Lords Sitting of 18 July 1940

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

AGREEMENT WITH JAPAN.
4.6 p.m.
LORD ADDISON: My Lords, may I ask His Majesty's Government whether they are now in a position to make a further statement about recent negotiations with the Japanese Government?
THE SECRETARY OF STATE FOR FOREIGN AFFAIRS (VISCOUNT HALIFAX): My Lords, on June 24 the Japanese Government requested His Majesty's Government to take measures to stop the transit to China via Burma of war materials and certain other goods. A similar request was made in respect of Hong Kong. The continuance of the transit of these materials was represented as having a serious effect on Anglo-Japanese relations. An agreement has now been reached with the Japanese Government as follows: With regard to Hong Kong, the export of arms and ammunition from Hong Kong has been prohibited since January, 1939, and none of the war materials to which the Japanese Government attach importance is in fact being exported. With regard to Burma, the Government of Burma have agreed to suspend for a period of three months the transit to China of arms and ammunition as well as the following articles: Petrol, lorries, and railway material. The categories of goods prohibited in Burma will be prohibited in Hong Kong. In considering the request made by the Japanese Government, and in reaching the agreement to which I have referred, His Majesty's Government were not unmindful of the various obligations accepted by this country, including their obligations to the National Government of China and to the British territories affected. His Majesty's Government were, however, also bound to have regard to the present world situation; nor could they ignore the dominant fact that we are ourselves engaged in a life-and-death straggle.
1040
The general policy of this country towards the Far Eastern troubles has been repeatedly defined. We have persistently asserted our desire to see assured to China a free and independent future, and we have as frequently expressed our desire to improve our relations with Japan. To achieve these objectives two things are essential—time and a relief of tension. On the one hand, it was clear that tension was rapidly growing owing to the Japanese complaints about the passage of war material via the Burma route. On the other hand, to agree to the permanent closure of the route would be to default on our obligations as a neutral friendly Power to China. What we have therefore made is a temporary arrangement in the hope that the time so gained may lead to a solution just and equitable to both parties to the dispute, and freely accepted by them both.
We wish for no quarrel with any nation of the Far East. We desire to see China's status and integrity preserved and, as was indicated in our note of January 14, 1939, we are ready to negotiate with the Chinese Government after the conclusion of peace the abolition of extra-terrilorial rights, the rendition of concessions and the revision of treaties on the basis of reciprocity and equality. We wish to see Japan attain that state of prosperity which will ensure to her population the welfare and economic security which every Japanese naturally desires. Towards the attainment of the aims of both these countries we are prepared to offer our collaboration and our contribution, but it must be clear that if they are to be attained it must be by a process of peace and conciliation and not by war or threat of war.
4.12 p.m.
LORD ADDISON: My Lords, it would not, I think, be the general desire that we should now embark upon a discussion of the important statement made by the Foreign Secretary; but I must say in two or three sentences that it increases my regret that, owing to the persuasiveness of the Foreign Secretary and various representations that were made, we did not have a discussion on foreign affairs some time ago, as was proposed, because one of the main reasons which prompted me to put that Motion on the Paper was that we might be able to discuss this very matter before a decision had been arrived at. I can only say that I am

1041
afraid this seems to me a most unfortunate arrangement, and I hope it will not have the bad effect in China and elsewhere which one fears it will have. I would like to ask the Foreign Secretary, although I noted carefully the words he used in his statement, whether or not this agreement implies any departure by His Majesty's Government from the principles of the Nine-Power Treaty to which this country is pledged.
4.14 p.m.
VISCOUNT SAMUEL: My Lords, I understand that it is the general desire that this matter should not be debated today, and I also understand that it is likely to be raised and discussed fully when the House has a formal debate on foreign affairs next Wednesday. At the same time I would again suggest, as I have done on previous occasions, that this particular topic might be better discussed in private than in public. I do not suggest that secret debates should be frequent. On the contrary, it is of great importance that even in time of war national and international affairs should be discussed freely in both Houses in the presence and in the hearing of the whole nation and of the world, but there are occasions and there are matters on which secrecy should be observed in assemblies such as this. The other House already has had three secret debates. This House has only had one, and that not on foreign affairs, and I would earnestly submit to the consideration of noble Lords that the debate next Wednesday should be held in private.
As for the subject matter of the noble Viscount's statement, it is to be observed that the arrangement is of a temporary character, in the hope that during the next few months peace may be reached between China and Japan. If that hope is not fulfilled—and it is a very problematical one—then it may be that this arrangement will have to continue indefinitely. The temporary often slips into the permanent. For my own part I can only say that such a course would, in my view, be exceedingly regrettable and indeed deplorable.
4.16 p.m.
THE EARL OF LYTTON: My Lords, it obviously is impossible for us to have a general, or indeed an adequate, discussion of a statement of such gravity as that which we have only just heard for
1042
the first time, but, like the other noble Lords who have spoken, I feel I must say this, that I have heard with dismay the statement which the Foreign Secretary has made, not, I need hardly assure your Lordships, because I have any wish to see a conflict with Japan, and not because I should not rejoice as much as any member of His Majesty's Government at any action which, in my opinion, would render such a conflict less likely. I accept all the arguments which are used, or may be used, by those who defend the policy made in the announcement we have just heard, but I dispute their application, and it is not because I do not want to see the tension removed, but because I differ fundamentally from His Majesty's Government as to the best way of removing conflicts between ourselves and other nations. I fully recognise that in such matters the decisions must rest with the responsible Government, but if Parliament is to serve any useful purpose even in war-time it must retain its right of independent judgment, and those who differ from His Majesty's Government on matters of grave political importance must in Parliament say so frankly and freely. I will say no more on this occasion. I hope we shall have another opportunity of expressing our opinion in greater detail, but I felt I should be lacking in my duty if I said less now.
4.18 p.m.
LORD MARLEY: My Lords, before the noble Viscount replies, if he is to reply, I should like to ask him three questions. The first is whether the British Ambassador in Moscow was consulted as to the effect on the relationship between this country and the Soviet Union this decision would have. Secondly, I should like to ask whether His Majesty's Ambassador in Washington was consulted as to the effect this decision would have on the relationship between the United States and Great Britain. We have just had a very important communication in this respect from America, stating that Mr. Hull has protested against the closing of the Burma road. Radio analysts and editors are sharply critical, while both Nazi and Japanese propagandists are working hard in the United States to widen the breach. The British action has seriously undermined the position of those who, like Colonel Stimson, advocate a strong policy against Japan, and American people, it

1043
is stated, are commencing to turn anti-British, which is a very dangerous situation. My third question is to ask whether the Canadian Prime Minister was consulted before this decision was reached.
4.20 p.m.
VISCOUNT HALIFAX: My Lords, if I might, with your Lordships' leave, say another word, I think it is due to noble Lords who have made observations that I should make some reference to them. First of all, if I may begin at the end, with regard to the questions the noble Lord who spoke last addressed to me, I need hardly say that in all the quarters to which he has referred we took steps to see that our Ambassadors and representatives were informed. While it would not be fitting in answer to a question to specify the degree of exchange of view, I think the noble Lord may rest quite satisfied that these considerations were not overlooked. With regard to the Dominion of Canada, I can also truly say that they were kept fully informed of what His Majesty's Government had in mind. It is, of course, no surprise to me that on this matter there should be many of your Lordships who feel the force of everything that has to be said or can be said upon the side of doubt and appreciation of the difficulty involved in the decision to which His Majesty's Government have come. I certainly would be the last person to differ in any way from what fell from the noble Earl on the Cross-Benches, when he said that whatever might be the responsibility attaching to His Majesty's Government, it was the inexpugnable right and duty of Parliament to express their view. As far as I am concerned, I shall be very happy for this House of Parliament to avail itself of whatever may be the most appropriate opportunity of doing that.
The noble Lord, Lord Addison, asked me a specific question with regard to the Nine-Power Treaty with which I think he will find my statement had implicitly dealt. I was careful to say that His Majesty's Government had not been unmindful of the various obligations accepted by this country, and to that Treaty, of course, this country was a party. Then the noble Viscount, Lord Samuel, made a suggestion, that has also reached my noble friend the Leader of the House from other quarters, that it might be
1044
desirable and useful if this matter with other matters were to be debated at the right time in secret. So far as I am concerned, representing the Foreign Office, I should raise no objection to that, if that is the general desire of your Lordships, and I think it may well be that on this occasion it might be advantageous, both to those who speak and to those who listen, that the proceedings should be so conducted.

MILITARY IDENTITY CERTIFICATES.
4.23 p.m.
LORD ADDISON: My Lords, may I ask the noble Lord, the Under-Secretary of State for War, if he can give the House any information as to the issue of military identity certificates for the use of members of this House?
THE JOINT PARLIAMENTARY UNDER-SECRETARY OF STATE FOR WAR (LORD CROFT): My Lords, these certificates will be issued from the office of the Lord Great Chamberlain in the House of Lords. Peers desiring to be furnished with a certificate are asked to attend at the office of the Lord Great Chamberlain on or after Monday next, bringing with them a small passport photograph. They will then be asked to fill in the form and the official stamp and endorsement will be affixed. In view of the nature of the document it is impossible that the form should be issued in blank for Peers to complete otherwise than in the presence of the issuing authority. Instructions in accordance with what I have stated will be issued with the Whip in due course.

MERCHANT SHIPPING (SALVAGE) BILL.
Order of the day for the House to be put into Committee read.
4.25 p.m.
LORD TEMPLEMORE: My Lords, in moving that the House do now resolve itself into Committee on this Bill, I desire to make a short statement. You may remember that on the Second Reading, two days ago, I intimated that it was the intention of His Majesty's Government on the Committee stage to move one or two Amendments in order to clarify and improve the Bill. These

1045
Amendments have been printed and, I think, circulated to your Lordships. It has now occurred to the Government, after further consideration and consultation, that these Amendments would not have the effect they intended of improving the Bill. Therefore, when the House gets into Committee it is not my intention to move the Amendments.
Moved, That the House do now resolve itself into Committee.—(Lord Templemore.)
On Question, Motion agreed to.
House in Committee accordingly: Bill reported without amendment.

UNEMPLOYMENT INSURANCE BILL.
House in Committee (according to Order): Bill reported without amendment.

BRITISH PURCHASING MISSION IN AMERICA.
4.27 p.m.
LORD ADDISON LORD ADDISON rose to call attention to the statement made on behalf of the Ministry of Supply in the debate on Lord Barnby's Motion, with regard to the placing of overseas orders, on Thursday, July 11; and to move for Papers. The noble Lord said: My Lords, I feel that I must apologise for intruding upon you again. It usually results from the accident of the place I happen to occupy, but on this particular occasion it is my own choice. It will be within your Lordships' recollection that there was a very instructive debate in this House initiated by the noble Lord opposite, Lord Barnby, last week, with relation to the proceedings for obtaining war supplies from the United States and Canada. We had a reply from the noble Lord, Lord Woolton, on behalf of the Ministry of Supply, and another from the noble Lord, Lord Beaverbrook. At the end of the discussion I expressed my unmixed pleasure at the character of the statement made by the noble Lord, Lord Beaverbrook. I also said I was very disappointed, with the statement which the noble Lord, Lord Woolton, had made on behalf of the Ministry of Supply—so disappointed that I proposed to call attention to it at an early date. This is the early date.
Let me say that I hope the noble Lord, Lord Woolton, will not regard what I have to say as any reflection upon him-
1046
self. If he had made the statement on behalf of the Ministry of Food it would have been a very different statement. It would have given us something to bite at. It would have been quite different from the document which he read very artfully to your Lordships' House, but which, of course, had been drafted by the Ministry of.Supply and supplied by that Department. Therefore I hope the noble Lord will realise that I acquit him entirely of any responsibility for the contents of the document which he communicated to the House. The noble Lord, Lord Barnby, wanted to know amongst other things—and I think the House is entitled to be told—what arrangements had been taken to avoid or to put an end to the discreditable delays that had occurred in the placing of orders for munition supplies in the United States. It is well known that these delays have occurred. They have often been complained of by the heads of the American Government, and it is therefore not any use shutting our eyes to the fact. In bringing the subject before us Lord Barnby, I think very properly, wanted some light upon what the new arrangements are to short-circuit delays and these processes.
In his reply the noble Lord, Lord Woolton, said that of course things were better now than they were, that we had had several months of experience. It is not very much to claim, as the document claimed, that we have learnt something by experience. But then he went on to tell us of the arrangements, and it is to that part of the speech that I would call your Lordships' attention. There were, of course, tributes of thanks to those who were at work, with which we are all glad to associate ourselves; and then he went on to explain that Mr. Purvis, who is now the head of the Mission in the United States, was assisted by the necessary technical, production and financial assistance. I think it is right to inquire what that means: what are the nature and extent of that technical and other assistance. At the end the noble Lord assured us that His Majesty's Government will not fail to vest in him—that is, Mr. Purvis—powers necessary for the carrying out of his work. Then the statement went on to say, "This is an outline of the organisation." I confess that it did not strike me as an outline. It was not even a smudge; I have not gained from that statement the

1047
faintest idea of what the organisation was. All it said was that Mr. Purvis was going to be equipped with the necessary technical, financial and production assistance; that is all.
I am afraid that if you look a little further you will find that is not enough. It goes on to say that in the course of all this time orders have been placed to the extent of £100,000,000. After that we had the statement of Lord Beaverbrook, which dealt almost in astronomical figures as compared with these, with the vast sums for which we had become committed in respect of aeronautical supplies alone. This Mission has been there I do not know how long—the greater part of the year—and it appears that that is the extent of the commitments—£100,000,000. These things cost a lot of money, and I am sure there is not one of us who would want to spend any more than we need. A good many of us who have had experience of these things know very well that there are quite a number of people in the United States, as there are in the United Kingdom, who are always glad to make hay when the sun shines, and who are glad to get good orders and gladder still to get big prices if they can. Therefore, of course, it is necessary that proper precautions should be taken to see that our necessities are not exploited. We take that, I should think, as an axiom. But, seeing the extent of our needs and what the United States can supply, we are entitled to expect something which will lead to more expeditious and efficient work than that in the course of a good many months.
We were warned in the same statement, of course, that some control is necessary. We should all agree with that, but I think that we ought to be told what is the measure of control that is exercised and how it is exercised; what steps have been taken to overcome obstacles which clearly have presented themselves, not only in getting delivery of goods but even in placing orders for them. We want to know what steps are being taken to promote efficient and rapidly-working arrangements for the delivery of the goods which we need and which the United States can supply. May I, in elucidation of this request, ask the noble Lord some questions on a few specific points? I do so because the "outline" to which I have referred threw no light upon them, and
1048
also because I have a vivid and entirely painful recollection of the kind of experiences we had in the last war on this very matter. Specifications: what arrangements are there for securing that the specifications are, if necessary, adapted to United States manufacturing processes in a reasonable way, so that we do not have too many messages and journeys to and fro about alterations in specifications, some of which may be of quite a minor character? I well remember that in the last war—and it is quite evident that it has occurred again—all kinds of delays occurred owing to the insistence upon specifications which might have been, perhaps, the custom or at all events well understood in British manufacture but which were not common or usually adopted in American processes. At all events, will the noble Lord, if he can, please give us some light as to how difficulties about specifications are dealt with and how delays are minimised?
The second question is, how are questions dealt with which relate to the provision of equipment for the production of supplies? Has the Mission in the United States been given a programme, and if so—of course we do not want confidential details—to what form has the programme been committed? What arrangements are made, or what authority has the Mission for placing orders? Has it complete authority, and what categories of orders does it need to refer to this country? Then I should be glad if the noble Lord would tell us something about the authority of this Mission with regard to price. Here let me draw your Lordships' attention to a very important reservation which the noble Lord skilfully passed over with regard to price. He said that the Board in Canada had wide discretionary powers in negotiating price. Lord Barnby asked "Is that in Canada only?" and in reply Lord Woolton said "I said in Canada." We had heard that, of course. Then he went on to say that financial arrangements for each purchase were invariably placed upon the Board's recommendation, but he did not hark back to the question about what were the arrangements with respect to price in the United States and what authority the Mission had.
I well remember that last time it was found that the only way of short-circuiting talk—so to describe it—and

1049
getting rid of delays was to give your Mission authority with regard to price within certain limits and on certain bases. We had at the head of our Mission over there some of the most responsible and able business men from this country. Of course we have some very able business men on this Mission, but of course they cannot operate quickly unless they are given authority of a fairly clearly defined character; otherwise there would be interminable references to headquarters here and a lack of decision. I suggest that we require an organisation in the United States quite different from that which has been functioning in the last eight months—something which will get the work done much more quickly and which will give more satisfaction both there and here.
After that, the noble Lord's statement—it was not his statement, but the statement with which he had been supplied—went on to say that the Controllers of raw materials were men of wide business experience. I do not quite see what that has to do with it, but I have no doubt that they are; I am sure that they are very estimable gentlemen. The point is that the arrangements for dealing with the supply of raw materials have hitherto been exceedingly cumbrous and almost unworkable, because the Controllers live in different places, they operate on different systems and they have no organic relation to one another. It would be very comforting if we could be told that we are now to be provided with a better arrangement. This is no reflection upon the Controllers themselves; the ablest men cannot work smoothly and successfully if the arrangements are unworkable, although a good many of them have been trying to do so for a long time past.
Finally, there was a statement which—if I may use a little slang in this august assembly—rather "got my goat" It was a sort of homily on the duties of Ministers and their relations to civil servants. I did not think that that had much relation to Lord Barnby's Motion, although perhaps it did have some relation to something which he said. I can fairly say that I have championed the Civil Service myself on a very large number of occasions, but I do think—and it is better to say it—that in this matter the Civil Service has not been altogether fairly treated. Some time ago,
1050
under the last Government, a very important civil servant was made the Chairman of the Supply Board. Well, there is no getting away from it, that the operations of the Supply Board during the last two years have been a disastrous failure. It is no good pretending that they have not. We have lost thousands of precious lives and we have suffered enormous military and economic losses because of their failure; and it was never right to put a civil servant in the position of being head of an executive body of that kind. It was always wrong to do so; and, in view of the admonitions in this statement, I feel that it is necessary to say frankly that that arrangement ought not to be made. We ought to have men at the head of these organisations who are responsible to Parliament, and the Minister should not—it is not that he wishes it to be so—by the arrangements which were instituted in the case of the Supply Board, be necessarily divorced from the executive action of his own Department; because that is what this brings with it. Therefore, making no reflection whatever upon- the distinguished civil servant who was placed in this impossible position, I express the hope that we shall have some assurance that before long this arrangement will be brought to an end.
I do not suppose that my right honourable friend Mr. Herbert Morrison ever saw the reply which was given. It bore the imprint upon it of a well-drawn-up departmental document, and I think I could hazard a guess as to who was its author, or at all events as to who gave it his blessing. However, Mr. Morrison would be the very first to accept full responsibility for the document, and we should, of course, honour him for doing so. No one has a higher opinion of his splendid abilities than I have, and no one has done more to back him up. I hope that the result of this discussion will be that the Minister will turn his mind to putting our organisation in the United States on to a proper basis so that it can work efficiently and with reasonable rapidity, and that in reply we shall be given something more than an outline of what the arrangements are. If the Minister will turn his mind to this matter, as he has done with such splendid results to the production of munitions in this country, then I am quite sure that before very long a debate of this kind, with the questions which led to it,

1051
will be entirely unnecessary. I beg to move.
4.46 p.m.
THE MINISTER OF FOOD (LORD WOOLTON): My Lords, a week ago, when the noble Lord, Lord Barnby, raised issues concerning the Ministry of Supply, I found myself in a position of some embarrassment. The noble Lord—of course very properly—spoke on a wider front than that for which I was prepared by the terms of his Motion, and I felt that the reply that I made was disappointing to your Lordships and might even have been considered discourteous by the noble Lord, Lord Barnby, who had just come back from America and who presented to your Lordships' House opinions that he had obtained as a result of first-hand contacts with North American industry. I was therefore glad that the noble Lord, Lord Addison, gave notice that he proposed to raise the question again to-day, in order that your Lordships might have fuller satisfaction. I am sure that your Lordships will not be unsympathetic with me if, from time to time, I am inadvertently less competent than I would wish to be in dealing with matters which concern the Ministry of Supply. My own Ministry is a very heavy and detailed one, and the Ministry of Supply is also a very heavy and detailed Department; and, whilst I hope that I shall always be able to satisfy you with my detailed knowledge of what is going on in the Ministry of Food, I cannot possibly hope to give your Lordships first-hand information from the Ministry of Supply, and I am therefore at the best but a poor substitute for a Minister. My right honourable friend Mr. Morrison was kind enough to say that he hoped that I would continue to represent him in your Lordships' House, and I shall certainly do my best to present his point of view to your Lordships. I beg your Lordships to forgive me for these personal remarks.
Traditionally, my Lords, we prepare slowly for war, and in this we are no different when we are dealing with other countries than when we are dealing with our own. I cannot pretend that in the early days of the Ministry of Supply everything worked smoothly, and that there was that definition and precision which are so essential. Industry in North America was not ready for a war programme. The Ministry on this side
1052
was hampered in placing orders in Canada because there was no industry there, outside the Dominion arsenals, with actual experience in the production of munitions. The plant concerned with this work in the last war, and the arrangements with which the noble Lord opposite, Lord Addison, had to do in the last war, had been dispersed, and new capacity had to be built. The noble Lord, Lord Barnby, referred to the large industrial production in Canada, which he measured particularly by the output of motor vehicles. There was a large potential capacity for war work, but the difficulties of turning over that capacity quickly to the production of munitions were considerable, and I am sure that the noble Lord will agree that it is probable that they were not all on one side.
The experience throughout has been that in order to convert Canadian resources to war output, large new plants have had to be laid down. The aim originally—but not now—was to build capacity there for something approaching the maintenance of five divisions. For such items as shell the progress made towards this goal was reasonably rapid, but the most substantial progress was made by plants that had received orders before the war broke out, and which had already got together complete equipment and machine tools. There is no doubt that the tempo of production at the outset was slow and was constrained. I can understand—perhaps better than most people—the feelings of irritation that the business man, able to give decisions in his own business, feels when he comes to a Government Department urgently in need of supplies which he thinks that he can give, and puts before it a proposal expecting to receive an immediate reply; and when such a person happens to come from the North American Continent, with its reputation for hustle, it is easy to see that that irritation must have been quite considerable.
But there were many things in the way of quick decisions of this nature. The Ministry had to get from such experience as the war had produced some definition of what the Army wanted, and the best is for ever the enemy of the good, and, in the industrial world striving for the best probably holds up production more effectively than anything else. The Government had also to consider to what extent they could afford to use their

1053
limited currency. Perhaps the conception of a long war with a strong and vigorous Ally and the need to husband our resources overseas imposed on the Ministry more of prudence than of vision. But it is relatively profiless to dwell on the past. In the language: of the city, "Nobody benefits by jobbing backwards." Nevertheless, I think it is only fair to us as a nation to record that as soon as he was appointed, my right honourable friend Mr. Burgin recognised how important the North American Continent would be. He secured the eminent services of Lord Riverdale, who went to the United States of America and to Canada in July, before war broke out, to make contact with the authorities there, and to consider what sort of organisation should be set up in the event of war occurring. Lord Riverdale returned and reported.]t was then arranged that the Government of the Dominion of Canada should send a Mission of Canadian industrialists to this country accompanied by their technical advisers, in order that they might study on the spot the main forms of munitions stores in use and make themselves acquainted with our methods and processes of production. We then sent another Mission from this country under Colonel Greenly to Canada to follow up the work of the Canadian industrialists and to place such contracts as could be immediately placed. I am sure your Lordships will forgive me for having dwelt so much on the past, but it is proper to give credit to those who cultivated the virgin soil.
But now a new chapter is open. New men of great vigour and fresh minds have been brought into the Ministry's service, both on this and on the other side of the Atlantic. They have been brought in under new circumstances. France has collapsed. The whole situation has changed very rapidly. The Anglo-French organisation has been brought to an end, both here and in America. In the United States the American Government have embarked upon a vastly increased programme of national armament. The world is faced with a Germany in control of the productive capacity of a large part of Europe, and not only our success but maybe the future of the world must depend upon our bringing in the new world to redress the balance of the old by mobilising and utilising the actual and
1054
the potential resources and capacity of the American Continent. In this way only can we secure with great speed the munitions that are necessary for victory. On this perhaps depends the struggle of the British Empire to preserve the Western civilisation which is the heritage of the American Continent as well as of our own. On this depends our capacity to liberate those countries in which that civilisation has temporarily been replaced by the tyranny of Nazi Germany.
In these circumstances His Majesty's Government have realised that there is no time for hesitation, or for prudence, or for the undue consideration of positions of exchange. The organisation of the Ministry is, I believe, now matched to meet these circumstances. Responsibility for contracts in Canada has been transferred to the Department of Munitions and Supply of the Dominion Government, and in the United States full powers have been given to Mr. Purvis. The noble Lord who leads the Opposition, from his own vast experience of the difficulties of supply, has asked, "Has the United States Mission got a programme?" It has. The Department here is enlarging its orders to the full capacity upon which we can draw either in the United States or in Canada. We intend to spend, and to spend freely, in order to acquire all the munitions of war that we now need and which we can quickly obtain. One of the difficulties to which the noble Lord referred was that of dealing with specifications. I have already referred to this difficulty. It is a difficulty that arises from the constant desire to use the latest experience in order to get something better. It is now arranged that orders are proceeding on the basis of existing designs, and no changes, even though they may be improvements, which will delay production, are introduced once production has begun.
I hope I am being very specific in my replies. In the matter of price, Mr. Purvis and his colleagues have full authority to fix prices, and they require prior approval only when the British Government have to invest capital in order to put new works or to buy new plant to operate on the other side. The noble Lord said that I did not reply fully to the question which the noble Lord, Lord Barnby, asked me last week. I did reply to the full extent of my know-

1055
ledge, and I did not go further than my knowledge. I knew that this arrangement operated in Canada; I can now say that it operates in the United States as well. The noble Lord asks me if the arrangements for inspection are satisfactory. In this, and in all technical matters, we are strengthening the British Mission by the addition of further technical staff and experts, and I am assured that every possible step will be taken to cut through any red tape restrictions which would prevent the fullest and quickest utilisation of North American resources.
Noble Lords may have observed that the Minister without Portfolio, Mr. Greenwood, who is Chairman of the Production Committee of the Cabinet, has taken every possible step to help Mr. Morrison in the heavy task he has undertaken and that he has asked Sir Arthur Salter, a man of great experience in the last war, to be Chairman of the North American Supply Committee, composed of all the interested Departments, for the consideration of general questions arising from the purchasing programmes in the United States and in Canada. My own personal experience of the work of that Committee is very small, but in view of this debate I spent some time last night with Sir Arthur Salter in finding out what they are doing. Even the Americans would be surprised at the speed with which things are being carried on there. It is really most gratifying.
It is difficult perhaps to give satisfaction to your Lordships on the question of how much we are getting from America and from Canada. That is a difficult question, having regard to the national interest, for me to deal with at all specifically, but may I just pick out one or two instances? The production of one Bren gun-making firm which is at present at the rate of approximately 50 per month will rise to 400 per month in the spring of 1941 As an example of shell output, the National Steel Car Company has a capacity for 130,000 shells a month of various important calibres, and that we are getting.
The North American programme is designed to cover comprehensively the whole range of major equipment required for
1056
the maintenance of the Army—guns of all types with their ammunition, tanks, vehicles, machine guns, rifles, and small arm ammunition—and to be a balanced programme, including the provision of explosives and filling and all ancillary stores. As a consequence of the French collapse the British Government have taken over in America the whole of the orders placed on behalf of the French Government, and that has provided an important reinforcement to immediate assets and future deliveries. The size and complexity of this programme will present big problems, and in carrying it out we must rely on the maximum help and cooperation from the authorities and the leaders of industry in Canada and the United States.
We on our part are taking immediate steps—some of which have already been taken—strongly to reinforce the Mission with additional production, technical, and inspection staffs. Air-Commodore James Weir has already proceeded to America to deal with the special problems of gun production. A further team of experts to deal with tank production is leaving very shortly. That is the result of the inquiries I have made in consequence of the questions that Lord Addison and Lord Barnby raised in your Lordships' House last week. I hope I have satisfied your Lordships that the activities of the Mission in America are not now hampered by restrictions, either financial or technical, imposed in Whitehall. It is true to say that never have wider powers to commit this country been delegated to any Mission, and indeed it is true also to say that no Mission has ever carried so grave a responsibility.
It is clear that the sentiment of the people of the Western world has roused them to eagerness both to defend themselves and to do what they can to help this country. We are less fortunately placed than they. We have endured already the experiences of war. Our soldiers have faced the enemy munitions; our technicians have seen their theories tested by facts. In this we have been unfortunate, since it is experience that no country can desire to have; but that knowledge may indeed be of some use to the technicians of the United States Army and to the manufacturers of munitions in that country. Their capacity for speedy pro-

1057
duction has earned American manufacturers world-wide reputation and admiration. It will be the object of the Mission that we have in America to co-operate to the fullest with the designers and the manufacturers in America in order that production may be speeded right up to the limit, and if indeed the knowledge that we have obtained from our experience is of use to them, now that they are embarking on this vast programme of expenditure on armaments, that co-operation may indeed in the long run be of vital importance to both our countries.
Subject always to human frailties, I am convinced that the Ministry of Supply will leave nothing undone that can be done to secure the fullest production of munitions in the North American Continent, and that whatever may have been the difficulties that arose in the initial periods, the Ministry have learned by that experience and are now profiting by it. I hope I have satisfied noble Lords that on this issue, at any rate, they can take a more optimistic view of the future than Lord Barnby's experience of the past would seem to justify.
5.8 p.m.
LORD BARNBY: My Lords, I am sure the House will feel very gratified at the very comprehensive and reassuring statement which Lord Woolton has just been able to give us. As I was responsible for this most important statement, may I have your Lordships' indulgence to make two or three remarks with regard to the position in which Lord Woolton found himself when I raised this matter? First of all I should like to say that Lord Addison must feel satisfied that the action which he took in following it up, in what the House will agree was a very reserved and moderate way, has been justified. The statement will give great satisfaction in the country. I want to explain that the position in which Lord Woolton was put was a very difficult one, and I would repeat what I said on the last occasion that I appreciate the consideration he has shown. I appreciate now the result of that debate because I suspect it has been as the result of his personal intervention that your Lordships' House has received a reply of the character to which it is entitled, considering the importance of the subject.
May I add, with the indulgence of the House, that I raised this matter only with the object of being helpful? This is not
1058
a time when recriminations are appropriate. All through last winter there was, in the minds of a great many members of this House, serious disquiet as to the way in which the Ministry of Supply were functioning, more particularly on the part of those who were familiar with the United States and Canada—very grave disquiet, not with the men in New York, because I pay tribute to their capacity and brilliance, but with the system as it was worked here. It was considered unpatriotic to criticise during all those months, and nothing could be more pleasant than to hear the noble Viscount, Lord Halifax, say that he welcomed the idea of Parliament resuming its functions of helpful criticism. That was the object I had in view when I raised this question, and it is still to further that object that I now return to the point. When I spoke last week I was under the impression that some statement was being given to the public on this very matter, and I felt bound to raise it in your Lordships' House on that particular occasion because I considered it was a subject of the greatest importance. I think it is unfortunate, when a statement bearing on the very subject had been made that afternoon in another place, that the member of the Government entrusted with the task of answering the question in this House was not even accorded the courtesy of knowing of the matter. In those circumstances I think we can say there is clear evidence of inefficiency in regard to some aspects of the administration, and evidence of lack of co-ordination at the Ministry of Supply.
With regard to the situation now existing, I want to be helpful and constructive. Those of your Lordships who have special knowledge have the responsibility of contributing that knowledge to the Government Department which it concerns. I know now that Mr. Morrison's intention is beyond question, and I have great confidence that, when he gets into his stride, he will produce results. But he has a lot of time to make up. The reassuring statement which the noble Lord, Lord Woolton, has given, will hearten those in this country who were seriously concerned at the position, and it will have the further effect of giving consolation to Canada. I say that because I believe there is an unfortunate state of bewilderment existing among the industrialists of Canada as to why their resources have not been more

1059
fully utilised. It was for the purpose of ventilating that, and of eliciting a statement of the character which we have had from Lord Woolton, that I raised the matter. I hope his Lordship's statement to-day will be reported widely in both the United States and Canada, where it will give satisfaction and be a reassurance to the industrialists there and also correct what was a very unfortunate position in the past. It will hearten them to still further efforts. I am glad that there is now that freedom of action, vigour and energy of direction of which Lord Woolton has told us, and I think it will get results.
With regard to Canada, I want to appeal to the noble Lord who has replied, and to the noble Viscount the Leader of the House, to be given an assurance that there is an intention such as is expressed in a letter I have received from Mr. Arthur Greenwood, to carry out a long-range policy which will fully utilise the resources, industrial and otherwise, of Canada. If such an assurance can be given, I feel that the anxieties which have been felt will be allayed in Canada. What we really want now is production from the arsenals of the North American Continent which have been available to us since we entered the war and now, thank God, are being used.
5.14 p.m.
LORD SEMPILL: My Lords, as I had the privilege of participating in the debate the other day, might I crave your Lordships' indulgence to say just a few words and to ask my noble friend Lord Woolton, whose statement we have listened to with the greatest interest, whether his remarks regarding the ordering of materials without change of design apply to aircraft materials as well as to the other materials to which he was referring? If so, that certainly would be a very good move along the lines of the remarks made on the last occasion. As time is the essence of the contract it is essential to get all the machines we can at the earliest possible moment. Might I also ask my noble friend Lord Woolton what arrangements are being made with regard to obtaining an increased supply of Colt.5 machine guns, as these are very necessary for our present purposes. As your Lordships know, the guns normally in use in aircraft are.3. Those are to be, so far at any rate as the Fleet
1060
Air Arm is concerned, replaced as rapidly as possible by guns of a heavier calibre. I think your Lordships will be very interested to know what suggestions Lord Woolton has in regard to that important matter. Might I also ask the noble Lord if he can say what is being done with respect to the other suggestion made on the last occasion this matter was debated in your Lordships' House—namely, the all-important question of propaganda, of placing the British cause, our great cause, more vigorously before the people of America so that one and all may bend their energies as effectively as possible to producing the material we require?
5.16 p.m.
LORD STRABOLGI: My Lords, my noble friend Lord Addison has asked me to thank the Minister for the obvious trouble he has taken with his reply, and for the heavy burden he continues to assume to the satisfaction, I am sure, of all your Lordships, of answering in your Lordships' House for the Ministry of Supply. We are much more satisfied with the statement we have had to-day. My noble friend Lord Beaverbrook said that in ordering aircraft in America the sky was the limit. I was not sure that that applied to munitions, and I asked my noble friend at the time—Lord Woolton was there and will remember the episode—and my noble friend Lord Beaverbrook replied that he could not answer for anything but aircraft. We were a little disturbed as to whether the same principle applied to the other munitions we need. Now we listened with very great care to my noble friend Lord Woolton. He did not use the expression: "the sky is the limit," but I understood him to say we were ordering from America as much as the American production capacity can supply, which means very much the same thing. Further on, he said we were ordering up to the limit, so that sounds as if we were getting the same latitude in ordering munitions in America as in ordering areoplanes.
LORD WOOLTON: My language was merely less graphic than that of my noble friend Lord Beaverbrook.
LORD STRABOLGI: If the noble Lord had used less graphic but equally clear language on the last occasion, we should have been much happier and should have

1061
spent a happier week-end. May I take the opportunity of making what I hope is a practical but very revolutionary suggestion to my noble friend Lord Woolton? He has, and quite rightly, very great influence with the Government, and the suggestion may be of value to him. He referred to the impatience of the business man who goes with a practical proposition to the Ministry of Supply, for example, or to the War Office or Admiralty or some other Department, and meets with long and heart-breaking delays before he gets a decision. My noble friend is aware of the irritations felt by business men, to-day, the 18th of July, at these long continuing delays—two or three weeks to get an answer even to a letter, two or three months sometimes 10 get a decision. We recognise that great efforts have been made to stir up the machinery We have seen the instructions issued by the Prime Minister to the Civil Service. But these delays still go on. Now why is this?
In every successful business—and my noble friend is a great example of the successful business man, if he will allow me to say so—the business man has somebody always to give a final decision on any matter of importance. He would not survive otherwise. I am speaking now as a business man myself in a much smaller way. Reference of these matters to Committees is perfectly hopeless. The disease that is affecting our whole war effort to-day is this Committee system. When my noble friend Lord Woolton said that Sir Arthur Salter was head of a Committee I can only hope that it is a general staff, which is quite different. In a general staff there are assessors and experts, each with his own particular responsibility, but the chief of the staff gives the decision. That is what you have in any successful business to-day. There is one other reform, quite apart from the necessity of getting rid of this awful Committee system, which is found absolutely necessary in business. In great businesses like Imperial Chemicals or Vickers there is a tendency to become bureaucratic. You get committees of officials, red tape, dockets and all the rest of it, but you have also something that is missing in the Civil Service; that is the power of removal for inefficiency.
In the Civil Service you can remove an official for misconduct; you cannot remove him for inefficiency. In business
1062
you must have the power of removal for inefficiency, otherwise no business would survive. That is the great difference. I know the arguments against it—that our wonderful Civil Service must have security of tenure and that if you remove that you may ruin it. That is perfectly valid in peace-time. But I am not sure that we shall not have to introduce this reform in war-time. I believe the power of removal for inefficiency has to come. If in one of the great spending Departments to-day, one high official was sent for, given a cheque for three months' salary—it can be done under the Defence of the Realm Act—told that his papers would be packed up and sent to him and that he was not to come to the Department again—if that was done in one case of proved inefficiency, a new spirit would go right through the Service. There are dozens of cases of inefficiency and I am sure that the people who would most welcome this reform would be the great bulk of the civil servants themselves. They would welcome it more than any other section of the community.
Despite the great reforms which my right honourable friend Mr. Morrison has brought into the Ministry of Supply and which the noble Lord, Lord Beaverbrook, has brought into the Ministry of Aircraft Production, I still find that there are complaints from business men of delays, slowness, changes of policy, indecision. If my noble friend Lord Woolton will ask some of his former business associates who have to do with Government Departments, he will find that these complaints are widespread among men who are trying to help with the greatest public spirit and the greatest patriotism. They still complain of the slowness of Civil Service methods and demand a change. I know it is a very difficult problem to deal with, but I make these suggestions to my noble friend because I know he rightly has very great influence in the Government.
5.25 p.m.
THE SECRETARY OF STATE FOR DOMINION AFFAIRS (VISCOUNT CALDECOTE): My Lords, perhaps you will allow me to make a few observations with regard to some matters which have been raised in this debate. With reference to the question put by the noble Lord, Lord Sempill, as to changes of design, I cannot speak and my noble friend Lord Woolton could not speak with direct

1063
authority, but I understand that substantially the same rules apply to aircraft as to other forms of equipment. With regard to the Colt machine gun, large quantities of these weapons are on order and it is hoped they will be supplied without much delay.
The noble Lord, Lord Strabolgi, made reference to the position of civil servants, and he made some suggestions which would lead me very far afield if I attempted to discuss them now. I refer to them only because—I may be mistaken—they seem to be pointed at the same subject to which the noble Lord, Lord Addison, referred when he said—I need not use his colloquialism—that his anger was aroused by a homily addressed to your Lordships by my noble friend Lord Woolton in reply to the statement made by my noble friend Lord Barnby on July 11, as to the responsibility for what was done or not done. I think my noble friend Lord Woolton was fully entitled to make the observation he did that Ministers must bear ultimate responsibility. So far as a particular civil servant is concerned, to whom I think the noble Lord opposite referred, there is no civil servant in the whole of the Civil Service who is less open to criticism so far as supply is concerned, than the particular civil servant mentioned. The Minister of Supply, my right honourable friend Mr. Morrison, is the last Minister in the world to allow a civil servant to occupy a position in connection with supply for which he is not fitted.
Sir Arthur Robinson agreed to serve as Chairman of the Supply Board at a time when his long service entitled him to greater leisure than he has enjoyed for some years. The noble Lord, Lord Addison, is really wrong, if he will allow me to say so, when he speaks of the Supply Board as an executive body. It is a Sub-Committee of the Committee of Imperial Defence. It brought together representatives of the Departments who conveyed the directions of the Committee of Imperial Defence to the Supply Board, whose duty it then was to estimate and prepare for the programme for which the Minister was responsible. I am sure that the noble Lord, on reflection, will realise that the Chairman of the Supply Board cannot be charged with lack of energy in the arrangements he made to provide for the programme in peace which would be
1064
necessary to maintain the Forces in war which the Minister contemplated. I do not want to go further in detail into the question. I know that the noble Lord, who is generous and always fair, will not desire that a great civil servant should be exposed to criticism in debate in this House without Ministers accepting the responsibility they must bear for the acts or defaults—though in this case there are no defaults—of civil servants.
I am sure every one of your Lordships have been gratified to think that the statement of my noble friend Lord Woolton has given satisfaction on the Benches opposite and to my noble friend Lord Barnby. They may rest assured that the fact that the statement was not made last time was not because the steps he has described had not been taken. The rearrangements in the United States and Canada had been decided upon and taken before the debate on July 11. It is a great satisfaction to all of us to feel that Lord Woolton has been able to make a statement which is accepted, on this occasion at any rate, as thoroughly satisfactory.
5.29 p.m.
LORD ADDISON: My Lords, may I before the debate closes make a personal statement with regard to what the noble Viscount has said about my remarks regarding a civil servant? It was Sir Arthur Robinson I had in mind, although I refrained from mentioning his name. In my opinion, I repeat, it was wrong to place a civil servant in that position. That is my judgment and experience. I said that then, and I say it now, without any reflection whatever—and I hope the noble Viscount will acquit me of any other desire to make any—upon Sir Arthur Robinson himself, with whose competence I am well acquainted, and I entirely agree with what the noble Viscount said about him. I do hope, therefore, that I may be allowed to associate myself finally with the noble Viscount in explaining that I was making no reflection upon this gentleman himself but only upon those who appointed him to the position. As to what the noble Viscount said on the method of dealing with this matter, I have not altered my opinion.
VISCOUNT CALDECOTE: I am glad to hear what the noble Lord, Lord Addison,

1065
has said, but the responsibility for appointing Sir Arthur Robinson was not Sir Arthur Robinson's responsibility!
Motion for Papers, by leave, withdrawn.

BUSINESS OF THE HOUSE.
LORD ADDISON: My Lords, I beg to ask the noble Viscount whether he can tell us anything about the business for next week.
VISCOUNT CALDECOTE: My Lords, on Tuesday, July 23, the House will complete the consideration of the Merchant Shipping (Salvage) Hill and the Unemployment Insurance Bill. Lord Marley is asking a question on the scheme for the evacuation of children overseas and is moving for Papers. On Wednesday, July 24, it is proposed to hold the postponed debate on foreign policy on the Motion of the noble Lord, Lord Addison. As your Lordships have expressed a general approval of the suggestion that the debate should be held in Secret Session——
LORD ADDISON: No, no. Perhaps we could discuss that later.
VISCOUNT CALDECOTE: I understood there was a general assent to the suggestion of the noble Viscount, Lord Samuel, that the debate should be held in Secret Session.
LORD ADDISON: No.
VISCOUNT CALDECOTE: As that appeared to be the general desire of your Lordships——
SEVERAL NOBLE LORDS: Hear, hear.
VISCOUNT CALDECOTE:—I thought it was agreed that arrangements should be made accordingly. We may expect to receive the Emergency Powers (Defence) (No. 2) Bill from another place that afternoon, and on Thursday, July 25, it is proposed to take all stages of that Bill, which will be followed by a
1066
Royal Commission. The House will meet on Tuesday and Thursday at four o'clock, and I propose to ask my noble and learned friend on the Woolsack if he will make arrangements for your Lordships to meet on Wednesday at three o'clock.