the obligation you are imposing here is not an aggregate quota. It does not mean that if a million feet of foreign films come in you have to have 200,000 feet of British films in the aggregate. It means something quite different from that. It means that every renter who rents a foreign film has to fill his own individual quota with British films. It means that every exhibitor—4,500 of them I believe there are—who exhibits foreign films in his theatre has to fill his individual quota of British films. That is a wholly different kind of obligation, and it is very important to realise why it is so different.

The way this industry is built up is three-fold. There is the producer, who makes the film; there is the renter, who is the middle-man, who trades in it; and there is the exhibitor, who exhibits it. But in many cases the producer, particularly the big producer, who probably produces most of the films, has what I may call a tame renter, either a subsidiary company of his own or—renters will not mind the parallel—renters who represent something in the nature of a tied house. You may have a producer who has produced twenty films, and perfectly good films, but those films are dealt in by his own renter, and the better the film the less likely is that renter to pass it on to somebody else to rent. He is going to keep all those films in his own hands and deal in them to the best advantage. That means that the other renters have to collect British films from other producing houses and make up their own individual quotas by the films they can collect in that way. Therefore if my noble friend recites a long list of films which have been produced, it is utterly irrelevant for this purpose unless he is able to say that all those films are available to the individual renters in this country. I am quite sure he would not do that, and the would not attempt to do it

If he has made his inquiries carefully he would probably tell us that a very large proportion of the films which he knows are in existence to-day are tied films in the sense that they are produced by one producing house or two producing houses here, and they are under contract to be rented to selected renters. The renters' quota which he wishes to increase will have no call whatever on those films to fill the quota. They will have to get their quota out of other British films produced elsewhere. I have stressed that because I am quite sure that the majority of your Lordships have probably not appreciated it. I am bound to say that this is a system which has grown up, and until I went into it very carefully I had not realised in the least the extent to which this tied-house system goes. I think we have to be extraordinarily careful in increasing the renters' quota to make sure that there will be films available.

One other point. Do not let us think of the quota which we impose as a maximum. It is not. It is a minimum. It is the minimum amount which every individual renter or exhibitor has to rent or to exhibit. The Bill would fail entirely if there were not a large number of British films over and above the minimum required to fill the quota. It was never intended—I certainly never intended it in my legislation—that quota and exhibition should be at the same figure. I had always hoped and intended that the total number of films exhibited would be considerably above the minimum obligation of the quota. I think we should be very unwise to raise this quota. What is the whole object of this Bill? It is to get rid of the "quotaquickie," the bad, cheap film, the film which is carelessly, quickly, cheaply produced, which has got us a bad name.

It is also to get American producers producing here. It is very important that American finance and American knowledge should come in and employ British labour and British talent. We want to get good films and they are going to be costly. You have to get the finance of those films. It will not be too easy. My noble friend was talking the other day about a period when everybody went mad about films. You could get any amount of money for the asking. You did not even have to ask for it, and millions of pounds of capital were put into this industry. But a great deal of that was lost. It is not a very easy time to-day to raise money for other, more solid and certain, purposes than this, and certainly those who have money to invest will want to be quite sure that they are investing their money wisely, that if they are going to put £50,000 into the production of a film they can be certain that that film has been carefully prepared—good story, scenario writers effectively used, the cast carefully prepared, and indeed the whole structure of the film so organised that it will be worth investing in. Well, you are not going to get people to put money in that way into films which are going to be made at a fortnight's notice and have to be completed within two or three months.

As I say, we want to get American money in. There is, I believe, a very good chance to-day of getting what we never have had—the American producer who is also maybe the owner, certainly a large renter, possibly the owner of large circuits of houses in America, producing films here with British labour, British talent, British artists, and showing those films not only in this country for British quota, but showing them in America, and thus giving British production a worldwide opportunity. We shall not get that if we are unreasonable about the terms of this Bill. I venture to submit that all the arguments which convinced even my noble friend Lord Moyne as to why we should leave Clause 16 in the Bill apply here. If he tries to insist on increasing the quota to a dangerous level he will be passing an unreasonable law, which reasonable men who want to keep the law will not be able to keep He will be forcing the President of the Board of Trade to exercise his dispensing power, which ought to be used only exceptionally. He has had to exercise it over and over again in the past. My noble friend was talking about a time two years ago. I have been inquiring, and I find that in the last two years there were hundreds of defaults, but the President of the Board of Trade did not feel justified in prosecuting in more than a very few cases. The use of that power of dispensation ought to be a rare exception. If it becomes a rule you bring this law into contempt. Finally, and once again, you forfeit that good will upon which this Bill with its ten years of, I hope, useful progress has got so much to rely. You would be doing something which is unfair to the renter and to the exhibitor and, last but not least, doing something which might in my opinion very well react most unfavourably on those very producers whom it is your object to serve. I beg to move.

Moved, That this House doth not insist upon the said Amendment.—(Viscount Swinton.)

LORD MOYNE

My Lords, it is very disappointing that the noble Viscount in charge of the Bill shows so uncompromising a front to this Amendment about the renters' quota. Much of his speech was directed to the difficulty of the exhibitor fulfilling his quota because of the fact that many films are tied and he cannot get them. I want the House to come back to this particular Amendment about the renters' quota, and to put quite on one side this difficulty about the exhibitors.

VISCOUNT SWINTON

I did not make myself clear to my noble friend. I was arguing this from the renters' point of view. A number of renters are tied to the big producing houses, and films which they get will not be available to the independent renters, and the independent renters whose quota my noble friend wishes to increase will not, I am advised, be able to find the films with which to fulfil their obligation.

LORD MOYNE

I will come to that. But first I would ask the House to distinguish very carefully between the position of the exhibitor and the position of the renter. Personally, I am not altogether happy as to what supply of films will be available to the exhibitors in view of the incalculable disturbance of output, and of films available, which will result from the perfectly sound provision of the treble quota. The noble Viscount pointed out that this Amendment about the renters' quota, putting it up by 5 per cent., applies only for one year. I think it was rather in his mind that we were open to criticism for our moderation. It was certainly suggested in another place that it would have been much more logical to put up the quota throughout the whole period. That argument quite ignores the machinery of the Bill. The producers are very keen on a reasonably high obligation on foreign producers and their agent renters in the first year because that is going to be the test year, and it is going to have a great weight in forming the opinion of the Films Advisory Committee as to how far to vary, by acceleration or retardation, the quotas that are to be enforced. This first year is of very great importance as a jumping off point, and it is for that reason we did not want the Bill to bring down the renters' quota to a much lower level than what has been their obligation up to now.

The noble Viscount alluded to the Amendment regarding short films, and he pointed out that in another place many Amendments have been agreed to. He did not, however, mention that one of the most important of these Amendments was moved by the Government. That was the triple quota; and a great many of those which have been accepted had nothing to do with my noble friends and me who are anxious to give a better chance, as we believe, to British film production. I admit that the Government have met us reasonably on this question of short films quota. They have allowed an increase of 5 per cent. throughout the whole period of ten years, and I am grateful for that. I appreciate that in many respects it is an even more valuable Amendment than that for which we have pressed in the case of the long quotas, because it is a new form of quota, helping a new kind of film activity, and it does not run for only one year as in the case of our long quota Amendment but for the whole period. On that short quota proposal there is really no fear whatever that there will be any disadvantage from the point of view of turning the exhibitor from the screening of short films to that of long. He uses these short films as a convenience to balance the length of his programme, and he will continue to do so for one very good reason, that although under the existing system where the American short is given away for nothing, and there is no compelling need to show British shorts at all, British short film producers could not get anything like the cost of production. In fact, short films are produced cheaper than the corresponding length of long film, and they will therefore on an economic basis be sold more cheaply.

So it is a bogey to say that in accepting these short film Amendments we are risking the position of the short film producers, because it is quite certain that the exhibitor, both for his convenience and also on the ground of cheapness, will go on using short films. He must have them, he cannot work out his programme without them. Short films are a British speciality, and I believe they will develop. They may be the means, by experiment, of working out a new type of British product. I sometimes doubt the wisdom of those who say that the only hope for British films—it was said in another place by the Minister in charge—perhaps not the only hope, but the great hope, of British films was to break into the world market with super films. These may be valuable, but I do not think it is at all true that the super film is going to command the permanent and exclusive support of the public that it now enjoys in certain directions any more than the spectacular play ousted the serious and more cheaply produced play from the legitimate theatre. There is a great chance that cheaper films, by new methods, whether they be short films technically or long films, may develop a peculiarly British character. We all know that each country has its own flavour of humour. There may be some noble Lords, like myself, who find it difficult to appreciate transatlantic or German jokes, though we enjoy the pages of our own comic papers without having to read them through a second time as one must do with the transatlantic joke. It may well be that we shall produce a type of film which will appeal to our people but will not appeal to the American people. That is why I do not agree with the view that the only hope for British films is to compete in the world market and to produce films which can only be paid for if they get tens of millions of spectators, in view of the fact that every spectator of a film on the average only pays one penny for the top line film and much less towards the cost of the second feature.

I am sure we are all quite appreciative of the wonderful film work that has been done in America. They have shown great invention, great technical excellence, and great enterprise in advertising and otherwise in pushing the products of their industry. We also must recognise that in recent years they have been a very valuable and a greatly valued form of entertainment. Judging by what one's friends tell one, I think that in the United States the attitude to films is rather different from our attitude. Educated and thoughtful people there do not look quite so seriously on the film. They consider it a popular entertainment of no very great value, apart from being an entertainment. Here there are a great many of us who do look upon the film not only for its great entertainment value but also for its future social, patriotic and artistic influence.

It is now proposed by the Government that the long film quota should be reduced to 15 per cent. As the noble Viscount said, these quota percentages are a very complicated matter for most of us to understand. I recognise the very great difficulty in which the Government have been in assessing the exact portion of these quotas and the results which they may be calculated to bring about, but I want to show the House how two new factors have been introduced which are going to make a good deal of difference in the operation of the quota. There is a new basis of computation, firstly, the separation of the short film quota; and, secondly, the provision for double and treble counting. There has been a good deal of confusion—I am not sure it has not been shown even in the speeches of noble Lords here—as to the effect on the long film quota of separating the short film quota obligation. It has even been suggested that this separation is going to throw a new burden on the producer of long films. In fact the operation is directly the converse, because hitherto there has been a freely exercised option on the part of the film renting and exhibiting industry to count long British films against short American films. That paid, especially the Americans, because they could count these good American short films against cheap "quickie" British films which there was no intention in the case of the renters of ever having shown. Now they will have to show long films only against long films and that necessarily will reduce the demand for British long films.

A second modification of the position is due to the provision that certain films, high in their labour costs, will be credited double and treble in footage, with an over-riding maximum of not more than half. That means that the renters' obligation, which in the Schedule stands at 15, will be reduced to II as compared with a 20 per cent. that he has been fulfilling hitherto, though it is agreed he has been fulfilling it by his own ingenuity in a way which is really a fraud on the intention of the original Act. See how this output of renters' quota affects the exhibitor. The exhibitors' quota depends on quite a different calculation. It is footage multiplied by time, and the screen value of the renters' treble counting film is not necessarily by any means treble the single counting film with a cost of £7,500 in labour. It is more likely to be something like half as much again. That fact will mean that the provision of films by these foreign renters will have to be supplemented by films made by independent British producers, and it is these independent producers that are causing the greatest amount of anxiety to my noble friends and me who are dissatisfied with the Bill. We have got the figures for the last year. There were about 625 registered films. That meant a renters' quota at 20 per cent. on 121 films. There were 220 British films, produced, and the extra 100 may be taken to have been produced independently regardless of any foreign renters' obligation.

In the past the British independent producer has been able to work with some confidence. He knew exactly what amount of films would be produced in the tied market about which the noble Viscount has told us, and he knew what would have to be made up out of independent sources. He will not have that confidence in future, because he cannot gauge in advance what demand there will be over and above the renters' quota film, since he cannot tell whether the renters' quota is going to work out at 15 in footage or whether it is going to work out, because of the production of these treble quota films, at much less than treble screen value, at perhaps only II per cent. Therefore, what the producers fear is that there might easily be very grave fluctuation in the supply of films. As the noble Viscount says they cannot be turned out in a moment. The British producers will be caught short, and the exhibitors will quite properly go to the Board of Trade and apply for relief from an immediate obligation which cannot be carried out because the independent producers are not in a position to supply films for some months ahead. That is really why we want to see the renters' quota put up to the highest reasonable level at the start. Obviously we do not want to bring people into default, and what we are proposing could not possibly bring anybody into default because it is quite easily within the power of the foreign producers to find these films. I think it is a deplorable situation that after ten years and this great effort under the noble Viscount's Bill, having reached the quota of 20 per cent., we should now go half way back to the start and be content with II per cent. on the same basis.

There is another consideration which I confess weighs very heavily with me. There has been a great deal of attention in the Press on the subject of tax dodging. Well, when people exercise their ingenuity to get out of their obligations I have never heard of the Chancellor of the Exchequer saying "I will lower the tax." He has always done his best to drive people up to their duty and to stop any gaps in the law. Let me tell your Lordships how these American renters have been fulfilling their obligation. They are, for the most part, agents of great and powerful American corporations. We had in evidence the footage which they supplied. The average length of a long film is 7,000 feet. For the British film quota in 1935 Columbia supplied 68,000 feet, First National 49,000 feet, Fox 69,000, Metro-Goldwyn-Mayer 89,000, Radio 78,000, Universal 113,000, and Warner Bros. 47,000. These people were so scientific in their computation that they did not provide one single foot of film beyond the exact quota requirement. But there was one very unbusinesslike firm, the Paramount, who filled the quota of 97,000 feet, by a careless oversight, by supplying 98,000 of film—1,000 feet more than the law required.

I do not think when the quota has been applied with that extreme scientific exactness that we need think that the American renters and producers are going out of their way to find outlets for British production. The independent producers in this country are satisfied that there is no difficulty in supplying the full 20 per cent. for the first year. They absolutely disagree with the Reason given in the Paper which is before us. The Commons disagree with our Amendment because they say …not enough films of suitable quality have been or can reasonably be made to enable renters and exhibitors to fulfil the suggested quota requirements. I am informed by the responsible organisation which represents this great industry that that fear that films cannot be produced is an absolute bogey so far as independent British film producers are concerned. The noble Viscount talked about the danger of putting this quota up because you would face the renter with an instantaneous obligation. He said that it was not reasonable to give him a fortnight's notice to produce a film which would have to be delivered in three months. That is not the case at all. He has got, exceptionally, in the first year twelve months in which to deliver it. I have made inquiries in many directions and I am told that there is no kind of precedent for taking anything like a year for producing even the best of these films. The trade show, even if they were two or three weeks or a couple of months slow off the mark, would take place long before the year was out and films would appear in the list for renters' quota.

Remember, these same renters have made provision for the year beginning the day after to-morrow on the basis of the White Paper which is so sacred. They have made provision, presumably, for an output of 15 per cent. It does not seem a very big matter for them to expand that output by the necessary amount to comply with 17½ per cent. or 20 per cent. nominal quota. I think there is absolutely no evidence that there is any necessity to sell the pass of British film production and abandon the ground which has been so laboriously gained. The same factor we know has queered the pitch—the factor of the White Paper and short notice—but if that applies to the exhibitor it does not apply to the renter with a whole year to fulfil the obligation. Even if 20 per cent. may in some cases cause a little difficulty to the renter—not the exhibitor—I am certain some compromise figure would be quite easily within the capacity of the foreign producing industry.

LORD DARCY (DE KNAYTH)

My Lords, after what my noble friend has said I should be very grateful if your Lordships would allow me to move the Amendment which stands in my name. It is to the effect that this House should not insist on the Amendment but should propose another Amendment in lieu thereof. I will not bother your Lordships with a number of figures set out in columns, but I propose that instead of sticking to 20 per cent. we might be allowed to retain 17½ per cent. The difference between the two proposals we have before us is 5 per cent., and I am asking that that should be cut to 2½ per cent. Your Lordships will realise that that is very considerably less than half the additional footage originally asked for here. The reason given by the Commons is that the amount of film is not available. If your Lordships agree to the Amendment you will also be agreeing with the Commons in their view, because we are dealing here with a totally different length of footage which no one, as far as I am aware, has suggested is not available. Your Lordships will recollect that there was difficulty about suddenly causing renters to take on an increased rate of quota running through the year. We know quite well how that has come about. We had hoped that the Bill would have been passed earlier, but in the circumstances we realise that there is a difficulty. But though it may be difficult to make films for the next six months I see no reason why certain films should not be produced so that the rate of 20 per cent. may operate at the end of the period. You can do that by relieving them of the extra obligation for the first six months and agreeing to this Amendment.

Most careful estimates have been made of the amount of films that would be required. You are not starting with an industry that is suddenly asked to produce films. It has to produce 15 per cent. and we are only asking for a little more. If you take the ordinary single quota film, sixteen more films would be required to be produced in this country during next year. If advantage is taken of the treble quota scheme that produces pari passu single and treble quota films, it means that eight films will have to be produced—four long and four short. There are four major studios in this country; and has anybody ever suggested—and I think they have not suggested it, for the very excellent reason that it would be wholly untenable—that any one of those film studios could not, between now and April of next year, complete one single treble film and, of course, one ordinary film? I might, incidentally, refer to a remark which was made by my noble friend when he talked about imposing defaults on people and said that there might be hundreds of defaults. A film can only be registered for renters' quota once, and in those circumstances it seems to me that the absolute maximum, if every single one so defaulted, would be only sixteen. I do not quite understand where the argument about giving wholesale dispensations can possibly arise. There is, of course, the alternative for each of these studios, if nobody else makes any films, to make four single quota films themselves.

But your Lordships must forgive me if I digress at this point, because I cannot help feeling that, when this matter is looked at, some of your Lordships may come to the conclusion that we are asking for such a small matter that it is not worth while. From the production point of view it is trivial; it is easily obtainable. There is, however, a much broader question than this, if your Lordships look at what this means. If your Lordships consider the cost question, you will realise that a minimum amount of £120,000 will go into the pockets of otherwise unemployed technicians; technicians who as a body have been brought into existence by the Goveernment's film legislation; technicians who have now bought their houses round Pinewood and are in the direst poverty, whose children have to attend communal soup kitchens in order to keep themselves from starving. That is a humanitarian appeal which this House is entitled to consider, and to consider earnestly.

If your Lordships agree to this proposal, you will have met in their entirety the views of another place. Your Lordships will have given way wherever there was any question of practical difficulty. You have agreed entirely with what has been said by the Minister in another place over that. You have given way on all questions of technical difficulties. You have given way anywhere where you might have done any possible injustice to renter or producer; and, what is of greater importance, the personal honour of the Minister is absolutely and entirely safeguarded under this scheme, scrupulously safeguarded. In those circumstances I beg of you to consider whether, when we send this Bill back, it will not be a totally different Bill from what came up. It will be a better Bill in that respect. It is shorn of all the disadvantages to which exception has been taken in another place, and it goes back with a really vigorous and cogent humanitarian appeal which we cannot assume, and which we are not entitled to assume, will be lightly regarded in another place.

Amendment moved— At the end of the Motion insert ("but proposes the following Amendment in lieu thereof: Leave out ("15") and insert ("17½")).—Lord Darcy (de Knayth).

VISCOUNT BRIDGEMAN

My Lords, I want to keep you a very few minutes only in which to add a word or two on the Amendment. After all the talk which has taken place in your Lordships' House on this Bill, there must be very few of your Lordships who are not completely familiar with the intricacies of the quota and with the meaning of the expressions used in the Bill. Therefore I hope that none of your Lordships will think that the one bone of contention still left is anything but the biggest bone, because indeed it is. The initial figure in the Schedule means more to the film-producing industry than any other part of the Bill. Two reasons have been given for the disagreement in another place to the Amendment made by this House. The first is the Reason on the Paper: Because not enough films of suitable quality have been or can reasonably be made to enable renters and exhibitors to fulfil the suggested quota requirements. But there is another reason which has been employed from time to time in this debate and in the debate in another place: that because certain figures were put in the White Paper which indicated the attitude of His Majesty's Government on certain matters, therefore it was an injustice to the trade to make any alteration at the time that the Bill came before Parliament. That, I think, is a proposition which your Lordships will accept on this occasion, as on any other, with a certain amount of reserve.

Now it may be perfectly true that the exhibitors, when they saw the figures in the Government's 'White Paper made their plans, with very little regret, to take in a small quota of British films. But it does not follow that the producers gave way to the same feeling. In fact, my information is that the producers have gone on hoping; they have not abandoned hope, and in fact they have made the preliminary preparations to produce films up to the additional amount for which we now ask. That has been 2½ per cent. on the renters' quota. It is perfectly right, and I do not think anybody in this House or anywhere else would disagree, that whatever we do we should not encourage the "quota-quickie." It is a deplorable thing. But can the "quota-quickie" really be held to apply to long films? And, my Lords, it is long films about which we are now talking. The "quota-quickie" is a cheaply-produced film costing £1,000, or something in that neighbourhood. I cannot really believe that anyone in his senses is prepared to spend a minimum of £7,500 on a "quota-quickie." Therefore, whatever this increase which we propose might involve, I do not think it could possibly involve "quota-quickies" on a large scale, because no producer and no financier would agree to put money to that sort of use.

Then the objection has been raised that the producers are tied to their renters and that therefore only a certain number of British films can be absorbed. But the producers have already said in no uncertain terms that they are prepared to make these films and that they are able to make them. I do not think it is likely that they would say that if in fact they had no outlets for the additional films which they maize. For these two reasons I doubt very much whether the arguments used are really as valid as perhaps they appear to some people. I myself, from the inquiries I have made, am perfectly convinced that the producers can make the additional films for which we are now asking, that they can be financed, and that suitable preliminary preparations have been made to ensure that the films will be of a quality of which we would all wish them to be. I beg, therefore, to support the Amendment.

EARL STANHOPE

My Lords, I rather disagree with my noble friend who has just sat down when he says that all your Lordships must have thoroughly understood the quotas in this Bill and the various expressions which appear in it. I have studied the Bill to some extent, and I am bound to say that a great deal of it is extraordinarily difficult to understand. Therefore I am not going to take up your Lordships' time in putting a lot of technical arguments before you. All I want to do is to point out to your Lordships that this Bill has had close consideration in another place before it came here; it was amended in your Lordships' House; it then went back to another place, where all the Amendments were considered including the two main points which we are considering now: the first the dropping of Clause 16, and the second the percentages in regard to the first year, as shown in the Schedule to the Bill. Lord Darcy (De Knayth) told your Lordships that the figure he had put forward had received no consideration in another place, but I am sure he will realise that when an Amendment has been put down, and it is considered in another place, any intermediate figure also comes under consideration, and that therefore anything between the figure which your Lordships suggested and that which is thought of in another place has received full consideration there. He has omitted to tell your Lordships that in spite of the arguments which were put forward, no Division was challenged, and that the Government Motion was accepted without a Division. I suggest, therefore, that this is not exactly an occasion on which your Lordships would be inclined to think that your opinion was necessarily right, and that of another place was necessarily wrong. If your Lordships will look at the figures of the Division here, I am afraid that they were not very large nor was the majority considerable.

Quite apart from that argument I would like to take up the point made by Lord Moyne. He said that this first year will form a test year. I suggest that we had better go slow in that test year, in order to see that we get a really first-class type of British film, and that the quota is easily filled. If that test is passed, when the matter comes up for reconsideration by the Board of Trade in 1939 the President of the Board will see that the quota in future years is maintained, and possibly increased. Nothing could make it more difficult for him to increase the British quota than to find that in this first year a large number of exemptions were asked for, and that the quota was not filled with regard either to length of film or quality. All of us desire to see British films increase in quality and quantity, and I feel sure your Lordships will agree, for that reason, that we had better make a slow start and lay a sound foundation in the first year. I am not sure that all your Lordships realise that the figures which are now under discussion refer only to the first year. There is no discussion between this House and another place with regard to the quotas for subsequent years. Therefore I suggest to your Lordships that we shall be wise if we agree with the other place in accepting the figure which, after full consideration, the President of the Board of Trade thinks is the highest figure which is really a wise one to put into the Bill, and do not increase it above that amount.

LORD BALFOUR OF BURLEIGH

My Lords, I very much regret that we are discussing these two Amendments, one about renters and the other about exhibitors, all in one breath. There is a very great difference in the two cases, and it must not be taken for granted that the Amendment which we are now discussing hangs absolutely with the one which follows it. I do not pretend to be an expert, but I have listened very carefully to the debate, and I understand that this is a contest between the wealthy American renter and the struggling British producer. The struggling British producer is being championed in this House by my noble friend Lord Moyne, and the wealthy American renter is being championed by the Government. Now I find myself in disagreement with only one thing which Lord Moyne said. He said he was very grateful to the Government for having made the concessions which they had made. I totally disagree with my noble friend. I think the Government have very great reason to be grateful to my noble friend for having moved the Amendments which have been accepted in another place. By securing the acceptance of so many Amendments he has proved that the Government were wrong, and no one, I am sure, has greater knowledge of these matters in this House than my noble friend. He was Chairman of the Departmental Committee who considered all these matters with very great care, and he has been proved to have extensive and very great knowledge, and when he comes and tells your Lordships that this 15 per cent. could not unreasonably be put up to 20 per cent. I, for one, am prepared to support him. In fact if he had proposed to put 20 per cent. back and had taken it to a Division, I certainly should have supported him. If that course be not adopted, and an alternative to take 17½ per cent. is pressed, still more would I propose to follow him.

On the constitutional issue, that it is out of place for your Lordships to disagree with another place, it is pointed out to me that there is a precedent in the case of the Children's Act, when your Lordships put in "whipping"—not that I altogether agree with it. Another place disagreed, but your Lordships insisted, and your Amendment was accepted in another place. I understand that that is a perfect precedent for the course which I suggest you should take to-day. The noble Viscount, speaking for the Government, made the point that it would be a hardship that the finance would have to be got for productions at such short notice. It is the producer who would have to find the finance, and the producers are asking you to accept the Amendment. Therefore it cannot be put as a point against the Amendment that it is hard on the renters and exhibitors to have to produce the finance at such short notice. I think your Lordships would be wise to accept the guidance of my noble friend Lord Moyne, who has such intimate knowledge of the subject. I hope the matter will be pressed to a Division, and that even at this late hour the Government will see their way to accept a reasonable compromise of 17½ per cent.

On Question, Whether the words proposed to be added shall stand part of the Motion?

Their Lordships divided:—Contents, 21; Not-Contents, 95.

CONTENTS.
Iveagh, E. Cornwallis, L. Harris, L.
Darcy (de Knayth), L. [Teller.] Hindlip, L.
Bertie of Thame, V. Killanin, L.
Bridgeman, V. [Teller.] Dickinson, L. Monkswell, L.
Chelmsford, V. Doverdale, L. Moyne, L.
Fairfax of Cameron, L. Oxenfoord, L. (E. Stair.)
Balfour of Burleigh, L. Gorell, L. Teynham, L.
Carnock, L. Hampton, L. Wolverton, L
NOT-CONTENTS.
Maugham, L. (Lord Chancellor.) Elibank, V. Kemsley, L.
Halifax, V. Kinnaird, L.
Plumer, V. Lamington, L.
Hailsham, V. (L. President.) Samuel, V. Mancroft, L.
Swinton, V. Marks, L.
Northumberland, D. Marley, L.
Wellington, D. Aberdare, L. Merthyr, L.
Addington, L. Mildmay of Flete, L.
Aberdeen and Temair, M. Ailwyn, L. Newton, L.
Bath, M. Allen of Hurtwood, L. O'Hagan, L.
Dufferin and Ava, M. Amulree, L. O'Neill, L.
Zetland, M. Ashton of Hyde, L. Pender, L.
Belstead, L. Perry, L.
Airlie, E. Berwick, L. Plender, L.
Albermarle, E. Biddulph, L. Polwarth, L.
Bessborough, E. Brassey of Apethorpe, L. Portsea, L.
Bradford, E. Cautley, L. Rankeillour, L.
Carlisle, E. Clanwilliam, L. (E. Clanwilliam.) Rea, L.
Denbigh, E. Ritchie of Dundee, L.
Feversham, E. Clwyd, L. Rockley, L.
Graham, E. (D. Montrose.) Cottesloe, L. Rushcliffe, L.
Haddington, E. Craigmyle, L. St. Just, L.
Lucan, E. [Teller.] Cromwell, L. Sandhurst, L.
Midleton, E. Daryngton, L. Shute, L. (V. Barrington.)
Munster, E. Denham, L. Stanley of Alderley, L. (L. Sheffield.)
Plymouth, E. Desborough, L.
Radnor, E. Elphinstone, L. Stanmore, L.
Rothes, E. Eltisley, L. Stonehaven, L.
Scarbrough, E. Fermanagh, L. (E. Erne.) Strathcona and Mount Royal, L.
Shaftesbury, E. Forteviot, L.
Stanhope, E. Gage, L. (V. Gage.) [Teller.] Templemore, L.
Vane, E. (M. Londonderry.) Gifford, L. Waleran, L.
Howard of Glossop, L. Wharton, L.
Cobham, V. Hutchison of Montrose, L. Wigan, L. (E. Crawford.)
Colville of Culross, V. Illingworth, L. Wyfold, L.

Resolved in the negative, and Amendment disagreed to accordingly.

On Question, Motion agreed to.