Lords Sitting of 11 May 1938

Preamble
The House met at three of the clock, The LORD CHANCELLOR On the Woolsack.
LORD GOWRIE.
Brigadier-General the Honourable Sir Alexander Gore Arkwright HoreRuthven, V.C., G.C.M.G., C.B., D.S.O., having been created Baron Gowrie of Canberra in the Commonwealth of Australia and of Dirleton in the County of East Lothian—Was (in the usual manner) introduced.
EIRE (CONFIRMATION OF AGREEMENTS) BILL.
Brought from the Commons; read 1a; and to be printed.

BUSINESS OF THE HOUSE.
THE PRESIDENT OF THE BOARD OF EDUCATION (EARL STANHOPE): My Lords, I beg to move the Motion that stands in my name on the Paper.
Moved, That Standing Order No. XXI be considered in order to its being dispensed with for the purpose of giving precedence to the Motion for the Second Reading of the Sea Fish Industry Bill over the Motion standing in the name of the Earl of Liverpool.—(Earl Stanhope.)
On Question, Motion agreed to, and ordered accordingly.

NORTH WEST MIDLANDS JOINT ELECTRICITY AUTHORITY PROVISIONAL ORDER BILL.
Read 3a (according to Order), and passed.
MINISTRY OF HEALTH PROVISIONAL ORDER (BRIDGWATER EXTENSION) BILL.
Amendments reported (according to Order).
MINISTRY OF HEALTH PROVISIONAL ORDER (SCARBOROUGH) BILL.
Read 3a (according to Order), and passed.

SEA FISH INDUSTRY BILL.
Order of the Day for the Second Reading read.
THE PARLIAMENTARY SECRETARY OF THE MINISTRY OF AGRICULTURE AND FISHERIES (THE EARL OF FEVERSHAM): My Lords, the measure to which I am asking your Lordships to give a Second Reading to-day is rather different in its subject from the Agricultural Bills for which I usually stand sponsor in this House. The sea fish industry, like many others, has in the last half-century undergone not only a phenomenal expansion but also a fundamental change in character. Forty-five years ago about 6,000,000 cwts. of white fish, having a value of about £4,000,000 were landed every year. In 1913 the quantity had almost doubled, whilst the value had risen even faster—from £4,000,000 to £11,000,000. Last year the yield reached 16,000,000 cwts. and the value 13,000,000. These figures will give the House some idea of the growth of the industry, a growth which has been due not only to a complete transformation of the fleet which catches the fish, but also to a vast expansion of the area from which the fish are caught.
Until the 'eighties the sailing trawler was in undisputed possession of the seas, and even after that, when steam made its appearance, sailing trawlers still made up the greater part of the fishing fleet until about the end of the last century. Between then and 1913 the number of first-class sailing trawlers had decreased from about 2,000 to 860; and in 1936 as much as 90 per cent. of the catch was landed by steam trawlers, the number in that year being 1,600. Along with the change over from sail to steam and the great increase in individual tonnage there has been a steady development of the power and efficiency of the trawl; and yet another fact is that whereas the North Sea was once the main fishing ground of Europe and yielded the greater part of the total landings, nowadays less than a quarter of the catch comes from the North Sea and more than half from far distant Northern regions.
Unfortunately, although the sea fish industry has expanded and developed at such a tremendous rate, its expansion has not been entirely healthy, and its condition to-day, as no doubt your Lordships
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are aware, is far from prosperous. During the War, owing to the enforced limitation of fishing, the stock of fish had time to replenish itself, and the result was that as soon as the War was over there was a great boom in fishing. In fact a competitive race began. Other countries, which fish in the same waters as ourselves, also increased their fishing activities on parallel lines with the consequence that very soon the nearer fishing grounds began to fail. That did not mean a decline in the quantities caught, because the larger and more powerful ships that were being built could stand longer voyages and could explore more and more the far distant waters. But it did mean a very great decline in quality. By the time the distant-water fish reached port a great deal of it was stale and uneatable. With more fish of poorer quality being landed, prices naturally came down with a run. The wholesale index figure for fish to-day is practically down to the level of 1914, whereas the producers of food from the land are getting about 30 per cent. more.
While the price which the catcher gets for his fish has gone down, the cost of all the commodities necessary for catching it has gone up. Coal, the most important, will serve as an example. Between 1934 and 1937 the price per ton of coal went up about 2s. 6d., and in addition I understand that there was a further substantial rise in the early months of this year. Not a penny of this increased cost has been passed on. A perishable commodity like fish has to be sold at once for what it will fetch. Nobody has gained by this vicious circle of over-building, over-fishing, depleted stocks, constant widening of the sources of supply, increased landings, poorer quality, lower prices and the attempt to recoup losses by ever-increasing expansion and greater production. Employers and workers have suffered alike. While the producer gets no more than before the War, the consumer, largely owing to a higher wages bill on distribution, pays twice as much.
In 1933 two measures were taken to meet the economic crisis which had arisen in the industry. The Sea-Fishing Industry Act of that year provided in the first place for some measure of regulation of supplies, both in quantity and quality; and secondly it set up a Sea Fish Commission—known as the Duncan Commission—to investigate the position of the

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industry, with particular reference to the question whether some scheme of reorganisation was needed. The first great object of the Bill which we are considering to-day is to implement generally the recommendations of the Sea Fish Commission in regard to reorganisation; but before I come to that I ought to mention the other measures which have been taken under the 1933 Act. These are: the regulation of landings of foreign-caught sea fish; the restriction of landings in the summer months from the distant waters; and the fixing of minimum sizes for the meshes of nets and for the actual fish which may be sold. These measures have led to some improvement in the general quality of fish and also to a modest rise in price, from an average of 18s. 7d. per cwt. in 1933 to 20s. 3d. in 1934. In the absence of any internal organisation of the home industry, however, there was nothing to prevent the improvement being wiped out by still more building of trawlers. That is in fact what has happened. New trawlers of the largest type have been built, and this increase in catching power has led to record landings, which in turn have been reflected in a fall in price. In 1935 the price was 19s. 3d., in 1936 it fell to 16s. 9d., and in 1937 it fell even further to 15s. 11d.
The powers for which the Government are now asking are powers for this industry to help itself. The present Bill not only provides for the reorganisation of the whole industry on the general principles contained in the Duncan Commission's recommendations, but will also enable a scheme, on the lines of one that has already been put forward by the Trawlers' Federation, to be brought into operation as soon as possible. Part I of the Bill follows, to a great extent, the Agricultural Marketing Acts, and enables each of the many sections of the industry—catchers, wholesalers, fishmongers and fish friers—to attain self-government by means of a marketing scheme. There is, however, a difference from the Agricultural Marketing Acts, and that is caused by the fact that there exist so many different branches of the industry, each with its own particular problems. There has to be some outside body to see that the interests of these various branches of the industry are co-ordinated and that
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their schemes fit in with each other. There will also be matters of general concern to the whole industry which could not be dealt with appropriately by the individual marketing boards set up for each branch.
So in this Bill we propose to set up a White Fish Commission with five independent and non-representative members appointed by Ministers and paid out of public funds. The Commission's functions will be to register all persons engaged in the various branches of the industry; to submit marketing schemes prepared either by catchers and distributors or by itself after consultation with the representatives of those bodies; to ensure co-ordination in the schemes and their operation; to make regulations governing matters outside the operation of the schemes; to administer a voluntary fund for purposes of common benefit; and generally to keep the industry under review and advise and assist Ministers. There is one other function which it will be necessary for the Commission to perform—the submission of co-operative schemes for inshore fishermen—which perhaps I may be allowed to touch on later. We believe that these supervisory and co-ordinating functions can best be performed by an independent body; but that does not mean that the Commission will act without knowing the full conditions within the industry. Like the Livestock Commission, it will be assisted by a fully representative body, to be known as the White Fish Industry Joint Council. The members of this Council will he appointed by Ministers after consultation with the appropriate organisations, and naturally they will represent the various interests concerned. Ministers may also appoint representatives of any other interests likely to be affected, including, of course, those who are the real backbone of the industry, the fishermen and the other workers employed in the various branches. I should explain that as this Joint Council, like the Livestock Advisory Committee, will be advisory only and there will be no question of its taking decisions by vote, the actual numerical representation of the various sections will not, therefore, be of great importance.
The necessary first step in dealing with a largely unorganised industry is to obtain registration. A number of branches of

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this industry lack even a reasonably complete census of their members. Under the registration proposals there will not be any restriction on registration; the Commission must register any applicant. When a marketing scheme has been prepared, the machinery for its adoption will consist first of the publication of the scheme, the consideration of objections by Ministers, and if necessary, the holding of a public inquiry; then a poll of persons covered by the scheme; then, if at least half those on the register have voted and at least two-thirds of the voters are in favour, the scheme will be submitted to Parliament for an affirmative Resolution and, if that is given, Ministers will finally confirm the scheme. The boards which will administer the schemes will be made up mainly of elected members, but not less than three, nor more than one-third of the total number, will be independent and appointed by Ministers.
Under Clause 8, the chief powers which may be conferred on a producers' marketing board will be the regulation of marketing by producers, including the limitation of quantities and the fixing of prices. I should here say that the intention is to give power to fix low minimum prices only. The other powers for the regulation of marketing will be the licensing of boats, in order to check uneconomic expansion of the trawler fleet: the power to limit landings both by number and quantity; to require the temporary laying up of boats in order to prevent excessive landings; and lastly, the power to encourage the landing of fish in better condition. Distributors' marketing schemes under Clause 10 may empower the boards to regulate the equipment and condition of premises and vehicles, and the manner in which white fish may be offered for sale. Under this clause there will be no licensing or price-fixing powers in these schemes. Marketing boards may also have certain development powers, connected, for example, with such matters as research and experiment, advertising, and the collective purchase of such things as stores, gear and equipment. In the Bill there are ample safeguards both for consumers and for sections of the industry not concerned in any particular marketing scheme. Besides the presence of independent members on each board, there will be a Consumers'
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Committee and also a Committee of Investigation, with functions similar to those set up under the Agricultural Marketing Act of 1931, and Ministers will be able to act as they have under the Agricultural Marketing Act on the recommendations of the Committee of Investigation.
Inshore fishermen, whose ports cannot accommodate the large steam vessels which land most of our white fish supplies, need special treatment. They could not be included—for practical reasons—with the deep-sea trawling industry under a producers' scheme, and provision is therefore made in Clause 18 for the Commission to submit co-operative schemes on their behalf. Ministers will not be able to proceed with a cooperative scheme unless they are satisfied that there is a preponderating opinion in favour of it among those who are concerned. Each scheme will require an affirmative Resolution by Parliament, and will be administered by what the Bill terms an authorised body. This authorised body may set up a central selling organisation in its area, and may also undertake the collective purchase of supplies and equipment. We expect that when these co-operative schemes are in operation they will be self-supporting, but the inshore fishermen have little or PO financial reserves, and we therefore propose to give the schemes an initial impetus by loans from public funds up to a maximum of £10,000 in all.
Now I turn to Part II. The main object of this Part of the Bill is to implement the International Convention for the Regulation of the Meshes of Fishing Nets and the Size Limits of Fish. This Convention was signed by the representatives of ten Governments in March of last year. In some respects the Convention goes rather further than the provisions which we had already adopted in the Act of 1933, and in order to enable effect to be given to the Convention it is therefore necessary to amend that Act. The Act of 1933 relied for the protection of small fish on the prohibition of sale, and the most important of the amendments has the effect of prohibiting the landing of small fish and their retention on board ship after capture. We have also taken the opportunity of making various other amendments to the Act, into which I need not go in great detail here, but I ought to refer to Clause 39,

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which formally discharges the Duncan Commission. I should like to take this opportunity of acknowledging the great obligation under which the Government have been placed by the excellent manner in which that Commission discharged its important task.
Part III may be said to do for whales what Part II does for fish: that is, it aims at preserving the stock. Whaling takes place mainly in the Antarctic, and it used to be conducted entirely from land stations in British territory, so that it was possible for us to regulate the taking of whales by conditions in the leases of the factories. But, later on, great factory-ships were built, and these, by lying outside territorial waters, were able to do what they liked. As a result there was an enormous increase in the destruction of whales, and in 1931 an International Whaling Convention was signed at Geneva. The Whaling Industry (Regulation) Act was passed in 1934 to implement this Convention. But since then it has become clear that the regulations in force do not go far enough; so another conference met in London last June. The principal measures which it decided to adopt were first the entire prohibition of the killing of grey whales, secondly the power to limit the number of whale catchers, and thirdly, the power to close certain areas in the Atlantic and Pacific which are known or believed to be breeding grounds. Experiments are in progress in some countries with electric harpoons, with the object of making the process of killing whales a much quicker one than it is now, and thus to avoid the cruelty which results from the present methods. Accordingly this Bill gives power to prohibit, if thought fit, the killing of whales other than by a particular method.
Part IV of the Bill is a very important Part, designed to implement a number of recommendations made by the Duncan Commission in regard to the pay of the crews of trawlers and the powers of Board of Trade superintendents to check the correctness of the accounts. The welfare of fishermen is of course bound up with the welfare of the industry as a whole, and they therefore will benefit as much from the reorganisation provisions of Part I of the Bill as the trawler owners themselves. The Commission found that
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there was a good deal of dissatisfaction among the men with their present conditions in regard to payment by a share in net earnings, which is at present regulated by the Merchant Shipping Act, 1894, and it is the object of this Part of the Bill to remove those grievances. The seagoing personnel engaged in steam trawling at present numbers about 21,000. The Commission recommended that the Board of Trade should have additional powers of inquiry into the process of distribution of the profits, so as to remove any doubts that may exist on the question whether the profits are being properly shared out. The Board of Trade have had discussions with the men's organisations and the Trawlers' Federations and have in the main reached agreement.
It is hardly necessary for me here to go in great detail into the provisions of Part V, which makes various amendments to existing legislation. The main changes are concerned with the constitution of the local sea fisheries committees set up under the Sea Fisheries Regulation Act, 1888, and the extension of their powers and functions, and of the Minister's powers in relation to the Committees. It also imposes a liability on the owner as well as the skipper of a vessel in respect of illegal fishing offences and provides for an increase in the penalties; there is also a simplification of the procedure for making shellfish orders under the Sea Fisheries Acts of 1868 and 1884. Part VI contains provisions of a formal character and definitions.
I hope I have not wearied the House with this description of a measure which I believe to be worthy of your Lordships' sympathy and interest. This Bill, with its six Parts and 62 clauses, is a Bill with a greater number of Parts and clauses than the Coal Bill which we discussed at great length only last week. The fishing industry's importance in our national life is, as your Lordships will remember from the experience of the War, far more than a merely commercial one. I believe that this Bill will go a long way to restore prosperity to the white fish industry and to the crews of our trawlers; to reconcile the interests of the various branches of the industry; and, what is equally important, to ensure an abundant supply of good fish in a form and at a price attractive to the public. I beg to move.
Moved, That the Bill be now read 2a.—(The Earl of Feversham.)
LORD MANCROFT: My Lords, I am sure I shall carry your Lordships with me if I say we are greatly obliged to the noble Earl who has introduced this Bill for the very lucid way in which he has helped us to understand its many clauses. I think the Bill provides an object lesson to the country and to the Socialist Party of the degree of success with which a Government Department is likely to handle a competitive industry which requires imagination and initiative. I shall not oppose the Bill; I shall vote for it, but with no enthusiasm. I shall vote for it grudgingly and, lest that may sound impolite and ungracious, I would say I bear in mind that honourable members in another place spent sixteen long days in careful, conscientious, and expert examination of the Bill in Committee and at other stages, in trying to mould it into a form which would provide a successful remedy for the problem with which the white fish industry is confronted.
It was found 3,000 years ago that you cannot make bricks without straw, and from the start this Bill never lent itself to being moulded into a form which would prove a remedy for the problem with which we are confronted. In order to justify my grudging support of the Bill I shall, if your Lordships will grant me a little patience, try to point out the necessary remedies for the difficulties of the industry, which are omitted from this Bill. I know that this Bill has nothing to do with the herring fishery. It deals with demersal fish such as soles, plaice, turbot, halibut, cod, and haddock, but the pivot in the difficulties of the herring fishery, whose sales are mostly in the export markets, principally in the Russian and Baltic ports, and in the difficulties of the white fish industry, whose sales are mostly in our own home markets, is the same—the turning into money of the results of the fishermen's labours. Here in this Bill I see nothing in practical form which will help towards that.
We have bad many legislative enactments dealing with the herring fishery and the other fisheries during the past twenty years and if I am not out of order I would merely mention that I have taken part frequently in the fishery discussions in another place. None of these enactments has proved successful. Year after year we have had enactments to help the herring fishery, and year after year we have to all intents and purposes scrapped
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them by giving amended forms to those enactments, with subsidies, helps and grants; but, notwithstanding all the help we have given with the best will in the world, to the North Sea herring fishery, I believe the herring fishery to-day is in no better state than ft was fifteen years ago—probably worse. And to-day there was in the public business Papers of the other House a notice to say that the Minister would introduce legislation to amend the Herring Industry Act of 1935—only three years old. In that measure they are going to change the constitution of the Herring Industry Board by providing that the Board shall consist of members of a different status. There will also be grants for larger motor boats: in other words the Minister is adopting a polite means of putting the enactment of 1935 asleep. Five years hence the Government will have to do the same with this Bill, whichever Government may be in power.
The Government will never find the remedies for the white fisheries by the means which are here spoken of with such elaboration. Take the first clause, and listen to the elaborate language:
"There shall be constituted a Commission to be called 'the White Fish Commission' (hereafter in this Act referred to as 'the Commission')"—
no doubt it will be scrapped five years hence—
"which shall have the functions of keeping generally under review matters relating to the white fish industry, and of advising and assisting the Ministers in such matters as aforesaid, and such other functions as are entrusted to the Commission …"
Here is a great elaboration of language. It reminds me of what we call in my native county a "Norfolk hackney," which picks up its feet with much ceremony and puts them down in nearly the same place.
There are sixty-two clauses in the Bill and a number of Schedules; it presents, I think, a perfect sample, in the idiom used by Sir Thomas Browne, of "platitudinous ventosity." From these elaborate and platitudinous clauses no remedy will come. Let me examine the aims of the Bill—I think we should keep the aims in mind. We wish to provide employment for what as we all know is one of the most industrious sections of our wage-earners. I noticed that my noble friend mentioned there were 21,000 engaged in

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the industry. I suppose he meant seagoing.
THE EARL OF FEVERSHAM: Yes, sea-going.
LORD MANCROFT: I should put it rather higher for the industry. I should put it at 50,000 altogether. In the boats and probably including the quays—I say nothing about railwaymen—I suppose 50,000 get their living out of this industry. That seems to be a very small number, because I am given to understand that another island nation, Japan, has 1,500,000 engaged in the fishing industry. We want to provide employment for these men. That is on commercial grounds; but on national grounds there is a greater necessity that we should keep the fisheries going. The fishing industry is the nursery of the Royal Navy, and noble Lords who have served in the Navy will tell that these deep-sea fishermen are most valuable men in handling the King's ships when there is difficult weather. There are no better seamen and no braver men in the world. We know what they did in mine-sweeping during the War, and we know what they do in the lifeboats in winter time when ships are in distress. On national as well as on economic grounds it is therefore of the utmost importance that we should keep this industry alive and provide employment for these excellent men.
How do we hope to attain this end? By making it possible for them to make a living out of the fish they catch and offer to the public—in other words, turn their labour into money. As the Minister has explained, the method by which to attain that end is to provide a continuous supply of fish in good condition and at reasonable prices in the markets of this country and create an increased sale as a result. I may be telling your Lordships something you already know, but I am under the impression that the general consumption of fish of all kinds—white fish, herring and other fish—per head per day in Britain is no more than two ounces. There is plenty of room for expansion. The pivot of the whole policy and the solution of the difficulty we are in is to increase sale in our home markets. We must keep that point in mind throughout our consideration of the fishery problem. You may catch and land fish by Parliamentary regulations,
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but this Bill and its regulations will not sell the fish or provide more wages for the men. Such things as bridges, textiles and fish do not sell themselves. They have to be sold through human ingenuity, and unless initiative and imagination can be used, while catching may be regulated, landings regulated, and the size of the mesh regulated, if you do not sell the fish and turn them into money you will not be able to pay wages to the men who catch them. More markets are the paramount consideration. Therefore this Bill fails in its basic conception.
In the first place I have a suspicion that there is an attempt to reduce the number of trawlers and men. That is the very opposite of what we should aim at. If the Bill does that, it defeats its own object. If it does not control foreign competition by foreign-caught fish it will reduce the number of trawlers and consequently the number of men. I may be wrong, but I am under the impression that some of the Scandinavian boats which land fish in our ports receive direct or indirect subsidies. You cannot compete with foreign competition of that kind when other nations subsidise their boats. There is nothing in the Bill to deal with that. The London wholesale market for cod and haddock is mainly supplied by Scandinavian boats. Very few British trawlers come into the Thames with deep-sea white fish. The Scandinavians have somehow beaten our trawlers out of the Thames market, with the result that the number of British vessels coming into the Thames with white fish has been reduced to a minimum. There is nothing in this Bill to remedy the malady which has resulted from British trawlers being beaten out of the Thames wholesale market by foreigners.
True, there is our international agreement dealing with foreign trawlers and foreign-caught fish. But we shall be told that nothing can be done now, in this type of legislation before us, to meet the subsidies which foreign countries give to their trawlers, and that nothing can be done to deal with the competing methods of Scandinavian boats; they are not controlled by our regulations once they are outside our territorial waters, unless by international agreement. That is so; but upon what does our international agreement rest? It rests upon the demands of the coal trade. The white fishing in-

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dustry is in some degree sacrificed to the coal trade. We say to the Scandinavian nations: "We want certain things done about coal. You must take so much coal from us." "Very well," say the Scandinavian nations, "but we shall insist on your giving better facilities to our fishing vessels in the British market."
As to the quota which comes under this international agreement, that is in practice almost a farce. A certain quota of weight is allowed. If the weight is not per month but per year, the consequence is that foreign vessels can bank up a quota, not using it for a small number of months, and at the end of an aggregated number of months use the quota in such a way as to dump foreign caught fish into our market and probably smash the prices to pieces. The quota arrangements need alteration. There is another way in which the quota agreement operates detrimentally to our own fishermen. I speak under correction, for I have no connection whatever with the trade—I have merely an academic interest in it—but the quota lays down a certain weight. What do the foreign trawlers do? At sea they will head, gut, bone, and fillet the fish, and instead of landing whole fish weighing a larger number of pounds the weight of fish landed will be probably 30 per cent. lighter and of greater money value than was assumed when the quota was introduced. They get round the quota by reducing weight by discarding the offal, and thus increasing the market value per pound. What does the Bill provide against this? Nothing.
Then what is provided in this Bill for research? It is only voluntary. Clause 23 provides that if someone likes to give a sum of money, or if one of the boards wishes to vote some money, that money can he used for research. Is an Act of Parliament needed to empower a Commission to receive gifts for research? It is necessary to operate research about the life-history of most white fish. It is necessary to know more about the manners and customs of fish. We know nothing, for example, about what happens to the herring after it leaves the West coast of England and Ireland in the early spring till it: reappears in the Pentland Firth about the first week in June. In the case of the herring it does not matter very much, because the herring are avail-
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able in such myriads that we are not yet concerned whether they are more or less. We did not know until quite recently the life history of the eel; it was only during the War that we learned for the first time that eels bred off the Bahamas. We know nothing about where most of these white demersal fish breed, and it is time we did find out what happens to them. We are told that the North Sea is being overfished. We do not know whether that is true; we ought to know whether we are overfishing the North Sea. My noble friend mentioned that fishing ceased during the War with the result that when peace came we found large volumes of fish easily catchable in British areas in the North Sea. No one knows whether most of these white fish breed only in the shallow waters off our own and other coasts, and whether those shallow waters are overfished.
We do not know whether the shortage of fish is not due to uncontrolled destruction. It may be so. No one knows whether demersal fish breed only in shallow water or both in shallow water and deep water. We know they breed in the shallow waters from Cape St. Vincent up to Vigo and off our coasts right up towards the Shetlands. There is a shallow shelf off our East and North-East coasts on which undoubtedly large numbers of prime white fish do breed and when they are small they leave that portion of our waters and go round off the Belgian and Dutch coasts and make for deep water; on the way, although useless for food, they are caught and exterminated. There is no control, although there has been some international undertaking between ourselves and the Dutch and the Belgians about immature fish. There is, however, no certainty as to whether the arrangements made are put into operation. The small foreign craft which catch shrimps off the coasts of Holland and Belgium capture myriads of small immature plaice, turbot, cod and haddock. They are probably killed before they are brought to the surface; if they are it is no good then putting them back. If they are pot put back they are taken ashore and made into fish meal. There is lax control there. We have no control at all outside the territorial waters, and this Bill applies only to territorial waters.
In referring to Clause37 my noble friend dealt with the matter of mesh. I have no faith in mesh regulations for this

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reason. Your Lordships will have seen in the old days those beautiful, elegant, dandy-rigged trawling vessels under sail; fishing smacks with a trawl beam. To-day we do not use that kind of trawl net or smack. We use the otter net, a deadly destructive trawl net. It is a bag with side pockets and with a sack or cod at the end, and steam trawlers. It does not matter if under this Bill you have meshes 5 inches square. These otter nets are drawn along the bottom of the sea perhaps 400 yards down as against the sixty yards depth into which these sailing smacks used to fish. These otter nets are let down a quarter of a mile deep by steam vessels which drag and bump the otter nets over the bottom, filling them not only with prime fish, which of course should be done, but with small fish which are smothered by the big fish. The nets are drawn at some speed because the vessels are steam vessels. The mesh as the net is dragged forward closes itself, and the small fish cannot get out, with the result that the small fish are destroyed, notwithstanding the fact that the mesh may be a very big one. These steam trawlers catch seven times as many fish as the old sailing vessels. There is nothing in this Bill to deal with the problems of destruction by the use of otter trawl nets with big meshes, side pockets and rough passage over the surface of the bottom. No wonder big white fish are crushed and bruised and immature fish destroyed.
We are told that it is necessary to have fish which are in prime condition but these fish come up bruised, many of them in poor condition, and the immature fish also are destroyed. Is not this one of the reasons why there is a scarcity of prime white fish on the Dogger Bank? Is it that the North Sea near our shores has been overfished? Is that the only thing that we have to consider? Have we not also to consider the uncontrolled destruction, notwithstanding the mesh being big? Here is need for vigorous research. We know that the fish which do come to market in good condition fetch more money. The line fishermen who catch white fish off the Shetlands obtain a very much higher price for their well-conditioned fish in the Glasgow market than is obtained for the fish drawn up in a trawl. I submit that there must be a
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new method invented to catch these fish other than by the otter trawl.
New methods of preservation also must be invented. Imagine what our markets would say if New Zealand lamb were sent here after six or eight weeks or more in transit and store here, and out of condition, bruised or crushed. The fish which can be soonest brought here are taken five, six or ten days previously in the fishing ground and when they are brought into the markets they are often broken and in bad condition. Why is that? It is due to the method of catching with the trawl and to the mesh and the out-of-date methods of preserving. There must be an improvement on the crude methods of ice and boxes and even the landing from the net, to the hold, to the quayside. There is nothing in this Bill to deal with that. Neither do I see anything, except advice "and other functions" as in Clause r, to set on foot a movement for treating the fish as it is brought on board so that it does not suffer from bacteriological infection. Fish decomposes very quickly. There is some disinfection of the storage equipment, but there is not sufficient disinfection of these receptacles, with the result that the fish easily deteriorates on board.
I have troubled your Lordships with rather a tiresome explanation of why I think the Bill is not of great value, because it does not meet the case in relation to the points I have just made. With regard to Clause 11 we are told that the Commission will allow advertising. But advertising will not of itself increase the sale of fish. Advertising is a spearhead but useless unless there are proper shops or places where fish can be bought in the inland towns and villages of England in good condition, with an assurance of regular supplies, for the housewife to cook and put on the table. Unless that is done not much good will be done by advertising. Sir Alfred Jones, of Elder, Dempster and Co., about thirty-five years ago, by advertising and by propaganda, induced the people of this country to regard the banana as a fruit and not as a vegetable. Having done that he arranged that every village should have a plentiful and regular supply of bananas in good condition, as they have to-day, ready for people to buy at a reasonable price. After the banana had been thoroughly advertised and people had been made con-

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versant with that fruit's name bananas were obtainable in every greengrocer's shop and thus they have become an important item in the food trade. They were obtainable: that is the essential point. The same can be done for fish, not by advertising alone, but by providing outlets in the villages and towns in the interior of England so that the people can get it regularly and become accustomed to buy it regularly.
As I said in my opening remarks the consumption per head of fish is very small, there is plenty of room for expansion beyond the average of two ounces per head a day. The noble Lord, Lord Strabolgi, who is connected with Hull, knows very well that the fish which comes to Hull is mostly sent to the West Riding and the Northern Midlands and is there used as fried fish. It is not in a very good condition. When it conies into Hull it has usually suffered a good deal of the knocking about which I have described, but it is suitable and makes a very wholesome food in the form of fried fish for the large populations of Manchester, Birmingham, Leeds and Bradford. These people have learned from the foreigners in their cities the benefit of fish done in fat, in cotton-seed oil, in lard and in meal. A cheap food has thus been provided and is used widely in the North. I believe that the greater part of the Hull landings go to the Midlands and West Riding for the purpose of fried fish sale. Nothing to extend the sale of fried fish where it is not a regular item of diet is provided in this Bill. It has never been thought out so far as I can see to ascertain whether in the South of England or the West of England there is an outlet for fish in this form. In this Bill we have nothing that is active, and based on imagination and initiative. The first thing I think which should be done would be to try fish supplies to small inland towns on the railways in refrigerator vans with fish at railway stations of the inland towns. These vans would be to all intents and purposes trial and only temporary shops for fish to be sold in those towns where fish is not regularly available. This would be merely to introduce and accustom fish to the consumers.
I have tried to explain the defects of the policy disclosed in this Bill. It provides no plan for an increased sale of fish and an increased sale of fish is the keystone of the whole of this problem. I feel
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great disappointment. If I wanted to be rude I should call it a Bill of quack remedies. Those who drafted it may know a great deal about otoliths and the science of fisheries but they seem to know nothing about the necessity to devise means for selling fish. Your Lordships will remember Butler's Hudibras. Butler laughs at the quacks of 250 years ago. In one of the instances he satirized, quack doctors had recommended as a cure for warts that the patient should wash his hands in an empty bowl in which the moon had shone. This Bill is an empty bowl in which the moon has shone. As remedies for our problem its sixty-two clauses are not very far short of moonshine. They will not remedy the difficulties of the white fish trade. But after the careful examination in another place and consideration by the trade the Bill will test the views of the Ministry in a trial run. Five years hence there will probably have to be another Bill whatever. Party may be in power. I think the discussions which have taken place and the criticisms which have come from people who wish the Bill well and know the trade's requirements will gave an opportunity for the next Bill to be drafted in such a way as to contain practical remedies. I hope I have not bored your Lordships with my views about this Bill, but it is a Bill that gives me no enthusiasm and I shall vote for it grudgingly.
THE DUKE OF NORTHUMBERLAND: My Lords, I do not wish to detain your Lordships by speaking at any length. I do so as a member of a local sea fisheries committee appointed pursuant to the Sea Fisheries Regulation Act of 1888, which as your Lordships are aware deals with matters relating to inshore fishing. The Association of Sea Fisheries Committees representing all the local committees have already assented to much of the Bill, but exception is taken to several matters in connection with the inshore fisheries of the country. In due course it is proposed to submit for your Lordships' consideration a number of Amendments to Clause 37 and also to Part V of the Bill which is wholly connected with this subject.
THE EARL OF MANSFIELD: My Lords, originally I meant to confine my remarks to that portion of the Bill which deals with the whaling industry, but I

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should like to dissociate myself from the wholesale denunciation of the measure in which the noble Lord, Lord Mancroft, has just indulged. I disclaim any knowledge whatever of the ramifications of the white fish industry, but it does seem to me that, whether all the noble Lord's criticisms are well founded or not, most of them are of a character which could not be remedied by Act of Parliament—certainly not in the present state of our knowledge. He talked about research into the breeding places of fish. That would require a good many years before we acquired accurate knowledge. He talked of the lack of methods of preventing bacteriological infection on board trawlers. That is surely a question for regulations by the Board of Trade rather than for clauses incorporated in an Act of Parliament. I was a little disappointed in view of his stringent criticisms that he did not produce a few more constructive suggestions as to how this Bill might be improved. I have no doubt whatever that it will be necessary, as the noble Lord said, to bring in another Bill five years hence, but at the same time I think this Bill, whatever failings it may possess, is at least a commendable effort to improve conditions, which are at the moment admittedly unsatisfactory in the fishing industry.
What I really wanted to do was to express the great pleasure which it gives to all naturalists as well as industrialists to see some further protection afforded to certain species of whales, because the pursuit of whales, especially in the last few years, has driven a number of species if not to the verge of extinction at least dangerously near it. It may be argued that it would not matter, provided a few were left, if we carried on the destruction up to that point. That is not the case, however, because whenever a species, be it of mammal, fish or bird, is persecuted to such an extent that its numbers are very greatly reduced, even if the process is reversed and persecution stops and may be actual protection is given and encouragement afforded, that species in too many instances seems to be unable to recover. The heart seems to be knocked out of it and for reasons that are not yet known the species seems unable to recover its former status and indeed very often becames extinct. That is why I am very glad the Government
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are insisting upon further protection. I hope that they will co-operate and try to persuade other nations to co-operate more in the future than in the past in the preservation of the largest mammal still found in the waters, not merely in the interests of naturalists but also as part of the efforts to improve the industry.
LORD STRABOLGI: My Lords, I apologise to the noble Earl for missing his speech in moving the Second Reading of this Bill. It was due to inadvertence on my part. I had overlooked the early time of meeting and I also thought that the Motion of the noble Earl, Lord Liverpool, might occupy a little time, as I had not realised that this Bill would be taken first. I apologise also to the noble Lord, Lord Mancroft, for having missed the first part of his speech. That is all the more regrettable because I so enjoyed the part of it that I did hear. If he will allow me to say so, I think, in opposition to the noble Earl, Lord Mansfield, that his criticisms were completely justified. I am only sorry that our gain in this House is loss to another place and that the noble Lord was not present at the sixteen meetings when this Bill was considered in Grand Committee in another place. He might have knocked some sense into the Government on this particular measure. But although I did not hear the whole of these speeches my noble friend Lord Snell has given me the main points of them, and I have followed this Bill from its inception through all its various stages. For some years I had the honour of being chairman of the committee of my Party on sea fisheries, and for a number of years I represented in another place the most important fishing port in this country. Therefore I make no apology for making a few observations on this Bill, and in doing so I speak on behalf of my Party.
The Bill as originally introduced in another place has been improved there in Committee, despite the absence of the noble Lord, Lord Mancroft. For example, Part IV, giving certain security to the fishermen themselves, is in our opinion valuable, and so is the direct representation of the fishermen on the governing body. That we think a very good thing. But this Bill in principle, I submit, is basically wrong. The Minister in charge of the Bill in another place,

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summing it up on Third Reading, said its objects inter alia were to check the excessive landings of fish from distant waters, and further on he said that the object was to impose a limitation on the quantity of fish to be caught by different vessels. This is in line with the Government legislation on coal and milk, and potatoes, and in regard to many other industries. It is utterly wrong, criminally wrong. It is limiting the output of necessities at a time when there are great poverty, hunger and distress in large sections of the community. Your Lordships are aware that a limitation of catchings and landings has been in voluntary operation for some time. That does not make it any better. It appears to us very wrong in principle to give official sanction to, and to legalise, that system.
From the naval point of view you cannot have too many experienced fishermen, nor can you have too many seagoing fishing vessels. Both in men and in material they are an invaluable reserve for the Fleet. I do not know how we should ever have gone through the last War without the assistance of the fishermen and the fishing vessels. Your Lordships are well aware of the services performed by the fishermen in the anti-submarine campaign, in mine-sweeping and in many other activities. This Bill will reduce the number of fishing vessels and of prime fishermen. It cannot help that; it is intended to do so. It is therefore hitting at the most valuable portion of our naval reserve and is a blow to the efficiency of the Fleet.
Another aspect of the Bill which I must criticise is that no compensation is provided for the crews who will be put out of employment, although there is compensation for trawler owner companies who have their licences taken away or suspended. A great many of these fishermen are not entitled to any unemployment insurance, because they are on shares. That is particularly the case in Scotland, where often not only the skipper and the mate but also the third hand are on shares. They are partners in the industry, and I am not sure that they will get any compensation at all under the Bill. As I read it, they will not, and I think that is a serious blemish.
At the same time the Bill has some good features, on account of which my honour-
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able friends in another place did not oppose it on Third Reading and we in this House have no intention of opposing the Second Reading to-day. One of those good points is the power which is given to check minor abuses. The real trouble, however—and here I hope I shall have the agreement of the noble Lord, Lord Mancroft—is the difference in price to-day between what the fisherman gets for the fish and what the housewife has to pay for it in the shop. The average price of fish landed in the ports last year was about one penny a pound.
LORD MANCROFT: About twopence.
LORD STRABOLGI: My figures are from Hull, and I believe that in Scotland, and particularly in Aberdeen, the price was about twopence a pound. The average price to the housewife is about tenpence. There is far too wide a gap. Obviously there is a great need of organisation on the marketing side. But if you limit landings, if you prevent the men from going to sea and reaping the harvest of the sea, I do not understand how you will avoid in the long run a still further increase in price due to shortage of supply. Limitation of output is economically wrong and in the long run injurious to the industry. I venture to agree with the noble Lord, Lord Mancroft, that after a few years this Bill will have to be radically amended. I believe it will do a great deal of harm, and I cannot speak too strongly against the principle which underlies it. In conclusion, may I say how glad I am that the noble Duke, the Duke of Northumberland, made a contribution so soon after his successful maiden speech the other day, and that I only regret it was not longer.
THE EARL OF FEVERSHAM: My Lords, we have had a severe indictment of the Bill by the noble Lord, Lord Mancroft, who is an authority upon the sea fishing industry, for at the conclusion of the War he published a book called The Herring, and its Effect upon the History of Britain, which I have read and found most attractive and interesting. As, however, we learned from the noble Lord's speech, several of his comments and condemnations of this Bill applied to the herring industry, which is of course excluded from these provisions. The chief complaint of the noble Lord opposite, Lord Strabolgi, and of Lord

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Mancroft, against the provisions of the Bill, which they say is basically wrong and which the noble Lord, Lord Mancroft, described as a quack remedy, is that they believe that it provides for a limitation of production. Further investigation of the Bill will undoubtedly prove that there will not be a limitation of production of edible fish. The Bill is designed to enable wasteful production to be limited.
The noble Lord, Lord Mancroft, has referred to the trawlers, of the largest types and fitted with the most modern equipment, that go to the far distant waters of Bear Island and come back after a fortnight or three weeks' trawl to the port with which Lord Strabolgi is associated—Hull—with much of their fish spoilt, bruised and inedible. It is that which we wish to prevent. The provisions of the Bill would result in landing less of the poorer quality fish which is now sent to meal and manure works, and the quantity of fish available for human consumption would not be reduced, while on the other hand its quality would undoubtedly be improved for the consumer. Lord Strabolgi has implied that, by the provisions of the Bill, under the producers' marketing schemes there will be a severe limitation of trawling and consequently a great loss of fishermen, who, as he properly and rightly says, are such an important and essential feature of our national life, our country being an island. It is true that for a great number of years the white fish industry has been in an unprosperous condition. The purpose of this Bill is to save the persons who are to-day engaged in the industry. Unless action is taken which will provide in the first place for organisation, the position which the noble Lord deplores will continue, and might even grow worse.
The Bill will limit wasteful catching, provide for keeping up stocks of fish in the sea, and make it possible for the Commission to require by regulation the proper grading, packing, processing and distribution of fish, and for the distributors' marketing board to regulate the condition of premises and the manner in which fish is offered for sale. Lord Mancroft has said that the root of the trouble lies in the fact that the cost of distribution is extremely high, with the result that the wholesale price of fish is
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more than doubled by the time it reaches the consumer; but the Bill should give a consumer better value for his money, without reducing the supplies available. The noble Lord, Lord Mancroft, referred to the fact that research was an essential feature for improving the condition of the industry, and he implied that Clause 23, under which the Commission are empowered to administer a voluntary fund for the purpose of conducting research, would be of no advantage because it was only on a voluntary basis. I would point out that it is not only individuals who can voluntarily contribute to the fund, but a marketing scheme can contribute collectively, and if, as Lord Mancroft says, it is important that at this juncture there should be further provision for research, I feel there is no doubt whatever that the promoters of a marketing scheme will provide for contributions to be made for that important purpose.
LORD MANCROFT: I forgot to mention that when the trawl is brought up it brings up with it bucketsful of spawn from the bottom, and if there should be research, as I hope there will be, I hope there will be some research in order to find some way of constructing a net which will not destroy the spawn on the bottom when bringing up the fish.
THE EARL OF FEVERSHAM: I am grateful to the noble Lord for his comments on the regulation of the size of the mesh of fish nets, which I would remind your Lordships was agreed to by an International Convention of March of last year. That Convention was signed by ten countries, and I think there can be no doubt whatever that improvement has been made which we are trying to implement in the part of this Bill dealing with the regulation of meshes of nets. Lord Mancroft said that little good would come by marketing organisations under a producers' scheme unless there was some improvement in the equipment of the trawlers themselves, and he referred to the necessity of the provisions for ice boxes. But I would remind the noble Lord that under the marketing scheme for producers it is possible, and even probable, that in the process of organisation the board will make regulations which will cover the very points to which the noble Lord has referred. I am grateful to the noble Duke, the Duke of Northumberland, who has intimated that he

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wishes to move certain Amendments to this Bill on behalf of the Sea Fisheries Association. I hope that the remaining points to which reference has been made will be clarified during the Committee stage, but on the main question of principle I believe there is no real ground for thinking that the supplies of fish will be limited, or that the industry will suffer by these reorganisation proposals.
It may be said, my Lords, that we have not implemented all the recommendations of the Duncan Commission in regard to licensing under a distributors' marketing board. Before we consider taking that step it seems that it is first necessary to obtain organisation and to obtain registration, for at present we do not know the numbers of those engaged in the industry in this country. Having done that this industry will be on an analogous basis to the bacon industry, which has been reorganised under its marketing schemes, and now the time has come for further steps to be taken which are being laid before Parliament during the present session. Similarly, in the case of milk, we have had a few years of experience, first in the organisation of the milk industry and the marketing schemes, and now, under the proposed legislation for milk, it is provided that the distributive side of the industry should be tackled. So this Bill is the initial stage of reorganisation. It may be found, as Lord Mancroft has indicated, that in five years' time it will be necessary to take a further step to control to a greater degree, and assist, the distributive side of the industry, in order to reduce the retail price to the consumer, but I submit to your Lordships that that time has not yet come.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

LOCAL AUTHORITIES AND RATES.
THE EARL OF LIVERPOOL THE EARL OF LIVERPOOL had the following Notice on the Paper: To ask His Majesty's Government, whether, in view of the heavy burden which has been placed on the community from increased rates, they would consider the question of appointing a Commission to inquire as to—

(1) The increased cost of living;

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(2) The urgent necessity of limiting the extent whereby rural areas are absorbed by urban authorities;

(3) The position from the financial side, especially with reference to the investment of British capital in foreign countries;

and to move for Papers.
The noble Earl said: My Lords, those who have asked me to raise this question in your Lordships' House, to-day, have done so because they feel that something should be done as regards the inequality which is apparent in the rating by local authorities. I cannot but think that it is a rather appropriate day on which to raise this Motion, and I am sure many of your Lordships will agree with me on this subject, for down in Kent I sec they had ten degrees of frost, and that must contribute to reducing very much the earning power to pay rates in the county. I am afraid we are in for a very bad time, not only in the South but all over the country. This is no new question, this question of the inequality of rating. As far back as 1906 Lord Haldane, then Mr. Haldane, had a Committee sitting for the reorganisation of His Majesty's Army, and I think Lord Lucan will recollect that on that Committee there was raised one point, and a very big point, about the question of the production of food. It was urged that everything should be done to stop the migration of the rural population into the towns. It was also pointed out by the Chairman himself, Mr. Haldane, that there was a great tendency on the part of all Government Ministries to place further burdens on the local authorities, and that at some time or other there would have to be some kind of review into the basis on which the burden was put upon those authorities.
Well, that is thirty-two years ago, and if it was necessary to do so then how much more necessary is it to do so now, when I notice that the expenditure by local authorities has increased from £555,000,000 in 1920 to £2,000,000,000 at the end of 1937. The individual contributes his share from two sources—that which he earns and any savings and investments he may have, and if those two sources are reduced in any way he has necessarily less with which to discharge his liability for the rates. I have in my hand papers showing that the cost of

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living—not only food, but other commodities also—has increased from the March quarter, 1936, to the December quarter of last year by no less than 33 per cent. I do not propose to go into detail upon that, it would only bore your Lordships, but I have taken the figure from authoritative sources and this large increase is a very serious matter to the community at large, and especially in agricultural counties. Not only has the cost of those commodities largely increased, but all the commodities which are necessary in industry have gone up likewise.
I will pass from that to the main respects in which the budgets of county councils have been so largely increased in the last few years. I was a member of a deputation which went to the Minister of Education not very long ago to point out the hardships which we had to face as an agricultural county owing to the new Education Act. I went away somewhat disheartened, though I frankly say we were most courteously received, and if I had been the Minister myself I could have given no other answer than that which he gave. He could not possibly distinguish between one county and another. But the fact remains that if we are going to keep the population in the rural areas at all it means a very heavy burden on agricultural counties. The Minister on that occasion gave us the figure of 480 as the economic unit for a senior school. Where the population is sparse and distances are great it would be absolutely impossible to build those schools on an economic basis. Distances would prevent it, and other things too. In this case I must take my own County—one of the administrative Counties of Lincolnshire, Kesteven. On an economic basis we should require for that County only four senior schools, but to carry out the Act on the proper basis and keep the population on the land we want twelve, and that would cost a county with 112,800 inhabitants a sum of £400,000. I am quite aware that a very large proportion of that would come back in grants from the Education Department, but at the same time it is a very heavy burden to bear. I hope the noble Earl who leads the House will not think for one moment that I am finding fault. Parliament in its wisdom or unwisdom passed that Bill, and we have to bear it.
I will come to another expensive item —the roads. Here again I quote my own County. A penny rate yields £1,833. We have about 1,600 miles of all classes of roads and we get from the Minister of Transport 60 per cent. for first-class roads, 50 per cent. for second-class roads, and nothing for district roads except for improvements. In Bedfordshire, which has nearly the same population, a penny rate produces £6,600 and that County has 1,300 miles of road to maintain. In Lincolnshire we have a good deal of the Great North Road, which earns 100 per cent. but we have also some very tiresome roads which take the whole of the holiday traffic from Birmingham and Leicester to the coast, and those roads have to be kept in very good condition to carry that traffic, and, as a corridor county (because it amounts to that), the burden is extremely heavy on the rates. There are of course other things which build up this large budget of the county council. The increase in the cost of living, 33 per cent., of course affects all the articles which have to be provided for public assistance and mental hospitals, but as regards the question of public assistance, I do not propose to deal with that at all. I do not see how you can get much further there.
But I will say a word on the question of police, the cost of which has become a very great burden. I saw in the organ of the County Councils' Association that the remark was made that owing to the present mechanical age the burdens are becoming almost intolerable. The police on their part are finding all kinds of new devices to track down criminals, and the cost of these devices must ipso facto fall on the counties concerned. When I discuss the rates I am only speaking of the county rates. A lucky County at present is Surrey. It has the smallest rate of all, but it has a large population and a penny rate produces something over £44,000. There is a good deal of difference between that and the produce of a penny rate in Kesteven. I suppose that Surrey carries out its duties just as efficiently as any other county council, and it is due of course to its very large population and rateable value that the rates are so low.
I come now to the question which is a burning one in the counties at present, and that is the everlasting desire of the

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boroughs to seize the best parts of the counties for their own purposes. I think a great many of your Lordships will agree that when the boroughs come to your Lordships' House or to another place for Private Bills, a good deal of money is wasted, and the only gainers are the legal profession. I was told by the predecessor of the noble Earl, Lord Onslow, the noble Earl, Lord Donoughmore, that the Parliamentary Bar were lamenting because there were so few local authorities coming to dispute on that particular question, but I am afraid that latterly the number has grown again. I am sure the Lord Chairman guards the interests of the counties very carefully, but I think that in a great many cases—I do not say unfairly—portions of counties are handed over to the boroughs without due consideration being given to the circumstances.
I come to the question of investments which, as I have said, are one of the means by which the ratepayer contributes his share of the rates. Has the time not come when the Government of this country should say that British capital is not to go to insolvent countries? It is no good saying, as has been said, that the Foreign Bond Holders' Association are responsible. There are lots of other investments with which the Foreign Bond Holders' Association are not concerned at all. Some of these small people—tradesmen who have retired, small farmers, and so on—see a most attractive investment at 7 per cent.—say, a Greek Refugee Loan. They never look for a moment at what they have to pay for it; they only look at the interest which is coming. They buy it, and what is the result? For a year or so everything goes on all right, and then some day a revolution breaks out, and their shares are clown to 20 or 3o and no dividends are paid at all. We have just had an example of that today. I see there is a revolution in Brazil. A few days ago the whole of the oilfields in Mexico, where there is an enormous amount of British capital invested, were seized. Is it not time something was done in the direction of saying to these countries: "Look here, we have done our best to assist you in the past. It is up to you to pay what you owe us, and not always on all occasions to repudiate.
It is for these reasons that I have brought this Motion forward. It has not
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been an easy one to put down on paper. My noble friend Lord Stanhope rightly remarked to me that these are very large questions; but I am not here to combat the Government. I am asking the Government for their help, and I hope they will be able to say something that will encourage those who have sent me here to speak to-day. In conclusion, I should like to be allowed to thank the noble Earl who leads the House for the courtesy he has extended to me on every occasion, particularly when I was not able to speak here on March 30, and it would have been very scant courtesy on my part if I had not provided him and Lord De La Warr with the material of my arguments. I beg to move for Papers.
LORD BAYFORD: My Lords, I am sure a great many of us will welcome the Motion which the noble Earl has so ably put before us. I rise to support the Motion, but I would ask the noble Earl whether he would consider making the scope of the Commission for which he asks a little broader than the words on the Paper would indicate. I would suggest that he should embody in the instructions to the Commission he proposes the words that already appear in his Motion—that is, to put in at the beginning of the Resolution for the Commission "to consider the heavy burden which has been placed on the community from increased rates." The words would then read:
"A Commission to inquire as to—

(1) The heavy burden which has been placed on the community from increased rates;

(2) The increased cost of living;"

and so on. I would suggest to him that if there is to be an inquiry into this matter at all, it is better that it should be as thorough an inquiry as possible. The change I suggest would give every opportunity to make the inquiry a really thorough one.
I cannot say that I am speaking on this Motion on the instructions of the County Councils' Association, because I do not think they have met since the Motion has been on the Paper, and at all events they have not had an opportunity of considering it. But I have spoken in the course of the last few days to several leading members of the County Councils' Association, and I find general approval of the terms of this Motion, and I may

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say on behalf of the Association that they would welcome such an inquiry as is proposed. With regard to one particular point to which the noble Earl referred—namely, the extent to which rural areas are being absorbed by urban authorities—that is a matter which the County Councils' Association have under consideration. A special Committee has been appointed to go into it and is now sitting.
As to the general terms of the Motion, it is generally acknowledged that the increased rates are in a good many ways a danger. They are, though people do not realise it, one of the causes of the increase in the cost of living. The rates, whether they are on houses or on premises, and whether these premises are for manufacture or are shop premises, are part of the overhead charges and, as everyone knows, overhead charges form a not inconsiderable part of the ultimate cost which the consumer has to pay. Therefore it is quite true to say that the increased burden of rates comes, in the shape of increased charges on almost every commodity, eventually out of the pockets of the consumer, whether rich or poor. I am sorry to say that this last year rates have been increasing almost all over the country. If you look at the table of rates charged by local authorities throughout the country you will find that in something like go per cent. of the cases there has been an increase in the rates for the coming year.
That causes discontent with the local authority, not always reasonable discontent. Sometimes, it may be, the discontent is quite unjustified, but there is no doubt it makes for criticism and discontent with the bodies that have to levy that rate. In my own county, where there has been not a large increase, but still an increase, we have been having from all directions protests from public bodies against the increase which has occurred. Where, as has happened in some parts of the country, the increase is excessive, where the rate is very heavy indeed, that fact prevents people from coming to live in that particular district, and it also prevents manufacturers from starting works in that district, thus increasing the very evil which was the first cause. Another thing we ought to consider is that this burden of rates will get more acute as the population falls. As we all know, the symptoms of a fall
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in population have already begun to appear, and there is every evidence that they will accelerate. As the population falls the number of people who will have to pay the rate will get smaller, and so the burden will be greater.
I should like first of all to say one word about the general cause of this increase in rates, and then, if the House will bear with me, I would come to more particular instances and take them very shortly in detail. The cause in general is, I think, that people all over the country expect everything to be done a little better than they did a few years ago. That is the first reason. They expect to have everything a little better than it used to be, and if you have a thing a little better you have to pay for it. The second reason is the number of new services that have been imposed, are being imposed, and are likely to be imposed upon the local authorities. The last one has been, it is true, a small one, the air-raid precautions. I attended a committee only two days ago considering this matter. We had to see what it was likely to cost. Remember, you have to split your county into districts, each district has to have an organiser, and the first thing that organiser asks for is an office, and the second thing he asks for is a clerk. It is not a very large charge. For a county of the size of my own we find it would come to about £5,000 a year, or almost exactly a halfpenny rate. That is in addition to the grant that is going to be given to us by the Government. That is only one instance of these new services which are being imposed one after another every Year.
Now let me take the principal matters on which the local authorities have to spend their money. They are police, education, roads and the Poor Law. The police system is, I think it must be generally admitted, an anomaly, and if any inquiry is set up that is one of the things which ought to be inquired into. The standing joint committee is a body independent of the county council, though it is true that half of its members are county councillors. The other half consists of representatives of magistrates, and it is a body independent of the county council. It is not directly elected in any way, but it orders very considerable expenditure. It orders new buildings for one thing, and it sends in the bill to the

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county council. The county council cannot even question the details; it has to foot the bill. That is one thing, at all events, which shows, I think, there is a case for inquiry.
Then as to education. The education rate is one of the heaviest that we have to pay. The standard all through is laid down from above. The whole scale on which the thing has to be done is dictated by the Board of Education, and the actual administrative body is partially co-opted. A large proportion is appointed by the county council, but the remaining members are co-opted from various people with knowledge and experience of education. Those people are very valuable, but my experience has always been that the co-opted member is more in favour of expenditure than the elected member. The result is that the conditions under which schools are built nowadays are, in the opinion of a great many people, extravagant. I do not want to express a personal opinion, but I was at one of our great public schools myself, and when I think of the form rooms in which we sat then I can only say that we were living in a state of absolute squalor compared with the village child of the present day. Is that altogether necessary? I want to see children well housed, and decent conditions in their schools, but have we not gone a little too far? Have not we gone beyond the requirements of decency and infringed upon the precincts of luxury?
There, again, it is not the local authority but the Board of Education that controls the standard of school that we have to build, and it is the Board of Education that also is controlling—I will not say by order and I will not call it by bribery but by financial inducement—the time in which the schools have to be built. They are pressing to get these new big schools to which the noble Earl, Lord Liverpool, referred just now done by a certain clay, and the method of pressure is by saying: "We will give you a grant of so much per cent. if you complete them by a certain time. If they are not done by that time we cannot promise what grant we shall give you." They are really pressing a standard of expenditure upon the local authorities which I do think at all events merits reconsideration. It is a thing in regard to which a local body might very well look to the Board of Education itself
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to give them a helping hand in keeping down expenditure. I think we ought to look to the Board for all the economy that is possible in the present state of things. Again, when these schools are being built, I do hope that the Board will take into account the certainty in the future of a drop in the birth-rate. We do not want to see very large sums of money spent on schools which before long are going to be half empty.
Now I come to the next item, that is the roads. They, after all, are the biggest item of all. I think in almost every county the expenditure on the roads is the largest item of its budget. There may be some countries in which there are better roads than there are in this country, but I do not think that taking them as a whole we have much to complain of in the standard of quality. In making a comparison with other countries we have got not only to take quality but also quantity into consideration, and I think it is a fact that for the area of this country we have got a very much larger number of roads of one sort and another than they have in any other country, and of course that means that the expense is on a larger scale. Here again the Ministry have adopted a system of grants, but their grants have been regulated, first according to time and then according to quality. All those who are connected with local government have heard of the five-year plan of the Ministry of Transport. That means a promise to give you a big grant on condition that you put through a big and very expensive programme within the next five years. This action is something which I think is a very good subject of inquiry. Is this the right time, when we have this enormous national expenditure on armaments going on, to spend very large capital sums upon the big main roads of the country?
Another matter in which I think there is at all events a case for inquiry in regard to the action of the Ministry is the standard to which they insist that a main road should be made before they will consent to give their grant. I am all for having good roads, but we do not want such wide roads or such expensive roads in a county like my own, or in a county like that of my noble friend, as are wanted in the counties immediately around London. You do not want the

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same class of road in Hereford or in Cornwall as you do in Kent or in Surrey. The Ministry might well take into consideration the question whether it would not be in the interests of the country that roads made in the more distant counties should not be of such an expensive character as those on which the Minister insists in counties nearer London. Again I do not want to dogmatise, but I think it is a matter on which it would be very well worth while having an inquiry. I expect the experience of the noble Earl is the same as my own and the same as the experience of most county councils. There is perpetual pressure for improvements—small improvements which may cost £2,000 or £3,000 each, but they all mount up. I do not think that this is a time when we ought to make them. Most of them can wait a bit, and while the present large national expenditure is going on we ought only to make those improvements for which there is absolute necessity.
Another matter that is coming up all over the country, and a matter that we cannot shirk, is the rate of wages and provision for superannuation. That will probably be urged upon us from above unless we deal with it ourselves before very long. It is something that everyone wishes to see done, but it does mean expense. We were going into it the other day in my county and found that to provide the roadmen alone with a system of superannuation will cost something like an extra penny-halfpenny rate. These are all things that are pressing on the county councils and making it very difficult for them to keep the rates down at the present time.
Then there is the Poor Law. Like my noble friend I do not wish to say much about that. I think that on the whole the system of taking the administration of the Poor Law away from boards of guardians and putting it into the hands of county councils has been a success and has been more economical. It is very hard to assess the pecuniary results exactly, but what evidence I have seen tends to show that on the whole there has been a decrease in cost. On the other hand, you have to bear in mind that people are living longer than they used to. If people on Poor Law relief live longer there are consequently more of them at any one time.
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And next we have the health services. First of all there are nursing and midwifery, two very important subjects. There again, we have had the charge for midwifery forced upon us by the action of the Government. The Board that controls midwives' salaries has insisted upon those salaries being raised to such an extent as to need an extra penny rate. We have sanatoria for tuberculosis, and isolation hospitals. That is an expense which we must incur, and they are institutions that must be kept up properly. We saw in Croydon only the other day what an outcry there was directly there was any suspicion even that anything was wrong with the medical services. Lunatics are about stationary, but mental defectives are a very growing charge. That is a new service and the Ministry demands that provision should be made for that new service on a very expensive scale. The cost for mental defectives comes, I believe, to something near £300 a bed, which is a great deal larger charge than most of these people were accustomed to in their own homes.
I think that concludes the services for which the county councils are responsible, but I should like to say a word about district councils because housing comes under their care. The same danger has to be faced there as in regard to other items of expenditure I have mentioned. With regard to housing more than perhaps anything else, we have to remember the danger of a falling population. The time may come when we shall have all these houses built at the expense of the community and we shall not get tenants for them. Then there is the most difficult question of water supply and drainage. The finance of that service is most extraordinarily difficult because it has been done hitherto either by a district council or in respect of a small area in the jurisdiction of a district council. To get a good system the area ought to be a very much larger one. You ought to have the service spread, if not over the whole county, at any rate over a very considerable portion of the county. What has happened, however, is that it has been done by very small detachments of the county as I may call them. Those who are most progressive have done it long ago, have borrowed money to pay for it, are paying off that money and in some cases have nearly paid the whole of it. Then the less progressive places come along and they are beginning to spend

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money on the same object when the others have nearly finished paying. It is extraordinarily difficult to pool the lot when some areas have paid a very considerable proportion of their loans and others are only just starting. It is a very difficult question on which inquiry such as the noble Earl suggests might be of the very greatest value.
This is a Motion to set up an inquiry which ought to decide two or three things. It ought to give the Government a chance to explain things that seem to the outsider, or to the interested observer, to be unreasonable. It ought to reveal how far local authorities are responsible for the expense which they are at present incurring; and it ought to show the grumblers who are complaining of all these "local extravagances," as they accuse them of being, whether they are right or wrong. I therefore have much pleasure in supporting the suggestion of the noble Earl. I hope he will consider the suggestions I have made to him as to the terms on which his proposed Commission should be set up. I hope the Government will give the matter favourable consideration. All we are asking for is some inquiry into matters that are causing much trouble and grumbling. If anything can be clone to get them right, it would be well worth the time of any Commission that might be set up.
THE MARQUESS OF CREWE: My Lords, I am sure that your Lordships' House ought to be grateful to my noble friend for introducing this Motion, which ought to be of prime interest to a great many noble Lords. He compressed his remarks into a very small compass, but the noble Lord opposite, Lord Bayford, speaking with the greatest authority from his knowledge of local government and his position as president of the County Councils' Association, was able to develop the question with a number of most acute and searching observations, to which I am sure your Lordships listened with the utmost interest. Those of us who can recall the leadership of the late Lord Salisbury here will remember how often, when some project was advanced of which he in any way disapproved, used to point out with urgency what a damaging effect any such legislation would have on the rates, more especially in rural districts. I cannot help wondering what the reaction of Lord Salisbury's intensely practical mind would
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have been if he had been here to-day and had witnessed the state of things described by my noble friend and by the noble Lord opposite.
My noble friend began by mentioning the cost of living as one of the elements involved in this inquiry. I was very glad that Lord Bayford was able to say that this question is absolutely germane to that raised by my noble friend. It is quite evident that anything which tends to increase the general cost of production must also increase the cost at which a commodity can be sold. But my noble friend's main point—and I am sure it is one with which the noble Earl will desire to deal—is the singular inequality which exists between different local authorities who have to carry out the duties imposed on them by various Statutes. He specially alluded therein to the cost of education, and mentioned the interesting points of difference which the institution of central schools—admirable, no doubt, in themselves—is apt to make in the cost to some counties as compared with others, his own county being one of the chief sufferers. These matters, of course, all come back to the whole question under dispute, if dispute is the right word: what ought to be the local charge, and what ought to be the charge to the Central Government, of various local improvements and the carrying out of local duties. Of course, it is a platitude to say that where administration or the form of government is left to the local authority, they will not carry out their duties with the greatest efficiency unless they are themselves liable for part of the cost. That, of course, is the merest common sense. But the allocation of portions of the charges in particular instances must always remain a difficult matter and one which is liable to give rise to certain degrees of friction.
Both noble Lords dealt with one of the principal questions, and perhaps the most: important: that of the roads. The greatest social revolution which has ever taken place in this country has been caused by the invention of the internal combustion engine. In the generation before mine the railway system of the United Kingdom came into operation. That was in a sense a revolution, but it was a very gradual revolution and its effects, though large and in a way permanent, were not appreciated in a moment. But the revolution caused by

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the universal adoption of motor cars and of tractors has come like a flash of lightning. It is practically since the War that our whole social system has been affected by it. As a result, it has been found impossible to bring our system of roads into conformity with the need—or at any rate with the supposed need—of those who use them in the modern manner. I am not going to dilate on the whole question of the great roads which it is sometimes proposed to make in imitation of those which are being made in various parts of the Continent of Europe, but it is interesting to note, as Lord Bayford said, that considering the relatively small size of this country we are more largely provided with roads than any country on the Continent of Europe, and of course that is even more true of the rest of the world. Therefore I am sure that it is wise to approach with caution, and with a great deal of thought, the whole question of improving our national roads, and to be rather shy of sudden remedies, which are proposed in some quarters, and which might, I think, if carried into effect, prove disastrous from many points of view.
I cannot attempt to follow all the points which have been raised, but I would just say one word on the question of the absorption of our rural districts by the ambition of boroughs, and of course, in a degree, of urban rural district councils, to enlarge their areas. The noble Lord opposite spoke of the attempts from time to time made in Parliament by a town to bring the question of enlargement before the Committees in another place and here. I think it is quite true that this has been sometimes overdone in a rather unprincipled way; that is to say, by a sort of Oriental system of bargaining, in which a town has claimed almost fabulously large areas outside its boundaries, in the knowledge that it will not get all it asks for, but in the hope that having made a rather large demand it will get much more than it would have got if it had asked for less. I am very glad Lord Bayford alluded to that particular matter.
My noble friend touched on the question of foreign investments, as having a certain bearing on this question. When he stated that the noble Earl opposite, Lord Stanhope, had remarked—I do not say
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complained—that my noble friend's Motion covered a somewhat wide field, I think it is possible that he might have been alluding to that particular item. However that may be, and whatever the noble Earl's views on that particular point may be, I do hope that he will be able to do something in regard to the matters raised by the Motion. I feel sure that it would be a distinct comfort to those local authorities who are represented by the noble Lord, the Chairman of the Association of County Councils, if the noble Earl were able to say that some form of inquiry into these points should be made. I trust, therefore, that the noble Earl will be able to give not merely a sympathetic but a hopeful reply to my noble friend's Motion.
THE CHAIRMAN OF COMMITTEES (THE EARL OF ONSLOW): My Lords, I want to detain you only for one brief moment. Lord Liverpool, in introducing his Motion in a most interesting and able speech, referred to the question of the absorption of parts of the counties by county boroughs, by means of extensions, and I have no doubt he had in mind the creation of county boroughs, although that is not a matter which often comes before us at the present time. If it were to do so I should remind your Lordships that the population limit had been increased from fifty thousand under the Act of 1888 to seventy-five thousand under the Act of 1926, but I do not think we have, or are likely to have, very many county borough extensions. Indeed I hear that there are some towns and municipal boroughs which are approaching, or which may approach in the near future, the seventy-five thousand limit, which would prefer to find themselves in the proud position of remaining the chief town of the county, rather than go out of the county and become a borough. I myself would welcome such a decision on the part of many towns, and I think that the community in most cases would benefit by such a decision; but you have a large number, some eighty, of county boroughs which throw out houses round about and who are constantly applying for leave to extend their boundaries.
My noble friend said he hoped I would see that attention was called to any such endeavours, but in my position I have very little to say on the question of county borough extensions. I only have

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anything to say if such proposal is unopposed, and it is not within my recollection that a county has not opposed such an extension. If there has been an extension Bill I think I am right in saying that the county council has always had a petition against it. I must remind your Lordships, if I may, that the whole of this question was reviewed some twenty or thirty years ago, and there was considerable opposition on the part of the counties to what they considered the unfair methods by which the county boroughs were able to absorb some of their most valuable rateable areas. In consequence, Parliament, in the Act of 1926, took certain steps. The county boroughs objected to the method of procedure by Provisional Order, because they said that when the Local Government Board in those days—the Ministry of Health in these days—sent down for a local inquiry the county borough really was in a better position as promoters than the county council as opponents. Whether that was the case or not I do not know, but it was certainly an opinion which was very generally held—as I think the noble Lord, Lord Bayford, will agree—among the County Councils' Association. Parliament made a very considerable alteration in the law in the Act of 1926, because it abolished the procedure by Provisional Order in any opposed case, and insisted upon procedure by Private Bill; so that now any county borough which wishes to absorb a portion of a county has to proceed by Private Bill.
A great deal of attention was given to the question of whether you could by any means restrict the extension of county boroughs. After a most exhaustive inquiry the conclusion was reached that it was impossible to lay down a rule whereby you could curtail the extension of county boroughs, and that the only method was that proposals for such extensions should be subjected to the statutory test as to whether in the opinion of the proper authorities such extensions were desirable. I may say I have had a certain amount of experience, and have gone into this question pretty carefully, and I do not think there is any other way of settling it. The situation all over the country varies so much that it is only by subjecting the point to a competent authority that it can
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be properly dealt with. The competent authority should take the views of the inhabitants who are going to be included in the borough, and then strike a balance and, if they find it desirable, give to the county borough the extension, or such part of the extension as they may think proper. I think that is the only means whereby you can possibly adjudicate on these demands.
My noble friend (Lord Liverpool) in most touching terms referred to the demands made on agricultural counties, and in fact all counties, although I think he excepted my own County of Surrey, which he spoke of with some envy. I would remind your Lordships that when a county borough applies for an extension and it is granted there is a financial adjustment. In 1913 a strong Committee sat, presided over by the noble Duke whose loss to your Lordships' House and to the country we all lament: I mean the late Duke of Devonshire. That was just before the War. They laid down, and it was embodied in the Act of 1913, that fifteen years' purchase should be given for financial adjustment for the added area. Of course after the War the altered value of money caused that period of fifteen years to be inadequate, and by the Act of 1926 it was raised to twenty-one; so at the present time the financial adjustment is made on a twenty-one years' basis.
The noble Lord very truly observed that Parliament piles more and more expenditure on the counties. We notice it wherever we go. You have only got to look at the county halls. Every one of them in this country seems to have got a new wing, or is building one. That is to accommodate the officials to do the work that Parliament puts upon them. It may be that by now this period of twenty-one years is inadequate, but there is no means that I can see of altering the method of county borough extension except possibly by some change in the proportion of financial adjustment. The counties have enormous expenses put upon them, and they very justly say, when most valuable rateable area is taken from them, that it is a great hardship, but the only remedy is some means of financial adjustment.
I think I ought to say a word on the subject of the authorities who adjudicate on the question of whether or not an

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extension is desirable. These matters—I am speaking of your Lordships' House, and I have no doubt the same is true of another place—go before very strong Committees. Those Committees have the advantage of counsel and witnesses and reports by the various Ministries, and they are eminently competent, I think, to adjudicate on these questions of extension. My noble friend Lord Crewe has said that he had heard that some county boroughs may ask for rather more than they expect to get, and that sometimes they are successful. But I would say this, that the noble Lords who sit on those Committees—and I have no doubt the same is true of another place—are very wary, and if such matters were to come before them I feel pretty sure that the question would be examined very closely. I really do not see how you are going to alter for the better the law as it stands at present. The only thing that can be urged on Committees—and I should like, most respectfully, to do so—is that they should use the utmost vigilance and really make up their minds that the extension demanded is desirable before granting it.
THE MARQUESS OF ABERDEEN AND TEMAIR: My Lords, having spent many years in local government, I should like to say a few words on the subject raised by the noble Earl, whose speech I regret to say I did not hear on account of having been called out of the House. But I should like to join the noble Marquess opposite in expressing my thanks to the noble Lord, Lord Bayford, for the very illuminating facts he put before the House. With regard to roads, I think that the Ministry of Transport insist on county councils spending far more money than is necessary on what might be called the touching up of new roads. For example, they refuse to pay a grant unless the county council puts a stone kerb all along the road. I am hoping that the Committee presided over by the noble Lord, Lord Alness, will convince this House and the Ministry of Transport that that is not the safest way of providing for traffic conditions on our main roads, though it adds enormously to the cost of construction, as also does the insistence on a pathway being made along all these main country roads—to be used by nobody, because nobody is going to walk a long distance on these
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country arterial roads; they would rather use a bicycle or some means of public transport.
With regard to housing, which was touched upon by Lord Bayford, I do not think it is realised that a great deal more money is spent, comparatively, on housing in rural areas than in urban areas. It costs much more, relatively, to bring the same services to a few houses per acre than to houses in an urban area. The result is that an enormous amount of money is spent on services to which rural inhabitants are not necessarily accustomed. The private owner finds it practically impossible to meet the cost because, curiously enough, although the cost of building has gone up enormously, yet the limit under the Housing (Rural Workers) Act which attracts a grant has not increased, so that if you spend £401 on putting a house right you would get no grant. When the Housing (Rural Workers) Act was first in operation, £400 was an ample sum, but now it is not ample. Therefore you penalise the private owner as well as the county council by raising the cost of building houses and not meeting that increase by Government grants, and thereby increase the rates as well as the costs to the private builder.
The same applies to water. Recent legislation treats the country house in the same way as an urban house, but obviously a water supply in a thinly populated area costs very much more than it does in an urban area. Again, when a county council creates a water district, it creates a rate only for those who live in that district. Lord Bayford's argument on that point seems to me irresistible. Such a rate ought to be spread over a larger area, and I am not at all sure that the same conditions should not be insisted on in the depth of the country as in urban areas. Moreover, it has to be borne in mind in these days that there is often not a water supply. An insanitary house supplied with water which does not flow is much more insanitary than one which is not supplied with water at all.
With regard to the rural aspect of this whole question, the State and the municipalities between them take all the labour, especially at the present time. Nobody says it is wrong to use all the labour you can get for social improvements, but it is an extraordinary thing to go full force

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with your social programme and at the same time go full force with your rearmament programme. The two cannot go together. There, again, the ratepayers suffer. The most serious point about the rising rates is that at the same time as the rates are raised the assessment rises also. If you have an increased assessment the extra amount of money raised in that way ought to be sufficient without increasing the actual rate. There seems to be no reason for an increased assessment as well as an increased rate. The Government could by a little more careful administration so arrange their legislation that the national cost and the local cost should not clash and go up together, and therefore make the state of both the taxpayer and the ratepayer almost impossible, especially in the case of the private owner who tries to do his duty towards the legislation passed by Parliament. There is every reason why the noble Earl should be congratulated on bringing this question before the House, and I hope something may be clone in the way of an inquiry whereby this ever-increasing local expenditure may be curbed.
THE EARL OF GLASGOW: My Lords, I would like to support the noble Earl, and I shall not occupy your Lordships more than five minutes. I am a member of the Scottish County Councils' Association; we are affiliated to the English County Councils' Association and know a good deal of what they are doing. There has been a tremendous increase in the rates during the last few years, and that increase is one of the reasons why this Commission should be appointed. There is another reason, and that is the tremendous demands which are going to be made on county councils in future. That it just as important a reason to my mind. Lord Hayford, in his most interesting speech, spoke about education and roads. If your Lordships will allow me, I will approach these particular questions from another angle.
With regard to education we have, I suppose, one of the best educational systems in the world. We have the finest lot of teachers, women and men, in the world to carry on the work of education, but the whole of our education is marred by one thing. and that is the size of the classes. It is impossible in a class of sixty pupils—and I know classes of sixty
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spupils—to get at the children properly. That is a question that must be met some time in the future. Of course it means a great many more teachers and very considerable expense all round. We know that the population of the country is said to be dwindling, and perhaps pupils will decrease in number, but I cannot help thinking there will be a great demand for teachers in the future.
The other point is about roads. The Government have taken a very good step in taking over the trunk roads, but let your Lordships visualise the traffic we are bound to have throughout this country in the future. I have been shown the possible traffic we may have in fifty years' time; it is enormous. I have not the figures with me, unfortunately, but they are enormous. When you go to Germany and Italy and see their marvellous roads going right through the country, you must recognise that such roads will be necessary in this country. I recognise that the Government have taken over the trunk roads, but when I visualise the future I look forward to the Government more than the county councils, and if this inquiry is carried out it might consider the question of the State taking over the first-class roads of the country. There are certain roads in our country which, as your Lordships know, carry a tremendous amount of traffic and are not included in our trunk system. The traffic over them is increasing day by day. It is absolutely necessary that something should be done about these roads. What I suggest would be to raise the grant we get now for roads in the counties and allow that extra grant to be applied to the roads to which we consider it necessary it should go. Those are the two points which I really wished to make to your Lordships as reasons why this inquiry should be held. I hope that the Government will take the matter into their very serious consideration.
THE LORD PRIVY SEAL (EARL DE LA WARR): My Lords, I think after the debate to which we have just listened the noble Earl, Lord Liverpool, should be feeling very satisfied with the result of putting down his Motion. May I first of all thank him for his courtesy in letting the Government know the main points which he intended to raise. This debate has really established that there are a great number of points of agreement.

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The first point on which we are all agreed is that the subject is a very important one, and that His Majesty's Government must take this discussion most seriously, as they do. Then we are all agreed that the rates have increased very largely during the last few years. Yet it is perfectly true that during the last five or six years, since 1932, the actual rate in the pound for the country is lower than it was in the nine preceding years. I do not stress that point, because, as we all know, assessments have gone up.
There are one or two points that have not really been very much stressed. I expected a certain amount of discussion in regard to the incidence of public expenditure as between rates and taxes, a point the importance of which it has sometimes seemed to me it is very possible to exaggerate. When a sum of money has to be obtained for public expenditure, if it does not come out of one pocket then it comes out of another. While taxation raised by a system of rates may to some extent seem to be a worse burden on the cost of production than the Income Tax, it is no doubt inevitable that a great amount of public expenditure must be borne locally for the simple reason that the majority of us in this country are very satisfied with our system of local government and desire it to continue. I think very little has been said about the actual amount of the rates. The noble Lord, Lord Bayford, did deal with the question of the increase, and said he would like that question to be included in any inquiry that might be set up, but I think he recognised fully that with our rates we, as the public, do in fact buy certain services. We buy our roads, our police protection, our sewage system, our lighting, the better health of our people and the greater intelligence of our people. Those are all things that Parliament and the local authorities between them have laid it down that it is desirable the public should enjoy.
The noble Lord, Lord Bayford, mentioned a number of specific points. He said, for instance, that there was extravagance in our expenditure on education. He mentioned the new schools. I wonder if he is right there. I believe that if he and I sat down to criticise the results of our present educational system we should probably find ourselves in very considerable agreement. We complain that that
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system has turned out far too many black-coated workers from our villages where we should like to see our children being taught something about the countryside. We are turning out far too many typists and clerks, but how are we going to adjust that? Surely that question is bound up with the question of more expensive schools. As long as you are satisfied with having in the school a number of little boxes, which you call rooms and in which you enclose children for the purpose of pumping into them a certain amount of information out of a book, you can do it very cheaply, but you get a kind of education which the noble Lord and I dislike. It must be remembered that we have to have a woodwork room, a metalwork room, school kitchens, a gymnasium, school gardens and so on. Those are the things that are adding to the cost of education, and I would suggest to the noble Lord that they are undoubtedly the cause of the cost of the new buildings being greater than the cost of the old buildings. At the same time we are getting very much better value for our money. I think it was the noble Lord, Lord Bayford, who made the point that the luxuries of one generation become the necessities of the next generation. That is inevitable, and it is a subject in which I think he and I, and also the noble Earl, Lord Liverpool, would be mutually interested.
Then there is the question of an adequate supply of agricultural labour. We are all concerned about the shortage in the supply of agricultural labour. We have to face the fact that unless we increase—and it has inevitably to be done at the expense of the rates—the amenities of the countryside we are not going to get the necessary supply of agricultural labour. The wives of the agricultural labourers go into the towns, they see their friends' houses, they see their electric light, they see the water laid on to their houses, they see the far more convenient sanitary arrangements, and they go back and tell their husbands to try and get a job in the town. There, again, is an example of how inevitably the costs are bound to run up. These burdens grow and these costs run up. May it not be because we as members of Parliament and as members of local authorities think that certain services have to be extended?
And exactly the same applies with regard to loan expenditure as with regard

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to current rate expenditure. We know that year by year the amount of the loans outstanding by local authorities is growing. Nobody has mentioned it to-day, but I think your Lordships should welcome the last circular of the Ministry of Health in which all the local authorities are asked to plan their capital expenditure for five years ahead. There has been far too much spasmodic expenditure in the past, and I think this question of planning for the future is particularly important from the point of view of the future trend of population to which the noble Lord, Lord Bayford, has referred.
Those are certain remarks on the general side of the subject, but a number of more specific points have been raised, and are particularly raised in the Motion of the noble Earl, Lord Liverpool. The noble Earl has referred to the question of the cost of living. Over a certain period, making comparison between 1931 and 1932, the period of slump, and to-day, it is perfectly true that the cost of living has risen considerably. But is it really fair to take a comparison of those years? Did not every single one of us of every political Party in 1931 say that if we were ever going to escape from the trough of that depression prices had to rise? If we compare 1929 with 1938 we find that the index of retail food prices is down by no less than 11 per cent. and that wages are up on an average 6½ per cent. I can also tell your Lordships that the rise in the cost of living has been definitely checked, and we are actually down 2½ per cent. as compared with the end of last year. This is a question that is under continual review by the Government, and your Lordships will realise that the Food Council is continually watching the price of food. You may also have noticed with interest that we have just set up a committee of inquiry into the cost of coal distribution.
Now I come to a point about which a great deal has been said to-day—an extremely important point; that is, the absorption of rural areas by urban areas. If unfortunate Ministers are allowed to have personal opinions perhaps I might be allowed to say that I have a great deal of sympathy with what has been said on this matter. On that point the noble Earl, Lord Onslow, made some very interesting remarks. I cannot see any solution for this problem in the future simply in terms of accepting the
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present basis of local government areas and refusing to certain urban areas extensions for which they ask. I believe that ultimately—I use the word "ultimately" because I am making no statement about immediate Government policy—we shall have to look at the matter from a much wider point of view, the sort of point of view that was seen in the report of the Tyneside Commission, and the point of view which I think was hinted at by the noble Lord, Lord Bayford, when he talked about adopting a very much larger area, for instance, for water supplies and other services. We have to think possibly in future far more in terms of the region and far less in terms of the small and in some cases rather out-of-date local government area.
There was one other point which noble Lords have raised, and that was the question of inequality in the incidence of rating between rural and urban areas. I do not think it is quite fair, as the noble Earl suggested, to say—
THE EARL OF LIVERPOOL: I do not wish to interrupt, but I should like to point out that I purposely did not touch on the urban question.
EARL DE LA WARR: I apologise to the noble Earl if I did not quite catch his point, but I think the remarks which I intended to make are equally applicable. I do not think it is quite fair to say that nothing has really been done during the last few years in the matter. Of course nothing can be final, and certainly the present system need not necessarily be final, but a very great deal has been done with regard to this specific point. As your Lordships know, during the last year or so a very big alteration has been made in our rating system. No fewer than 4,500 miles of trunk roads have been taken right out of the sphere of local government expenditure and responsibility for them has been assumed by the State. Then in respect of the smaller roads very full allowance for differences between one rural area and another has been made in the block grant. I wonder if the noble Earl realises how much the assistance given to different areas is varied by the block grant. I find that last year the block grant paid to Lincolnshire was equivalent to a rate of 12s. 4½d. and to Montgomeryshire 12s. 3d. East Sussex, of which I am a proud resident, only

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got is. 7½.d. Kent, the home of the noble Earl, Lord Stanhope—I think it was referred to—only got 8½d. Surrey, to which the noble Earl referred, got nothing at all, and from what he said I am sure he thinks that that is quite right. The noble Earl must admit that a very considerable attempt has been made already by the Government to bring about some measure of justice as between different areas. The question of education has been referred to, but I am not going to deal with that because at present my noble friend the President of the Board of Education is engaged in discussion with local authorities in order to get adjustments of what he admits to be certain inequalities and injustices.
One last point to which the noble Earl referred was the question of British capital being driven abroad—I think that was his point—by the incidence of rates.
THE EARL OF LIVERPOOL: Forgive my interrupting, but I only quoted that as one of the results. If capital is invested abroad and comes to nothing we become the losers. But I only put it as a side issue.
EARL DE LA WARR: The noble Earl may feel that it is a side issue, but it takes rather a prominent part in his Resolution. We all recognise that foreign investment is frequently more risky than home investment. Against that, however, we must ask ourselves where we should be to-day if in the past we had made no foreign investments. The whole basis of our prosperity to-day is those foreign investments. The noble Earl asks why we do not take a strong line with some of these defaulting countries. I think he is aware of what the Government are saying to Mexico at the moment, and he will agree that we are doing everything we can. I am not quite clear how this matter comes into the question of rates. It might be, of course, that high rates would drive British capital away; that would be more likely were it not that productive industry is exempted from the charge of rates to the extent of no less than three-quarters. The noble Earl mentioned the Kent fruit-growers. They do not come into the matter at all, because they are completely derated.
I am afraid I have only been able to touch on a few of the points that have
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been raised, but I hope what I have said will convince your Lordships that His Majesty's Government do take this subject very seriously. They do not feel that a Commission of the very roving type which has been suggested by the noble Earl would help in the solution of these problems, but they feel rather that the continual review and revision of our system of rating and local government which is taking place from day to day, and by which all these matters are under the constant consideration of the Government through the Ministry of Health, the Ministry of Transport, the Board of Education and so on, is a better way of meeting the need for possible adjustment in the future. Although we do not intend to adopt the method proposed by the noble Earl, we certainly admit the need for this continual review. I will close by once more thanking the noble Earl for bringing up this question and for ensuring such a useful debate.
THE EARL OF ONSLOW: My Lords, does the noble Earl suggest that the county boroughs as they are at present should remain static and that there should be no further extensions or creations?
EARL DE LA WARR: I was purposely vague on that point. I merely said I felt some sympathy with the noble Earl, but in that I was speaking as a county-man, and not as a member of His Majesty's Government.
THE EARL OF LIVERPOOL: My Lords, I will not say that I am entirely satisfied with the reply of His Majesty's Government, but I certainly do not intend to divide on the Motion. These matters seem to be receiving the attention of the Government. I would thank Lord Bayford for the very able way in which he seconded me, and also my noble friend Lord Crewe for supporting me. I quite agree with Lord Bayford in what he said on superannuation. I am afraid I omitted that subject in my first remarks. I would go further and say that the increase in the staff which we have obtained in the county councils has substantially contributed to the large sums we have to pay in superannuation. I think I read in his speech in a paper which is beside me here that the size of our staff is eight times what he originally knew it to be. Our county building has become almost a

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small town in itself. The noble Marquess, Lord Aberdeen, spoke about footpaths. I am afraid I do not entirely agree with him. I agree in regard to the kerbings; although they are not used, I grant that it is necessary to place them there for the safety of the younger people, especially those going to school.
I purposely avoided differentiating between the two kinds of taxation, as I was trying to keep to my Motion, National taxation is one thing which, disagreeable as it always is to everybody, we share alike. We all grumble like anything, and I suppose the noble Earl, Lord De La Warr, grumbles no more and no less than anyone else. I certainly am in the same condition. But: the rates are calculated on quite a different basis and, especially in agricultural counties, naturally operate unevenly. That is the point which I particularly wanted to bring out to-clay. I found no fault even with the noble Earl, Lord Stanhope, for courteously sending us away after saying nothing. I quite agree with him, and I should probably have done the same if I had been Earl Stanhope.
EARL STANHOPE: I think I told the noble Earl that one of the reasons why he had to look forward to a large expense now was that his county had not done these things earlier.
THE EARL OF LIVERPOOL: The noble Earl said that, but whether he was right or not I cannot at the moment say. But the inequality of the incidence of rates on varous counties was the point I chiefly wished to raise. I particularly did not want to question the necessity for the various enactments which impose expenditure on county councils. That is quite another question. I agree with the noble Earl, Lord De La Warr, that something has been done to lighten rates, but I do not think that touches the whole point. Rates are only subsidiary to all the other expenses of the county council, many of which I omitted and Lord Bayford put in. I therefore beg leave to withdraw my Motion.
Motion for Papers, by leave, withdrawn.

BUSINESS OF THE HOUSE.
LORD STRABOLGI: My Lords, on behalf of my noble friend, may I ask the Leader of the House whether he has any statement to make on business?
EARL STANHOPE: My Lords, I am obliged to the noble Lord for giving me this opportunity. Perhaps I might remind your Lordships that to-morrow we have an important debate on the Air Service. I propose that we should meet on Monday next to consider the Eire (Confirmation of Agreements) Bill—Ireland, as it is more familiarly called—and take the Second Reading then. On the following day, if your Lordships will agree, I propose that we should take the further stages of that Bill, suspending the Standing Order for the purpose. As your Lordships know, we cannot touch the Agreements themselves, and therefore I do not think that any of your Lordships is likely to wish to have any debate on the Committee or Report stage. I anticipate that debate will be entirely on the Second Reading, which we shall take on Monday. On Tuesday, therefore, we shall have the Housing (Agricultural Population) (Scotland) Bill, in its Committee stage, the Report stage of the Increase of Rent and Mortgage Interest (Restrictions) Bill, and one or two other small measures. On Wednesday, the 18th, we shall have the foreign affairs debate on the Motion of the noble Lord, the Leader of the Opposition, when I think it is very likely, from what I understand, that we shall sit after dinner, as there are a fairly large number of speakers. On Thursday, the 19th, there is the Motion of the noble Lord, Lord Hastings, on going into Committee on the Coal Bill, and that Bill will take the whole of the rest of Thursday. I do not think I need look further ahead, except to tell your Lordships that I may have to ask you again to sit on Monday week, May 23. I hope I have made the proposed business clear.
LORD STRABOLGI: The noble Earl did not say whether we shall meet at the usual time on Wednesday next, or at three o'clock.
EARL STANHOPE: If your Lordships agree I think it would be much better if we met at three o'clock. There are nine speakers down already, and other names are coming in. If your Lordships agree

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I think we had better meet at three o'clock.
THE EARL OF LIVERPOOL: Is it proposed to take the Coal Bill on Wednesday?
EARL STANHOPE: No, we shall take the Coal Bill on Thursday, as soon as Lord Hastings' Motion has been disposed of.
House adjourned at half-past six o'clock.