COLONIAL ECONOMIC POLICY.

HL Deb 06 August 1941 vol 119 cc1097-123

LORD NOEL-BUXTON rose to ask His Majesty's Government whether the Committee appointed to prepare the ground for decisions on Colonial economic policy, as announced by the Secretary of State for the Colonies on July 9, will be instructed (1) to consider the problem of poverty arising from the low prices of primary products in the Colonies; (2) to inquire into the available means of improving those prices, by reduction in the cost of processing or by marketing organisation or by other methods; and to move for Papers.

The noble lord said: My Lords, I am asking this question because of the very important announcement made by the Colonial Secretary in a recent debate on Colonial affairs, when he told us that he had appointed a Committee under the Chairmanship of Lord Hailey to prepare the ground for decisions on planning of Colonial economics after the war. I want to welcome that announcement, and also to welcome the marked interest shown by the Colonial Secretary and Leader of the House upon questions of the economics. It seemed to me that the appointment of the Committee was so important that it suggested some further debate should take place in your Lordships' House, and I want spec ally to urge that the Committee should be authorised to attend to one aspect of economic conditions—namely, the extreme poverty which arises from low prices received by the producer. The Colonial Secretary alluded to the terrible problem, as he called it, of malnutrition, and said that in a circular he had urged the Governors of Colonies to promote a higher standard of living wherever possible. I suggest that the Committee should inquire into this very special feature connected with the low prices received by the producer compared with the price paid by the consumer in so many cases. I refrain from burdening your Lordships with figures on this point because the general fact is familiar to us. It is conspicuous in regard to sugar and cocoa.

The great disparity suggests inquiry particularly, I think, into the possibility of bettering the condition of the producer by better methods of processing. There is also the question of the locality of processing. There has been a natural tendency to concentrate processing in this country in regard to many products, but there may be cases where processing could be advantageously promoted in the country of origin. Then there is the question of marketing. Marketing organisation has become a great feature of Dominion agriculture, and was extending in Europe also before the war. I was very glad to notice that the noble Lord, Lord Hailey, in his speech in a recent debate spoke of marketing as part of the problem of Colonial poverty. He made interesting reflections on the four stages which characterise Colonial development, and he spoke of the second stage, the economic stage, as necessarily preceding that of Social Service development. There is a great new-interest in Social Services in the Colonies. It is represented by the recent Colonial Development Act. We are now concerned with the question of backwardness in the Colonies. Everyone accepts the principle of trusteeship, which has grown into prominence in the last two or three decades.

Social improvement presupposes an adequate economic standard, and by common admission we have not yet achieved a standard which really ought to precede the Social Service period—the third period in Lord Hailey's category. The main cause of backwardness is unquestionably poverty, and the main cause of poverty is low prices, whether in industry or agriculture. We are familiar with the extent to which it applies to sugar, cocoa, palm oil, nuts, coconuts, ground nuts and so on, the characteristic products of the Tropics. Till prices are better, Social Services are only in the nature of a palliative. A prominent side of Social Services in the Colonies is provided by the Medical Services. Medical needs arc abnormally great because of poverty. Till the spending power of the Colonial populations is increased, the revenue generally derived from import duties is not enough for Social Services; therefore we have adopted the general policy of contributions from the Imperial Exchequer. But among fifty Colonies the share of each cannot be very great. In war-time some Colonies are even cutting down what they had been planning and doing in regard to Social Services. In these days we must all feel that the extreme loyalty and generosity to us of so many Colonies form an added incentive for the policy of promoting betterment.

What are the facts of poverty to which the Colonial Secretary has alluded? Let me give two or three illustrations. Not long ago, the Governor of Nigeria estimated that the monthly income, indicated in values of English money, of a family in Nigeria, was not more than 8s. Nigeria is a very large section of the Colonial world. The more than 20,000,000 people in Nigeria form a great section of the sixty odd million people who inhabit the Colonies as a whole. Conditions are not strikingly different in Malaya, in Fiji, in Ceylon and many other Colonies. In the West Indies, the average income is somewhat higher, but there it is compensated because the prices paid for food and goods are higher on account of their being mainly imported. The Governor of British Honduras said lately that poverty was so increasing that the cost of poor relief in the coming year would be doubled. That no doubt is largely a war feature, but we are not dealing with a war problem only. It is a chronic problem. Everyone is proud in these days of the trusteeship which in great measure has animated Imperial policy, but we must face the facts. The noble Lord, the Leader of the House, has faced them in many recent statements and we are grateful for the lead he has given. Nobody can charge the British Empire with less concern for the welfare of tropical populations than that shown by other Empires. It is a problem for all the States which govern tropical countries.

What are the main effects of this "terrible problem," as it has been called? I take only two results of poverty. One is the inefficiency of labour, and on that I will quote briefly from the Report of the Committee on Nutrition in the Colonial Empire of which the noble Earl, Lord De La Warr, was Chairman and which reported in July, 1939. The Report is a mine of information on these subjects. The Committee, in its conclusions, said: If it were possible to remove all traces of malnutrition in the Colonial Empire there would be an immense gain in physical health, in mental alertness and material welfare. And again: The effects of malnutrition are seen in inefficiency of labour, in industry and in agriculture. I am very anxious not to exaggerate. I prefer to understate the case. But we cannot ignore the effect of this underfeeding on the health of tropical populations, especially in Africa, which forms such a preponderant item in the Colonial world for which we are responsible. Every writer on Africa is compelled to describe ill-health as a deplorable feature of African life.

Let me illustrate by only two or three of the features of this phenomenon. The Committee on Nutrition said that malnutrition is one of the chief factors in causing infant mortality. The rates per thousand are remarkable. The English rate is 59 per thousand. In Nigeria, a recent figure was 300, in Northern Uganda it was 350, and in Kenya it was 400. If we visualise what this means in human life, such figures leave us almost speechless. There is another example of the ill-health resulting from malnutrition in Africa. The disease known as hookworm, of which any of us who have travelled in Africa must have seen a good deal, comes from bare feet, and poverty is the cause because shoes cost money. The Kenya Government lately examined 52,000 cases taken at random; 94 per cent. of them were infected with this horrible disease. It is absolutely preventable by the wearing of shoes, but the average native cannot afford shoes. It has been very well said that "two square meals a day and two pairs of shoes a year are the African's prime need."

I take one more example of the urgency of a better standard of life—that of leprosy. It has been ascertained that that is definitely associated with poverty. The belt from Nigeria to Abyssinia is the most affected part of the world. In Nigeria, in a population of rather over 20,000,000, it has been variously estimated that the number of persons affected with leprosy is anything from 800,000 to 1,500,000. The last figure that I have been able to obtain of cases treated is that of 1935. In that year only 5,116 were under treatment. These facts are only part of the picture of malnutrition and its results. I think one may say that if the cheap products that we enjoy here mean disease even in part—if that is the price of cheap goods, the British public would gladly avoid the paying of it, even at a sacrifice. J. have certainly not exaggerated the picture of ill-health in the tropics, particularly in Africa. A more lurid picture is drawn by all the best authorities in their writings or Africa.

As to proposals other than debatable questions of quotas and tariffs, they are reviewed by the Committee on Nutrition. They include wage regulation, education in better management, subsistence crops—alluded to by the noble Lord the Leader of the House in his speech the other day—and storage against famine. I want to ask that the Hailey Committee should very specially inquire into the disparity of prices and the means of raising prices to the producer, particularly in regard to processing or to market organisation. Of course, one must recognise that this is not a native question only; it is a British question as well and the two interests must harmonise. They coincide in one interesting respect arising from the war; they coincide in that after the war the Colonial market will have an ever-increasing importance for us because the Colonies are part of the sterling group. It is a world question, too. The States which govern the Tropics are trustees for other trading States who are not so fortunate as to control any section of the Tropics. It is a vast and complicated question that we are dealing with and I would conclude by urging that the paramount aim in view must be the. I beg to move for papers.

LORD HAILEY

My Lords, the noble Lord, Lord Noel-Buxton, had the kindness to give me notice of his Motion today, because the question is connected with the work of the Committee to which the noble Lord, Lord Moyne, referred in a recent debate on Colonial affairs. If I may, I would return his courtesy by thanking him for giving us the opportunity of discussing this highly important question. I should like to think that he has given the Secretary of State the opportunity of making another of those lucid, informative and well-considered statements on Colonial policy of the type he gave us recently in this House. I fully appreciate the great sympathy with which Lord Noel-Buxton has approached this question. I feel with him that there are urgent and insistent questions of poverty in the Colonial Empire. But the points that he has raised, as a matter of fact, go further than merely this question of poverty. Poverty there is; ill-health there is, in spite of all that we have done, and we have done an immense deal in improving the condition of the Colonies and particularly the condition of Africa since our occupation.

Poverty is not universal. There are some areas of Africa where the standards of living, certainly as compared with those of the East, are relatively high. But there are parts where disease is rife, and people are living in a state of semi-starvation. But it must not be assumed that this is connected entirely with the question of prices of exportable goods. Lord Noel-Buxton said, if I have his words correctly, that, if poverty is the price of our obtaining cheap goods in Great Britain, we would willingly sacrifice cheap goods, and I think we should, but there is a vast area of production which is not concerned with exportable goods at all, and we have to realize that the whole question goes far beyond the issue of raising the price of goods which are exported or utilized in manufacture. Still, this question is of wide range and immense importance. As Lord Noel-Buxton has said, it does raise the whole issue of whether we can now ever hope to raise standards of living in the Colonies, I will not say to European standards, but to something more approximate to standards that we should like to see. It does raise the whole question of whether we can so improve the material conditions in the Colonies that they themselves can provide the means for improving their Social Services, which, as Lord Noel-Buxton has admitted, must be a preliminary to extending their political liberties or their advance in self-governing institutions.

I am not anxious to anticipate anything which the noble Lord, Lord Moyne, may have to say as to the functions of our Committee. Particularly, I do not desire to anticipate anything he may have to say as regards the fundamental principles which regulate this vast question of the price economy of the Colonies. It is true that the relatively inferior position—the position referred to in the first part of Lord Noel-Buxton's Motion—of the producers of primary products as compared with the position of producers of manufactured products, the industrialists, has been a matter of concern for many years. I think, perhaps, it was first brought into prominence by the great crisis of 1929–31. Indeed, it seems to need these periods of depression in order to remind the world of the relative situation of its industrial and agricultural producers. These depressions have the effect of causing a far more spectacular fall in the prices of primary products than in the prices of manufactured goods. I think it was calculated recently that in the depression of 1929–31 the fall in the prices of the raw materials of industry in Germany was 59 per cent. while the fall in the prices of manufactured articles was only 29 per cent. It is on such occasions that the world begins to recall the fact that 70 per cent. of the whole population of the world, roughly speaking, is engaged in the production of primary materials. A sudden depression of that kind not only makes an immediate attack on their standards of life, but also, of course, has its own reaction in the fact that they, themselves, must be the chief consumers of manufactured articles.

What is the fundamental problem which study of these factors seems to bring to light? Is the fundamental problem this: that we have to endeavour to level the incidence of these periods of depression over the producers of primary products and of manufactured goods respectively? Or is the problem this: that modem economic developments—as indeed was suggested in Lord Noel-Buxton's question—even in normal times do leave the producers of primary materials or the agriculturists in a permanently inferior position? If the former is the case, if it is merely a case of levelling out the periods of depression, then the remedy lies in stabilization, in a process of valorisation as it is called on the Continent, or in the control of production by international agreement. At once the questions assume a very wide aspect—one which, perhaps, the Secretary of State will say goes beyond the sphere of the work of the Committee of which I am in charge. This process of control of production by international agreement and the like are now in full force; undoubtedly they must continue after the war. They have their limitations so far as purely Colonial goods are concerned. There is a wide range of Colonial products which is very difficult to bring under any scheme of international control. That is perhaps a question that should be left for treatment by the Secretary of State when he addresses us in reply to the question.

As regards the latter of the two problems that I have mentioned, that, I think, is the really foundamental issue. Suppose that the producers of primary materials, the large body of Colonial producers, are in a position of permanent inferiority in comparison with the producers of manufactured goods. 1 cannot range over the whole field of that question. It is interesting to recall that that was the theme put forward by Dr. Dolfuss when he placed before the world the case of Austria in 1931. Indeed there are many figures which go to show—so far as figures can prove facts of that nature—that the incomes of agriculturists and the producers of primary materials all over the world are markedly less than the incomes of producers of manufactured goods. If we are to accept this fact, does it mean to say that the peoples of our Colonies must have a standard of living that is permanently lower than that of the industrialist peoples? It is difficult to suggest here any final remedy for a situation of that character, but perhaps the only real economic remedy for it would be the creation of an economic unit so large—such as the British Empire itself—that it might be able to regulate the whole of economic life, including industry and agriculture, in such a way that it would be able to give an equal opportunity for improving the standards of life of the agriculturist or the producer of primary materials and the industrialist. I am not overlooking the other serious aspects of the German New Order or its vulnerability, but it was the offer of an economic unity of that type which has proved the chief attraction to many people in South-Eastern Europe.

However, it will probably be agreed that the reconstruction of the whole of the British Empire on an economic basis of that type, the creation of a ring fence of that nature and a closed economy of that character, is too idealistic and too far off for us to consider at the moment. Meanwhile, we can undoubtedly do much for the producers of primary goods in the Colonies by endeavouring to establish some kind of economic balance within the larger Colonial units themselves, by encouraging secondary industries. That is a question which, I think I may say with justice, has been largely neglected so far as the British Colonies are concerned. I do not say that the neglect of the promotion of secondary industries in the Colonies has been done purposely, in the interests of British manufacturers. It is quite clear that there is a wide field for the promotion of secondary industries in the Colonies which would not touch the British manufacturer at all. There is a large field which would not interfere with our trade, and a large field which would not necessarily injure the importing firms. It is that field which I think we must now endeavour to cultivate.

Secondly, much could be done by the improvement of purely internal trade, by giving people better communications, by extending means of marketing, and by better means of building up credit facilities which help the small trader to establish his business. Much could be done also, as the noble Lord, Lord Noel-Buxton, has said, by the promotion of processing in the Colonies themselves. That is a second means by which we can improve the situation; but most of all, perhaps, we can improve the situation by a betterment of subsistence production itself. Many of these areas are not on a cash economy at all; many of them have no exportable goods and live entirely on a subsistence economy. The study of modern economics is not merely the study of wealth; it is the study of welfare. Colonial economics should also be a study not of wealth but of welfare. In the promotion of welfare, better nutrition, better health, better housing and better education are all factor just as important as the provision of greater opportunities for obtaining consumable goods. It is therefore on that third element which I have mentioned, the improvement of all means of subsistence production, that I think our attention must in the first place concentrate.

VISCOUNT BLEDISLOE

My Lords, I cannot help wondering whether there is not a fundamental question which should be put forward for solution even before those which have been submitted to your Lordships by my noble friend Lord Noel-Buxton. It was adverted to in the last few sentences of the speech of the noble Lord, Lord Hailey. It is whether the right solution in the main is not for the natives of these Colonies and Protectorates—and this particularly applies to Central and South-Central Africa—to cultivate their land in such a way that it will produce a preponderance of essential foods for the native population. To my mind, it is not so much a question of the low prices of primary produce which is important, but a larger production of those products by the natives themselves. We all know that over a large area of Central and South-Central Africa, "shifting cultivation" is going on, with serious soil exhaustion and no attempt to provide a rotational cropping by providing, for instance, a leguminous crop as an alternative to the maize crop. The land thus becomes terribly exhausted, and the natives naturally want to move to a long distance away to find other land to exhaust, in order to provide the essential foods to save themselves from starvation. Moreover, owing to what my noble friend opposite calls under-feeding—I should prefer to call it malnutrition, because many of them do not suffer from insufficient food, but from a badly-balanced or unbalanced ration—they look to the Government for help, and all the time they become more and more susceptible to the various diseases which are undermining the physical condition of the bulk of the natives of Africa to-day.

When my Royal Commission two years ago visited the two Rhodesias and Nyasaland, we found that no less than 80 per cent. of the whole of the native population was affected by some disease—malaria, or hookworm (to which my noble friend referred), or leprosy, Bilharzia, venereal disease, or perhaps sleeping sickness. In every case we found that that condition was accentuated mainly through susceptibility due to malnutrition, and the malnutrition was due very largely to the incapacity of the ordinary native to cultivate his own land in a suitable manner. I should like the noble Lord, the Secretary of State, in replying to this discussion, to say whether it is not a fact that attention should first be paid, at any rate as regards the natives of Africa, to the proper cultivation of their own land, rather than looking to outside help, and—particularly because it breaks up the tribal system, which is so unfortunate—looking to distant gold mines or mines of other mineral products to provide them with a means of living for themselves and their families. I cannot tell you how immensely impressed I was, on that long and strenuous tour which my Royal Commission took, at the absolute destitution of knowledge on the part of the whole native population as to how to make the best use of their own land.

LORD HUTCHISON OF MONTROSE

My Lords, I want to add only one or two words on this very important subject. I am sure we all extend our sympathy to those who are engaged on this Committee studying the question of Colonial economic policy. To my mind it is largely a question of prices. We shall undoubtedly, after the war, come down to the question of how our own agriculture is to be made a paying proposition. Then you have the industrialists who in this country were pressed to export goods to foreign countries and to our Colonies and Dominions, Argentine and other countries. An immediate question arises: how are you going to pay for those products? It can only be done by buying products which. those countries produce. Then comes the question of how much you are going to produce at home and how much you are going to buy from overseas. You have got into an extremely difficult position and you will get into a more difficult position after the war. I think this question of prices is vital, and unless the Committee can evolve some method by which fair prices are paid for commodities, whether they come from this country or abroad, then you have failed in your object, in what you want to do, which is to improve the conditions of the people producing those products.

I think perhaps the Government have not done all they might in war-time. They have become a monopoly buyer in many cases. Markets in Europe have disappeared; they are the only buyers of various commodities. I can speak with knowledge of certainly one commodity, that is copra, produced in Malaya, Ceylon and other countries, of which the Government are the only buyers. The result has been that they have depressed prices. I think they have acted quite wrongly in the matter, and instead of paying a price corresponding to even what was paid immediately before the war, they have depressed the price, with the result that those poor unfortunate people producing coconuts are losing more and more money every year. The result is that estates are getting into worse and worse cultivation and ultimately will have to close down. I venture to suggest to the Government that in fairness to those countries which produce various commodities, they ought not to act in that manner. I will take the instance of cocoa in the Gold Coast. Those countries producing commodities ought to be paid a fair price for their commodities and not beaten down simply because the Government happen to be a monopoly market. If you take the price the consumer in this country is paying for the results of those commodities after manufacture, I think there is reason for saying the Government might consider their policy in relation to those prices and do something to alleviate the distress which some of our Colonies are suffering under to-day.

LORD FARINGDON

My Lords, you will appreciate brevity and will not make the mistake of supposing that if I am very brief it is from any lack of appreciation of the importance of the subject we are discussing to-day. I have already sent a note to the noble Lord who will reply for the Government, indicating the subjects which I am going to raise, and I shall therefore speak on them very briefly at the present moment. It does seem to me that, although the war must produce economic crises in so many of our Colonies, in most of those Colonies the crisis produced has really only been an exaggeration of ills which were already in embryo, or even in some cases already fairly far developed in the industries of those Colonies before the war, and likely to become more severe after the war. It is possible, therefore, that the war may be a disguised blessing, a very well disguised blessing no doubt, but none the less it may force upon the Colonial Office and upon the Governments of the Colonies a policy which otherwise in peace-time they would have been much slower to adopt. It is my intention to suggest some of the lines which it seems to me that policy should follow.

Primarily, it is, of course, evident, and has been shown to be evident in times o slump, that all our Colonies are far to dependent upon the export market. I has been suggested that whereas self-sup porting agriculture tends to conserve and even improve the soil, export agriculture inevitably impoverishes it and leads to soil erosion. Of course it is equally perfectly conceivable that an export crop could be grown in rotation with other export crops, and so the richness of the soil could Le conserved. In growing for export there is always nowadays a failure to make the necessary rotation of growth which has produced this situation in which it would appear that export crops do impoverish the soil. It is, however, one of the results of the war that these export crops have ceased to be marketable, and it is one of these disguised blessings to which I have referred that Governments are now compelled to undertake and to encourage production for home consumption in the form of agriculture which will have some effect, at any rate, in preserving the fertility of the soil. Do not let the Governments suppose for one instance that these measures alone will be sufficient. Far more strenuous and far-reaching measures are required to deal with that situation.

I would like to touch briefly on the situation in one or two Colonies. I cannot resist one short reference to that Cinderella of our Colonial Empire, British Guiana. British Guiana has been British for a century and a quarter. I am afraid conditions in that Colony are no credit to British rule. It is difficult to say why this particular Colony should have remained such a backwater and so completely fail to be developed. Out of an area of 90,000 square miles, 198 only are cultivated, an almost unbelievable percentage, even allowing for uncultivable areas. There have been extensive Commissions of Inquiry into the situation. There was one in 1897, and another one in 1927. Both those Commissions came to a similar conclusion. They both found the Government, the whole organisation and the whole economy of the Colony controlled by the sugar interest. The Commission of 1927 said that this Colony was a plutocracy, or a government of sugar, by sugar, for sugar.

The bottom has gone out of the sugar market for a variety of reasons and alternative crops have got to be found. An alternative crop has, to some extent, been developed in British Guiana, the rice crop, but British Guiana rice compares unfavourably with the rice produced in other countries, and I understand the reason is to be found in indifferent, old-fashioned milling facilities. There have been suggestions that a good modern mill should be established in the Colony, and I believe such a scheme was in fact adopted by His Majesty's Government at one moment. It seems now to have been shelved owing to the difficulty of obtaining the metal for machinery in this country. It is true at the present moment that, because rice cannot be imported from other parts of the world owing to lack of shipping, British Guiana rice can be sold. This, however, is a condition which cannot continue after the war, and I hope that the Minister may perhaps tell us that, even though it is necessary to hold up the construction of new rice mills in British Guiana for the present, even though he cannot tell us that the necessary dollar exchange will be released to buy this milling machinery in the United States, he will tell us at least that further milling facilities for Guiana rice is the adopted policy of His Majesty's Government and will be put into force at the earliest possible opportunity.

In Jamaica there is also a rice problem. Jamaica imports £250,000 worth of rice annually. This rice, all of it, could be grown in Jamaica. There is suitable soil, there are experienced workmen, in Jamaica. The Food Production Board in Jamaica, which has, I understand, a most able chairman in Mr. Williams, for whose services the Colony is indebted to the West Indies Banana Growers Company, which pays his salary, has produced a scheme for the production of rice. It obtained, through the generosity of the West Indies Sugar Company, 2,000 acres, and another 4,000 from other landowners. The necessary men to work this area were forthcoming, experienced men. All that was required was—in a number of cases not in the whole number—loans of about £5 per family. Three thousand families were to have been settled on this area, and even had loans been required in respect of all of them, it would have needed only £15,000—not a very considerable sum for the establishment of a new industry and the absorption of a large number of unemployed. The scheme has been dropped. The money, it appears, was not forthcoming, and nothing apparently is being done. I hope that the Secretary of State will be able to tell us that rice production in Jamaica is one of the schemes which the Colonial Development Fund will be used to finance. Wheat growing in Jamaica was also a scheme of the Food Production Board. I understand that, in its first year's working, it showed quite remarkable results, but it, too, owing apparently to pressure in the Legislature, has been dropped. I should be interested if the noble Lord—I confess I did not give him notice of this—can possibly tell me whether this scheme is to be continued.

The noble Lord, Lord Hutchison, has already referred to the case of cocoa. Cocoa is one of the cases to which I have referred as having a pre-war history, and no doubt will have a post-war history. Its position has been intensified by war conditions, but it is not in itself a new problem. The trouble with the Gold Coast cocoa seems to have been the excessive ease with which it can be cultivated, and the amazing results which, without adequate care, and without experienced and careful cultivation, could be obtained from that Colony. The result has been a very low standard of cultivation in the Gold Coast with none of the care, manuring, pruning, pest control, and the proper provision of shade which has been undertaken in other cocoa-producing countries. Despite this, British West Africa as a whole is the producer of about half the world's cocoa. The price which has been paid for this incompetence, or perhaps for this excessive ease of production, has been the low quality of the cocoa production, as shown in the price of 27s. 3d. per cwt., as opposed to 70s. 8d. for cocoa from Venezuela. This has to some extent been improved by the compulsory grading enforced by the Agricultural Department, and the Agricultural Department deserves full credit for this. There is another point here, and it is a point which was remarked upon by the Cocoa Commission, whose Report is, after all, the Bible of all who are interested in the cocoa problem of West Africa. The Commission remarked on the complete lack of education amongst the growers, and the complete lack of any attempt to educate them. The Commission said, rather sardonically, that they presumed there must be some reason for this lack of education. I am afraid there is no reason except lack of enterprise on the part of those who should have supplied the education.

The trouble with the cocoa crop is apparently, in the first place, the fault of the growers, their failure to cultivate the crop as they should, the fact that it is cultivated on such small farms that the crop is picked in one lot, some over-ripe and some under-ripe. But that is only part of the trouble. The rest of the trouble seems to lie in the fact that the crop is bought by a very limited number of firms, thirteen in all, one of whom takes one-half of the whole crop. As a consequence, these firms were in a position to monopolize and control the buying of the total crop. The result was that when they tried to fix a price for cocoa in 1937–38 there was a hold-up on the part of the growers, and a Commission was sent out to deal with the matter. They reported in stinging terms on the activities of the shippers, but in justice to the shippers it should be said that they themselves are forced to pay considerably higher prices, owing to the extremely complicated and redundant system of middlemen existing in the Gold Coast, than they would have to pay if these middlemen could be cut out. I suggest that it is the business of the Government and the Colonial Office, through the local Government, to take the necessary steps to help in the marketing of cocoa so that these middlemen may be cut out.

To show your Lordships how much Is absorbed by this inefficient marketing, it is only necessary to mention—Lord Hutchison remarked on the difference in price paid to the producer and the price paid by the consumer—that, in the case of West African cocoa, the cocoa in this country is bought at Is. 7d. per pound while the producer receives I.4d. Even with due regard to processing expenses, shipping expenses, and insurance, that is surely an excessive margin between the two prices. The activities of the Cocoa Control Board are, like the curate's egg, good and bad. It is a system which I hope will continue, the system of control, quotas, and marketing en masse, but unfortunately, the Control Board seems to put into operation exactly the reverse system of that recommended by the Cocoa Commission. The Cocoa Commission recommended that more control of their own marketing should be undertaken by the producers, but the Control Board seems to have put the control of the cocoa industry into the hands of the shippers and the Colonial Office, which came in for most of the criticisms from the Commission.

As I warned the noble Lord I should, I would like to make just short mention of the position of the citrus industry in Palestine. His Majesty's Government have, on the whole, shown signs, at any rate, of considerable; generosity to the Colonial Empire in its difficulties. It has, as I have said, already bought up the cocoa crop, at perhaps an inadequate price, but still it has saved the situation for the cocoa producers. It has subsidized the banana producers, and it promised help to the citrus growers. I think the form of assistance which has been extended to the citrus growers is considerably less than generous. It has taken the form of guaranteeing loans to citrus growers from the bank. When your Lordships consider that for loans the banks have been allowed to charge an interest of 6 per cent. and that the loan has been guaranteed by the Government, I think you will agree that the citrus growers have hardly received a very generous deal. I hope the noble Lord may be able to tell us that the citrus growers will perhaps receive as generous treatment as the banana growers of the West Indies.

In passing I cannot resist a short reference to Malaya. That is one of the fortunate Colonies whose produce is essential to war production, and there prices therefore have been maintained. But Malaya has also been the scene recently of strikes, in which life has been lost, and I cannot think that the reply given by the Government spokesman was satisfactory when he stated that there was no economic foundation for these strikes, which he said were merely fomented by agitators. Your Lordships will, I feel, agree, when I say that the average wage of the Malaya worker is between Is. and Is. 6d. a day, that such a wage does seem to give some economic ground for a strike. Particularly it should be remembered that trades union legislation in Malaya is far from satisfactory. Peaceful picketing, for example, is forbidden. On the other hand, Income Tax in Malaya—I am afraid this will make some of your Lordships' mouths water—is at two per cent. It begins at £560 a year, and at £2,330 it rises to the enormous figure of eight per cent. That is perhaps another side of the picture from that which shows the workers receiving from Is. to Is. 6d. a day.

I would like to press upon the Government that it is desirable throughout the Colonies to take measures—and measures which can be taken now because they entail only a small number of personnel—for the improvement of the methods of production, for the improvement of marketing probably through the encouragement of co-operative effort, and for the co-ordination of marketing within the Empire. We have the spectacle of different parts of the Empire competing one with the other, and also competing with places beyond the Empire. I was very much pleased with the remarks on international co-operation which the noble Lord made when last he spoke on the subject in your Lordships' House. Encouragement for the home market is another matter to be attempted. In this connection I do hope that the Customs revenue which is collected from the imported foodstuffs will not be allowed to stand in the way—as it is suspected that it is standing in the way of, for example, production in Jamaica—of greater development of production for the home market. Subsidization of war-afflicted industries has been generously undertaken by His Majesty's Government already. I hope that will continue and in certain cases be extended. Finally, I would like to press upon the Government the need for soil conservation, and everything that goes with it. This I believe to be the basis of all hope for the future in the Colonies.

THE SECRETARY OF STATE FOR THE COLONIES (LORD MOYNE)

My Lords, I am sure the House will have welcomed such very interesting speeches on this subject of Colonial poverty and standards of life. None of those who, like Lord Hailey and myself, have been from time to time engaged in inquiries into native conditions throughout the Colonial Empire, can for one moment overlook the compelling importance of the subject, and I confess that from my own point of view it remains in my mind after many Colonial journeys as the first and most urgent problem that cries for solution. The tradition that Colonies are places of great wealth to be exploited for their own profit by Imperial Powers dates from conditions which are now long past when the East and West Indies had a virtual monopoly of tropical produce. Those days no longer exist anywhere, and the African Colonies which were not developed in the days of large profits from the plantation industry have never taken any part in that form of Colonial enterprise. In recent years the public conscience has, I think, shown a growing recognition of our responsibility to the backward populations for whom we are trustees. It has realised that it is not enough for us to give the Colonies peace and a settled Government and to leave them to find their own paths to salvation, but that we must provide leadership and financial aid to develop the resources of the Empire on which alone the welfare of its peoples can be built up. The problem is one of very great complexity, and it has to be attacked from many sides.

Lord Noel-Buxton's Motion raises one aspect of this poverty problem which is certainly of the very first importance. He wishes us to ensure good prices for the primary products on which the external trade of the Colonies must depend. I certainly look to the researches of Lord Hailey's Committee not only to examine the bearing of low export prices on Colonial peoples, but also to get together the necessary information on which a better condition may be founded. The Committee's examination, however, can only cover a part of the ground as the price of primary products is not merely a Colonial question. Lord Noel-Buxton said, and I am sure said truly, that the British public would gladly pay more for their articles of consumption if thereby they could relieve the poverty of Africa. But very many of the products upon which native standards of life depend are not dependant on our market for the fixing of a fair price, for these products are sold in the world market and are subject to world prices. The case of cocoa to which the noble Lord alluded is an instance in point. The British Empire consumption of cocoa is, I think, only about one-third of the Empire production, so that nothing we can do in isolation is going to secure satisfactory prices for the cocoa producers, and we shall have to go on to a wider basis than that of organisation for British Colonies alone.

There are very few commodities of which the Colonies produce more than a small proportion of the world supply. I can assure noble Lords that this question is very much in the minds not only of the Colonial Office but of those who in other Departments are devoting their thought to the shaping of future organisation.

The House may like me to give them an outline of what seem to be the fundamentals of the problems of primary production in its relation to the welfare of primitive peoples engaged upon it. It has often been said that the primary producer has been sacrificed for many years past to the consumer. Production beyond current world needs has frequently enabled the consumer to buy products below their real cost. The blind haggling of the market has taken no account of whether a decent life has been possible for the primary producer. We are surely justified in strengthening the producer so that he can speak on equal terms with the consumer. And the primary producer suffers not merely from low prices but from fluctuating prices, which of course upset not only industrial arrangements and producers' budgets but also the budgets of the various Governments which depend on those primary industries.

The cause of low prices and of fluctuating prices is of course the maladjustment of supply to demand The remedy is to make the two balance. That is very much easier said than done. In many cases where supply has outrun demand it would obviously be a happy solution if you could increase demand. There is a very large potential demand for various commodities from the many millions throughout the world who are under-nourished, under-clothed and under-housed. To deal with this situation the method has been invented of international regulation of supply. It has already been applied to a great many primary products. The British Empire has led the way because the problem developed most acutely within our area. Other great consuming countries have realised the urgency of this matter and lately there have been discussions taking place in Washington as to a wheat scheme on the widest possible basis. In America also in recent years discussions have taken place preparatory to working out a cotton scheme in the interests of the producers of that crop.

Not all commodities lend themselves to this treatment. The important group of vegetable oils and oilseeds, for instance, covers too many interchangeable commodities produced by too many different individuals in too many different countries to be susceptible to international regulation. But many of the chief commodities of the world such as rubber, tin, tea and sugar are now subject to regulation either under government control or, as copper and diamonds, under the control of the industry concerned. There can be no doubt that these schemes have succeeded in providing a better standard of life for those engaged in production without causing difficulties to the consumer. There is no question of withholding supplies from those who wish to obtain them: the consumer's point of view is normally represented upon the body which controls the arrangements, and if such representation is not adequate, we should always be prepared to consider how the interests of consumers can be more fully safeguarded. No doubt this method has been a stabilizing influence upon the world economic affairs in the last ten years.

But regulation of supply is only one of the ways that have been invented for helping the primary producer. Alternatively, it has sometimes been possible to provide him with a special market, more or less insulated from the general world market. This may be either his own internal market, insulated by geography and often also by tariff protection. Or it may be some insulated market abroad. For instance, before the war both the British and French Colonial banana industries were almost entirely dependent on preferential arrangements within their own Empires. Or the preferential arrangements may take the form of a special quota obtaining in a foreign country. Italian and Spanish orange growers, for instance, have in recent years obtained a certain temporary prosperity by securing quotas in the German market. In times of difficulty, producers are glad to find any market, but these special arrangements should be regarded as a palliative for times of distress and are no substitute for the international adjustment of supply and demand.

The war, while it has more than proved the value of regulation schemes, has rendered preferences and quotas almost out of date, for it has altered not only the direction but the whole nature of international trade. Quality and price are no longer the criteria whether or not goods that are offered will be accepted. Nowadays other considerations are much more important—whether foreign exchange and shipping can be made available; whether it is necessary to purchase the goods in order to prevent the enemy getting them, and so forth. Many indeed of the most vital needs of the British Empire are being supplied from across the Atlantic by an emergency transaction of great generosity quite unlike anything in normal commercial practice, which has got over the difficulties of exchange and finance. In fact, the old-fashioned free international market, already threatened before the war by the growth of quota and barter arrangements, has, since the war began, practically ceased to exist.

I tried to tell your Lordships a week or two ago something of the way in which the Colonies arc faring under war conditions, and the emergency arrangements which have been made, and I will not cover the same ground now. On the whole we may be satisfied that things are not worse than they are. The Colonies have a double advantage. First, they belong to the sterling group, and therefore between them and us no exchange difficulties arise; and secondly, they have behind them the power and willingness of the Home Government to help them out of their tight places. Incidentally, as your Lordships are aware, besides helping the Colonies by buying their goods for immediate consumption we are also storing their goods beyond our immediate requirements to help to meet the post-war needs of Europe. Lord Faringdon referred to various cases where the war had altered marketing arrangements, and he asked for an account of what is happening and of our intentions for the future. He raised the question of cocoa. I did, I think, on a recent occasion give some account of the Cocoa Control Board. It has taken the whole of the West African Cocoa crop for 1939–40 and 1940–41. The marketing of the crops is in the hands of a specially constituted Board and they have been able to sell the greater part of them in the United Kingdom, the United States and other markets which are still open. Cocoa, fortunately, can be stored and there has been no cocoa of reasonably good quality which has been lost under the present system. No doubt these conditions will have to continue for the future, and I hope that the general level of efficiency in producing cocoa will be improved at the same time by the oversight which will be imposed, and by improved marketing.

The noble Lord also asked about citrus. He alluded to the very heavy rates of interest which have been charged by the banks in Palestine. He suggested that the rates were too high in view of the Government guarantee. I will certainly take that matter up, but I do not know that we can necessarily assume that the Jamaica banana crop is to be taken as the financial standard of what is necessary in Palestine. We must see that the citrus industry is kept going, but, of course, we must not spend more money on it than is necessary for that purpose. The noble Lord also referred to problems in British Guiana. I think that a great deal of the distress in that country has been due to the extremely bad soil. The noble Lord gave us the figures of cultivated land and of land which is not cultivated. There have been very conclusive experiences of the disastrous effects of clearing the Wallaba forests and trying to grow rotational crops. The land upon which these forests grow is peculiarly deficient in any mineral ingredients, and when you get above these forest areas on to the Savannahs, as we saw when we flew up to the Rupununi, the herbage is extremely poor. The fact that very much of this country near the rivers is flooded for many months of the year makes any scheme for grass improvement extremely difficult to carry out.

But it happens that the war has improved the position for the rice producers of British Guiana. The Indian population of Trinidad in peace-time were in the habit of importing their rice from India. It may have been that British Guiana rice was not properly milled, but, anyhow, it seemed very uneconomic that, when there was rice being grown so close by, the people of Trinidad had to bring it half way round the world. Well, of course it is not possible for us to justify one Colony, for our convenience, so to speak, giving preference to another Colony against its will, and it is very difficult to see how, in peace-time, the taste of the Indian population in Trinidad is to be weaned from Indian rice or Burmese rice. But for the moment war conditions have helped the British Guiana rice producer, and I hope it will be possible to improve the milling and the processing of the rice which he is now able to send to Trinidad.

The noble Lord asked about the various agricultural proposals which have been made in connection with Jamaica. He mentioned rice and other products. Well, Sir Frank Stockdale, the Controller of Welfare, has the very greatest experience in tropical agriculture and he is going into these possibilities of new crops in the West Indies with very great care. Not only does he hope to deal with crops in Jamaica, but he is considering possibilities of developing the live-stock industries. Up to now, I think quite rightly, he has not felt it possible to send us any definite proposals, and I think it is wise that we should wait a little longer for a fuller consideration of the possibilities. I can only say that we all realize that the prosperity of the West Indies must depend on agriculture. I agree with what the noble Viscount, Lord Bledisloe, said, that it is important that the producer there, perhaps more than anywhere in the Empire, should pay more attention to subsistence crops and not concentrate quite so much on crops for export. Lord Hutchison asked about the price of copra in Malaya and Ceylon. Well, the purchasers of this Malayan and Cingalese copra are the Ministry of Food and I could wish with him that prices were higher. But the reasons for these prices are that they are comparable with the prices of other vegetable oils. It would have a very big effect on the whole price structure of these vegetable oil products if one particular group was singled out for a better price arrangement than was offered elsewhere.

LORD HUTCHISON OF MONTROSE

A monopoly?

LORD MOYNE

Yes, it is under war conditions a monopoly for lack of alternative buyers. Prices are, however, always related to interchangeable products and if the price goes up for copra naturally it will turn people away to other sources of vegetable oils such as rachides and oil nuts. I think that it inevitable.

What is going to happen to the prices of these primary commodities after the war, it is at present impossible to say. For one thing the war introduces daily fresh changes of such magnitude that no one can foresee at all exactly the conditions of things with which we shall have to deal afterwards. It is the declared aim of this country as of the United States to do our best to secure to all nations economic opportunities and resources that will ensure for their peoples freedom from want. That seems to me to imply both decent prices for primary products and a wide international exchange of goods. But it will not be possible to build up again overnight an international price structure even if, under the new conditions, that by itself were sufficient to secure our aim. Many difficulties will have to be overcome before war-time restrictions can be demobilized and freer international trade built up.

The noble Lord, Lord Noel-Buxton, asked whether these problems of poverty would be considered by Lord Hailey's Committee Lord Hailey has since then given us a very interesting view of many of these problems. His Committee have the very widest responsibility for examining all these matters, and I feel sure that they will keep these world-wide problems in mind, and deal especially with their Colonial aspects. The Motion of the noble Lord refers to particular methods of improving prices; he suggests a reduction in the cost of processing, and marketing organisation. Those are matters which I feel sure the Committee will examine. We have a good deal of information about them, and of course the noble Lord, Lord Noel-Buxton, himself had considerable experience of processing and grading when he was at the Ministry of Agriculture, and when these schemes which are now having such a very valuable effect in this country were in their early stages. There is no doubt that in the Colonies, as here, better prices will be secured by proper grading and packing. This method, however, does not really apply much to the large commodities. Such commodities as rubber, for instance, sell themselves, and it is the smaller products, such as arrowroot, and the products of many of the local industries which are found throughout the Empire, which are in most urgent need of this kind of help. It was, indeed, for the purpose of improving the marketing of the smaller products that the Colonial Empire Marketing Board was set up. That is in abeyance during the war, but it can easily be revived afterwards if it is found necessary. I believe that in the case of Kenya a great deal has been achieved in the way of getting better prices by grading, and in certain Colonies a good deal has been done in the way of establishing co-operative marketing. I trust that this movement may take firm root and spread elsewhere.

As noble Lords have pointed out, however, we cannot deal with poverty merely by attention to exports. In certain parts of the Empire, producers have been neglecting the production of subsistence crops, and their standard of life has been depressed by selling export crops in a glutted market and spending the proceeds on imported supplies, which, whether in labour value or nutrition value, is likely to bring about a very bad bargain. It is not only in such extreme cases, where local economy has been built on export trade, that great scope for improvement is to be found in internal trade. The last pre-war figure for the annual value of exports for the 20,000,000 inhabitants of Nigeria was 18s. 10d. per head. Even if you could double this amount, by a rise in value or an increase in volume, it would be a very inadequate basis for an advance in social standards. By comparison with export trade, there is clearly unlimited scope for the increase of wealth by internal exchange. It must necessarily be a slow process and need much instruction and encouragement. We must not attempt to build up elaborate and artificial industries, but we should stimulate the manufacture of simple articles. I could give many instances of how poverty and malnutrition can be tackled by the exchange of such products for meat and other nourishing foodstuffs. The war has naturally given a great stimulus to this movement, as imports must be reduced to the minimum. Last week I attended a meeting of the Colonial Agricultural Council, which discussed a very encouraging review of food production in the Colonies. On the industrial side, there might of course be a tendency to overdo the setting up of new industries, which could not be continued later under peace-time conditions, and which might tend to become white elephants; but the difficulty of importing machinery from abroad at the present time is a safeguard against this danger.

Poverty, ill-health and malnutrition cannot, however, be defeated by economic methods alone. They depend very much on ignorance, and must be fought by educating our Colonial peoples and bringing to their knowledge the results of research devoted to their special problems, so that they are able to use their own opportunities and resources. If one travels among people entirely untouched by civilization—and one can still find them in places like New Guinea—one realizes that the natural standard of life is often one of under-nourishment, sometimes alternating with semi-starvation. Yet even these less civilized races are capable of becoming skilled at husbandry and expert craftsmen if they are only taught how to grow new crops and how to use new tools. It is not therefore necessarily a question of cash income. Our civilization can bring great benefits to the people for whom we are responsible if we can teach the individual either to produce for himself or for his neighbours better food and other necessities, such as good houses and simple furniture. Our Colonial policy must educate the people to look better after themselves and to make better use of their own resources. That is why in the Act which was passed last year, development and welfare were linked together and provision has been made for our welfare grants to help the Colonies on their way to better health and a fuller life.

LORD NOEL-BUXTON

My Lords, I have to thank the noble Lord, the Leader of the House, for his most interesting statement. It has been full of valuable points. This is not the time to comment upon them, but I feel we may rely on what he has stated that the Empire will not be deterred from its civilizing mission even by the greatest war in history. We greatly appreciate the intense interest that he has expressed. I beg to withdraw my Motion.

Motion for Papers, by leave, withdrawn.