Lords Sitting of 29 February 1944

Preamble
The House met, The LORD CHANCELLOR on the Woolsack.
SUPREME COURT OF JUDICATURE (AMENDMENT) BILL.
Returned from the Commons, with the Amendments agreed to.
DEATH OF THE EARL OF CHICHESTER.
THE SECRETARY OF STATE FOR DOMINION AFFAIRS (VISCOUNT CRANBORNE) (Lord Cecil): My Lords, I regret to inform the House of the death on active service of Captain the Earl of Chichester. Your Lordships will, I am sure, wish me to express our deep sympathy with his relatives.

HOUSE OF COMMONS DISQUALIFICATION (TEMPORARY PROVISIONS) BILL.
Order of the Day for the Second Reading read.
THE LORD CHANCELLOR (VISCOUNT SIMON): My Lords, I move the Second Reading of this Bill, the effect of which is to continue for a further period of twelve months the House of Commons Disqualification (Temporary Provisions) Act, 1941. That Act itself was for a limited period, and there have been two enactments since which have extended the period of its operation, each time for one year. If the present measure is passed, the period to which these temporary provisions may operate will be carried down to March 5, 1945. The urgency, therefore, of carrying this Bill at once will be obvious because otherwise the existing legislation will expire next week.
The Bill deals, as your Lordships will recall, with offices of profit under the Crown. That is an interesting subject with a long history behind it, and a subject on which a Select Committee of the House of Commons, presided over by my noble friend Lord Hemingford, made a
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most valuable Report to Parliament some time back. There is nothing very scientific about the existing law on this subject, which draws a distinction between old offices, which are offices of profit under the Crown that may be held by a member of the House of Commons, and new offices of profit which are offices that cannot be held by a member of the House of Commons. The only difference between the two categories is that the first lot came into existence before and the second lot after a particular moment in the reign of Queen Anne—in the year 1707.
The history is interesting to us because there was a moment when it very nearly happened that we adopted the law that nobody who held an office of profit could sit in the House of Commons at all. In that event we should have had something like a separation between the Executive and the Legislature, which is a prominent feature of the Constitution of the United States; but before our ancestors finally put in force that provision—which they had carried—they repealed it and substituted the Act of 1707. It was felt—and for us at least this is a good argument—that it really was necessary to have a certain number of Ministers holding offices in the House of Commons, and on the other hand it was most desirable that the number of persons holding offices of profit who were in the House of Commons should not be too large. Consequently, legislation was passed, as your Lordships know, which provides that old offices of profit may be held with a seat in the House of Commons and new offices may not, unless Parliament specially provides otherwise, as Parliament often does. There is, for example, the case of a number of the new Ministries. Take the Ministry of Agriculture—an example before the war. The Ministry of Agriculture was created, and by the express terms of the Statute the holder of that office may sit in the House of Commons. To take a later example within the period of the present war—the Minister of Economic Warfare. By express provision of the law he may sit in the House of Commons.
When you come to the actual period of war such as we are living through now, it has been felt that some special considerations arise. It is a time when everybody wants to undertake what he properly can in the public interest, and it is a time when the Government or the head of the

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Government may very well be anxious to use a man who is a member of the House of Commons in a position which is technically an office of profit, though at the same time the individual may be very unwilling to give up his right to sit in the House. An office of profit in this connexion does not mean an office under the Crown for which, in fact, payment is made to the holder. There are offices of profit for which no payment is made at all. The test is not whether the individual is paid; the test is whether the office is the sort of office which would normally receive payment. Thus, for example, a member of the House of Commons who is chosen to take a particular position cannot retain his seat by the simple expedient of saying, "Oh, I shall not take any salary ". That does not make any difference at all. It still remains an office of profit if that is the general nature of the office. Therefore, unless some provision is made in war-time for the beat use of the services of some members of the House of Commons, which the Prime Minister and the Government are anxious to put to a particular use, no arrangement that these members will not receive any salary—as indeed is the case with a large number of the gentlemen who have been certified— would in the least alter the strict operation of the Act of Anne.
That is the situation in which the original Act was passed early in the war. The provision in fact was this, that if the First Lord of the Treasury certified that the appointment of a particular member to this office of profit "is required in the public interest for purposes connected with the prosecution of the war," then the office ceases to disqualify him. There was some criticism, I think, of the original Bill. Certainly one outcome of it was the Committee, presided over by Lord Hemingford, to which I have referred. That Committee recommended that when the original Act was extended, if it ever were extended—for it was only to last for twelve months—there should be set a limit to the number of certificates under the Statute. I think they described it as "a reasonably wide limit" as to the number of individuals in the House of Commons which could get this anomalous advantage—namely, that they were appointed to a new office of profit by the Prime Minister's certificate, which I have just summarized, and consequently
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did not lose their seat in the House of Commons.
Therefore in the second Bill, which was for carrying on the arrangements after twelve months, there was inserted a limiting provision. That provision was that not more than twenty-five members of the House of Commons should be allowed to enjoy this advantage at the same time. In fact the number of members now certified under the Bill is, I think, nineteen. Most of them (but not all of them) are in this country doing whatever service it is which they have been appointed to do, and therefore they are not by absence unable to attend the House of Commons, though a few of the others are in that position. In any case the matter is a purely temporary war-time measure. After some discussion in the House of Commons, which was quite natural, the Bill was carried without dissent and it now comes to your Lordships' House to be confirmed by this Assembly. If this Bill were not carried the whole of this arrangement, as I have already pointed out, would automatically come to an end in the course of next week. That unquestionably could not be regarded as a desirable thing; consequently I do not doubt that for that reason, if for no other, your Lordships would be prepared to approve of the decision unanimously reached by the House of Commons to prolong this purely war-time measure for another year.
There was an Amendment made in the Commons which your Lordships will have been glad to note in the present Bill—namely, that a return should be published before the end of January as to the number of the Members of Parliament who are holding these certificates. Some of the services being performed are very large and important and some are of a much more limited character, like presiding over some particular War Board and things of that kind. That, therefore, will be done. If time should so work out that we shall have occasion to consider this matter further in a year's time, there will be a precise return available showing exactly who are the individuals who have been appointed, what is the service which they are rendering and what is their salary, if any, at that stage. I hope I have made plain to your Lordships that really the test of whether a particular appointment is an office of profit is not definitely answered

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by inquiring whether the individual filling it is getting a salary or whether he is giving up a salary It is the nature of the office which decides what constitutes in the proper sense an office of profit under the Crown.
If I may conclude with a word of my own view on the matter, I would say that I think that the examination made of this whole subject by Lord Hemingford's Committee was of the greatest possible help. They pronounced their deliberate conclusions on a number of very difficult and very doubtful points and I do not doubt it would be an advantage, if time could be found, to have legislation on the lines of their more permanent recommendations. This, however, is a war-time measure for a purely temporary purpose. I think we shall probably all agree that the principle of Members of Parliament holding this kind of office puts them in an anomalous position and that their number should be strictly limited. It is not merely in the interests of the House of Commons, it is in the interests of both Houses and of the nation that there should not be an unlimited opportunity for an increasing number of Members of Parliament who are specially connected with the Government of the country by holding these offices. That has been assured by this limiting of the number to twenty-five and in fact, as I have slid, the number at this moment is nineteen. I hope with these considerations in mind your Lordships may be disposed to give a Second Reading to the Bill.
Moved, That the Bill be now read 2a.—(The Lord Chancellor.)
On Question, Bill read 2a, and committed to a Committee of the Whole House.

INCOME TAX (OFFICES AND EMPLOYMENTS) BILL.
Order of the Day for the Second Reading read.
THE LORD CHANCELLOR: My Lords, I have again to ask your Lordships' attention to a Bill, the Second Reading of which I am now moving, but I hope here to be quite brief, for in November last I had the duty of explaining to your Lordships' House, as clearly as I could, the very complicated and very interesting provisions amounting to a most important change in our Income Tax procedure
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which popularly has come to be known by the name of "Pay as you earn." It is a provision by which those who are taxed to Income Tax under Schedule E—that is to say, broadly speaking, those who receive salaries and wages—are taxed not in reference to the figures of a previous year but arc taxed as they go, week by week, or fortnight by fortnight, or whatever it may be, so that they are never either behindhand nor indeed (to take a still less probable case) beforehand in paying their taxes.
When I explained this Bill to the House last year I stated, as was said in another place, that there was a limitation in the scheme which it was hoped to remove. The limitation was that according to the previous Bill, which is the present law, this scheme of paying as you earn as applied to salaries either monthly or for a longer period would only apply if the salary was not more than £600 a year. There is no logic or scientific reason for that figure. The principle of the scheme can be applied just as well if you take larger salaries. For the time being the limit in the case of salaries was £600 a year. That was mentioned, as I have said, when the previous Bill was before Parliament. I venture to quote one sentence from what I said on November 4 last year, when I explained the Bill to your Lordships. I said:
"The Bill applies also to those receiving salaries not greater than £600. They also will find that they will pay as they earn. Beyond that, the Chancellor of the Exchequer has promised, as your Lordships will no doubt have noticed, that since there is no scientific merit in stopping at £600 a year, he will, in a future Finance Bill, extend this arrangement to all salaries, however large, with some very necessary safeguards.
As a result, it is the principal object of the present Bill to remove that limit. As a result of it, without regard to the size of the salary if it is a salary which comes for assessment under Schedule E, this system of pay as you earn will apply to this salary as well as to smaller salaries or to wages.
To take a concrete example, a man who was earning £800 a year as a salary last year and £900 as a salary this year, will find that the principle of pay as you earn will apply to the £900 and he will pay according to the present rate of salary. There is an exception which perhaps I might mention—it was also in the original Bill, if I am not mistaken—relating to

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pay, pension or other emoluments payable in respect of service in or with the Armed Forces of the Crown. That exception is made for purely practical reasons. If you take members of the Forces who are now serving in so many parts of the world it really would not be practicable to apply week by week the rather elaborate calculations which can be made with the help of the Inland Revenue here at home. Therefore it is not possible to apply this system. It is provided that in the case of members of the Armed Forces there shall be a deduction of tax from pay, tout it is a deduction in respect of last year's income. The cases are not common, but there arc cases, I suppose, where a soldier or an officer in the Forces may be earning this year a smaller income than last year—cases, for example, where a man goes back to substantive rank and loses the pay of the rank he was holding. It would be hard to make such a man suffer a larger deduction in respect of a rate of pay which he is no longer receiving.
In Clause 5 there is provision that:
"If, in the case of the year 1944–45 or any subsequent year of assessment, it appears that the Income Tax payable by a person in respect of any pay, pension or other emoluments payable in respect of service in or with the Armed Forces of the Crown has been computed by reference to the amount thereof for the previous year of assessment—"
that is the contrast between acting pay and substantive rank—
"and that the actual amount thereof for the year is less than the amount thereof for the previous year, that person shall be entitled to such relief from Income Tax (including Surtax) as will reduce the amount payable by him to the amount which would have been payable if the tax had been computed by reference to the actual amount of the pay…"
I think that is a very useful provision, which will be greatly appreciated among many who are wearing the uniforms of the Crown.
There are several other small provisions in the Bill. I have done my best to prepare myself to answer any questions about them—I will not promise to do so, but I think I can—but I will not occupy your Lordships' time by offering these explanations in advance. I have told your Lordships the substance of the Bill. It passed through the House of Commons with general consent and I ask your Lordships now to give it a Second Reading.
Moved, That the Bill be now read 2a.—(The Lord Chancellor.)
On Question, Bill read 2a, and committed to a Committee of the Whole House.

TANGANYIKA.
LORD CHESHAM LORD CHESHAM had given Notice that he would ask His Majesty's Government what steps they propose to take to implement the recommendations contained in the Report made to the Governor of Tanganyika Territory in May, 1940, by the Central Development Committee, which was appointed by him in December, 1938; and to move for Papers. The noble Lord said: My Lords, I make no apology for introducing the Motion which stands in my name, because a position has arisen of which your Lordships should be made aware. My Motion refers to the general development of Tanganyika Territory This was referred to fairly extensively a few weeks ago when the question of white settlement in East Africa was under discussion in your Lordships' House. At that time I tried to make it clear that white settlement, or non-native settlement, formed only a part—a very essential part, but still only a part—of the general development of any territory. It is to other forms of development, which are not only desirable but many of which have become of a very urgent nature, that I want to draw attention to-day.
Your Lordships will remember that Tanganyika prior to 1914–18 was German, and that a Mandate was given to this country. It is an enormous country. The land area alone is over 340,000 sq. miles. I want your Lordships to pay particular attention to the most recent figures I have got of the population, because they are rather important. The most recent figures I have got are more or less an estimate made in 1938. Then there were 9,000 Europeans—and that figure of 9,000 included officials, Germans, Greeks, Italians and other nationalities besides British—33,000 Asiatics and no fewer than 5,500,000 natives. That is an astounding difference. It is to those 5,500,000 natives that I would like to refer for a moment. From what has been said in your Lordships' House and in other places there seems a certain amount of popular misconception as to the African natives. Because a man happens to be coloured

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black a lot of people think that all black men are the same. If a native from one part of Africa has certain characteristics people are inclined to think that another native from an entirely different part must have the same qualities and characteristics. Nothing could be further from the truth. You have degrees of development and degrees of qualities all the way through Africa which make a very big difference between natives even although they happen to be living, geographically, comparatively not far from each other. It is quite absurd to compare a native from West Africa with a native from East Africa. The degree of development is very much higher in West Africa than the average in East Africa. In Tanganyika Territory itself there is a very large number of different tribes who have different habits, different customs, a different appearance and different languages.
When we took over the Mandate for Tanganyika after the last war we found that the Germans, who had owned it before, had done comparatively little towards native development or increasing and encouraging native production. We made a start in that direction, chiefly agriculturally, as is natural, with cotton, hides, maize and other products for which the country is suitable. But then came the 1929–31 crisis, and the necessary call for economy meant a big reduction of staffs and of general expenditure, which had a very big effect on the policy which we were trying to carry out. The result was that progress in that direction almost came to an end. Since that time and until just before this war the position has been more or less stationary. I know that some progress can be claimed in the encouragement of native development, but what progress has taken place is infinitesimal having regard to the number of natives and to the vast tracts of country to be dealt with. In a few parts of the country great progress has been made by the natives, chiefly in the coastal districts and in other parts where the natives have been in close contact with Europeans; but these areas are very small when compared with the vast tracts of land where the natives have not the advantage of being in close contact with Europeans.
The result is that at the present moment there are literally millions of natives who are ex: sting, at a very low standard of
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subsistence, on what they can produce from the soil, and that soil itself is losing fertility and losing in power of production through lack of knowledge of good husbandry. That is rather a gloomy thought, but what is far worse is that the natives themselves are losing, and in many cases have lost, all initiative and ambition to lead any improved kind of existence. They arc content to stagnate, living on what they can produce for their own needs from the soil. The result of that is very bad. Their physical constitution has suffered, and their mental development is suffering for the same reasons, and also because of the very limited amount of education which is possible to them. The future for these millions of natives is in fact very dark unless something is done.
In 1938 a Committee was appointed by the Governor, with very wide terms of reference, to make a general survey of the Territory, to inquire into these questions, and to make representations as to what could be done to remedy the situation. That Committee did admirable work, and issued a Report to the Governor in 1940 which is really a most remarkable document. It is rather lengthy, and I shall not read it, but it is a real effort to analyse the troubles and their causes and to see what remedies can be applied. In that Report there are a great many recommendations on varied subjects, the carrying out of which would be of inestimable value to the Territory as a whole. I referred to that Report some time ago, when we discussed the question of white settlement, and I am not going to quote from it to-day or to go into its recommendations in any detail; I merely want to touch very briefly on some of the main recommendations. As a result of the general survey, the Report itself emphasizes the enormous scope for development in that Territory, and lays very particular emphasis on the absolute necessity of raising the standard of living of the natives. This point, and the necessity of providing the natives with some incentive to work, are fully realized by all those connected with the Territory. Various organizations and bodies have issued manifestos and recommendations on that subject recently. The Association of Chambers of Commerce and Industry of East Africa has issued a memorandum emphasizing the urgent necessity of raising the standard of living of the natives, and the Report

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to which I have referred lays emphasis on the vast internal market which could and should be opened up by that means.
As a result of the Committee's survey of the land possibilities, it became apparent that in some areas the soil was of very low fertility and, as one would expect, the native population sparse. In other areas, however, where the soil was of equally low fertility, there was a very dense population of natives, so dense that the soil was in very great danger of becoming completely exhausted, so that eventually there would be a severe danger of starvation. In other parts of the country the soil was highly productive, yet the population was so sparse that the soil could not be properly developed and used. The Report also refers to soil erosion and to the possibilities of dealing with that very serious subject. It is interesting to note that in Tanganyika soil erosion is worst in those areas where no economic crops are grown and the natives try to gain a living as best they can from the soil.
The Report also makes some strong references to the question of non-native and white settlement in suitable areas. I am not going to dilate on this subject to-day, because it was debated a few weeks ago; but the Report does emphasize the very greatly increased number of products which would thereby be made available both for the internal and external markets. Such varied subjects as mining, forestry—of the greatest importance—water and irrigation, the establishment of markets, the enormous question of public health, education and the whole of the financial provisions for these subjects, are very thoroughly gone into in this Report. Not least among them are some very far-reaching recommendations as regards communications—roads, railways, air and telecommunications. Possibly that is the most important part of the whole Report, because without communications success is absolutely impossible in any other form of development. I have very barely and briefly mentioned the subjects contained in that Report, each one of which is really worth a lengthy debate in this House. My difficulty to-day has been to condense so much of importance into the brief space of time which I propose to occupy this afternoon. What I have tried to show is the position inside the country and the
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urgent need to do something to remedy it. In this Report you have recommendations made by people who know the country, who have made a study and survey of it, and who make very far-reaching recommendations.
I may have painted rather a black picture of the position of very many of the natives of the country at the moment, but it is the truth and it is not exaggerated. What is frightening so many people who are interested in Tanganyika is that there does not seem to be any possible means of bringing the recommendations in that Report into effect. It is now four years since that Report was presented to the local Government in Tanganyika and so far not a single concrete scheme has been put up from Tanganyika to the Colonial Office so far as I am aware, with any concrete suggestions that action should be taken. I know that from a great many other territories in Africa and in other parts of the world which are administered by the Colonial Office, a number of schemes have been put up, have received the approval of the Colonial Office, and are being put into effect. Nothing has come from Tanganyika yet, and the fear of so many of us here that this admirable Report may be pigeon-holed and forgotten is increased by the fact that there is no indication on the part of the local Government in Tanganyika that any other course will be taken. The Chamber of Commerce in Dar-es-Salaam has on several occasions approached the local Government and asked if anything is going to be done to put the recommendations of the Report into a genuine development scheme, and I must say that the reply has always been most unsatisfactory—that the time has not yet come when such a scheme should be put forward or that there is no intention of doing so at the moment.
I know that the Governor and all the authorities there have been extremely busy, but it does seem as if this Report may be pigeon-holed. It is going to be quite impossible to introduce from the Colonial Office legislation of the kind that is required out there for the territory. I am not suggesting that the Colonial Office should introduce a scheme of their own. That would be most unsatisfactory. Nevertheless, I do urge the Secretary of State for the Colonies to take every step he can to get at any rate some of the

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recommendations in that Committee's Report turned into a satisfactory development scheme. It is urgent that it should be done soon, because sooner or later—and I sincerely hope sooner rather than later—there will be many thousands of natives demobilized from the Forces. I do not think it is betraying any secret to say that those natives have been outside Tanganyika; they have seen other countries, other conditions of life, and the conditions under which they have been living have been a considerable improvement on the conditions in which they live in their own Territory. When they are demobilized there will be a tremendous field in which the Government can encourage a higher standard of living and a higher standard of native production right through the territory.
Your Lordships know that from time to time there has been criticism from abroad, and even occasionally from British subjects, of the administration of the British Empire by Parliament, and of the diverse races and peoples which the Empire has to look after. I have always been one of those who, from personal knowledge of various countries, have considered such criticism absolutely unjustified and not worthy of serious consideration; but I must admit that the present situation,, involving 5,500,000 of natives, makes one wonder whether there will not be justification for such criticism as regards Tanganyika unless something is done and unless the opportunity that is now presented is made full use of. The basic responsibility is yours, my Lords; it is the responsibility of Parliament. It is for that reason that I make no apology for drawing your Lordships' attention to what may become a serious situation unless some prompt action is taken. I beg to move for Papers.
LORD FARINGDON: My Lords, I am sure all your Lordships have been profoundly interested by the speech of the noble Lord, who, as we all know, speaks from intimate experience of Tanganyika Territory. I will detain your Lordships for a few minutes only to-day, but I cannot resist the impulse to rise to support the noble Lord, and in particular to support his plea of urgency, although I cannot share the view which he appears to hold in common with the noble Duke, of the perfection and apparently the complete rightness of British rule at all times
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and in all places. I share with him a conviction that the problem which he has brought before us to-day is one of the greatest importance and, above all, of the greatest urgency.
In order perhaps to impress that urgency upon your Lordships I will draw your attention to certain facts in connexion with the situation in Tanganyika. The noble Lord himself admitted that he had perhaps painted rather a dark picture. I confess that from the information that I have received the picture that he has painted has been, if anything, unduly optimistic. The noble Lord would, I think, agree with me that probably the basic problem of Tanganyika Territory is water. Your Lordships are probably aware that practically two-thirds of this territory is, to all intents and purposes, uninhabited, and if it is uninhabited that is because of lack of water. Two-thirds of the population are crowded into one-tenth of the land; one-sixth—that is half of the remainder—are on one-twelfth of the land; and the final sixth on about another fifth. This indicates clearly a very curious distribution of the population, and the reason for this is primarily, I suggest, a question of water. The rainfall of this Territory is extremely variable and it results in a large part of the Territory being in complete aridity. There are reported to be considerable underground sources of water in the dry part of the Territory but whether these can be developed or not is yet uncertain. It would, in any case, probably be expensive.
But in addition to this difficulty and the climatic difficulty, which is increased by the fact that in the highlands during the dry season there is an amount of dust which is exceedingly injurious to health and in the wet an amount of mist and cloud which also gives rise to respiratory troubles, particularly in the case of Europeans—apart from all this, the unfortunate Territory is also cursed with the tsetse fly and the tick. These pests are probably mainly responsible for the unfortunate situation of the African people because the form of cultivation at present in operation in this country is what is called, I believe, the cultivation steppe system. That means that in the rain forest and tall-grass-tree savannah, since the tsetse fly and tick make the keeping of cattle impossible, the natives are driven to a form of shift-

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ing cultivation and, to protect their cattle, have destroyed the tall-grass-tree or bush savannah and have substituted for it a low grass steppe. The result has been that the previously scattered gardens of shifting cultivation have now moved closer together. The fallow lands are not given time to rest but are given over to cattle, and, finally, land utilization becomes almost continuous.
Owing to sleeping sickness and to the cattle the forest is steadily disappearing and the land is becoming steppe. The result is that the population is steadily becoming more and more concentrated, and this gives rise to the conditions which the noble Lord has described. With this concentration and the destruction of the forest goes a decrease, if not actually in the rainfall—because I believe that scientifically that is not absolutely certain—certainly in the capacity of the land to retain moisture. This forms a vicious circle, resulting eventually in loss of fertility of the soil owing to excessive use, soil erosion, and, finally, desert conditions and starvation for the population. There is already a very strong demand from Africans for additional land and the apparent land reserves are entirely illusory.
I wish to support the noble Lord in his plea of urgency. The situation in Tanganyika seems to me to be for this population of 5,500,000 one of the most dangerous and most critical. I have in your Lordships' House on other occasions urged the setting up for Africa of a Commission like the Stockdale Commission in the West Indies. I wonder whether some such Commission could not be set up and whether the noble Lord would not support me in that suggestion. I believe that if such a Commission were operating in these territories, with the Funds of the Colonial Welfare and Development Act behind it, much could be done. At any rate we should have a clear vision of what could be done. The Sandford Committee's Report, of which the noble Lord gave extracts the other day, is an authoritative document. I am unable to accept all its views and recommendations. As the noble Lord will appreciate, I refer in particular to white settlement. I cannot think that white settlement of Tanganyika would be any more beneficial for the natives of that Territory than it has
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proved to be in Kenya. Still, as the noble Lord has pointed out, this is really a point we discussed at some length a fortnight ago, and if I correctly understood the reply of the Colonial Office, which was somewhat overlain by the personal enthusiasms of the noble Duke, the Government are unlikely to accede to any extension of the idea of white settlement. I fancy that may be one reason why the noble Lord has not pressed that particular view of the Sandford Committee.
My object is to impress upon His Majesty's Government the urgency of this situation, and I would like therefore to give your Lordships a quotation from a report by the Commissioner for the Western Province with regard to the health conditions of the natives which came to light as a result of recruitment for the forces. He says:
"…it has come as a shock to observe the high percentage of recruits rejected by the military authorities. It is true that the medical tests for the Army are stringent, and that many of the recruits are not the best physical specimens that the tribes can produce; but even so it is appalling to find such a high percentage of the population graded as C.3.…it is a conservative estimate to say that over 50 per cent. of the men examined are rejected for military service of any nature. The proportion quoted for the Wafipa is in respect of a fairly healthy tribe. That for the Uha is very much worse, only one in ten men called up being found to be fit for service. When it is remembered that on the application of conscription to Great Britain only five per cent. of the men were rejected as unfit for service, it is clear that there is still a tremendous amount of work to be done in improving the standard of living and the physique of the native population."
I think that this is something of an indictment of the rule of this Territory during the last twenty years. It is true, perhaps, that we inherited an unfortunate situation, but it seems to me that this picture of native backwardness, of native ill-health and recently, in 1942, of native starvation, does not reflect too favourably upon our government of this Territory. With all the earnestness that I possess I add my voice to that of the noble Lord in pressing upon the Government the urgency of this situation and the necessity for producing schemes to deal with it.
LORD WINSTER: My Lords, I listened with the deepest attention to the speech of the noble Lord, Lord Chesham. I hope his Lordship will allow me to say that I think his speech illustrated once

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again how fortunate we are in this House to have noble Lords who are able to speak not only with such complete firsthand knowledge upon such subjects, but also able to speak with such conspicuous fairness, and impartiality. I think that was the quality in his speech which impressed me above all others. But what had the noble Lord got to say about the condition of natives in Tanganyika? The noble Lord spoke of millions of natives living at a very low level of subsistence; he spoke of natives losing initiative and ambition, who are content to stagnate; he spoke of how their mental development was suffering and of the limited educational facilities open to them. The noble Lord said that the future for them was extremely dark, and he also stressed the absolute necessity for raising the standard of living of the natives. Yet, in spite of those words spoken by the noble Lord with such fairness, he had to tell us that not a thing had been done for years after the Report had been issued calling attention to these matters.
The only point in the noble Lord's speech upon which I would differ from him at all was when, following upon such a revelation of inaction, the noble Lord said that he thought criticism was largely unjustified and that he would not lend himself to any criticism of the Governments concerned. I think it was indeed a dark picture which the noble Lord drew and I hope the noble Duke who is going to reply may be able to make a rather more satisfactory answer than I consider he made when the question of white settlement in East Africa was debated at the beginning of this month. On that occasion the noble Duke tried to fasten upon me a quarrel with white settlers in East Africa. Nothing could be further from my thoughts. Far from having any quarrel with white settlers in East Africa I on the contrary admire, welcome and respect their ambition and their enterprise and initiative. I have no quarrel at all with them. I only wish so far as I possibly can to help them in any way whatsoever. I wish that more of our race would follow their example in going out into our Colonial Empire and endeavouring to further those great principles of Colonial settlement for which we have stood.
But if I ventured to urge upon your Lordships certain defects which I consider exist in our legislation so far as the indi-
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genous populations are concerned, that is not out of any hostility whatsoever to the white settlers in our Colonial Empire. It is only because I believe that prosperity is a mutual affair, and I do not believe that the ultimate prosperity of the white settlers in our Colonies can be served by any policy which depresses or depreciates the prosperity of the indigenous races. Prosperity is a mutual affair and the prosperity of our white settlers in our Colonies will be best served by promoting the prosperity of the indigenous races. To take a case in point. It is a very short-sighted view to think that the prosperity of our white settlers is promoted by stimulating the production of export crops. On the contrary, to stimulate the production of crops which are consumed at home will not only benefit the indigenous races, but must in the long run, taking the long view, also react to the benefit and to the prosperity of our white settlers. Therefore I most strongly repudiate this attempt of the noble Duke's to foist upon myself some pretended quarrel with the white settlers which has no existence except in his own mind and is a thing furthest from my thoughts.
I hope the noble Duke may be able to make a rather more satisfactory reply to the debate to-day than he made on the debate on white settlement in East Africa. I think his reply on that debate was perfunctory almost to the point of flippancy, and almost to the point of discourtesy. Anyhow, it was a reply which drew upon the noble Duke a very severe rebuke from the Economist, a paper which does not express itself without very grave consideration and due thought. I was very interested indeed to notice the severity of the rebuke from the Economist concerning the noble Duke's reply. I spoke on that occasion of soil erosion. The noble Duke in his reply showed that he was completely unaware of what the agricultural officer of Kenya himself had reported on soil erosion. The noble Duke also in his reply showed himself completely ignorant as to what is the effect of soil erosion upon native agriculture. He asked me what I really meant by what I had said upon that subject. I have the advantage of having served in both Houses of Parliament with the noble Duke and therefore I am well able to estimate his political powers. I think by common agreement they are not very great, although no doubt his administrative powers and abilities are far greater.

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I must really call attention to this one point in regard to the noble Duke's capacities, for these debates are reported in the Colonial papers. Our Prime Minister has great veneration for the House of Cavendish, as we have seen recently expressed in a letter to the electors of West Derbyshire, which apparently had rather an unexpected result. But possibly the inhabitants of Kenya and Tanganyika are not imbued with the same veneration, and I can hardly think it makes a great impression upon their minds when they find that the spokesman for the Government in such a debate as that upon white settlement in East Africa showed himself in his reply to be completely ignorant upon the subject I have mentioned.
There is only one point I want to raise in regard to the subject of settlement in Tanganyika and that is with respect to how far the principle of co-operative societies has made itself felt or effective there. In the East African Colonies two agricultures exist side by side and they exist in completely watertight compartments. There are the small native producers and there are the relatively more prosperous white settlers. There are no large buying combines in East Africa such as exist in West Africa. You have in these East African Colonies 16,000,000 inhabitants. Of those 16,000,000 inhabitants 100,000 are Europeans. They represent 6 per cent. of the population of these East African Colonies. Yet what do you find? This comparatively insignificant percentage of Europeans enjoy the advantages of co-operative marketing, of co-operative dairying, of co-operative stock dealing. Side by side with these advantages they enjoy also credit facilities. In East Africa certain crops are reserved for Europeans while the Africans, the indigenous races, are excluded from what are called co-operative societies. You find such co-operative societies as exist buying produce from Africans who are forbidden to become members of those societies. You find, for instance, that the native growers are compelled by law to sell the tobacco which they grow to European co-operative societies which they are not allowed to join. There is almost a complete absence of any possibility of joining or entering into the benefits of co-operative societies amongst the indigenous races.
The Constitution of Tanganyika forbids
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nominally any racial discrimination. Yet as a result of an agitation carried on against Africans growing coffee an association was formed called the Kilimanjaro Native Planters Association. It had a very troubled history. I do not think that is putting it too high. In 1932 a Co-operative Society Ordinance was passed in Tanganyika, but although the Ordinance was passed no co-operative department was set up in the Administration, nor was any staff established to deal with co-operative society matters, The Kilimanjaro Native Planters Association of which I have spoken became something called the Kilimanjaro Native Co-operative Union. "Co-operative," of course, was a very nice word to use, but it was co-operative only in name. As a matter of fact this so-called co-operative union was in reality only a Government marketing board with a European Marketing Officer. The Colonial Administration assisted at the forming of this union which nominally had a membership of 11,500 and had a European member on the administration. But the thing that really mattered was completely neglected. It was all very well to set up something called a co-operative union, but no effort whatsoever was made to educate the members of this union in co-operative principles. It was a co-operative union only in name. A territorial area was defined in which there were no non-native coffee growers, and all native planters were compelled to market through the union. In 1934 coffee prices fell. There was unrest, there was trouble, there were no dividends, no sales of coffee. Some planters demanded to sell where they liked. Some societies refused to obey the by-laws. There were riots in certain districts in 1937.
What is the lesson underlying all these troubles and grave events? It is that neither the Native Planters Association nor the Native Co-operative Union were ever really co-operative in character. They only aimed from first to last at economic gain. There was no education carried on in co-operative principles, and so no idea of loyalty to such a society in difficult circumstances was ever inculcated or grew up. The Administration of Tanganyika has shown conclusively that it has not got very much idea of what co-operation or a co-operative society really means. Yet Tanganyika is a rich ground for the inculcation of the princi-

1025
ples of co-operation. Of course official guidance is required and much teaching in those principles is required, but so far I repeat no staff has ever been appointed by the Administration for the inculcation, the teaching and the fostering of the co-operative principle. I know it may be said that a Co-operative Registrar was appointed for Tanganyika. That is quite true, and it as the sort of statement which it is very convenient to make and which appears to cover a great deal. But that Co-operative Registrar was stationed at Dar-es-Salaam. He was given no facilities whatever for travelling or for organizing native co-operative societies. In fact this so-called co-operative union was only a Government marketing board.
It is a very common complaint that Government marketing boards are inefficient, are very costly and that—whether it is their main object or not it is a feature of such marketing boards—they pay very high salaries to European officials. I think that such boards should not be established where competitive trading is possible and beneficial. Such boards arc only desirable where monopoly is inevitable. I agree that a Government marketing board is better than private trader exploitation, but these boards are very frequently established because of the difficulties encountered in building up co-operative marketing societies, and these difficulties will always continue until our Colonial Administration really undertakes the task of educating the indigenous races in the principles of co-operation and of co-operative societies. When we consider the difficulties which confront us in our task of Colonial Administration, I think perhaps sufficient stress has not hitherto been laid upon how very greatly co-operative enterprise could be of assistance in the development of backward indigenous races in our Colonial Empire.
I have recently been concerned in making a very exhaustive research into and preparing a very elaborate report upon the question of co-operation and co-operative societies in our Colonial Empire. I believe that we have there the key to the solution of many of the troubles which have caused us anxiety in regard to the development of the indigenous races. I can think of no instrument better adapted to advance ideas and development than this principle of co-operative societies. How better can ideas on such matters as stock-breeding, milk-record-
1026
ing, veterinary services, improved seeds, pest control, fertilizers, machinery, drainage, irrigation and soil erosion be inculcated in the minds of the backward native races than by inculcating the principle of co-operative societies and of co-operative services? A development of co-operative societies consists of what are called "better living societies," and many health and community services such as water, transport and sanitation can be very largely developed out of the idea of co-operation. I believe, as I say, that this is the key to the solution of many of our difficulties; and as one of our greatest difficulties is that of developing and training the backward races to a sense of democratic responsibility, how better can that be encouraged than by educating them in the principles which animate co-operative societies?
In the past, British Colonial policy has concentrated upon leaving power within the Colonial Administration, leaving the indigenous races exposed to all the impact of private enterprise, without any guidance whatever in development and welfare matters. I agree that the Colonial Development and Welfare Act, 1940, is a great improvement, but I believe that economic development and welfare can be most rapidly forwarded along co-operative lines, with special attention to education in co-operative ideas. Tanganyika has a completely adequate Co-operative Ordinance. It has been passed and is upon the Statute Book. When the noble Duke replies, I hope to hear something about how far it has been given effect to, and what staff has been provided in order to give effect to it. Co-operation is already well established among the white settlers in East Africa; they have nothing to complain of on this score. They have their own co-operative societies, which receive a great deal of encouragement from the Administration. What I hope that the noble Duke may be able to tell us to-day is how far co-operation in East Africa is being developed amongst the native races, and in particular amongst the native races of Tanganyika.
THE PARLIAMENTARY UNDERSECRETARY OF STATE FOR THE COLONIES (THE DUKE OF DEVONSHIRE): My Lords, the speech of my noble friend who moved this Motion was in the main a plea that the recommendations contained in the Report made to the Governor of

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Tanganyika in May, 1940, by the Central Development Committee should be implemented urgently. I agree fully with him that this question is one of very great urgency, and I agree fully with him also that the Report of that Committee is an immensely valuable and important piece of work. The Committee started its work on the premise of a Government statement that the objective in view was to increase the individual wealth and to raise the purchasing power of the community to as high a figure as possible. They considered that it must be many years before the African peasantry outside the settlement areas could expect from their own agricultural efforts a return adequate to raise substantially their own standard of living. They accordingly regarded as an essential preliminary to any wide development the increase of the non-native population.
I know that there is no observation more irritating than that there is a war on, but I must remind your Lordships that that Committee carried out its work very largely during peace-time, and, even after the war had broken out, largely with a background of peace. It was only after the war had come close to Tanganyika that this Report was presented. The disastrous events of the summer of 1940 affected most profoundly the whole structure and economy of the Territory. They made the most tremendous demands upon its man-power, both African and European; and one of the difficulties of getting on with any scheme now is that the man-power either to devise it or to carry it out is not at the moment available. A very considerable proportion of the country's man-power had to be released for the East African Forces. At the same time, many of the unofficial Europeans who were enemy subjects were interned, and no reserve was left for innumerable new war tasks. The Territory has since been very hard hit by the continual drain of officials, not always through releases to the Forces but through casualties, retirement, sickness and so forth, for which at the present moment there is practically no replacement. I think that it is perhaps not generally realized in this country under what enormous difficulties Colonial Governments have been working in this respect. Tanganyika has been possibly the worst handicapped of all the East African territories, by shortage of white
1028
man-power. It is literally the fact that every official in Tanganyika is at the present time heavily overburdened.
In the following year, the loss of the Far East necessitated concentration on the immediate task of making good war supplies which had been lost to the United Nations in those territories. The economy of Tanganyika was profoundly and fundamentally affected by the loss of sources of rope-fibre, through the loss of Manila, and so forth, and almost overnight the sisal production of Tanganyika became of paramount importance to the war effort. The war has indeed forcibly illustrated the fact that the labour supply in East Africa is very far from being inexhaustible, and the present Tanganyika labour force is no more than adequate to cope with the sisal industry and the very necessary expansion in home food production.
After the war, the entire economy of Tanganyika will have to be considered in the light of the world demands for its primary products, and no man can say what they will be. It may well be that there will not be available the pool of African labour clearly envisaged by the Central Development Committee in their Report. It is also necessary to remember that since that Report was made—I do not want it to be thought for a moment that I am denying its value; I think that it is a very important and valuable document—labour costs have risen very substantially, not only because of the higher wages now paid but also on account of the higher standards of food, housing, medical attention and so on. Those costs are likely to increase still further after the war, because the returning soldiers will no doubt look for conditions approximating to those which they have known in the Army, which are, I think, probably better than those which they knew in their villages before. That is another factor which may substantially affect the economy of the Territory, especially in such areas as the Southern Highlands.
It is perhaps a convenient moment, when dealing with standards of living, to deal with the facts—not the fancy picture presented by the noble Lord opposite—about co-operation in Tanganyika. Co-operation in Tanganyika is in fact making very rapid strides. There is a Co-operative Societies Ordinance which makes full provision for the regulation of co-operative societies in the Territory.

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Several successful societies were already in existence before the war. The noble Lord referred to the Kilimanjaro Native Co-operative Union, Limited. That society might be described as a flourishing concern; it had a membership of over 26,000 in 1939. It is an entirely African society, it is conducted by an elected committee of Africans, and it employs a British secretary. There are other societies, none of them on quite the same scale, but still of substantial character. For instance, there is the Bugufi Coffee Society, with a membership of 6,000, and there are other societies which are definitely making progress. It is definitely accepted by the Government of Tanganyika that it is part of its duty to assist the development of co-operative societies, and every district officer accepts it as part of his work to help and encourage the growth of small co-operative societies throughout the Territory. It is a fortunate fact that the co-operative society readily fits into the pattern of tribal life.
LORD WINSTER: I wonder if the noble Duke would tell the House what staff the Administration disposes of for education and guidance in co-operative matters—what staff actually exists in the Administration in this respect?
THE DUKE OF DEVONSHIRE: There is one man definitely in charge of co-operation, and your Lordships will be interested to hear that an officer who is an expert on co-operation has actually left this country to advise the Government of Kenya, and very probably of neighbouring territories on the principles of co-operative work. There is another purely African society of native tobacco growers in the southern province which, in 1939, had a membership of over 2,000. That was formed from a grant from the Colonial Development and Welfare Fund and the society has been able to pay that grant off. That is an illustration that co-operation is really going ahead. The contribution of the noble Lord (Lord Winster) ranged somewhat wide. We were going to discuss Tanganyika Territory, but we have discussed many other subjects, including West Derbyshire and my own personal merits. I was left with the impression that the noble Lord is a good deal more at home on the hustings than he is in East Africa, and his advice would be more valuable to Sir Richard Acland than to me.
1030
Your Lordships will agree that the war has had effects so profound and so far-reaching that the Report must need a good deal of consideration before it can be accepted as holding good for the entirely unknown circumstances of the post-war world. Its proposals are very comprehensive and envisage very considerable expenditure, much of which, under present conditions, might not be appropriate. There is uncertainty about the future of the former German lands which are now in the hands of the Custodian of Enemy Property. Whatever may be our own view of the proper future of these lands, it must be clear that their ultimate disposal must await the end of the war. That is another element of uncertainty. I hope I have not seemed unduly discouraging to my noble friend. There are various factors which make it almost impossible for me to lay down any definite policy now. There is the devastating lack of manpower; there is the uncertainty of the future of tropical products; there is the question of the trends of the African populations and what room is in fact available; and, above all, there is the question of continuity of policy. I regard that as almost the most important thing of all. My noble friend will be well aware that Tanganyika suffered heavily in the years between the wars through uncertainty as to the future, and it is our great interest that there should be no uncertainty about the policy to foe laid down. I hope I have said enough to show that it is really not possible for us to lay down a policy for which at present we can assure full continuity.
I hope your Lordships will not take what has been so far a catalogue of difficulties to mean that nothing is being done towards the further development of this Territory, for which Britain and your Lordships' House are trustees. Tanganyika, as I have said, has had its hands very full, and it is only now that the Government have been able to turn their attention to post-war planning. But the Governor, in his Budget speech in December last, announced the creation of a Development Section of the Secretariat. This section will be guided by an Advisory Committee under the chairmanship either of the Governor or the Chief Secretary. The Committee will include non-official representation and will seek to co-operate fully with non-officials in the working of

1031
the plan. Its main task will be to re-examine the Central Development Committee's Report and to advise on the modifications which will be necessary in the light of the changed circumstances brought about by the war. Now that this new piece of machinery is beginning to function the Secretary of State is hopeful that in the near future schemes for Tanganyika will be submitted for substantial assistance under the Colonial Development and Welfare Acts. The noble Lord referred to water supplies. Money was provided from the Colonial Development Fund before the war for a general survey of water resources in Tanganyika, but there, again, shortage of man-power has brought that to an end. This matter is under active consideration once more, and plans have quite recently been before the Colonial Development and Welfare Fund for the investigation of water supplies.
As in other Colonies, it may not be possible in the immediate future to go very far with the carrying out of these schemes so long as both men and materials are in short supply. Most of your Lordships who are interested know that both my right honourable friend and I look on the sum of £5,000,000 available under the Colonial Development and Welfare Act as not large enough for what is required. But it is a fact that owing to war conditions we have not been able to spend more than a fraction of that sum, thanks to shortage of shipping, scarcity of supplies, and to the fact that there are not the men to do the things that need doing. But the plans will remain and attention will be given to them where possible so that the earliest possible moment will be taken for starting work. In the meantime the Governor has just submitted his general views on education based on the Central Education Committee's Report, and that Report is under examination now in the Colonial Office. I hope that my noble friend is not unduly disappointed by the rather inconclusive nature of my reply. I would assure him that he has done a very useful service to Tanganyika Territory by his speech, and your Lordships' House is in his debt for having called attention to this very important subject. I can assure him that everything he said will be most carefully borne in mind in shaping our policy for the future, and
1032
that we are most anxious to see a real move forward made in the development of this Territory.
LORD CHESHAM: My Lords, I painted a black picture of the Territory but I think the noble Lord, Lord Faringdon, made it doubly as black-—no water, no rainfall, tsetse fly, tick, sleeping sickness and other diseases. I would like to assure your Lordships that there are vast tracts of land in Tanganyika open for development now by natives and other people. There is no shortage of land there, highly suitable land, without all those pests which have been mentioned. But I do want to stress once more that the most important thing to do in Tanganyika is to develop a long-term policy to defeat the inherent laziness of the native—because it is no use mincing words, he is lazy if he is allowed to be—and to encourage him and give him some incentive to work.
I must say that I am a little bit disappointed with the reply of the noble Duke, but I know there is a war on. As regards man-power, of course it is short, but, as I mentioned in my previous remarks, there will be a very large body of Africans demobilized some time or other who will be extremely useful for carrying out the development of the country. It is true that the food production question in Tanganyika has been pressed on as much as was possible, but I would like to draw the Government's attention to the fact once again that last year £300,000 was spent on importing maize for internal use into a country which should in fact be a very big exporter of that crop. With very little encouragement to the natives it could produce far more than is required in the whole Territory. I am delighted to hear that a scheme on the subject of education has actually been produced. I hope that other schemes will be coming along, in spite of the difficulties of the war and the present situation. I beg leave to withdraw.
Motion for Papers, by leave, withdrawn.

EXPORT POLICY
LORD BARNBY LORD BARNBY rose to call the attention of His Majesty's Government to the current policy with regard to export; and to move for Papers. The noble Lord said: My Lords, when I put this Motion on the Paper I naturally could not foresee what

1033
would be the line taken in the debate initiated by the noble Lord, Lord Addison, on the 15th of this month. In the course of that debate a considerable amount of time was given to the subject of exports. Lord Addison undoubtedly did a great service in initiating that debate, which brought forth a very informative reply from the Minister of Reconstruction, Lord Woolton. This is a non-Party question which, in the interests of the country, requires the wisest contributions from all parts of the House. A most timely and thought-provoking speech from Lord Latham added greatly to the value of the debate. Since then we have had a reminder from the Leader of the House that there is a danger of too much concentration on the future and an inclination to forget the sombre tasks of the present. There will be universal agreement that if we are to implement the many new schemes of social service and full employment for all, we shall have to do a large export trade to pay for the necessary imports of raw materials and food. It is in that spirit that I raise this question to-day. My aim is to advance the belief that there is need for an increased priority to be given to a minimum volume of exports.
It is necessarily all a matter of degree, but before I go over a few of the essential principles governing exports, I would like to underline two phases of the previous debate, particularly the denunciation of the deflationary and contractionist policy of the 1930s. Lord Woolton in no reserved language emphasized his own recognition of the misfortunes that had come from that policy. Well, that is past now; the immediate thing is that Lord Woolton in his responsible position says he is convinced that an expansionist policy is right. I quote:
"I have come to the conclusion that an expansionist policy is the right and proper policy for this country to pursue."
He did a great service in being so categorical. I am going to underline that by quoting an extract from a leading article in the Evening Standard subsequent to the noble Lord's speech:
"The statement may not sound so exceptional now. In the past year, indeed, it has become almost a commonplace. Everyone, from Parliamentary Private Secretaries at by-elections, to bank chairmen giving their reports, has affected to subscribe to the same doctrine, and yet it is revolutionary. In the period between the two wars almost every-
1034
one, including Parliamentary Private Secretaries and bank chairmen, not to mention a whole host of statesmen who shall be nameless but whose names are well known, acted on precisely the opposite doctrine."
It is really mysterious that during that period in a matter fundamentally affecting the lives and employment of the country so wrong a view should have been so widely held.
A fundamental error governed the whole monetary policy. It arbitrarily changed the value of the currency, and that, in its turn, affected the lives and employment of millions in this country. That result has been attributed to the old-school orthodox Olympians. I ask, has the purge in belief been adequate? We see persons in responsible positions in many directions whose opinion was wrong, as that article has pointed out. Opinion was wrong in the Treasury, in the banks and among political leaders. Many who were responsible in those times still hold office. They were the blind leaders of the blind and we had the spectacle of unemployment causing misery to families of millions in this country, to say nothing of the destruction of capital. It was not less than the misfortunes of war.
There has been much lip service to the idea of an improved world—much talk of food, work, houses, education, social services and full employment. Full employment necessarily means more imports of raw materials and they have to be paid for by exports. That must be in capital goods as well as consumer goods, and that means not an expansionist policy in the United Kingdom only but a world-wide expansionist policy, or at least in the sterling area. Britain's customers must have purchasing power and we must export capital goods as well as consumer goods. No one is going to buy capital goods in a contractionist era. Lord Woolton, I am glad to say, emphasized that he believes in multilateral trade as the chariot to which we shall hitch our future. Let us hope he is correct. Certainly the new agricultural policy means more home production and that means a lessened pull on the exchanges; but if it is to bring more purchasing power for the agricultural population at home then it is probable that higher prices must prevail and there must be continued subsidies. At the present moment they are a big drain upon the Exchequer.
May I ask the indulgence of the House for a moment while I give a few figures? In 1919, when our exports increased so tremendously, they were 52 per cent. above 1913, but only in value, because at the same time they were 44 per cent. less in volume than in 1913; and in 1920 that trend was still further emphasized. Again exports before this war provided only about 43½ per cent. of the home economy needed for raw materials. Since then we have lost foreign investments and invisible exports are less. That again emphasizes the necessity for more exports. Only about 9 per cent. of Britain's pre-war imports were finished products. All this seems to support the view of Lord Woolton that we must contemplate regulated imports as well as directed exports. That inescapably means drastic exchange control and Governmental regulation on a considerable scale for a long time. In that way alone can priority of import march with priority of export. In the course of the debate to which I have already referred Lord Latham particularly underlined the view that revised international monetary practices were essential. I am glad he did so because there are many who think that, instead of being lured into the dangers of ad hoc schemes of price and quality regulation for individual commodities, it would be much better to rely upon an overriding international monetary practice which would avoid much of the intricate machinery which other methods would call for.
With that review of axiomatic principles I return to the aim of my Motion. I believe more export is possible now. If export is fundamental, why not regard it as being entitled to higher priority? Why not permit more of it now? The belief exists that the Board of Trade are in this matter subservient to Committees in Washington and that this is a matter of delicacy which should not be discussed lest the United States might be offended. I hold that to be a wrong attitude. This is not the moment for timidity. There are no grounds for feeling that we should hesitate to emphasize to the United States of America that unless there is a prosper-our sterling area there is not likely to be prosperous world trade for the United States. This is election year in the United States and it calls for delicacy in what is said here, but I do not think it is out
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of place to quote something that was said by Mr. Sumner Welles when Assistant Secretary of State:
"The high tariff policy of the United States reached out to virtually every corner of the earth and brought poverty and despair to innumerable communities."
I claim that an expansionist world economy is essential and without prosperity in the sterling area the world plan fails. In export, supplies to the Empire must have priority. But we must remember that normally there were regular exports from this country to the United States.
While temporarily, owing to the operation of Lease-Lend in reverse, the drain on the dollar exchange may be much less severe than it was, it does not alter the fact presumably that there is a drain. In this perhaps I shall receive correction from my noble friend who is to reply. He may say that the situation has so changed with regard to dollars that we need not take that into consideration. If that be so, how right was the noble Earl, Lord Cork, in appealing for increased remittances to women and children in the United States. I know my noble friend will remind me that this subject is fundamentally governed by considerations of man-power and woman-power.
There is a danger in generalizing about steel. There is a difference between raw materials which are on a sterling basis and those which involve exchange problems. There are some industries that are damped down now far below capacity, some industries from which war-time requirements are decreasing, and there is a belief that in places pockets of residual labour exist which could be better and more profitably employed. The principle of equal sacrifice between comparable industries in the United States and in the United Kingdom has been established. I urge that there should be some export even at the expense of some home supplies. I wonder how many of your Lordships have had occasion to go into some of the big multiple stores—Marks and Spencers and Woolworths—and have seen the vast variety of merchandise of all kinds, much of it of recent production, and have asked whether that is vital to the war effort.
In recommending a course of action it is often best to give a specific illustration. I will take one big export industry—wool textile—because it is of exceptional in-

1037
terest to the taxpayer. The taxpayer has an enormous amount invested—I do not know how much, but it must be £100,000,000 to £150,000,000—in raw material for that industry. That industry contributed very largely to our export trade in normal times, but at the moment it is one of the industries which are damped down and is not working at more than fifty per cent. of its potential. It is in the very depressing position of having to reduce its output. There is an industry the product of which carried the réclame of British goods to the furthest ends of the world, and in the United States particularly that product was much sought after and admired. In view of the tender feelings of Scotland wherever Scottish interests are concerned I should have expected several noble Lords from Scotland to voice the virtue of Harris tweed and Scottish homespun. My plea is that if export trade is to be permitted the exports should be only of the highest quality. A belief exists that of the exports going out of the country at present many are of a quality and virtue appreciably less than might be the case without any further strain on labour supplies. We shall have to rely for our export trade in the future on merchandise of quality and character rather 'than on mass production which weans in many cases a relatively low labour content. We want a high labour content and a high exchange earning virtue.
Here I would draw my noble friend's attention to a concrete suggestion, that if we arc to promote export trade after the war there is need for a standard of virtue that is statutorily controlled by the industries concerned. I cannot better emphasize that than by quoting an eminent scientist, who in a recent address said:
"Quality control means keeping the variation of a certain characteristic or characteristics of a manufactured product within standardized limits which are specified. It may be said that there are three sorts of specification: (i) an imposed standard specification, (ii) an agreed or compromise specification, (iii) certified standards based on quality."
I hope my noble friend will recommend that thought to my right honourable friend the President of the Board of Trade. There may be criticism that such involves Government interference. In reply to that I would ask, is a Scrub Bull Act, under which the Government insist
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that there shall be a high quality of stock, unreasonable Government interference? Or I may turn to New Zealand for another example. The New Zealand Government insist that apple exports from that country shall be subject to a rigid minimum standard of quality.
The next point to which I would like to refer is research. My noble friend Lord Woolton has already emphasized to the country the importance attaching to research, and we are indebted to my noble friend Viscount Samuel for his repeated emphasis on that. As Chairman of the Parliamentary and Scientific Committee he is doing great service, and if he were present at this moment I would appeal to him to use the influence of his Committee to impress on the Government that research in industry should be by statutory provision. His Committee can impress upon the Cabinet a recommendation which I am sure my noble friend Lord Woolton will make that in order to ensure proper expenditure on research then should be statutory levies on industries That would involve passing an enabling Bill so that in regard to any industry, subject to appropriate indication of desire, an Order in Council could be made to ensure that the necessary funds would be forthcoming. That needs doing now, because individuals of high scientific attainments in the employ of different Government Departments are naturally thinking of post-war employment. They cannot be expected to give their services to associations unless they see an assurance of continuing revenue.
On the subject of taxation, I would mention the depreciation and obsolescence allowances which machinery requires. There is not much time before the Chancellor of the Exchequer introduces his Budget, and this subject justifies repetition. I cannot do better than quote from a letter which appeared in The Times on February 24, which puts the matter in very clear language, over the signature of some eminent industrialists:
"With taxation at a high rate, slow depreciation of plant, coupled with inadequate or no allowance for amortization of experimental and development expenditure, operates as a brake on productive efficiency, and a threat to full employment. It penalizes risk-taking, without which our twin problem of foreign exchange and full employment will not be solved. An early statement by the Treasury that they are reviewing the future of these allowances would help post-war plan-

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ning. Action which encouraged the constant improvement of plant standards would play its part in maintaining steady post-war employment."
The Federation of British Industries has recently published a report on International Trade Policy. It is a painstaking and careful production, which has received the endorsement of the Grand Council of that big organization, which represents an overwhelming part of the industry of this country. I hope that the recommendations there made with such care and conviction will receive consideration in the proper quarter. I should like to quote one recommendation with regard to the part which the United Kingdom should play in Imperial trade:
"A permanent body must be created in the United Kingdom by the Government to co-ordinate the views of the various Government Departments concerned in order that the Government can speak with one voice on Empire matters."
That is a constructive suggestion, and I hope that it will be considered in conjunction with what Lord Woolton reminded your Lordships of on February 15—namely, that we now have a sort of Economic General Staff. I think he called it a central service for statistical information. I have made certain constructive suggestions which I hope will facilitate that full employment to which Lord Woolton has told us we are committed. I repeat my earlier appeal for a higher priority now for certain exports, and I beg to move for Papers.
THE PARLIAMENTARY UNDER-SECRETARY OF STATE FOR INDIA AND BURMA (THE EARL OF MUNSTER): My Lords, my noble friend who has just spoken has taken your Lordships through the economic policy of this country in former years, the question of taxation, the need for future research, and the need for an expansionist policy in our export trade. I hope he will forgive me if my remarks are directed towards the Motion which stands upon the Paper, and which calls the attention of His Majesty's Government to the current policy with regard to exports. I ask your Lordships to bear with me while I endeavour to deal with some of the points which my noble friend has made on that subject in moving his Motion.
The principles which govern our current export policy were debated in another
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place in July of last year, and I do not think there is a great deal that I can usefully add, at the present moment, to that discussion. To-day, as then, our primary object is to win the war in the shortest possible time, and therefore everything must be subordinated to that aim. Nevertheless I think that it is useful in any discussion upon exports, either current or future, to examine the practice which we have followed in this country in the past, and followed, I venture to suggest, not without some degree of success. For generations our export policy was not difficult to appreciate, although it was more difficult to achieve. Generally, our object was to sell as much of our manufactured products as possible abroad, so that we could purchase our essential requirements from overseas. If anything occurred to hinder or limit this operation, repercussions were immediately perceptible both here and elsewhere, with results which are well known to my noble friend and to other noble Lords.
Our export trade has always been dependent upon four things: raw materials, machinery, shipping and manpower. If the working of any one of them was interrupted, the others could obviously not function successfully. I hardly think that my noble friend would quarrel with that very general description of our policy in past years. To-day, however, we find, ourselves in a very different position. Our resources in man-power, in raw materials and in shipping are all strictly limited, and our man-power has been diverted from peace production to war production. This has resulted in both our internal home markets and our export trade being affected. The production of peace-time necessaries for civilian consumption has already been cut to the very barest level, and that cut can be justified only on grounds of our war-time needs. Correspondingly, in the field of capital goods, mentioned by my noble friend, and especially of those capital goods which require steel and other products so important to the war effort, the same process has in fact taken place.
We have applied at home, as I think your Lordships will agree, the principle of "make do" without impairing our efficiency or our ability. We have rationed and limited the volume of consumer goods, and we have refrained from launching new capital enterprises. In point of fact

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we have quite deliberately curtailed civilian consumption of every kind, so that each and all of us may give our maximum contribution to war production and to war needs. I think it must follow-that we cannot afford to use our resources, all of which are now limited, to produce unessential goods for export, any more than we can produce similar goods for our own civilians at home. Many sacrifices are being borne in this country to-day and I believe that we can only be expected to sustain by exports overseas standards of civilian consumption and civilian industries at a level which can be justified by war-time needs. The only exports which the Government can allow, therefore, are those which directly, rather than indirectly, will contribute to winning the war, essential goods without which the military effort of the country concerned could not be maintained or its civilian morale upheld. To my mind a policy founded on any other supposition would realty be stark madness.
Let me turn for one moment to give the House a brief description of how one of our most essential export trades is now organized. My noble friend in the course of his speech referred to it as well. The textile trades are, in point of fact, a good example, for in pre-war days they accounted for one-quarter of the whole of our wide range of exports. In 1940 we first introduced a limitation of supplies, which was followed in 1941 by clothes rationing. That in itself was an effective measure of drastic economy in civilian consumption, and at the same time it ensured a fair share for all concerned. Although this particular trade has had to suffer ever-increasing withdrawals of labour for more essential purposes, it has at the same time to provide for the necessary needs at home and also for the requirements of the Armed Forces. Inevitably the goods which would be available for export have had to be reduced, and such as are available have been used more and more to meet the needs of our Empire and our Allies who are dependent upon us for such essential requirements. For the time being our textile exports to old, important, and traditional customers in the United States and Latin America have been cut off almost completely if and where they have involved demands upon our productive resources which, through reduced capacity, we have been unable to meet.
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I have (been told that on occasion pockets of labour are found to exist, and when these pockets cannot readily or immediately be absorbed for war purposes the output from them is allowed to go in exports. My noble friend will be aware that what applies to this industry applies in this respect to very nearly every other industry as well.
The whole of our current policy is based on man-power which, as everybody knows, is in short supply. The primary needs we must meet are the home market, the demands of the Services, and the requirements of those countries which are dependent on us. That must always limit the quantity which we can spare for export purposes. The Government are fully aware of the sacrifices which have been made and which have borne very heavily upon us. It has meant the loss of contact with old customers, the loss of traditional markets, and these old customers have had to seek for unaccustomed sources of supply or to develop local industry. It must be clear to everyone that the exigencies of war have compelled us to regulate and restrict exports to an increasing extent. It is not that we consider them unnecessary or that former exports were of a luxurious nature. Nothing could be further from the truth. They have had to be restricted so that we could meet our home demands which are indispensable for war purposes. We have adopted, as I have pointed out, an exactly similar policy at home where civilian consumption, in all respects, has been reduced to the very edge of efficiency and ability. In short, all our production must be employed to the optimum use for war purposes, and that has been the one dominant factor in our policy.
My noble friend, in the course of his speech, expressed apprehension that in our current export policy the Government are paying insufficient attention to postwar considerations. He seemed to suggest that we were content to stand by while our great Ally, the United States of America, by virtue of her enormous resources, filled the gap we have been compelled to leave through the war. We intend, the moment that our resources permit, to raise progressively the rigours of the control which is now maintained, but we and the United States are, at the present moment, engaged on a joint adventure, and our energies are jointly

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concentrated on the important task in hand. Any Government which set out to divert supplies from this object and to manœuvre for a post-war position would fail in their duty. We sympathize with those whose export business has had to be reduced or stopped, and who find that the volume of exports that can be permitted is insufficient to enable them to maintain their old connexions. Unfortunately, it is not always possible in wartime to explain fully the reasons for decisions which may seem to them very harsh. On sometimes very imperfect knowledge, people may get the impression that we arc negligently allowing the United States, for example, to steal a march on us. I ask them to remember that critics are not lacking in the United States who are making exactly the same complaint about us. All these allegations and counter-allegations often arise from an impossibility of judging rightly and correctly the facts of a particular case without full knowledge of all the circumstances, which cannot always be made available to everyone. We should be well advised, before lending ear to any voice of suspicion and mistrust, to remember that the good faith of both Governments, the Government of the United States and His Majesty's Government, is pledged under the special arrangements which have been made in the economic field for the effective prosecution of the war, that there should be no self-seeking or manœuvring to further the post-war interests of either country.
There is nothing useful that I can say at the present moment about the future. It is not really necessary for me to dwell at length on the need for exports from this country. A flourishing export trade built on a firm foundation is, of course, absolutely vital to the economic life of our people. If the standard of living is to be maintained and improved, it must revolve to an ever-increasing extent around our export capacity. Therefore any action which the Government may take must tend to ensure that the volume of our exports is raised and kept at the highest possible level. None of us wishes to see again those heart-rending scenes only too common before the war in the depressed areas—areas which were dependent to a very large extent on export trade. The Government are discussing the reconstruction problems of industry
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with all parties concerned, and in the course of those discussions every industry has been invited to place before us its views on the future export trade in their particular class of commodity. My right honourable friend the President of the Board of Trade is the very first person to appreciate—and in his view His Majesty's Government concur—that it is not only necessary to regain our export trade up to the limit of the pre-war level, but in the new circumstances which will confront this country at the conclusion of the war, when our oversea resources will be seriously depleted, our export trade must be considerably enhanced.
I often wonder whether it is sufficiently realized what a difficult position we shall all in fact face at the conclusion of hostilities; and, although the Government can of course play their part in making the expansion of export trade possible, it is in the end only industry itself which can perform the job. By and large, as my noble friend has said, export trade is really our breath of life, and most of us would sleep unsoundly if we thought that His Majesty's Government were not considering this problem. But I think I can assure my noble friend that my own sleep is not in any way disturbed, for I know that the future of the export trade is constantly and actively receiving the urgent consideration of His Majesty's Government. I have briefly endeavoured to give my noble friend an outline of our current export policy. I hope with that he will be satisfied, and forgive me if I do not reply to the other points he raised, which are not really germane to the discussion.
LORD BARNBY: My Lords, it is customary for the mover of a Motion, following the reply by the Government spokesman, to thank him for the way in which he has replied to the debate, and I am sure that in the case of my noble friend Lord Munster, with his invariable courtesy, no member of the House has ever any occasion to use any but words of appreciation. To-day my noble friend rather took me to task for ranging wide of the terms of my Motion with regard to the current policy on exports. It was with regard to those exports that I felt that current policy called for the consideration of certain constructive suggestions which I put forward. With those my noble friend did not deal. I would remind him that he himself re-

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ferred to the textile industry and said that what appeared to be true of the textile industry was true of other industries also. The reverse is true, because the textile industries in the main are working appreciably below potential capacity, and in the case of the wool textile industry, which I gave as a constructive illustration, it is never competitive with the United States in any market. Apart from that, a debate which took place last July in another place does not necessarily represent the up-to-date position, because I understand that the dollar position has changed very much since then.
I would, however, like to thank my noble friend for the patience of his reply. I admire the skilful way in which he made use of the very good matter that was at hand, to oppose my appeal for larger exports. He gave a soothing reassurance; but in regard to the five particular suggestions flat I made, I regret that he could not see his way to refer to them. I hope he will bring them to the notice of the President of the Board of Trade, and I hope that I may take his nod as assent; otherwise I should feel justified in asking for more information later. For the rest, I appreciate the fulness of his reply and I beg leave to withdraw.
Motion for Papers, by leave, withdrawn.

JEWISH COLONIZATION ASSOCIATION BILL. [H.L.]
Reported without amendment.

HERTS AND ESSEX WATER BILL. [H.L.]
The LORD CHANCELLOR The LORD CHANCELLOR acquainted the House that the Clerk of the Parliaments had laid upon the Table the Certificate from the Examiners that the further Standing Orders applicable to the Bill have been complied with.
The same was ordered to lie on the Table.

SUNDAY ENTERTAINMENTS ACT, 1932.
Order made by the Secretary of States for the Home Department extending Section 1 of the Act to the
Borough of Tiverton:
Laid before the House (pursuant to Act) for Affirmative Resolution and ordered to lie on the Table.
House adjourned.