Lords Sitting of 15 February 1944

Preamble
The House met, The LORD CHANCELLOR on the Woolsack.

SUPREME COURT OF JUDICATURE (AMENDMENT) BILL.
Order of the Day for the Second Reading read.
THE LORD CHANCELLOR (VISCOUNT SIMON): My Lords, I beg to move the Second Reading of this Bill, which comes to us from the Commons, where it has been pasted by unanimity and without amendment. The object of the Bill, as its title shows, is to regulate and, indeed, to increase the number of puisne Judges of the High Court and to regulate the attachment of such Judges to the several Divisions of that Court. I hope that I may be so fortunate as to receive the general approval of your Lordships' House to the measure. By puisne Judges, of course, is meant High Court Judges, excluding the heads of the Divisions—the Lord Chief Justice or the President of the Probate, Divorce and Admiralty Division, and, of course, the Lords Justices of Appeal.
At this moment there are twenty-six puisne Judges of the High Court distributed among the three Divisions, the King's Bench, the Chancery and the Probate, Divorce and Admiralty Divisions. Without any alteration of the Statute Law, it would be possible to have three more Judges added to the twenty-six. Two of these might be added to the King's Bench Division, upon a Resolution of both Houses of Parliament, if the state of business in that Division was such that it required the addition of those Judges. Another Judge might be added to the Chancery Division—again without any fresh legislation—if the state of business there required it, and in that event there would be no Resolution needed from either House of Parliament, but the consent of the Treasury would be required to the Lord Chancellor's proposal. Your Lordships see, therefore, that although the actual number of puisne Judges is twenty-six, in certain circumstances it might become twenty-nine. The difficulty is that
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the circumstances which mainly require us to get more Judges do not arise at present in the King's Bench Division or in the Chancery Division, but in the Probate, Divorce and Admiralty Division. As is well known, they arise because of the congested state of the divorce lists.
I appointed, some time ago, a Committee which was presided over by Sir Ralph Wedgwood and contained a number of persons skilled either in business or in the law, to report to me what was best to be done in connexion with this most unhappy and regrettable crowd of divorce cases waiting to be tried. The situation is really a very serious one, for I think there are something over 3,000 cases in the list waiting to be tried in the Divorce Courts at this time. The Committee made a unanimous Report, and amongst other things they proposed that contested divorce cases should be capable of being tried on circuit. As things are at present, all contested divorce cases have to be tried in London, unless they are cases in which a poor person is concerned; and of course these are much the longer and more difficult cases. I take the strongest possible view that there ought to be facilities for trying contested divorces cases in the provinces. It seems to me utterly wrong to compel people, who are often of small means, to make the necessary arrangements to come to London to have their domestic tragedy dealt with and disposed of. It is easy enough in the case of the rich, but for poorer people it is often so great a handicap that it prevents them from getting their rights.
In my view there is all the more justification for insisting on this when we consider the character of the dispute. In ordinary cases it arises in the locality where both the parties live. They will have lived there in the same home and in the same town. The evidence in most cases comes from that locality. They consult solicitors who are solicitors in that town. It seems to me a most serious failure in our claim to make justice what it ought to be if we say: "We do not care anything about that; if you want to fight your case you must come to London, and instruct London solicitors and counsel into the bargain, and incur all the extra expenditure of bringing witnesses there." I therefore welcome this Report of my Committee most heartily; and, as I have said, it was unanimous. I want to put it into force.

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Although by an order signed by the Lord Chancellor it could be provided that contested divorce cases should be tried on circuit—because it is not a statutory restriction—no good result would follow if I did make such an order because we have not enough Judges to try the cases. Therefore I have been driven to the conclusion—and I think that it is supported by a very large body of opinion—that we ought to have in the circumstances, and promptly, more Judges to try divorce cases. I may tell your Lordships that in my own view of the matter, if the Treasury approves, there ought to be three more. I have therefore taken the opportunity in this Bill to deal with this matter. I think that it is a bad plan which says that you have to judge of the need of an addition to the Judiciary by waiting until you can prove that in the particular Division of which you are talking there is such a mass of 'arrears as manifestly to justify a new appointment. It is much better to have a proper number of Judges appointed, not after there has been a great accumulation of arrears, but when it is reasonably seen that more Judges are needed in order that justice may be prompt—which is one of its most important features.
I think, too, that as far as that can reasonably be done there is an advantage in taking the view that a High Court Judge is all the better for having as wide an experience as possible. A Judge who goes circuit has all sorts of cases to try. If a divorce Judge went circuit he would, of course, take primarily all the divorce cases, but he might, on occasion, take work coming from other branches of the law just as every High Court Judge going circuit has now to take divorce work. The proposal contained in this Bill is therefore twofold. First of all, I propose that we should increase the full establishment of High Court Judges to 32. At present it is 29. I further propose that we should not increase the number which, as I have said, is now 26 (speaking of puisne Judges alone) save with the approval of the Treasury who will require to be satisfied that the addition is really necessary. I think that that is a better method than requiring on each occasion, as is the case with King's Bench Judges, a Resolution from both Houses of Parliament, because that means that there has
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to be a sufficient degree of arrears accumulated to satisfy Parliament that the addition must be made. If Parliament is prepared, as the House of Commons has shown itself prepared, to say that the statutory establishment shall be 32 but that up to that limit appointments will be left to the proper authorities—the Lord Chancellor, who makes the proposal to the King, and the Treasury, who have to approve the suggestion—that is the better course. As I have said, what I should like to do now—and I believe it to be very much in the interests of many people who are waiting to have their rights in the Divorce Court—is to add three Judges who would primarily undertake divorce work.
The other provision is of a minor character but it is one to which I wish to call attention because I think that it has aroused anxiety in some quarters. The requirement to which I refer is to be found in Clause 1(4):
"A puisne Judge of the High Courts may be transferred by direction of the Lord Chancellor from one "of the Divisions of that Court to another:
Provided that no direction shall be given for the transfer of a puisne Judge from the King's Bench Division, or from the Probate, Divorce and Admiralty Division, without the concurrence of the President of that Division."
The reason that the Chancery Division is not mentioned there is that the Lord Chancellor is the head of the Chancery Division. It has been suggested to me that in that form of words it might appear that the transfer of a Judge from the Division to which he is attached to another Division would be a matter which could be carried through without consulting the Judge himself and without obtaining his consent. I agree that the words as they stand are capable of suggesting something of the kind, although nobody who knows the way in which we really manage our judicial institutions would ever suspect any Lord Chancellor of doing anything so foolish; he would never, of course, ask a Judge who was attached to one Division to transfer to another and come under a new chief, unless he found that the Judge in question was willing that that should be done. But, sooner than that there should remain in any breast the smallest suspicion on the subject, I should propose, if your Lordships agree to the Second Reading of the Bill to-day, to put in a couple of words in Clause 1(4) to

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show that the consent of the Judge should also be obtained.
That is the nature of the Bill, and I hope that what I have said will convince your Lordships that it ought to be passed. What I would hope to do, as soon as the Bill receives the Royal Assent, is to make the necessary new order which would enable contested divorce cases to be tried in the country. I believe that that would afford a very great relief from what is at present a real injustice. I should do it with the knowledge that I should get some additions to udicial strength. The proposal would be to send round to the principal Assize towns a divorce Judge who would undertake what is often the very heavy list of undefended cases, together with, it may be, the much more limited number of cases that are defended. Some assistance of that sort is needed by the ordinary Judges of Assize in the larger towns. There have been times when the ordinary Judge of Assize, engaged in trying crime and local commercial and civil cases, feels that a burden is put upon him greater than he can bear if he is asked to dispose in addition of a large number of uncontested divorce cases. Under the new system both contested and uncontested divorce cases would be tried in the country—there would be the necessary additional judicial strength for that purpose—and they would also be tried in London. Judges dealing with divorce would have to remain in London for the purpose. I hope that this scheme, with the small amendment that I have suggested, will be regarded as a useful development of the law and that we shall very soon be able to put it into practice.
Moved, That the Bill be now read 2a.—(The Lord Chancellor.)
VISCOUNT CALDECOTE: My Lords, I need hardly say that I do not desire to object to the provisions of this Bill; indeed I may go further and say that, particularly in view of what my noble friend or the Woolsack has said as to the insertion of words requiring the consent of the Judge proposed to be transferred, I respectfully welcome and support the proposals contained in this Bill. I think my noble friend made one observation in the earlier part of what he said suggesting that circumstances did not require the appointment of a Judge so far as the business of the King's Bench Division was, concerned. But I respectfully
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wish to call attention to one aspect of the matter which I think perhaps my noble friend had for the moment forgotten. Nobody can say how many contested divorce cases after the change has been made will be set down for trial in the provinces: it may be a large number, it may be a small number. But, judging from what I have understood, I think from my noble friend himself, the volume of additional work thrown upon the Judges of Assize will be considerable.
The fact is that at the present time, even with undefended cases and defended cases which are poor persons' cases being tried, the strain upon the Judges who go circuit is very great. Until the present volume of divorce petitions arose we expected for instance towards the end of July—about the second or third week in July—that all the Judges out on circuit would be back in London and available to make a concerted attack upon the list of cases awaiting trial. In consequence of the large volume of divorce cases requiring their attention when they go circuit it is seldom the case that a Judge of Assize returns to London until the very eve of the long vacation; indeed it constantly happens that a number of the Judges of Assize remain completing their work on Assize until the first or second week in August. If these cases are to be added to the work to be done by His Majesty's Judges on Assize it really will be necessary to supply the King's Bench Division with additional Judge power to dispose of these cases, otherwise there will be an accumulation and a difficulty in fixing the dates of Assize, which is already experienced by the Judges of Assize. Perhaps my noble friend—I am sure he will—will bear that in mind if and when it comes to the time that he will have to consider the use to be made of the three Judges whom he tells me it is his intention to appoint if this Bill goes through.
THE LORD CHANCELLOR: To recommend His Majesty to appoint.
VISCOUNT CALDECOTE: I am much obliged to my noble friend for the additional words which he proposed to insert requiring the consent of the particular Judge in question. It is none the less, I think, desirable that the assent of the head or the President of the Division from which the Judge is being transferred should be obtained, if only from the point

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of view of the disposal of the work for which primarily the Lord Chief Justice is responsible. As long as my noble friend is on the Woolsack and I have the honour to continue to hold my present position I do not think there is likely to be any contest between us, and I hope I may not be here when any difference exists between the Lord Chancellor and the Lord Chief Justice. I think that the words he proposes to add will be generally welcomed by the Judges of the King's Bench Division. Perhaps I may say this further word. A number of duties are now being performed by Judges of the King's Bench Division which take them from their ordinary duties, so that it is not to be supposed that they can bear any further burden without additional Judge power to help them discharge those duties. Let me say that the Judges of the King's Bench Division, as I know from inquiries which I have made, are of course prepared to shoulder any additional burden that may be thrown upon them, but they will welcome the assistance of one or more of the Judges whom the Lord Chancellor proposes to appoint.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

DISABLED PERSONS (EMPLOYMENT) BILL.
Order of the Day for the Second Reading read.
LORD SNELL: My Lords, this Bill is based upon the recommendations made by the Inter-Departmental Committee set up at the end of 1941 under the chairman- ship of my honourable friend Mr. Tomlin-son, the Parliamentary Under-Secretary to the Ministry of Labour and National Service. The important charge laid upon that Committee was to consider and to make proposals for a comprehensive scheme of rehabilitation of disabled persons. The Report of the Committee was published at the beginning of 1943, and its proposals were generally welcomed throughout the country. The Government accepted the scheme in principle, and its proposals were discussed with representatives of the employers, the trade unions and the King's Roll National Council. Therefore this Bill, which I specially commend to your Lordships, has been
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planned upon this basis of agreement, and it carries out substantially the proposals made in the Tomlinson Report.
The need for the remedial measures which the Bill proposes is universally recognized. One of the most distressing sights in our village or city streets is the disabled man or woman whose disadvantages and suffering might have been avoided, or at least greatly reduced, had he or she received at the proper time appropriate and efficient attention. The fact that he was neglected or inefficiently treated when proper treatment might have saved the individual from a life of chronic disability and have saved the nation from the loss of the services of a wealth-winning citizen was not the fault of any person, of any group, or indeed of the community generally; it was due to the fact that the possibilities of rehabilitation had not been sufficiently realized. I hesitate to express an opinion upon a medical matter, but I believe that in the last 25 years immense progress in both physio- and occupational-therapy has been made, and that for the sufferers for whom a generation ago there would have been little hope, there is now a greatly increased prospect of recovery. Our knowledge of the processes of rehabilitation is still incomplete, but we have learnt something, and both the Government and the nation are firmly resolved that, so far as it can be done, these tragedies of broken human lives shall be reduced to a minimum.
This Bill is designed to achieve that universally desired result. When it becomes an Act it will bring hope and consolation to all disabled persons, either of war or industry. Let us remember that hope itself is a therapeutic agent. We are told in Measure for Measure that the miserable have no other medicine but only hope. If there be any truth in the German slogan of "Strength through joy," it is quite certain that strength and health can come through hope and properly applied knowledge. The shock to a man when he learns that he will not again be self-supporting, or be able to follow his accustomed occupation, could be immensely reduced by knowledge and by the assurance that, at the worst, he can be trained to be efficient in another industry. That is what this clumsy word "rehabilitation" means. It means nothing more than that through medical and surgical skill, through mind adaptation,

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and through the patient's own co-operation, much can be done to restore him to be a self-supporting and normally happy human being. On these grounds I feel sure your Lordships will welcome this Bill. The war is teaching us that we cannot afford to waste or misuse any of our national resources, and we now realize that the worst form of waste is to leave human beings to lifelong disability when, by proper application of remedial measures, they might be restored to health and to industrial efficiency.
A further defence of the Bill is not necessary, but I shall add a few words of general explanation. The Bill is based upon four general principles. First, rehabilitation is not solely a medical problem. The process of rehabilitation starts as soon as possible after the injury has been received. The Bill does not deal with medical rehabilitation because that forms part of a comprehensive medical service. The purpose of the Bill is to provide for such measures in the industrial sphere as are necessary after the completion of medical treatment. The second principle is that the steps taken must be on a comprehensive basis and must deal with the problem in all its aspects. The Bill is designed to be a permanent addition to the country's Social Services. All forms of disablement, whether due to injury or disease or congenital deformity, are brought within the ambit of the Bill. The third principle is that, save for a minority, disablement does not, and should not, prevent the undertaking of employment suited to individual abilities. However serious the handicap may appear to be, there is still a wide range of choice in the field of industry, with its greet division of labour. The problem is essentially one of choosing the occupation suited to the disability. Special provision is made for the establishment of courses of vocational training. We have learnt through the war what the advantages of specialized training are. It has been demonstrated that thousands have been taught occupations and processes which in normal times would have been regarded as beyond their individual capacity. The fourth principle is that successful resettlement calls for special measures to assist the injured persons in their entry into employment. The problem is too widespread to be left entirely to purely voluntary effort, and some kind of compulsion is therefore necessary. The
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Bill contains carefully-thought-out proposals to secure this end.
I need not detain your Lordships with any further description of the Bill beyond pointing out what the various clauses contain. Clause I provides a definition of disablement. Clauses 2 to 5 enable the Minister to establish courses of vocational training and industrial rehabilitation. Clauses 6 to 14 provide for the establishment of a register of disabled persons and impose upon employers a statutory obligation to employ a certain percentage of disabled who have been so registered. Clause 15 contains a provision for the establishment of special facilities for the more seriously disabled. Clause 16 lays down the principle that if at any time the facilities for training or employment should be found insufficient to meet the needs of the whole group of disabled persons covered by this Bill, preference should be given to those who have served in His Majesty's Forces or in the Merchant Navy. The remaining clauses deal with general questions of administration. The Bill has received the support of every section of opinion in another place, through which it passed without challenge and with general good will. I invite your Lordships to give to it a similar reception to-day, and I beg to move that the Bill be now read a second time.
Moved, That the Bill be now read 2a.— (Lord Snell.)
LORD ADDISON: My Lords, I rise on behalf of my noble friend Lord Nathan, who was to have said a word in support of this Bill to-day but, owing to indisposition, is unable to be present. As I heard the noble Lord explaining it, I could not help wishing that we could have had a Bill like this before the conclusion of the last war. With all the possibilities that are contained within such a Bill we know what great advances could have been made. Nothing can do more to rehabilitate an individual than to give him hope that in the future he will become self-supporting again. Of course in the long run it will require, as it has now obtained and I hope will continue to have, the good will both of the employers and trade unionists, and I cannot help thinking that so splendid an object will receive their good will and support.
VISCOUNT SAMUEL: My Lords, on behalf of noble Lords who sir on these

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Benches, I desire to express our cordial concurrence in the purposes and proposals of this Bill.
THE EARL OF DUDLEY: My Lords, I should like to put one point to the noble Lord who has moved the Second Reading of the Bill. This technique of rehabilitation is no new technique. It has been developed over many years on a voluntary basis and I am personally very glad that it has now been put on a statutory basis. But a great deal is known about the technique, which has been developed by such pioneers as Sir Robert Jones, who is well known to many of your Lordships, Dame Agnes Hunt, Professor Girdlestone and the Wingfield Hospital. A great deal therefore is now known about it. Clause 17 of the Bill provides for the setting-up of an Advisory Committee to advise the Minister on various aspects of this work. I only wish to express the hope that that Advisory Committee will be set up on the widest possible scale so as to embrace all possible institutions and individuals who have had experience of this technique. I refer to such institutions as the Central Council for the Cure of Cripples, which has been co-ordinating work among cripples for many years past and is thoroughly versed in the very difficult technique of rehabilitation. There is a great deal more to it than noble Lords would think, and therefore I hope the point I have put forward will be considered and emphasized by giving the widest possible representation on the Advisory Committee to all those who have had experience of the work.
LORD GIFFORD: My Lords, I should like to say one word in support of this Bill as managing director of a firm which for over fifty years has taken great interest in this problem, the Theatre Ticket and Messenger Company, Limited (the Old District Messenger Company). This company has, for many years under its late Chairman, Sir George Manners, given employment to disabled men, and to show what can be done by a private firm I should like to tell your Lordships that in our very small staff we have disabled men with an aggregate period of service with the company exceeding 400 years, including several disabled men with over 30 and 40 years' service. Perhaps I may be allowed to add that we have
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never regretted the pioneer efforts of this firm in the rehabilitation of the disabled.
LORD SNELL: My Lords, with permission of the House may I say that I am sure the Department will take note of the suggestion made by the noble Earl, Lord Dudley, and I myself will see that his remarks are brought to-its notice?
On Question, Bill read 2a, and committed to a Committee of the Whole House.

LANDLORD AND TENANT (REQUISITIONED LAND) BILL [H.L.]
Order of the Day for the consideration of the Commons Amendment read.
THE LORD CHANCELLOR: My Lords, I beg to move that the Commons Amendment to this Bill be now considered.
Moved, That the Commons Amendment be now considered.—(The Lord Chancellor.)
On Question, Motion agreed to.

COMMONS AMENDMENT.
Clause 1, page 1, line 11, leave out ("where,") and insert ("if the lease determines while possession of the land is so retained, or if").
THE LORD CHANCELLOR: I move that this House do agree with the Commons in their Amendment. I must explain in a few words what the object of the Amendment is. This Bill, your Lordships may remember, originated in the House of Lords, but when it went to the Commons it was noticed that there was an omission which should be made good. The Bill deals with the requisition of premises which are at the time held under lease, and the two main provisions of the Bill as it left this House were these. When in consequence of the requisition the tenant had to go out and the requisitioning authority went in, the expelled tenant was not to remain liable during the requisition for repairs under the covenant. The second provision was that if, when the requisition came to an end, the tenant was left with some part of his lease still to run, he should not be compelled to pay compensation for damages under his covenant in a case where the landlord was entitled to get from the requisitioning authorities the necessary compensation.

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Everybody agrees that these were very proper provisions to make. But there is a third case which was overlooked. It is the case where the tenancy ceases before the requisition comes to an end. In that event the tenant, it is true, could not, under the Bill as it stands, actually be forced to pay until the requisition ended. But the landlord might have a claim against the tenant which would presumably become effective when the requisition came to an end. That would not be right because it might be, and sometimes is, the case that the requisitioning authority does not pay compensation but makes good the damage and leaves the landlord with a place that is quite undamaged. In those circumstances your Lordships will, I think, agree the landlord ought not also to have the right under his covenant to sue the tenant when the requisition comes to an end. It is that case which was overlooked and it is that case which is met by the words of the Amendment. I beg to move.
Moved, That this House doth agree with the Commons in the said Amendment.— (The Lord Chancellor.)
On Question, Motion agreed to.

POST-WAR WORK.
LORD ADDISON LORD ADDISON rose to direct attention to the fact that at the cessation of hostilities the productive capacity of this country, both in industry and in agriculture, will be greatly increased as compared with the pre-war period, and to urge upon His Majesty's Government the necessity of preparing plans accordingly for post-war work without delay; and to move for Papers.
The noble Lord said: My Lords, the Motion that is on the Paper in my name is intended to help to establish some undeniable facts and I hope it will bring into clearer relief our ability as a nation to deal with post-war problems. I also hope this discussion may serve to combat some misunderstandings which have arisen and which, if persisted in, may well become a deterrent and have a very paralysing effect upon our outlook and our resolution. I will not refer to the statement which was made by General Smuts but to a statement made by the noble Lord the Minister of Reconstruction, of which, I think, some improper use has been made.
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In order to make the matter clear I would remind your Lordships that in a discussion held in this House on December 8, the noble Lord the Minister of Reconstruction said:
"Our wealth has been destroyed, our ships have been sunk, our towns have been burnt and broken, and for some years to come we shall be a nation poor in wealth, though we shall be rich beyond any dreams of the past in reputation."
I noticed that in commenting upon some of the criticisms which were made on that statement, taken apart from its context, the noble Lord, in a speech at Liverpool reported on 1st January, maintained that, having had so much destroyed in the war, we were not quite as well off as we might have been. I will not contradict that.
More comforting still, and I say so because I am sure it is Tight that it should be said in your Lordships' House, in the prolonged discussion on reconstruction problems the noble Lord on Friday, December 10, referred to his own action in connexion with the great business he directed and said:
"I was one of the people in this country who, at the depth of the depression, said to the companies with which I was associated, 'We are capitalists, with money, with reserves. Now is the time to spend them.' And I went out in practice on an expansionist policy at that time, to the subsequent benefit of my shareholders and myself."
I think we must take all these statements together, and not misjudge the noble Lord on one single sentence. Nevertheless it is the case that that particular passage has been widely quoted, and I am apprehensive that it may be seized upon by the same kind of people who at the end of the last war plunged us into the so-called crusade of economy and deflation, which brought years of misery upon this country. It is on that account that I have ventured to bring this subject before your Lordships to-day.
Our national income and savings are the resultants, of course, of the enterprise and management and labour of the people. That is where they come from; that is the source of wealth. Our greatest asset without a doubt is in the people. The loss caused by the war will be the loss of the men in the prime of life who will be either killed or maimed. That is the great national loss, because a machine is nothing without somebody to direct it and land is of no use save with somebody to till it. So far as the people

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of this nation are concerned we are certainly not poor, and we are not poorer than we were in spirit or in attainment. I think it is fair to say that the stature of the people of this country in character and resolution has evoked the admiration of the world and the surprise of themselves. Their ingenuity in production, in factory and field, given this great opportunity of expression, has exceeded all anticipations. I was glad the noble Lord, in the same speech at Liverpool, said:
"The war has demonstrated beyond all doubt that we have a quite extraordinary power for invention, for the application of science to industry, and the capacity for perseverance, that is something very near to industrial genius."
I am sure not one of us would differ from that, and I suggest that the people with this wonderful record are worthy not of timid counsels but of bold leadership.
Undoubtedly there has been during the war a remarkable increase in our productive capacity. So far as land is concerned—your Lordships will not be surprised that that is quite to the front in my mind—although we are well aware that in its capital equipment it is suffering from the neglect of a long period, and that it ought to be one of our purposes after the war to make that good, yet the machinery equipment of agriculture in this country and its productive capacity are probably greater than those of any other nation in the world. There has been an enormous increase during the war. The same may be said in different degrees of the science and management which have been applied to our factory production. It is perfectly true that much of the war-time machinery may not be adaptable to peace-time purposes, but very much of it will be so adaptable. I see that the economists—I take the minimum figure—calculate the increased productive capacity in this country at 1.5 per cent. per annum. If that is anything like true it means that between 1938 and 1944 there will have been an increase of productive capacity of something like 9 per cent.
Now I will say a word about our cash account. I do not profess to be an economist—only an ordinary person of sense—but in my view the internal debt is not a loss except for the additional clerical services needed to deal with a larger internal debt.
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Certainly there have never been so many people in this country—there are millions of them—who have had so much money in the savings banks and who have lent their money to the State. I have had a note from my noble friend Lord Mottistone who wished to speak after me in this debate but who is unfortunately ill and cannot be here. He was going to say something on the question of savings. Of course, savings in a stocking are of no particular use, except to the person who may want to get them out of the stocking later in order to buy something. They are not producing; they are much better lent to the State as they are now being lent. So far as this internal debt is concerned, except for the clerical services needed, what it really amounts to is that money is taken out of the taxpayer's pocket with one hand and put as interest into the lender's pocket with the other hand.
I have been reading for the purpose of this debate a number of papers by eminent economists, and they say with remarkable and surprising unanimity that, notwithstanding the war, our national income has increased very substantially. One gentleman writing in the Economic Journal for April, 1943, put the figure at 40 per cent. Although there were elaborate calculations to support that statement it was rather surprising, and I am content to take the much more modest estimate given in the Economist on December 18, that national income has increased by 10 per cent. At all events these estimates show that what the noble Lord said at Liverpool is true. We may not be as much better off as we should have been if there had been no war—no doubt that is true—but we are better off than we were so far as national income is concerned, and therefore able to shoulder the burdens that we may be called upon to bear. There has been a great loss, of course, in the destruction of buildings. So far as that loss results from the destruction of houses I am quite sure that we all hope that thousands of them will be replaced by cleaner and better houses, so that in the long run that may not be so great a loss. Perhaps it may foe an advantage in several places.
The only other financial loss I think I need refer to is the loss of our overseas investments. I see that the imports, in round figures, before the war were somewhere about £1,000,000,000, and large

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sums were accounted for by overseas investments, shipping, insurance and other services. I do not think anybody will deny that the post-war situation, if properly handled, will give a great opportunity for British export trade in many directions. The world will certainly be wanting good British goods. It will depend on the nature of international policy—to which I will refer in a few moments—as to whether full advantage will be taken of that possibility. The demand will certainly be there. In any case, the loss of the payments available for invisible exports is, after all, not more than 7 per cent. of our total national product, and the magnitude of this is often over-estimated. I do not think that Britishers need be appalled at the task of making good that deficit.
Lord Latham, who is more competent than I am, will deal with certain financial questions, but I want to draw your Lordships' attention to this very important fact. The comparisons that I have been making hitherto have been based upon national Income and production in the year 1938 as compared with the possibilities of the post-war period; and I want to point out that in 1938, on an average through the year, there were 1,881,357 people not producing anything at all. In other words, there were nearly two million people out of work. Well. I do not think the most pessimistic of us would tolerate a prospect of that kind with any satisfaction. We certainly want something better than that. It is sometimes pointed out, in referring to the finance of the Beveridge Report, that it is based on full employment, but I would remind your Lordships that the employment statistics which Sir Walliam Beveridge uses as a basis of calculations allow for there still being 1,500,000 persons out of work. In other words, there will be, on that basis, 1,500,000 people not producing any wealth. That again is not a possibility that we could regard as something we were going regularly to tolerate. We want something better than that. I suggest that the possibility of full employment depends very largely upon what policy the Government adept with regard to wages and investments, and their control of money.
Some long time ago now—I have not been able to recall the date—my noble friend Lord Perry made a remarkable
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speech in this House in the course of which he referred to the necessity for the establishment of a statutory wage basis which will ensure that no person fully employee shall be paid a wage less than that which will enable him to support himself in decency. If we can get a wage principle like that applied, then, clearly, the consuming power of the people will go up with a bound, and the demand for con sumer goods will go up accordingly. So it is that we shall look some day—not now, of course—for the Government to make some announcement of its wage policy for the post-war period. Happily— as I have recalled once or twice before in your Lordships' House, and I will not promise not to recall it again—at Hot Springs we had forty-five nations agreeing that the purchasing power of primary producers throughout the world should be increased. If you begin to work on that principle there will be no lack of employment, and no lack of demand for consumer goods after the war. I recognize that it will take time for such a state of affairs to be brought about.
So far as industry is concerned there will be a transitional period in which demobilization will be taking place, and that will be followed—as it was, followed at the end of the last war—by a soaring demand for consumer goods both here and abroad. How long that period will last I do not know, but I am not so much concerned with that inevitable demand as I am with the long-term policy, which this country will be aiming at, which will govern our industrial operations after that time. We have had very disastrous demonstrations from time to time of what is called by the economists, 1 believe, "structural unemployment." That is to say where you have an industry entirely located in one area, as, for example, the coal industry in South Wales or shipbuilding in some other place, whenever there comes a fall in demand there is a complete slump in the whole district owing to the one-sidedness with which industry has developed in that district. The same applies to cycles of unemployment That is to say there are times when certain products are fashionable, and the making of them leads to a lot of employment. Then the demand passes, and people who have been engaged in the producing industry become unemployed. All this means that we should have guidance, lave a proper policy in regard to the

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location of industry and in regard to the provision of alternative training. We should not have whole districts dependent upon one industry with the disastrous results which we have seen.
Much, indeed more, will depend on the international policy that is pursued with regard to exchange, and I derive great comfort from the fact that my noble friend Lord Keynes is at the Treasury. I wish that we had had somebody of a like mind at the end of the last war in the same position of influence. We know that the banking, the central banking, can make employment or can make unemployment, that if the bank buys securities you increase the bank money available, and in the ordinary process of banking operations I believe that for every £10 bank money available they will lend £100. In that way it is possible enormously to increase the credit available. It is equally possible to diminish it, and it is that which happened after 1923. I was one of those who were behind the scenes in the crisis of 1931, and I shall never forget the degrading experience of the British Cabinet having to adjourn to know whether we could get a loan of a few millions from another country. The country was persuaded that we were on the verge of bankruptcy because there was a debt of £120,000,000 on the Unemployment Fund. We know, and we knew then, that sterling was sold in Paris on purpose, and it depreciated the pound accordingly. We were let in for a period of what was called economy and deliberate deflation, pursued over a series of years, which spread wholesale misery from one end of this country to the other. In our view it should not be within the power of any private corporation to do that sort of thing.
The whole control of money policy and the major control—not the detailed control—of investment policy should be a national concern in peace, as it is during the war. One of the first things that we did when the war began was to bring the control of these matters under the Treasury, and they should remain there. If we are to have considered, deliberate, organized guidance in the development of our industries and in the supply of capital in the most profitable directions, of course with sensible management, the final control of this policy should belong to the State, and should not be let loose. It
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belongs to the State to-day, and I hope it will be kept there. In my view, it should not be within the power of irresponsible organizations, however apparently respectable, to juggle with the lives and opportunities of employment of the people. But that was what happened, to my knowledge, in 1931. It should never happen again. I shall not pursue this matter in detail; I feel so strongly on it that perhaps I might talk a little rashly. I do not speak, however, without a foundation of first-hand knowledge.
The other day, in a broadcast—I have not the text of it, and I hope that I shall not misquote the noble Lord—Lord Woolton referred to the embarrassment, which no doubt he must experience sometimes, caused by irresponsible people who expect the impossible. He has said in this House that he will not make promises before he can make them good. He does not want to be embarrassed by people who expect the impossible. We are not asking for the impossible. I have not met anybody who expects that we are going to do these wonderful things very quickly. If there are such people they must be very few in number, and very irresponsible and inexperienced. I have met, however, a great many people who are very apprehensive (and that is what lies behind this Motion) that the same kind of interests - which precipitated this country into deflation after the last war, with such calamitous results, and who cried aloud that we were not able to afford things—so much so that we even burned millions of little trees because we thought we were too poor to buy the land to plant them— will once more become more powerful than they ought to be. It is in order to get a word in advance that this Motion is put on the Paper.
To whatever Party we belong, we are all proud of our country. We are proud that our people are indomitable in time of danger; we are proud of the splendid record of our people during the war on land and sea and in the air, in the farm and in the factory. We are justly proud of them. But we are ashamed that a nation with all these great qualities should have had millions of people, up to the outbreak of the war, living in pestilential slums. We are ashamed that up to the outbreak of the war there should have been, in a nation like this, 6,000,000 people or more who did not regularly

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get enough to eat. We are ashamed to know that, as the dreadful record of the Ministry of Labour Gazette shows, for several years between 1931 and the outbreak of war more than 2,000,000 people were wandering about without anything to do and producing nothing. We know that we can do better than that. We arc not looking for (if I may so express it) a mushroom New Jerusalem, but we are looking for a determined and disinterested endeavour to apply the lessons of our great experiences, so that life and opportunity in our homeland shall be more worthy of the people who inhabit it. I beg to move for Papers.
LORD BINGLEY: My Lords, in the very few words which I shall address to your Lordships, I should like to develop the agricultural side of the Motion which the noble Lord has just moved, and deal with the question of what can be done in the future to maintain and develop the increased agricultural capacity which has been brought about during this war. Postwar agricultural planning is, of course, an intricate subject. I do not propose to develop this at any great length or in detail, but we all agree that for some time after this war some measure of control will be necessary. Obviously the food situation is going to be difficult for a long time, and the food-producing capacity of this country must be maintained at a higher level than it ever was before the war. Of course we no longer wish to see some of the rather slipshod farming, perhaps of infirm and elderly men, that went on in the past. I am certainly not going to suggest that all the farming of this country was bad in the past; it was extremely good in the case of a great many areas all over this country; the agricultural production was extraordinarily high. Farmers had not got the opportunities of the new developments that have taken place since; they had not got the machinery, they had not got the new knowledge that has come to them. Therefore it is not fair to compare the future with the past.
But while we agree that a certain amount of control will be necessary, it is not going to be quite so easy after the war as it is now. The reason why the control of agriculture has been accepted so peacefully by farmers, who are not very easily induced to accept new ideas, has been that it has been
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administered by people whom they knew and whom they trusted. I cannot give too high praise to these splendid, loyal patriotic men who have given up their own jobs and have devoted so much time to developing this system of control and guidance and advice to the agricultural community. But if that system is to be continued indefinitely, then it will have to be done on a different basis. Those men cannot give up their time and continue unpaid work for ever. It will have to be a different system, and then it is not going to be so easy. Farmers will not accept the advice given under a system of paid civil servants with the same ease as they accepted that which has been given by those who are running the war agricultural executive committees. We must remember that that will be the position, and I should very much like the Minister to tell us, if he can, what scheme is contemplated for continuing this control, and how it is proposed to make it more palatable to those to whom it will apply.
If agriculture is to be kept at the high standard that we should like to see, we must remember that there are vast arrears, as the noble Lord has just stated. There has been a period of great neglect, and that has been followed during the war by a period of complete stagnation, as far as maintenance and repairs are concerned. It is appalling to think of the increasing decay of buildings, roads, fences, ditches—all the equipment of farmers—which has been taking place during the last few years, partly from want of material, partly from want of labour, and for various reasons. Anyhow, there is no question that there has been a very serious and very dangerous decay. There has been a tremendous shortage of labour, of course, everywhere, and we must remember that the more land you put down to arable, in whatever form it goes, the more labour it requires. This decay has followed after the depressed period which preceded the war, during which time of course a great deal of decay had already begun to set in. But it is true that after the war the farmers, we hope, will be helped by better machinery and better knowledge. But how is all this better machinery going to be got without some help from the Government, or some system of credit provided by the Government? I should like to know now that

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credit can be developed and that improved position be set up.
There is another point which is very troubling to anybody who has anything to do with what is called an estate. There are a great many estate men who are of great value to the community—woodmen and foresters who have gone to the war, and whose help we very badly need now. Those men will be coming back and everybody will want to see them come back to the jobs they occupied before, if they want them. But meanwhile the scale of wages has risen so considerably that unless the finances of these estates are going to be improved in some way it is going to be extremely difficult to pay them what they ought to be paid in relation to other branches of labour, and it will be extremely difficult to see how an adequate staff can be maintained. The staff may have to be cut down, which will mean inefficiency in the work they ought to be doing, and everybody knows the vast importance of afforestation in these days, when the country is so terribly short of timber. I should like to know whether the Government have any plans for dealing with a situation of that kind.
I am not going the ask the noble Lord to dive into the question of Death Duties on agricultural estates, but I do suggest with regard to those Duties, which have been so grossly unfair in the past in their operation in relation to agricultural estates, that if any modification can be made in that direction, and if you must take these chunks of capital away from the agricultural owner, at any rate make it possible for those sums to be diverted to the maintenance and improvement of his estate, if he is willing to agree to it, rather than into the insatiable maw of the State for other purposes altogether.
I am also not going into the vexed question of how we can improve our housing, water supply, and electricity supply, but I should like to say one word about the small cultivator. I hope that every assistance and every hope will be given to the allotment holders and owners of gardens, who have done so much to increase our food supply in time of war. Their great demand is for some system of security. It is obviously impossible to give security in a complete form for the occupation of land which is just outside a town which may
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be very badly needed for other purposes. I quite recognize that it is impossible to give an unqualified promise of security to all the people who are now cultivating allotments or gardens of that sort, but any assurance that the Minister can give that where it is really necessary that they should be dispossessed of the land, some effort would be made to see that they are accommodated somewhere else would do a great deal to increase the enthusiasm of these men. I should like finally to ask the Minister whether he can generally assure us that there will be some development of the credit system under which greater prosperity can be secured and greater opportunities can be offered to the agricultural industry, including smallholdings and small cultivation of the kind I have just mentioned, so that after the war we may be able to maintain, and I hope to improve, the agricultural capacity and the food-producing capacity which has been so well developed during the war.
LORD LATHAM: My Lords, in supporting the Motion which is before your Lordships' House I should like to raise certain questions of post-war economic policy. I think it must be conceded that there will be available after the war an immensely greater productive machinery in this country than there was before the war. That will be true as much of agriculture as of industry, and it is idle to assume that that greater capacity can be used unless there is a planned policy for its use. In short, full employment, attractive as it may be and desirable as it is as a policy, cannot be conjured up; we can only secure full employment if we plan it. And we can only employ the industrial apparatus which we possess if we have full employment. I would therefore like to invite the noble Lord the Minister of Reconstruction to give the House, if he can, some indication of the general line upon which the Government are approaching the problem of full employment. We all readily recognize that that problem inescapably divides itself into two: there is the internal problem and there is the external problem. Unless the policies in regard to both are co-ordinated it is difficult to see how full employment can be achieved.
It is important for us to bear in mind that there is no magic in employment for employment's sake. Employment must justify itself by what it produces. There

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is a tendency in some quarters to regard employment as an end rather than a means. The policy of employment must be to increase the general resources available for man's use and man's consumption. There are great needs. There is the need arising from the vast accumulation of renewals and repairs which have not beer done. Our stocks are very badly depleted. Not only the general stocks, but the stocks of individuals, are running out. Restrictions upon their renewal are such that that is inevitable. There are undeniable needs for new and better social, as well as industrial assets, and so, with a proper policy, there should be no difficulty in securing full employment for a time Indeed, in some directions it is almost certain that there will be a shortage of available labour immediately after the war. What I want to stress is that these needs were just as clamant in the years between the wars. There were needs for houses, for new roads, for new social equipment, especially in the depressed areas, but these needs were not met. On the other hand, the persons who could have built the houses, built the roads, and contributed to the new social and industrial assets were, as a result of the internal economic policy followed in this country, kept in a state of non-production and unemployment.
We know that there was no problem of shortage between the two wars. The real problem was abundance. There was too much for the nineteenth century monetary machinery to distribute. I am not going to question the achievements in some fields of capitalism and private enterprise, but it is now difficult to deny that the monetary technique of capitalism broke down at the sight of the very abundance which it had itself created. It is a curious commentary on human history that, although Man has sought plenty for thousands of years, when it arrived he did not know what to do with it. We destroyed wealth and we destroyed food which otherwise could have been consumed Nor were we alone in the pursuit of this curious policy. If I may quote a few words from the Report of the National Resources Planning Board of the United States, it will probably be of some belated comfort to us
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to see that we were not alone in our errors. This is what it says on page 5:
"We know that the road to the new democracy runs along the highway of a dynamic economy, to the full use of national resources, to full employment, and increasingly higher standards of living. This goal is within our reach if we plan to meet the challenge of our times. Failure to adjust to new conditions cost us two hundred billion dollars in the decades of the twenties and thirties, but such losses cannot be measured accurately in money terms; for they include undernourished children, failure to provide needed medical care, failure to provide for elderly people, and the desperation which comes from long failure to have creative work to do. Such failure to use our resources results from our lack of adjustment to our changing economy. All necessary physical things exist to supply all reasonable wants of all the people of the civilized world, and especially of the United States. Enough for all is now possible for the first time in history."
I submit to your Lordships that that very accurately sums up the position of our own country.
The cause was that we pursued a contractionist economic policy. Instead of seeking to broaden our national income in relation to the growth of production, we sought to do the reverse, and we achieved the results of the reverse policy—those dreadful humiliating years between the two wars. Unless the Government are now prepared to abandon contractionism and from the very start to pursue an expansionist policy, it will be impossible to utilize the industrial and agricultural equipment which is at hand. It will be impossible to avoid unemployment. I believe it is correct to state that the majority of thoughtful persons in this country now realize that the policies of the past have been wrong. It may be that, in America, acceptance of that is not so general, but there will be no want of support for the Government in this country if they pursue a forthright policy of expansionism with the object of securing full employment and a rising standard of living. Steps must be taken to avoid the peaks of booms and the valleys of depression. In a boom there is a riot of wastefulness. One need not go further than the Macmillan Report to be given some picture—but not a complete picture—of the waste of resources and of savings which occurred during the boom of 1927–29. I, from my own personal experience, know of the large sums of capital and the large amount of labour and materials wasted in that boom, when things were

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made which were not needed, and all sorts of catch devices were used to attract savings from the pockets of ill-advised investors.
It is important that we should aim at securing as high a volume of saving as we can in relation to the national income. Quantum of savings depends upon the quantum of our national income. We cannot expend the first unless we increase the second, but it is no use increasing savings unless we pursue a policy which will secure equilibrium between saving and investment. We know that that equilibrium did not exist for many years between the wars and that was one of the prime factors of some of our difficulties. But when we have regulated investments by reference to savings there is another thing we must do and that is to see that available savings are invested in the proper beneficial way and that savings and investments are devoted to appropriate, beneficial, social and industrial purposes. We must bear in mind also that just as it is essential to preserve equilibrium between saving and investment so it is no less important to have regard to the distribution of expenditure between what is spent on consumable goods and that which is spent on capital goods. There are a variety of ways in which periods of slump and of boom can be avoided or, at all events, their deleterious effects minimized.
First of all I would like to submit to your Lordships, perhaps without securing complete agreement, that direct taxation is not necessarily restrictive of industry; in fact the expansion of industry side by side with the expansion of direct taxation is historically proved. After all, taxation is not a tax on costs, at is taxation on profits, and provided taxation and the arrangements in connexion with taxation are such as do not prevent the accumulation of reasonable reserves for renewal, replacement and development, there is not necessarily any restriction arising from direct taxation. Taxation does, of course, reduce one's ability to save and it may affect one's disposition to invest, but if private investment should falter the Government can correct it by investment on their own. On the other hand, taxation can be a very helpful weapon in the hands of the Government in order to even out these periods of boom and depression. For instance, I think there is a good deal of opinion which now supports the view that for that purpose
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higher taxation during a period of good trade could be justified if it were on the footing that there should be lower taxation in a period of bad trade or less good trade. If that policy were pursued I cannot help thinking it would be helpful in avoiding these changing conditions.
I wish to submit also to your Lordships that whilst I do not embrace, and never have embraced, the doctrine that it was good for any community to dig a hole and fill it up again merely to provide employment, I do not subscribe to the doctrine that public works are necessarily wasteful. It depends what the public works are. It is a thousand pities that between the two wars we did not adventure upon a wide programme of public works, of renewing the social assets of this country, especially in the depressed areas. My noble friend Lord Portal will know what acute need existed and exists in many areas for the plain, elemental social assets which could have been provided by those who were compulsorily kept from employment. Moreover, let us always remember that employment upon public works creates indirect employment. The "multiplier" factor operates just as much with employment on public works as it does with employment on private enterprise or within the scope of private enterprise. If, for instance, unemployment is reduced in one of the unfortunate towns of South Wales, it not only means that the miner has employment and has more money but the baker does more trade, the grocer does more trade, the butcher does more trade, created by the greater demand for consumable goods. I believe it is contended by economists of some repute that the "multiplier" factor can do very much. In addition expenditure on public works even for amenity purposes only, such as roads and parks, which the classic economists are pleased to call "works of no commercial profitability," can nevertheless be of financial advantage to the nation. They provide a fund of money which is paid out in wages, which percolates throughout the industrial system and which attracts tax and is subject to tax.
It can be shown, I think with considerable satisfaction, that moneys so spent can produce, by way of direct and other forms of taxation, sufficient to meet the service of the debt which the expenditure may create. Moreover, we must also

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remember that Government expenditure is just as much a part of national income as any other expenditure and it can be in certain circumstances much more socially desirable. I hope, therefore, that the noble Lord the Minister of Reconstruction will be able to assure the House that so far as the internal policy of the Government is concerned it will be in the directions which I have indicated, having for its main and dominant purpose the securing of full employment and a rise in the standard of living.
But there remains, of course, the problem of exports. There are certain industries in this country which are either wholly or partly dependent upon export trade and no increase in the expenditure on public works or upon consumer goods in this country would be a direct help necessarily to those trades. I think we can contemplate the position immediately after the war as being not unsatisfactory from the point of view of exports. There will be a very big demand not only for capital goods but for consumer goods in the devastated countries, and it may be that in order to satisfy this we should finance those exports; indeed we may have to finance those exports. We might have, for instance, a kind of revolving loan fund, cut of which as we got repayment we could make other new loans to the same country or new loans to another country. That demand may go on for a number of years, but that will not of itself solve the problem of how to pay for our imports. That is, I suppose, the greatest single economic problem facing this country. To the extent that we achieve full employment and a higher standard of living, precisely to that extent we shall need to import more raw material and more food. That will be the case however much we may be able to expand our agricultural production.
There are a number of ways in which, perhaps, one could seek to solve the problem of how to pay for imports. We could, and I hope we shall, seek to expand our export trade by greater efficiency, improved technique and perhaps a greater willingness to give the customer what he wants. We could, of course—I hope we shall—lower costs and therefore be able to lower prices, but I would point out that there is not unmixed virtue in that, because if we do lower prices we attract less foreign exchange whereas we shall want more foreign exchange if we have
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to pay for more imports. Moreover, this lowering of costs is a delusive proceeding because other countries will seek to do the same, and I do not see any satisfactory permanent solution by the pursuit of cut-throat competition in exports between countries which require to create export surpluses. I think the only way to face this problem is in an international way. I agree that not even the powerful present Government in this country can necessarily determine wholly international policy, and that the agreement of other countries will be necessary; but I hope and indeed I feel sure that the noble Lord the Minister of Reconstruction will be able to assure your Lordships' House that we are pursuing and will actively pursue a policy of international co-operation in regard to post-war trade, and that we shall seek to do all we can to secure an international monetary policy which will enable the world as a whole to expand its production and to raise its standard of living.
We have, of course, had submitted to us the Keynes Plan and the White Plan. It would be presumptuous of me to pretend that I fully understand either of these plans. I heard it once said by an eminent economist that there were three persons who understood monetary technique, and that the other two were dead. But I will point out that whatever advantages the Keynes Plan or the White Plan might offer—and I personally prefer the technique of the Keynes Plan to that of the White Plan—neither plan pretends to do more than start countries off by creating a kind of fund of currency upon which they may draw or by creating currency credits. Neither plan pretends that it will be able in the case of countries with deficits—and countries in the process of development inevitably have deficits—to keep those countries going permanently, and sooner or later under either plan the country having a deficit would be required to apply internal deflation. From that application there might be set up the dreadful circle of world crisis once again. I suggest, therefore, that whichever of these plans is adopted, or whatever plan is adopted for monetary and exchange technique, it will need to be supplemented by arrangements for international loans, especially loans on a long-term basis to countries in the process of development or where development is needed.

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I hope that if this policy is embraced the eligibility of countries to receive loans will not be based too rigidly upon balanced Budgets. There is no virtue in a balanced Budget side by side with unemployment. There is much virtue in an unbalanced Budget for some time if the lack of balance arises from securing employment and from raising the standard of living. I think we are at times inclined to attach too much importance to the arbitrary distinction between good money and bad money. It is idle to talk to an unemployed man without money of the virtues of having good money when he has not got any kind of money. We must remember that the history of the last century shows that a rise in the standard of living in the world has marched side by side with the diminishing value of money, and it is difficult to see how a rising standard of living could have been achieved without that being the case. I hope, therefore, we shall not apply too rigidly the test of balanced Budgets in our international loan policy.
I would like to see the fullest development of multilateral trading, but I hope that if the United States of America are determined to follow in the post-war years a policy comparable with that of pre-war years—rigid adherence to the old principles of the gold standard, although the gold standard in terms may have gone— we shall not tie our international policy too closely to theirs, because I am convinced that if we do we cannot avoid disaster. No one wishes less than I do to say anything derogatory to the United States of America, but we are entitled to say that we are not a poor relation and that we are not the junior partner. We have immense resources within our Commonwealth and Empire. We constitute the most attractive and the largest consumer market in the world. Whilst I am quite convinced that the economic problems of the world cannot be solved except by the completest and fullest international co-operation, we must not lightly pursue a policy which will tie us to the movements of the dollar. After all, the United States will not be without their own problems. It may be presumptuous for me to say how they could solve them. I think they can only solve them on international lines. They have most of the gold of the world but cannot use it. They can only use it if they pursue a
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policy of loans and of making dollars available to the people who need them for purposes essential to their development. It is a curious circumstance that in fact the United States of America have for some years been sending out exports for nothing. True they have been paid in gold but that has not increased the wealth of the United States. The gold has been dug up with infinite labour in South Africa—as someone said, I do not pretend it is original—only to be buried in Kentucky. We pursued a policy for many years of sending out exports for which on occasion we did not get paid. We have written off many foreign debts, I believe in excess of £500,000,000, and if you read the proposals that are coming from some of the South American countries at the present time it seems that we are still having to do it. In short, we pursued a policy which resulted in our getting nothing for large quantities of our exports.
As I have said, we have the greatest consuming market in the world, and primary producers, therefore, cannot afford to disregard it. If they need payment for the goods which we import from them they can be reasonably expected to have regard to our exports and to look for payment by means of our exports. I agree that that is not multilateral but bilateral trading. I hope that we shall not be forced to that, but we may be. If we are, I think we shall be bound to contemplate it and to pursue it, though with some reservation owing to the fact that many of the former primary producing countries are becoming secondary industrial countries, and, therefore, they have less need for our industrial exports, and are under less obligation to export their primary products. We know that the Dominions have very largely expanded their industrial capacity under the stimulus of war, and to the extent that a country extends its industrial capacity its need for importing the products of industry inevitably becomes less.
This rather disjointed excursion of mine into the dangerous realms of international economics is now coming to an end. No doubt that is a solace to your Lordships. But I do want to plead with the noble Lord the Minister of Reconstruction to see to it that the policies we pursue in regard to the post-war period are based upon a determination to secure full employment and a rising standard of living.

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If we were a self-sufficient country we could achieve that within our own economic policy without let or hindrance from outside. But we are not a self-supporting country. I do not believe that even such an agricultural enthusiast as my noble friend Lord Addison would contend that we can become a self-supporting country. Therefore we have to face the problem of how to pay for our imports, and I hope that the policy of the Government—not only in the solution of that problem but in the solution of the wider and more important problem of creating abundance for all the peoples of the earth—will be to pursue to the fullest extent international co-operation. That co-operation must primarily be with the United States. I hope that wisdom will prevail with that country, and that in addition to a new international monetary system we can have a system of international loans—short-term or long-term as circumstances require—in order to expand the productive capacity of the world, and, at the same time, to expand the consuming capacity of the world. It is no good increasing production unless we can increase consumption. It is in that field of our economics, notably, that we have failed, and the failure has been evident in terms of human misery and suffering for the last thirty years. By some means or other, we, in this country, must blaze the trail industrially and commercially; we must take the lead. I hope that if we take the lead we can guide the other countries to regard themselves not as separate countries in this question of production and consumption, but as parts of a family, and to recognize that the primary object of a family should be to feed itself.
THE EARL OF ELGIN AND KIN-CARDINE: My Lords, the very eloquent and instructive speech to which we have just listened soared rather into questions of high finance and international politics. I hope it will not be considered too much of an anticlimax if, for the few minutes for which I shall ask your Lordships' indulgence, I direct your attention to earth. The Motion which the noble Lord has put on the Paper, and which he so ably brought to the notice of the House, stresses the fact that at the cessation of hostilities there will be an increase of production both in agriculture and in industry. I wish particularly
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to stress—as Lord Bingley has already done—the increase in agriculture. I should like to invite your Lordships to consider for a moment an aspect of that matter which is not so frequently brought before you; that is the aspect concerning the small man. Lord Bingley, it is true, referred to that at the end of his speech. I should like to give you, if I may, a few facts showing what the small man has done and is doing in response to the nation's call and the possibilities that lie ahead if he is given that opportunity of which the noble Lord who introduced the debate spoke, the opportunity of giving expression to his capacity.
The annual report of the Land Settlement Association has just been published for this year, and this provides, I think, some most interesting facts relating to what has been done. An analysis has been made of the accounts of some 550 tenants. Two-thirds of those tenants are men who have been recruited from the special areas; miners and others who had been out of work. The remaining one-third are tenants recruited since the war with agricultural experience. The analysis shows that on an average after payment of annual rents, rates and taxes there is available for the tenant a sum of about £418, and that disregards what he takes from his own holding for his and his family's use.
That, as I say, is an average figure, and perhaps I may give an instance of some of the better figures. About 30 per cent, of the tenants can show a profit of £600, and several can show a profit of well over £1,000. That is a demonstration that the smallholder, given the opportunity, can make good. It is for that reason that I hope that in the plans which His Majesty's Government will make for the future they will give credit not only to the large agricultural holding, to the development of mechanization, and to all the other aspects of the matter which were dealt with by the noble Lord, Lord Bingley, with regard to the improvement of agriculture, but also to what the small man can do, given the opportunity.
Comparing the production of the whole of the holdings of the Land Settlement Association in the year ending September 30, 1939, and the present year, we see the remarkable growth which has taken place. For the year ending September 30, 1939, the total receipts from sales of pigs,

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poultry, eggs, and crops produced on the estates were £357,028. In 1943 this figure had risen to £609,150. More remarkable still are the kinds of things produced. In 1940, sales of tomatoes amounted to £32,846, and in 1943 had risen to £173,201. With regard to lettuce, the figures were £11,104 in 1940 and £61,500 in 1943. In onions, the growth was from £302 to £3,637. A useful comparison may be made of actual quantities. The tonnage of tomatoes was 1,132 in 1940 and in 1942 it was 1,987. Crates of lettuce numbered 34,388 in 1940 and 119,500 in 1943. Those figures are illustrative of the growth in actual production and output.
Finally, I should like to put this other aspect of the matter. There is a tendency in the Ministry of Agriculture, and probably in the country at large, to think of industry impersonally, and to think of its improvement from the point of view of the improvement of mechanization. I have a strong belief that in business, and particularly in a business which deals with the production of crops or live stock, personality is of very great importance. A great deal depends on giving the individual scope for his talent; the individual is more important than the machine. Greater security through higher wages is not the only inducement which can be given to the agriculturist; independence through having a holding of his own is an equal inducement. I feel very strongly that for him to have a holding of his own means a great deal more to the social development of the country. From that point of view I have tried to put before your Lordships a few facts with regard to what has been done during the last two years, and I hope that they will be an inducement to the Minister of Reconstruction to find room for the development of smallholdings in this country after the war.
THE MINISTER OF RECONSTRUCTION (LORD WOOLTON): My Lords, I welcome the discussion which we have had to-day for many reasons. In the first place I welcome it because it is a discussion of what is, next to housing, the most important of the problems which are going to face us under the general heading of reconstruction. The debate to-day, from the way in which it has been so completely prepared, has obviously been one in which noble Lords opposite have
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sought to present their views at not too early a stage and make them known to His Majesty's Government, and that seems to be profitable not only to the House but to my colleagues and to me. I do not propose to reply to the whole of the debate; if I were to follow the noble Lord, Lord Latham, I might be in some danger of committing indiscretions. He is at liberty to say just what he likes on the subject of international relationships; I am a little more circumscribed, but perhaps I can give him some assurance if I say one or two things. He need have no fear that we are not thoroughly well informed on the subject of international currency problems and the importance of securing the position of this country. Moreover, it is because conversations on these matters are taking place at the present time that I do not propose to say any more on that subject, although when those conversations are concluded it will obviously be the duty of one of us to inform your Lordships of the results of them.
I am grateful to the noble Lord, Lord Addison, for having come to my rescue, not for the first time, when I was in a little danger of being misunderstood. There is nothing so pathetic as to feel oneself misunderstood. Perhaps I was guilty—it was a guilt induced by a desire for brevity—in a speech in your Lordships' House in not expounding my ideas on the subject of the financial effect of a certain amount of devastation which had taken place. More learned people than I, who were economists, took me up and judged me—I make no complaint—on my brevity. I am grateful to the noble Lord, Lord Addison, for having come to my rescue and, I hope, vindicated me to-day. There is one thing about which both the learned economists outside and Lord Latham in this House can be quite sure, and that is that, as a considered judgment based on some practical experience both as a banker and as a man engaged in commerce, I have come to the conclusion that an expansionist policy is the right and proper policy for this country to pursue. I noticed a sort of penitential atmosphere about the speech of the noble Lord, Lord Addison, to-day, when he looked back on the arrears of the past and deplored the previous generation of statesmen—not perhaps for their lack of wisdom so much as for their lack of courage. If indeed that was the case,

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then they were particularly to blame because they were sinning against the light, and that is one of the major crimes that any statesman can be guilty of. If we sin in this Government it will certainly be against the light, because we have had a great deal of light shown to us as to the way in which we ought to operate in the matter of reconstruction. I can assure your Lordships, perhaps very briefly this afternoon, of just a few points, and I hope that that will satisfy you, as to the lines along which our thoughts are going. And our thoughts will, I hope, subsequently be turned into action. But this is not the time for action.
In the first place we are realizing to the full the importance of creating plans now to deal with the economic factors that will arise when hostilities cease. There will be three periods of a very widely different nature. The first period, because it is the nearest, is the one that in point of fact is giving me personally for the moment the most concern, and that is the period immediately after the war—a period when men's hopes indeed will be high, but when we shall find ourselves having to move—industrially move, no, I will alter the word "industrially" and say occupationally move, because they may remain with the same firm—something like ten million people; not immediately, but over a period of time; and probably five million people in a comparatively small amount of time. We have these people who have been making guns, and will proceed to make articles of ordinary commerce. That means, of course, a great deal of alteration of machinery, and it is only those of your Lordships who are knowledgeable on the subject of engineering who know what interval of time takes place between the moment when someone decides that he is going to have a new machine and the time when, all the jigs and the tools having been made, you finally can get into mass production.
It was for that reason that I ventured some time ago in your Lordships' House to urge the engineering industry in particular, in so far as they had spare time, and spare minds, to be looking to this period and to make their arrangements, in order that we might more quickly move to the period in which we could find employment. Your Lordships realize already the very considerable number of factories
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that we have closed down altogether as productive factories, and arc aware of the various concentration schemes; many of these factories are now being used as storehouses. You realize the dependence we shall have upon raw materials, of which immediately after the war we shall certainly be short in very many directions. One of my greatest worries now is as to whether we shall have sufficient timber to meet all the demands for houses. Well, you can multiply that right through the whole range of raw materials, and you will then realize the difficulties we shall have at that period.
I merely mention these things because I want to make it quite clear that we are not going to have surplus capacity in that period immediately after the war, and it is one in regard to which we shall require all the advice that we can get if we are to handle it to the satisfaction of the public, and particularly of the men who will be returning from the Forces. It will be a period of great difficulty and a period of considerable uncertainty. Moreover, it is going to be a period in which public demand will most certainly exceed supply, and detailed plans must be and are being worked out in consultation between industry and Government in regard to the availability of labour and raw materials. During this period I think it is the general sense of the country that it will be necessary for us to keep control of some sort—I do not want to specify the precise control, but some control—over raw materials which are in short supply. And in view of the line along which the discussion has gone to-day I want to say this too. I think it will be necessary for us to make some stipulation that will ensure that we export goods at least to those countries from which we shall require food supplies. Your Lordships will not misunderstand me and think that I am advocating a policy of economic bilateralism by suggesting that we should export to the countries from which we buy. I personally believe that it will be on a multilateral policy that we shall probably restore our commercial and economic position overseas.
There is another thing I think I ought to say, and that is that during this period not only will it be necessary for us to have some control over raw materials. I think we might as well face up to it that we shall have to have some form of con-

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trol—whether it is Government control or some other disciplinary control—over consumption, because I can see no possibility in this transitional period immediately after the war of our having anywhere near sufficient ordinary goods of domestic use to meet the demands. People have long since grown, or some of us have, rather shiny and rather threadbare, and having for a considerable period of time—because somebody has used our coupons or for some other excellent reason—gone without things, we shall have the strongest possible temptation to want to buy them. If we want to do that, and money is to be left free to do its natural job, then prices will go up and up and up, and we shall be faced with a great deal of distress and disaster. I have dealt with this transitional period. Your Lordships may have thought I have been a little depressing. I hope you will not think that. I merely emphasize the fact that my colleagues and I are very conscious of the difficulties of the period and are using such capacities as we have in the hope that we may solve them. At any rate, I trust your Lordships will agree that we are thinking along the right lines.
Now I should like to take a longer view. It may be dreaming; it may be that our hopes are ambitious; but I believe that we can deal with the long-term problem of employment in this country. When I talk of employment, I agree entirely with the noble Lord, Lord Latham, that we are talking about useful and profitable employment. It is no use talking of "finding work" for people, as if there were any particular pleasure or virtue in working unless you are working to produce something or to do something useful. At any rate we are determined to do all we can to find work that will be socially beneficent work. Immediately after this transition period I do not think there will be any difficulty in finding employment for people. The danger is otherwise. For some time, possibly for some years—during which if we do not make our plans beforehand we may become negligent— we shall have a very big home market to satisfy. It will be very easy indeed to get a boom in trade in this country.
LORD LATHAM: Too easy.
LORD WOOLTON: We shall aim in our plans, not at getting a boom, but at getting regularity. Alternative booms and slumps are of no use to anybody except the speculator, and I understand that even he, on the whole, loses money on them. We must avoid letting the pent-up demand produce a rapid rise in price which would absorb the whole of those war savings about which the noble Lord, Lord Addison, spoke, and absorb them at the expense of these people who have put their money into Government at current values. It would be very wrong indeed if we let prices rise so high that when these people get their money back they were not able to get something approaching the values at which they put the money in. We are all very conscious of that. It is clearly in our minds, and it is a vast sum of money which is concerned. I wish Lord Mottistone had been here, because I should have liked to say to him how greatly indebted the Government are to him and to those 60,000 voluntary workers who are working with him in collecting and organizing this War Savings movement. Small savings from the Post Office Savings Bank and Savings Certificates amount at the present moment to £2,500,000,000. That is a very creditable sum, and it is a very valuable sum for us to have in reserve for the time when we shall want it.
In looking over our errors of the past, I think the truth is that our statesmen at the time were perhaps not very well equipped with economic information, and perhaps the science—if it be one—of statistics was not so good as it is now in enabling people to make forecasts of future trade. In future the Government will have the advantage, as we have now, of a central service of statistical information and expert advice in interpreting and forecasting economic trends and movements of trade. I hope that the Government will be able to take such steps as will enable them to be better informed in future than were the Governments between the two wars. I talk of the importance of this statistical information because it is vital that we should avoid unemployment by taking very early action to prevent it.
There will be a third period when all this willing spending is over. That is the period of danger, that is the period to which, I hope it will give some confidence

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to the country to know—long ahead as it may be—His Majesty's Government are now directing their attention. That will be the time when we must prevent disasters similar to the disasters to which the noble Lord, Lord Addison, referred. That will be the time for local authorities, public utility companies, and private undertakings to expend capital on plans which we shall encourage them to defer until this period, but which they must have ready to the last details of the drawing office in order that they can bring them into immediate execution.
I was interested in what the noble Lord, Lord Latham, said about public works. It is perfectly true that public works failed to do the job that people thought they were going to do in the thirties. But that was not the fault of the public works. It was because they were applied at the wrong time. They were applied when, already, unemployment was severe. We do not know how much worse it might have been if it had not been for these public works, but they were certainly not effective in preventing unemployment arising—and how could they have been when they were not brought into existence until unemployment, with all the secondary effects to which Lord Latham referred, had already started? We have under consideration plans to regulate the flow of public works. But there is another factor, a. financial factor. Bernard Shaw said that the only thing the matter with the poor was their poverty. The thing that creates unemployment is a failure in demand.
LORD LATHAM: Effective demand.
LORD WOOLTON: A failure in effective demand I agree. I believe we can find a sort of economic thermostat that will enable that demand, which in point of fact is always present in this country, to become operative. If we can do that then we shall have done a great deal to attack the problem of unemployment in its earlier stage rather than attacking it when it has already arrived. There is the other question to which the noble Lord referred and that is what I am told is called "structural unemployment." It is quite obvious that it is a bad thing for any community to be entirely dependent upon any one industry. The noble Lord, Lord Portal, and I worked together for several years before the war as Treasury
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Commissioners for Special Areas. I then saw the misery and the economic and physical disasters that came upon those neighbourhoods. We are conscious of that and we are very well informed about it. We have reasonable hopes of being able to take effective action because we have built during the course of this war a quite considerable number of Government factories in those very areas. They are good factories and many people are employed in them who had for a period of time ceased to become competent operatives in industry, but they have reacquired their native skill. In the process of dealing with these Government factories in the post-war period we shall have regard to the creation of a diversity of industries in those places. I am glad to say that some of the leading industrialists of the country who arc responsible for the operation of those factories during the war are so satisfied with the skill of the operatives that they have become very willing indeed to listen to us when we suggest that when the war is ended and their particular operations for the production of munitions comes to and end, they should continue to operate those factories in order to produce other things and help to create some diversity of industry in those localities.
On this particular point there is one other observation that I think I might profitably make at this stage. I am hopeful that there may come to this country after the war, as in fact throughout our history there always have come, new industries. We have been accustomed in the past to going abroad for very many things. For some reason or other industries making those things have settled themselves in foreign countries. There are some of us who made rather strenuous efforts before the war, not perhaps with a great deal of success, to persuade the people running those industries to come and build their industries in this country. I think those people may be a little more inclined, when the war is over, to appreciate the freedom and security which this country is able to give to such manufacturers. I have been making inquiries and I believe there is a great opening for those manufacturers here. I think that consumers would welcome them. I am not in this taking any narrow nationalist view. I am assured that our financiers would be willing to give them facilities to obtain working capital in order that they might

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establish enterprises that would enable them to employ British labour, and perhaps teach British labour the peculiar qualities of their technique and skill in manufacture. Thus goods made abroad in the past might be made particularly suitable to British markets.
I have kept your Lordships longer than I intended. What I have been trying to do, and I hope I have at any rate succeeded in part in doing it, is to assure your Lordships that on the problem of finding jobs for people after the war His Majesty's Government are taking a long view, that they are seeking to plan for the situation over the three periods, that they are recognizing to the full the particular dangers of the immediate and very probably short transitional period, and that they realize the dangers of the boom. They will seek to gain the confidence of the country, at any rate to control that boom, pleasurable as it might be for the time being for some people. With the vast resources, financial and otherwise, that the Government will have at their disposal they will, when the boom is over and we get to a normal period of life in this country, seek to bring about regularity and continuity of employment for all the people.
I hope Lord Bingley will not think I have been discourteous to him because I have not dealt with the problem of agriculture. It is quite beyond my brief to answer questions upon that. I dare not answer the questions he asked me, because if I start dealing with Death Duties I shall find myself in the black books of the Chancellor of the Exchequer, and very properly so. I will tell the noble Lord, however, that in regard to allotment holders I am most anxious in any planning that we should give them some sort of security so that their labours may be able to go on from year to year. I have discussed this matter with my colleague the Minister of Town and Country Planning in the hope that our planning arrangements will provide for that. On the general subject of agriculture this House is very well aware of my views regarding the importance of this industry not only to the economic life of the country but to its general health and well-being. I expressed those views to your Lordships very often when I was Minister of Food, and they have not changed now that I have become Minister
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of Reconstruction. I hope I have not kept your Lordships too long.
LORD ADDISON: My Lords, I am sure your Lordships will agree that we have had a very interesting and a very significant discussion this afternoon. I would like now to express my appreciation of what the noble Lord has been able to say so far. With respect to the statesmen of the past generation who made mistakes to which he referred and to which I referred. I would like to make this observation. It is a wholesome thing when a mistake has been made to recognize it. But I would like to say that the mistakes that were made then were not made because of lack of information. They were made because those who were in charge were stampeded for various reasons into wrong actions. It was not for lack of informed guidance. I hope, therefore, they will not be repeated.
I have in my dossier a little quotation from the present Prime Minister which I dug up the other day. It relates to that very spirit, and with the leave of your Lordships I would like to read it in concluding this debate. It is from the volume of The World Crisis called "The Aftermath," Chapter 2, page 33. The book is in the Library of your Lordships' House. This is what the Prime Minister said of the disposition which came over people on November 11, 1918:
"A requisition, for instance, for half a million houses would not have seemed more difficult to comply with than those we were already in process of executing for 100,000 aeroplanes or 20,000 guns, or the medium artillery of the American Army or 2,000,000 tons of projectiles. But a new set of conditions began to rule from eleven o'clock onwards. The money cost, which had never been considered by us to be a factor capable of limiting the supply of the Armies, asserted a claim to priority from the moment the fighting stopped."
Nothing truer was ever written. The mistakes were made not because we had not information, but because for various reasons which it is not material to go into now the wrong courses were allowed to be taken. I am glad to think that the noble Lord and his colleagues will have the virtue in the future to resist that type of person which I assure him is still in existence in large numbers. I beg leave to withdraw my Motion.
Motion for Papers, by leave, withdrawn.

JUVENILE DELINQUENTS IN SCOTLAND.
LORD SOUTHWOOD: My Lords, I beg to ask the question standing on the the Paper in my name.
The question was as follows:
To ask His Majesty's Government, whether they can supply figures of proven offences by juvenile delinquents in Scotland for the year 1943.]
LORD TEMPLEMORE: My Lords, I have been asked to reply to this question. The information desired by the noble Lord is at present being collected. As soon as the reports are received and have been summarized, the figures will be sent to him by my right honourable friend the Secretary of State for Scotland.

BECKETT HOSPITAL AND DISPEN-SARY, BARNSLEY, BILL
Report from His Majesty's Attorney-General received and ordered to lie on the Table.

PRIVATE BILLS
The LORD CHANCELLOR The LORD CHANCELLOR acquainted the House that the Clerk of the Parliaments had laid on the Table the Certificate from the Examiners that the further Standing Orders applicable to the following Bills have been complied with:

Jewish Colonization Association [H.L.].

People's Dispensary for Sick Animals of the Poor [H.L.].

Ascot District Gas and Electricity [H.L.].

The same was ordered to lie on the Table.
House adjourned.